In a settlement decision, the European Commission determined that five major European truck manufacturing groups had carried out a single continuous infringement of article 101 of the FEU Treaty and article 53 of the EEA Agreement over a long period. The decision comprised a relatively short, operative part declaring what the commission had decided and a large number of antecedent recital paragraphs explaining the background and reasoning. Following the commission’s decision, a significant number of damages claims were commenced in the UK. Seven such claims before the Competition Appeal Tribunal raised, as a preliminary issue, the extent to which the commission’s decision was binding on the national court for the purpose of the domestic damages claims. The claimants contended (1) that all the recitals were binding, insofar as they were the essential basis for the operative part, under article 16(1) of Council Regulation (EC) No 1/2003, which obliged national courts not to take decisions that might conflict with decisions of the commission. One of the defendants argued that only the operative part was binding, save that the recitals could be used to clarify or interpret that part. The other defendants asserted that the recitals were binding insofar as they were essential to understanding what the decision was. Alternatively, the claimants asserted (2) that, since the decision was a settlement decision, it would be an abuse of process as a matter of English common law for the defendants not to admit the recitals in the proceedings. The defendants submitted that insofar as a recital was not binding as a matter of EU law, it could not be an abuse of process for them to contest it.
On the preliminary issue—
Held, (1) a finding in a commission decision was binding on the national court for the purposes of article 16(1) of Council Regulation (EC) No 1/2003 if it was susceptible to challenge before the EU courts; conversely, if it could not be challenged in proceedings before the EU courts, it was not binding in national proceedings. A finding was susceptible to challenge and thus binding in national proceedings if it was an essential basis or the necessary support for a determination in the operative part, or necessary to understand the scope of the operative part. The criteria of “essential basis” or “necessary support” were not necessarily confined to legal assessments or a very narrow category of findings of fact. Each case was a fact-specific exercise, to identify what had actually been decided either in the operative part (which was to be interpreted with the aid of the recitals) or in a recital which was an essential basis or provided the necessary support for the operative part such that the national court would be acting inconsistently with the decision if it made a different finding. Since article 16 obliged the national court not to take a decision running counter to the decision adopted by the commission, that provision applied to all the decisions of which those agreements or concerted practices were the subject and so could concern both the operative part of the decision that concerned the infringement and the operative part that concerned the fine. Accordingly, not only the operative part of the commission’s decision was binding on the defendants, who were also bound by certain of the recitals in the decision (paras 64, 67–68, 69–72, 141, 147–149).
(2) Article 16 of Council Regulation (EC) No 1/2003 was not exhaustive in determining what in a commission competition decision was binding and, accordingly, the doctrine of abuse of process could apply as a result of a decision of the commission although it was not a court. It was an abuse of process for a defendant who had agreed a settlement with the commission to deny, or not admit, the facts which the settlement decision recorded it as having admitted. However, where the claimant did not object, it was not an abuse for a defendant to put forward a case or evidence inconsistent with a recital. It was also not an abuse for a defendant to put forward a contrary position to a finding in the decision on the basis that it did not accurately reflect the underlying document referred to, nor was it an abuse for a defendant to advance facts inconsistent with a recital if they came from new evidence to which it could not reasonably have had access at the time of the proceedings before the commission. If the claimant pleaded facts or allegations more detailed than, additional to or different from the facts set out in a recital, it was not an abuse for the defendant to plead a response in appropriate terms and details to such facts and allegations, provided its response did not amount to a denial of a recital not otherwise justified by the above. In all cases, it was for the defendant seeking to put forward a positive case contrary to a finding in a recital to set out the reasons why it should be able to do so in that particular instance, and then for the tribunal to decide. On the facts and in application of those principles, the defendants could be entitled, and it would not then be an abuse of process for them, to contest some of the recitals, and the tribunal would make a final determination in application of those principles if the parties could not agree (paras 115, 117, 120, 131-132, 134, 141, 143, 144).
Tim Ward QC, Ben Lask and Anneliese Blackwood (instructed by Bryan Cave Leighton Paisner llp) for the claimants in the first, second and seventh claims.
Mark Brealey QC and Derek Spitz (instructed by Ashurst llp) for the claimants in the third claim.
Marie Demetriou QC and Christopher Brown (instructed by Hausfeld & Co llp) for the claimants in the fourth, fifth and sixth claims.
Daniel Beard QC and David Gregory (instructed by Travers Smith llp) for the defendants in the first, second and seventh claims.
Paul Harris QC and Ben Rayment (instructed by Quinn Emanuel Urquhart & Sullivan UK llp) for the defendants in the fourth claim.
Kelyn Bacon QC and Matthew Kennedy (instructed by Herbert Smith Freehills llp) for the defendants in the fifth claim.
Daniel Jowell QCand Tom Pascoe (instructed by Slaughter & May) for the defendants in the third claims.
Sarah Ford QC and Daniel Piccinin (instructed by Freshfields Bruckhaus Deringer llp) for the defendant in the sixth claim.