Lincoln’s Inn lecture on public and private enforcement: part 3 – publications and the content of decisions

Thomas Sharpe QC and James Flynn QC invited me to speak to the Lincoln’s Inn Eurogroup on the relationship between public and private antitrust enforcement.

This is the second main section of the speech. The others are:
The Damages Directive and the protection of leniency submissions and settlement statements;
Single and continuous infringement.

For those who prefer to read paper documents, I attach PDFs of the full prepared remarks and the handout.


The Commission has a dual role in both proposing legislation to promote the effective application of competition law, as with the Damages Directive, and in directly enforcing the competition rules through its own decisions. And obviously there is an inevitable link between public enforcement and private enforcement because of follow on actions that, for the foreseeable future, are likely to account for the majority of private enforcement activity in the EU.

However the Commission’s public enforcement is a standalone responsibility; we should not, for example, alter our approach to the drafting and publication of decisions in light of the increasing prevalence of follow on actions. In other words we should not increase the amount of information available so as to help follow on claims, but nor should we limit the information available so as to avoid arguments with defendants who fear damages litigation.

The publication process

This does not mean that the publication of decisions proceeds in a vacuum. We have certainly seen an increase in defence lawyers contesting the content of public versions of decisions, and there is a clear tension between our desire to publish quickly and the parties’ desire which is often to avoid publication for as long as possible.

This extends to asking – successfully so far – the General Court to suspend publication of our decisions pending a full hearing on confidentiality issues.  One might speculate that part of the motivation for some of the court cases is not to win or lose the case, but simply to delay the publication of Commission decisions further.

I am sure that many of you are aware that this has led to some English judicial criticism of the Commission’s “molasses” like speed of publications. Certainly the situation is unsatisfactory.

But as with many aspects of damages litigation, until we have clearer judicial precedents, the European Commission’s ability to move this process along is limited given the legal constraints on our actions.

We now have a ruling of the General Court – Schenker 1 – that suggests that we should publish a preliminary non-confidential version of our decisions, essentially taking on board all of the claims of the parties. That will, as I am sure you have already realised, in practice lead to preliminary publications that are mostly blank.

We are considering unilateral action that may help the publication process, for example by possibly publishing greater public guidance on what is and is not a valid confidentiality claim. That may help to clarify what is and is not confidential, but it is not a panacea. It would not bind parties and they could still appeal to the General Court who would, on current practice, be likely to suspend the Commission’s attempt to publish.

The only way through this, I think, is for the General Court to issue judgments that clarify some of these publication issues. If that is to happen sooner rather than later, that will require the backlog of cases to be reduced, and it is not at all clear that a significant reduction is within the gift of the General Court acting alone.

Greater clarification in this area is, therefore, an exercise that is more likely to take years rather than months.

While this continues, we nevertheless continue to try and publish non-confidential versions of our decisions. The following are some principles that we apply:

First, that a particular fact or piece of evidence in the decision might lead to or facilitate damages actions does not mean that it is a business secret;

Second, although historically – before damages actions became common – there were no particular consequences to naming companies in our decisions even were the decision not addressed to them, that is clearly – after Pergan – no longer acceptable. If companies have been at best peripherally involved, or perhaps only indirectly implicated, in anti-competitive activity, then they should not be named at all unless the decision is in fact addressed to them. If they are named, then their names and any description of their actions should be confidential and should remain so.

Third, the public versions of decisions should not allow information provided by leniency applicants to be traced back to them. This falls under the general principle of the Commission needing to protect the system of leniency, so these are deletions that we will make on our own initiative, whether or not the parties have requested it (though they always will).

Ultimately however, we cannot publish decisions without the parties having identified their business secrets, and agreed to the final form of the publication. The scope for delay remains great.

This delay in making public versions of decisions available will, as many of you will be aware, lead to follow on actions being ready to proceed before a non-confidential version of a Commission decision is ready. Defendant addressees of the decision will have a confidential version in their possession, but how should the confidentiality issues be dealt with?

First, it is for the company having possession of the confidential document to ensure that it does not disclose confidential information; it could be liable for any unauthorised disclosure.

Second, if a national judge considers that dissemination of the confidential version is necessary for the litigation to continue, then it is for the national court to put in place appropriate mechanisms to safeguard the confidentiality of the relevant parts of the Commission decision.

That may take the form of ensuring appropriate redactions for “Pergan” evidence,2 and putting in place confidentiality rings with appropriate sanctions should those rings be broken.

This mitigates some of the problems caused by the delay in publishing non-confidential versions of Commission decisions and may in time prove to be a more effective basis for the follow on litigation than waiting for the public version. Indeed, even if a non-confidential version of a decision has been published, that does not bind a claimant to using that version. It could always go to a national court and argue for further disclosure of the confidential parts of the decision in the context of, for example, a confidentiality ring. It may be that ultimately the Commission’s non-confidential version of its decision will prove to be less important than it currently appears.

The publication principles outlined above apply equally to contested and settlement decisions. But from the point of view of public enforcement, there are significant differences between what is legally required as to the content of contested and non-contested (settlement) cartel decisions.

The contents of contested and non-contested (settlement) decisions

Contested decisions are likely – in practice are certain – to end up in Court. They therefore need to paint a complete picture of the anti-competitive activity, and of each party’s participation in it.

As an aside, I personally think that even in a contested case, a competition enforcer should aim for the minimum amount of information needed to demonstrate its case, rather than the maximum; I do not think that a complete description of the evidence on the file is necessary if highlights from the file would be sufficient.  For a public authority to address its entire case-load efficiently means that it should focus its description of conduct on that which is necessary, which may fall short of that which is complete.

Particularly with leniency-fuelled cases the amount of factual evidence can sometimes be extensive. Documenting in the decision every weekly meeting of a cartel that lasted for ten years may not be necessary to prove the infringement, and may mean that resource limited enforcement agencies spend too much time on too few cases. It is of course a delicate balancing exercise, and the safe option will always be to add more. A public authority should guard against that.

But consistent with that principle, settlement decisions should be treated differently by a public authority. It is – or should be – a non-contested procedure, that is not appealed. The addressees have acknowledged the Commission’s Statement of Objections and are not likely to appeal the case to the General Court. The amount of detail necessary for the public enforcement of the decision is therefore substantially less than that needed for a decision where every fact stands to be checked in court. We have so far only had one appeal on a settlement decision, which raised issues relating to the calculation of the fine rather than the description of the infringement: I imagine the General Court would give short shrift to any appeals on settlement cases where the parties sought to appeal that which they had admitted during the settlement procedure on the basis that the decision was too short to prove the case.

I realise that these shorter settlement decisions make for slimmer pickings for claimant lawyers who want to glean as much information as they can from cartel decisions so as to aid discovery. That, however, is not the concern of the Commission when it is acting as a public enforcer.

We have proposed in the Damages Directive a system of discovery that – although its implications are limited here in the UK – will have major consequences in other jurisdictions around the EU. It is a system that should ensure that claimants get access, directly from the parties to the cartel, to pre-existing documents, including those on which the Commission has based its decision. It is in that way that follow on actions are secured, even in settlement cases.

Given the increasing importance of damages actions it is no surprise that defendants and their advisers are looking ever more closely at Commission decisions and pursuing arguments about confidentiality with more vigour.

I think the increasing reality of private damages follow on actions will have other effects on the way the Commission approaches its decisions. For example, that the Commission has changed how it drafts its decisions to exclude Pergan-type information is one example of how greater private enforcement is affecting Commission practice. It is now our practice not to name companies in cartel decisions unless they are an addressee. This will help to avoid some of the difficulties currently faced in the Air Cargo litigation.

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