Insights

Antitrust Alert: European Union General Court Grants Access to the European Commission’s Files to Private Antitrust Plaintiff

The General Court of the European Union (General Court) has annulled a decision by the EU Commission (EC) that denied access by a private plaintiff to the EC’s files in cartel proceedings (Case T‑437/08 – CDC Hydrogene Peroxide vs European Commission).  The plaintiff requested access to those files to use in antitrust damages litigation in Germany.  The General Court’s decision of December 15, 2011, highlights the fact that immunity applicants and companies fined for antitrust infringements continue to face a significant risk that the agencies’ findings will be used in follow-on litigation for damages.

Background

The EC fined certain producers of bleaching chemicals for price fixing in May 2006.  In March 2009, Cartel Damage Claims (CDC), representing 32 customers of the chemicals producers, sued six of these companies at the Regional Court of Dortmund, Germany, seeking access to information and antitrust damages.  It estimated the cumulated overcharge to be at least € 430 million.  CDC sought access to the index of the EC’s cartel files.  The index inventoried certain documents and other evidence that the published version of the EC’s cartel decision did not mention.  In August 2011, the EC provided CDC with a redacted version of the index, but rejected its request to be provided with a complete copy.  CDC appealed the decision. 

Transparency Regulation

CDC based its request on the May 2001 EC Regulation regarding public access to the European Parliament, Council and Commission documents (Transparency Regulation).  The Transparency Regulation is intended to “give the fullest possible effect to the right of public access to documents.”  However, the Transparency Regulation contains a number of exceptions.  Most importantly,

The institutions shall refuse access to a document where disclosure would undermine the protection of:

 

  • commercial interests of a natural or legal person, including intellectual property,
  • court proceedings and legal advice,
  • the purpose of inspections, investigations and audits,

unless there is an overriding public interest in disclosure.

On this basis, the EC refused to provide CDC with a complete copy of the index.  The EC argued that cartel members would be exposed to an increased risk of damages litigation if third parties would be able to identify those additional documents.  Therefore, as it has in similar cases in the past, the EC took the position that access to its files would jeopardize its antitrust immunity program, which encourages cartel participants to confess and cooperate by offering protection from prosecution, as such access would dissuade companies from cooperating with the EC:

Disclosing the full list of documents … would signal to the business community that the Commission may disclose information on an antitrust case even if such disclosure would harm the commercial interests of the undertakings which were subject to the proceedings.  This would lead to a situation where undertakings reduce their cooperation to an absolute minimum and become very reluctant to come forward with information which is essential for the Commission in combating cartels.

Legal standard

The General Court emphasized that the EC must explain how the disclosure of a document for which access has been requested could “specifically and effectively” undermine the interests listed in the Transparency Regulation.  This mirrors past decisions by the General Court finding that, as a general rule, the Commission cannot rely on presumptions and other generic arguments when it tries to protect the confidentiality of its files.

Some observers had expected that the General Court would follow the European Court of Justice (ECJ), which tends to be less critical of the EC’s decisions refusing access to its files.  Most notably, in its 2010 Commission v Technische Glaswerke Ilmenau decision, the ECJ acknowledged that the Commission may

base its decisions … on general presumptions which apply to certain categories of documents, as considerations of a generally similar kind are likely to apply to requests for disclosure relating to documents of the same nature. 

The Ilmenau case related to state aid proceedings, for which there is a special Regulation with specific criteria for access to files.  According to the ECJ, allowing access under the Transparency Regulation where the state aid Regulation does not would call into question the EU system for the review of state aid.  The ECJ concluded that the EC, when evaluating requests for access to files under the Transparency Regulation, may rely on a (rebuttable) presumption that documents that are protected under the state aid Regulation do not qualify for disclosure under the Transparency Regulation.

Nevertheless, the General Court did not follow this path in the CDC matter.  The antitrust laws of the EU, similar to its state aid laws, have specific rules that define the criteria for access to files.  Those rules do not grant third parties a right to access the EC’s files.  Instead, the General Court required the EC provide specific reasoning, not general policy considerations.

No reasons for refusal of access

On this basis, the General Court rejected the EC’s arguments outright.  First, according to the General Court, the EC failed to explain exactly how it would adversely affect the cartel members’ interests if CDC were to obtain the index.  The Court even added: 

even if the fact that actions for damages were brought against a company could undoubtedly cause high costs to be incurred, even if only in terms of legal costs, and even if the actions were subsequently dismissed as unfounded, the fact remains that the interest of a company which took part in a cartel in avoiding such actions cannot be regarded as a commercial interest and, in any event, does not constitute an interest deserving of protection. 

Second, the General Court observed that the interest in protecting an EC cartel investigation cannot be in danger if the investigation’s goal has been achieved.  The EC had concluded its investigation more than two years before CDC requested access to files.  The General Court found that an investigation must be regarded as closed “once the final decision is adopted.“  This applies also if the EC’s decision is under appeal.  Otherwise, access would be subject to “uncertain and future events.” 

The EC has two months to appeal the General Court’s CDC decision to the ECJ. 

Conclusions 

In Europe, the question of who may access the antitrust agencies’ files (and which parts of it) continues to be a grey area.  With regard to national authorities, the ECJ found in Pfleiderer vs Bundeskartellamt that it is for the EU member states to determine the conditions under which access must be permitted. (See our prior alert on Pfleiderer.) 

However, the ECJ also stated in Pfleiderer that the EU laws on cartels must not be interpreted as precluding a person seeking damages from being granted access to documents (in that case: documents relating to leniency procedures).  Along the same lines, the General Court found in CDC that 

it must be recalled that the leniency and co-operation programmes whose effectiveness the Commission is seeking to protect are not the only means of ensuring compliance with EU competition law.  Actions for damages before the national courts can make a significant contribution to the maintenance of effective competition in the EU. 

The General Court may have found it feasible to grant access to the EC’s files since CDC requested access only to the index (not to the indexed documents themselves).  Moreover, the index did not originate from the immunity applicant (although likely listed documents submitted by the applicant).  However, the decision clearly demonstrates that the General Court is unwilling to accept the EC’s position that the goals of its cartel policy always prevail over the interests of private parties seeking damages.  As a result, it is currently difficult to predict whether documents in the EC’s possession will or will not be disclosed to plaintiffs seeking financial recovery. 

Lawyer Contacts
For more information, please contact your principal Jones Day representative or either of the lawyers listed below. 

Johannes Zöttl
Frankfurt
+49.69.9726.3939
jzoettl@jonesday.com

Dieter Strubenhoff
Frankfurt
+49.69.9726.3939
dstrubenhoff@jonesday.com

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