SOURCE: Monthly Case-law Digest - January 2021
Reference for a preliminary ruling – Competition – Penalties imposed by the national competition authority – Limitation period – Actions interrupting the limitation period – National legislation precluding, after the initiation of an investigation, the possibility that subsequent action for the purpose of proceedings or investigation may interrupt the new limitation period – Principle that national law must be interpreted in conformity with EU law – Regulation (EC) No 1/2003 – Article 25(3) – Scope – Article 4(3) TEU – Article 101 TFEU – Principle of effectiveness
On 7 September 2009, the Consiliul Concurenţei (Competition Authority, Romania) commenced an investigation on the retail food market against several undertakings, including Whiteland Import Export SRL (‘Whiteland’), in order to ascertain whether those undertakings had infringed the rules of competition law, in particular those laid down in Article 101 TFEU. The undertakings were accused of having concluded anticompetitive agreements between 2006 and 2009 aimed at distorting and impeding competition on the relevant market, by fixing the selling and resale price of the suppliers’ products. By decision of 14 April 2015, the Competition Authority imposed fines on them. Finding that, under the national rules applicable, the limitation period had expired when the Competition Authority adopted its decision, the Curtea de Apel București (Court of Appeal, Bucharest, Romania), hearing an action brought by Whiteland, annulled that decision in so far as it concerned that company. After finding that the limitation period had started to run on 15 July 2009, the date on which the infringement of which Whiteland was accused had ended, that court held that the decision of 7 September 2009 to initiate the investigation had interrupted the limitation period and caused a new limitation period to start to run, expiring on 7 September 2014. It stated that, under a strict interpretation of the national rules governing limitation periods, the measures taken by the Competition Authority after the decision to initiate the investigation were not capable of interrupting the new limitation period and, therefore, that decision is the last action of that authority which is capable of interrupting that period. In addition, that same court held that Article 25(3) of Regulation No 1/2003, concerning the interruption of the limitation period, applied only to the European Commission and did not govern limitation periods for the imposition of fines by national competition authorities It is in that context that the Înalta Curte de Casație și Justiție (High Court of Cassation and Justice, Romania, ‘the referring court’), hearing an appeal brought by the Competition Authority against the judgment of the Curtea de Apel București (Court of Appeal, Bucharest), asked the Court of Justice, in essence, whether national courts are required to apply Article 25(3) of Regulation No 1/2003 to the time-barring of a national competition authority’s powers to impose penalties for infringements of EU competition law.
The referring court also requested the Court of Justice to clarify, in essence, whether Article 4(3) TEU and Article 101 TFEU, read in the light of the principle of effectiveness, must be interpreted as precluding national legislation, as interpreted by the national courts having jurisdiction, according to which the decision to initiate an investigation, adopted by the national competition authority, concerning an infringement of EU competition law rules, is the final action of that authority which may have the effect of interrupting the limitation period relating to its power to impose penalties and excludes any subsequent action, for the purpose of proceedings or the investigation, from interrupting that period.
Findings of the Court
As regards the first question, the Court states that national courts are not required to apply Article 25(3) of Regulation No 1/2003 to the time-barring of a national competition authority’s powers to impose penalties for infringements of EU competition law. In that regard, it points out that, in the present case, the possible relevance of Article 25(3) of Regulation No 1/2003 – according to which any action taken by the Commission or by the competition authority of a Member State for the purpose of the investigation or proceedings in respect of an infringement is to interrupt the limitation period for the imposition of fines or periodic penalty payments – depends entirely on whether that provision is applicable to the factual situation in the main proceedings. The Court finds that, in the light of the context of which that provision forms part and its purpose, the provision governs only the powers available to the Commission in relation to penalties. It follows that that same provision does not lay down limitation rules relating to the national competition authorities’ powers to impose penalties. As regards the second question, the Court notes, at the outset, that, in the absence of binding regulation under EU law on the subject, it is for Member States to establish and apply national rules on limitation periods for the imposition of penalties by national competition authorities, including the procedures for suspension and/or interruption. However, the establishment and application of those rules may not render the implementation of EU law impossible in practice or excessively difficult. Consequently, for the purposes of not detracting from the full and uniform application of EU law and not introducing or maintaining in force measures which may render ineffective the competition rules applicable to undertakings, the Court makes clear that Member States must ensure that national rules laying down limitation periods are devised in such a way as to strike a balance between, on the one hand, the objectives of providing legal certainty and ensuring that cases are dealt with within a reasonable time as general principles of EU law and, on the other, the effective and efficient application of Articles 101 and 102 TFEU, in order to safeguard the public interest in preventing the operation of the internal market being distorted by agreements or practices harmful to competition.
The Court notes that account must be taken of the specific features of competition law cases and in particular of the fact that those cases require, in principle, a complex factual and economic analysis. Consequently, national legislation laying down the date from which the limitation period starts to run, the duration of that period and the rules for suspending or interrupting it must be adapted to the specific features of competition law and the objectives of applying the rules of that law by the persons concerned, so as not to prejudice the full effectiveness of the EU competition law rules. The Court also finds that national rules on limitation which, for reasons inherent to them, are systematically an obstacle to the imposition of effective and dissuasive penalties for infringements of EU competition law are liable to render application of the rules of that law impossible in practice or excessively difficult. In the present case, according to a strict interpretation of the national rules governing limitation periods at the material time – adopted in some of the national case-law, and in particular by the Curtea de Apel București (Court of Appeal, Bucharest) in the context of the main proceedings – the decision to initiate an investigation for the purpose of proceedings or investigation in respect of an infringement of the rules of competition law is the final action of the national competition authority which may have the effect of interrupting the limitation period relating to its power to impose penalties; none of the actions subsequently taken for the purpose of the investigation or proceedings in respect of the infringement can interrupt that period, even if the taking of such forms of action would constitute an important stage in the investigation and show that authority’s willingness to prosecute the infringement.
In those circumstances, the Court concludes that such a strict interpretation of the national legislation appears likely to compromise the effective application of the rules of EU law by national competition authorities. Indeed, such an interpretation, totally prohibiting the limitation period from being interrupted by action taken subsequently in the course of the investigation, could present a systemic risk that acts constituting infringements of EU law may go unpunished. It is, however, for the referring court to determine whether that is the case here. If that should prove to be the case, the Court finds that it is for the referring court to interpret the national legislation at issue so far as at all possible in the light of EU law, and particularly the rules of EU competition law, as interpreted by the Court, or, as necessary, disapplying that legislation. In that regard, the Court notes that the question whether a national provision must be disapplied, in so far as it conflicts with EU law, arises only if no interpretation of that provision in conformity with EU law proves possible. However, in the present case, it is apparent from the order for reference that such an interpretation appears possible, which it is, however, for the referring court ultimately to ascertain.