On 20 April 2023, the EU Court of Justice ruled that, where the Damages Directive does not apply, final decisions of national competition authorities are to be regarded by national courts as providing sufficient evidence of an infringement if the facts of the decision and the civil liability claim coincide (Case C-25/21).
• Context: what happened?
By decision of 11 July 2001, the Spanish Competition Court found that the oil company Repsol Comercial de Productos Petrolíferos (“Repsol”) had infringed competition law rules by fixing, in the context of its contractual relations with certain Spanish service stations, the retail prices of fuel. That decision became final in 2010 after a judgment rendered by the Spanish Supreme Court. Between 2001 and 2009, Repsol entered into further contracts containing similar anticompetitive clauses. This led to the adoption of an infringement decision by the Spanish competition authority on 30 July 2009 which became final in 2015 after unsuccessful actions for annulment brought by Repsol.
Following these decisions, the owners of a Spanish service station brought (i) an action for a declaration of nullity of the exclusive supply contracts entered into with Repsol during the period from 1987 to 2009 in connection with the operation of that service station, and (ii) an action for damages seeking compensation for the harm cause by the infringement of Article 101 TFEU. In the context of these national proceedings, the Commercial Court n° 2 of Madrid (the “national jurisdiction”) referred two questions to the European Court of Justice (“the Court”).
• Preliminary observations: is the Damages Directive applicable?
In the first place, the Court (further) clarified the material scope and temporal applicability of Directive 2014/104 (the “Damages Directive”) and, in particular, of Article 9(1), to which the national jurisdiction referred. This provision provides that an infringement of competition law found by a final decision of a national competition authority (“NCA”) or by a review court is deemed to be irrefutably established before civil courts in the same Member State.
Regarding the material scope, the Court noted that the Damages Directive is limited solely to actions for damages brought for infringements of competition rules. It does not extend to other types of actions, such as the action for a declaration of nullity brought under Article 101(2) TFEU by the owners of the Spanish service station.
Regarding the temporal applicability of Article 9(1), the Court noted that that provision is of a substantive nature. For such a provision to be applicable, the 2001 and 2009 decisions must not have become final before the expiry of the deadline for transposition of the Damages Directive (27 December 2016), the latter having been transposed into Spanish law five months after the time limit. In this case, the two decisions became final in 2010 and 2015. Therefore, the Damages Directive is not applicable ratione temporis.
As the Damages Directive is not applicable, the Court noted that the case must instead be examined under national rules.
• Where the Damages Directive is not applicable, are national civil courts still bound by the decision of a national competition authority?
The first question concerned the probative value of a NCA’s final infringement decision in the context of an action for declaration of nullity (falling outside the material scope of the Damages Directive) or an action for damages (falling outside the temporal scope of the Damages Directive), in light of Article 2 of Regulation 1/2003 and the principle of effectiveness.
The Court noted that, in the absence of EU rules governing the effects of final decisions of a NCA in the context of such actions, it is for the legal system of each Member State to lay down the applicable rules, provided that the principles of equivalence and effectiveness are observed. The Court indeed reminded that national rules must not make it excessively difficult for individual applicants to file an action in nullity or an action for damages.
On that basis, the Court decided that, in order to guarantee the effective application of Articles 101 and 102 TFEU in the context of these actions, the existence of an infringement of EU competition law found in the final decision of a NCA must be deemed to be established by the applicant, provided that “the nature and the material, personal, temporal and territorial scope” of such infringement corresponds to the one invoked by the applicant. The Court clarified that it is up to the defendant to prove the contrary, thereby shifting the burden of proof defined by Article 2 of Regulation 1/2003. In addition, if the infringement found in the NCA decision only partially corresponds to the infringement invoked by the applicant, the NCA decision can still be invoked as an indicia of the existence of an infringement of competition rules.
• What happens to the contract if Article 101(1) TFEU is infringed?
The second question related to the consequences that should flow from the possible nullity of the exclusive supply contracts concluded between the station owners and Repsol.
The Court considered that, provided that the applicant of an action in nullity or an action for damages succeeds in establishing the existence of an infringement to EU competition law, it is for the national court to draw all the consequences from it, including the automatic nullity of (i) all the contractual provisions contrary to Article 101(1) TFEU or (ii) the agreement as a whole if those provisions are not severable from the agreement itself.
For further information about this case and/or for general legal advice relating to European and Belgian competition law, please contact Pierre de Bandt, Chloé Binet or Victoria Heinen.