Robert Miklós Babirad
J.D. Masters Diploma candidate in EU Law, King’s College London; Post Graduate Diploma in EU Law (Merit); Member of the New York Bar
On April 24, 2013, Mr Joaquín Almunia, Vice President of the European Commission responsible for Competition Policy delivered a speech entitled “The Evolutionary Pressure of Globalisation on Competition Control” at the twelfth annual conference of the International Competition Network (ICN) in Warsaw, Poland. Mr. Almunia’s speech reflects his view of the International Competition Network’s critical role in fostering open global markets, promoting the exchange of information between competition agencies worldwide and establishing greater convergence with regard to global competition practices.
Although the speech calls for greater convergence and open markets, there is a failure to sufficiently evaluate underlying national policy concerns, which have led to what Mr. Almunia views as national “trade barriers” and “misguided regulations.” The speech does not effectively demonstrate that his views with regard to global competition practices will sufficiently address difficulties concerning convergence, existing practices, and the disclosure of information on a global level in competition cases.
The term “policy” is used in this article to refer to a potentially diverse array of external objectives that may need to be reflected in any consideration regarding disclosure and its prospective limits with regard to competition cases by global competition authorities. Policy may embody broad “non-economic objectives” and their consideration may be necessitated in applying the competition rules as has been suggested by Dr. Townley. The concept of policy could also be directly related to objectives similar to those suggested under the Treaty such as providing for “an area of freedom, security and justice without internal frontiers,” protecting the environment, and the encouraging of development that is of a sustainable nature. Policy concerns may also reflect, but are not limited to the protection afforded to certain interests from disclosure under the Transparency Regulation such as those of a commercial nature, the “privacy and integrity of the individual,” relations between countries, and concerns relating to national defence.
This article will begin by briefly discussing the role of the International Competition Network. Changes to competition policy will then be presented, particularly with regard to globalisation. The challenges presently being faced by the ICN and both EU as well as global competition agencies will then be addressed and evaluated as well as Mr. Almunia’s position with regard to the best practices for global competition. The article will conclude by suggesting that it may be difficult to refer to national “obstacles,” “practical gaps” and regulations as “misguided” or flawed without a more critical evaluation of existing practices and concerns involving competition related objectives both within the EU and abroad, particularly if better compromises and more effective global competition practices are to be subsequently formulated.
2 The International Competition Network
Mr. Almunia’s speech calls for continued investment and a renewal of commitment with regard to the International Competition Network. The ICN operates as a network of an informal nature with the objective of promoting the enforcement of antitrust on a global scale in order to increase effectiveness as well as efficiency with regard to businesses as well as consumers. The focus of the ICN is concentrated upon competition law and has established frameworks for analysis, tools relating to “best practices” with regard to competition, and various recommendations that have been put forth to enhance cooperation between competition agencies from differing jurisdictions. The ICN has the objective of enhancing convergence as well as cooperation when necessary, and minimising the danger of enforcement that is less than optimal as well as outcomes that are inconsistent with regard to competition.
Mr. Almunia refers to the guidance provided by the ICN as “very useful” and its success as representative of the expanding relevance on a global scale of competition law’s enforcement. It is noted that the enforcement of competition law must also be cognisant of the challenges presently being encountered by the world’s societies and economies. However, the speech does not sufficiently provide instructive guidance as to how competition law enforcement may be implemented in a manner that demonstrates that it is effectively cognisant of and responsive to these challenges. The speech notes that the ICN is closely connected with globalisation in that its objective in being created was to foster a spirit of cooperation between various global competition agencies, which would also encompass those agencies from developing and emerging nations. Encouraging cooperation between the world’s competition agencies is a positive objective of the ICN and its recognition by Mr. Almunia’s speech is instructive.
3 Changes to Competition Policy
Changes to the instruments and priorities of competition policy are noted and particularly that of a growth in liberalisation, expansion of the service industry, network industry privatisation, changes in technology, growth of the digital economy and a critical impact on traditional industry, because of the growing importance of climate change as well as the development of strategies to counteract its effects. However, the change of greatest importance in Mr. Almunia’s view is that of a global expansion of integration with regard to economics.
Mr. Almunia notes that globalisation’s greatest effect may be seen with regard to critical, new economic players on the global level. An important point is made with regard to the close links now present between “new trading partners and competitors” as well as concerning the shared interests and investments resulting from this global economic interaction. The speech notes that a benefit of globalisation has been more affordable goods in the global marketplace as well as the extrication of millions of individuals from poverty. It is also stated that an increase in global trade has developed international cooperation, confidence and the expansion of growth. These positive attributes of globalisation are importantly noted. However, it is not clarified as to how globalisation’s positive attributes may be reconciled with those which are negative in a manner that would enable it to be effectively used as a tool in the eventual resolution of the global financial crisis.
Mr. Almunia does acknowledge that globalisation has brought difficulties and challenges, and suggests that an evaluation of both its positive and negative aspects should occur. However, he fails to engage in this sort of balanced evaluation in his speech. An important statement is made in suggesting that the European Union reflects an effort at globalisation’s management and is “the only workable experiment in regional integration.” In Mr. Almunia’s view, the European Union has itself become a project, which amongst its various other objectives and goals, also embodies that of globalisation’s management, but there is a lack of elaboration upon this theory in the speech. Additionally, he suggests that the ICN is also demonstrative of this effort being directed at globalisation’s management.
It is acknowledged that an increasing amount of competition cases concern undertakings, which are conducting business on a global level. It is therefore suggested that greater exchanges on a multilateral and bilateral level must occur for the facilitating of competition control under conditions that are optimal. Exchanging information regarding competition on a global level becomes increasingly important under these conditions, but concerns regarding the scope of disclosure, degree of convergence, and relevant policy considerations, which will be inherently different based upon the competition agency at issue, fail to be sufficiently accounted for or assessed. It is suggested that international competition agencies must continue to work together and effectively exchange information. However, international competition agencies have had difficulties with regard to information of a confidential nature being exchanged where signed waivers are unavailable.  Additionally, restrictions or the exemption of particular agencies may be present even where a signed waiver is available.
Another obstacle to the exchange of information between global competition authorities cited is that of “blocking statutes.” These statutes require national undertakings to secure approval prior to responding to the requesting of information by foreign competition agencies. Additionally, in some situations national law also prohibits a voluntary response by these undertakings. Mr. Almunia calls for continued efforts in improving confidential information being exchanged between global competition authorities, but does not discuss the necessary protection or confidentiality, which must also be afforded and subsequently balanced against any interest in disclosure. It is stated that the ICN has a critical position in overcoming these obstacles to what are in Mr. Almunia’s view, better global competition practices. The speech advocates the importance of “open markets, vibrant competition, and a global level playing field,” but this view may not be an accurate representation of the present situation nor actual practices either within the EU or abroad.
Under the EU’s competition system, “obstacles” are also present that would prevent disclosure and convergence with regard to other global competition authorities as well as within the EU itself, differing from the position otherwise advocated by Mr. Almunia’s speech. Article 339 TFEU provides an example by prohibiting Union officials from releasing information, which is found to be protected by “the obligation of professional secrecy” and particularly “information about undertakings, their business relations or their cost components.” Under the Transparency Regulation, the EU’s institutions may refuse to release documents in competition related matters where disclosure would hinder the protecting of “the public interest” or the “privacy and the integrity of the individual.” Additionally, refusal of access to documents may occur where the “commercial interests of a natural or legal person, including intellectual property” may be endangered.
Access to documents concerning competition cases continues to be a source of difficulty within the EU, although this is not acknowledged in Mr. Almunia’s speech. An example is that of EnBW Energie Baden-Württemberg AG, a company impacted by the prohibited anti-competitive conduct of a cartel, which sought access under the Transparency Regulation to Commission documents relating to the cartel’s activities. Access to the documents was refused by the Commission under the Transparency Regulation’s exceptions permitting non-disclosure. One of the grounds on which the General Court annulled the Commission’s decision denying access, was due to a failure by the Commission regarding its duty to “undertake a concrete, individual examination of the documents covered by the request” in applying the Transparency Regulation’s exceptions permitting non-disclosure. The case is presently being appealed, which reflects the continuing difficulties still present with regard to interpreting the scope and limits of information disclosure even under the EU’s competition system.
The Court of Justice of the European Union (CJEU) also held in Pfleiderer AG v Bundeskartellamt that an individual “adversely affected by an infringement of European Competition law and is seeking to obtain damages from being granted access to documents relating to a leniency procedure involving the perpetrator of that infringement” will not be prevented from doing so under Regulation 1/2003 or the EU’s law with regard to cartels. However, ambiguity is also created by the Court’s judgment with regard to accessing this information, because the individual EU Member State tribunals and courts will be the arbiters of this access and deciding based upon each Member State’s respective national law, “the conditions under which such access must be permitted or refused by weighing the interests protected by European Union law.”
It is also interesting to note the statement of Alexander Italianer, Director-General for Competition in a letter to a New York Court regarding the Air Cargo Antitrust Litigation, which opposes the view of openness and convergence suggested by Mr. Almunia’s speech. Mr. Italianer has stated that permitting US discovery proceedings to access “documents that are strictly confidential under European competition law” would have the result of being “highly detrimental to the sovereign interests and public policies of the European Union” and consequently “substantially undermine the Commission’s ability to detect and punish unlawful cartel activity in the European Union.”
Additionally, in a U.S. proceeding relating to investigations performed by EU competition authorities, a motion to compel discovery of European competition related documents was denied in favor of the Commission’s position, which had argued for the documents at issue to be non-discoverable in U.S. litigation proceedings, confidential and protected by the doctrine of international comity. It is subsequently difficult to argue that clarity and convergence with regard to the disclosure of information relating to competition cases is presently or likely to become a reality in the near future either within the EU or abroad.
Mr. Almunia states that restrictions on competition are not the answer to resolving the crisis, but rather that there are “other ways to bring relief to households and firms.” However, this point is not sufficiently elaborated upon. The speech concludes by advocating that global competition agencies must “unleash the power of the markets,” particularly during these times of economic difficulty. However, current practices reflect a very different view, which reflects ambiguity and the presence of various restrictions with regard to cooperation and the disclosure of information in competition cases, both within the EU and abroad.
Unfortunately, Mr. Almunia’s speech fails to adequately address existing practices regarding a failure to disclose information and a lack of convergence concerning competition cases by both EU and global competition authorities. Additionally, the speech does not effectively assess how these issues may be resolved more effectively within the framework of the ICN. Additionally, the negative implications of globalisation are not sufficiently presented nor why open markets and strong global competition policies will effectively counter these otherwise negative effects while still being responsive to national policy concerns including, but not limited to the appropriate degree of convergence and confidentiality in competition cases.
The need for certain regulations and restrictions, which in Mr. Almunia’s view are “misguided,” as well as matters concerning the protection of confidentiality from disclosure in competition cases are also dismissed rather than being adequately addressed. Additionally, the EU’s position concerning the disclosure of documents in competition cases remains uncertain and fails to be effectively evaluated by Mr. Almunia’s speech.
 Almunia, J, The Evolutionary Pressure of Globalisation on Competition Control, International Competition Network 12th Annual Conference, Speech/13/360, 24 April 2013. <http://europa.eu/rapid/press-release_SPEECH-13-360_en.htm> Accessed 30th of April 2013.
 Townley, C. Article 81 EC and Public Policy (Hart Publishing, Oxford 2009), p. 5.
 Article 3(2)-(3) TEU.
 Regulation (EC) No. 1049/2001 of the European Parliament and of the Council of 30 May 2001 regarding public access to European Parliament, Council and Commission documents (Transparency Regulation) OJ 2001, L 145/43, art. 4(1)-(2).
 See Almunia, pps. 4-5.
 Transparency Regulation, art. 4(1)(a)-(b).
 Transparency Regulation, art. 4(2).
 Case T-344/08 EnBW Energie Baden-Württemberg AG v European Commission , paras 1, 3.
 Ibid., paras. 110-111.
 Case C-365/12 P Commission v EnBW Energie Baden-Württemberg .
 Case C-360/09 Pfleiderer AG v Bundeskartellamt  ECR I-05161.
 Letter from Alexander Italianer (Director General for Competition) to the Honorable Viktor v. Pohorelsky, In re Air Cargo Shipping Services Antitrust Litig. No. 1:06-md-01775-JG-VVP (E.D.N.Y Oct. 12, 2011). See also, De Stefano, G. Access of Damage Claimants to Evidence Arising Out of EU Cartel Investigations: A Fast-evolving Scenario (2012) 3 Global Competition Litigation Review 95, pps. 99-100.
 In Re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation No. 05-MD-1720-JG-JO (E.D.N.Y Aug. 27, 2010) (Loislaw, NY Caselaw) pps. 2-3.