Out-Law News | 17 Dec 2014 | 4:23 pm | 3 min. read
Only if there are sufficient EU interests at stake in further investigating the case can businesses expect the Commission to look itself at cases already being dealt with by national regulators, the EU's General Court said.
In its ruling. the General Court said the European Commission was right to reject a competition complaint it had received from a mobile market operator in Slovenia about the alleged practices of a state-owned operator in the country which it claimed had resulted in reduced competition in both the retail and wholesale mobile markets.
The General Court made its ruling on the basis that the national competition regulator in Slovenia, the UVK, was already dealing with the case that had been raised with the Commission and which concerned the same issues, and because there was "not a sufficient degree of European Union interests in conducting a further investigation of the case".
Slovenian mobile provider Si.mobil had claimed that the Commission had made a "manifest error" under EU law when deciding to reject its complaint. It argued that the UVK was "not dealing with the case effectively" and presented evidence about the alleged "existence of institutional shortcomings within the UVK", including that the UVK was not independent from the Slovenian government department that was responsible for overseeing the state-backed rival that Si.mobil had raised its complaint about.
However, the General Court said that there was evidence, from the Commission's own interactions with the UVK, that the Slovenian regulator was dealing with Si.mobil's complaint and that, therefore, the Commission was entitled to consider that the UVK was handling the case, for the purposes of EU law.
Si.mobil also criticised the Commission for determining that "the case investigated by the UVK concerned ‘the same alleged infringement on the same market within the same timeframe’," according to the judgment, and argued that the Commission was obliged to consider whether it was better placed to look into its complaint than the UVK and that it had not done so.
However, the General Court said the Commission had "sufficient grounds" to reject Si.mobil's complaint without having to make this assessment.
"It is apparent from the clear wording of [the EU regulation on the implementation of the rules of competition law] that the Commission is entitled to reject a complaint on the basis of that provision if it is satisfied that, first, a competition authority of a member state ‘is dealing with’ the case that has been referred to the Commission and, second, the case relates to ‘the same agreement, decision of an association or practice’," the General Court said.
"In other words, if those two conditions are fulfilled, the Commission has ‘sufficient grounds’ on which to reject the complaint referred to it. Accordingly, the application of [that EU regulation] cannot be subject to any conditions other than those set out … above," it said.
Even if the Commission had been well placed to investigate Si.mobil's complaint instead of the UVK, the Commission would not have been required to take on the case under EU law, the General Court said.
The General Court said that the Commission is not under any duty under EU law to check whether national competition regulators have "the institutional, financial and technical means available to it to enable it to accomplish the task entrusted to it by [EU competition laws]".
The Court further rejected Si.mobil's argument that the complaint it had raised with the Commission was about different practices from those being investigated by the UVK in Slovenia.
"[The] complaint [submitted to the Commission] … related to the conduct of the same undertaking during the same period [as that which was being investigated by the UVK]," the General Court said. "Moreover, the practices complained of by [Si.mobil] and the case dealt with by the UVK also concerned the same geographic market, namely the Slovenian market. Lastly, it is not disputed that the complaint received by the Commission related to a practice of margin squeezing and/or predatory pricing on the retail mobile telephone services market that was the subject of proceedings before the UVK, which subsequently confirmed in [a] letter [to the Commission] that it was investigating that practice."
"As the Commission satisfied itself that the case being dealt with by the UVK related to the same factual matrix as that described by [Si.mobil] in one part of its complaint, it was entitled to apply [its right under EU law to reject a complaint] to that part of the complaint and to ascertain whether there was an EU interest in conducting a further investigation into the other part of the complaint," it said.
The Commission "did not make a manifest error of assessment" by finding that the alleged infringement identified in the second part of Si.mobil's complaint, which claimed that its state-owned rival had engaged in anti-competitive activities in the wholesale mobile market in Slovenia, had no more than "limited significance as regards the functioning of the internal market", the General Court ruled.