Cronin v Competition Authority & Min Enterprise & Employment
| Jurisdiction | Ireland |
| Judge | Mr. Justice Barrington |
| Judgment Date | 01 January 1998 |
| Neutral Citation | 1998 WJSC-SC 5166 |
| Docket Number | [S.C. No. 269 of |
| Court | Supreme Court |
| Date | 01 January 1998 |
1998 WJSC-SC 5166
THE SUPREME COURT
Hamilton, C.J.
O"Flaherty, J.
Barrington, J.
Murphy, J.
Barron, J.
and
and
Citations:
COMPETITION ACT 1991 S4(2)(a)
CA/77/92E
COMPETITION ACT 1991 S4(1)
COMPETITION ACT 1991 S4(2)
TREATY OF ROME ART 85
METRO (NO 1) V COMMISSION 1977 ECR 1875
TREATY OF ROME ART 85(1)
TREATY OF ROME ART 85(3)
COMPETITION ACT 1991 S7(1)
COMPETITION (AMDT) ACT 1996 S12
COMPETITION (AMDT) ACT 1996 S12(1)(1)
CITYVIEW PRESS V AN CHOMHAIRLE OILIUNA 1980 IR 381
COMPETITION ACT 1991 S23(1)
COMPETITION ACT 1991 S7(6)
Synopsis
Competition
Judicial review; certiorari; exclusive purchasing agreement; anti-competitive effect; notification of such agreements; category licence granted by the Competition Authority providing that agreement was not anti-competitive; positive and negative conditions for grant of licence; whether procedures concerning granting of licences fair; whether principles of natural justice complied with; whether notification procedure applies to draft agreements; whether unconstitutional delegation of legislative functions to the Competition Authority; failure of Minister to draw up regulations; s.4 Competition Act, 1991; Art. 85 Treaty of Rome
Held: Relief refused; decision of Competition Authority upheld Supreme Court: Hamilton C.J., O'Flaherty J., Barrington J., Murphy J., Barron J. 27/11/1997
Cronin v. The Competition Authority - [1998] 1 IR 265 - [1998] 2 ILRM 51
Mr. Justice Barrington delivered herein on the 27th day of November, 1997. [NEM DISS]
This is an appeal from the Judgment and Order of the President of the High Court Mr. Justice Costello delivered and made herein on the 24th day of June 1994.
The facts of the case are as follows:-
The Appellant is the licensee of a Petrol Filling Station at Blackrock, Co. Dublin and he brings these judicial review proceedings on his own behalf and on behalf of the members of the Texaco Retailers Association.
The first named Respondent is the Competition Authority established under the Competition Act, 1991and the Notice Party, Texaco Ireland Ltd., is the company with which the Plaintiff presently has an exclusive agreement for the purchase of motor fuel.
The principal relief sought by the Appellant is an Order of Certiorari to quash a decision made by the Competition Authority in July, 1993 to grant a category licence under Section 4 (2) (a) of the Competition Act, 1991.A claim is also made against the Minister on the grounds that he failed to carry out a duty allegedly placed upon him to make regulations prescribing procedures to be followed by the Competition Authority.
On the 13th March, 1992 the Competition Authority placed an advertisement in the newspapers announcing that it had received notification, from Texaco (Ireland) Ltd., of five different types of agreement for the supply of motor fuel. These were notifications made under Section 7.2 of agreements which were already in existence. The Appellant and his fellow members of the Texaco Retailers Association took no steps in relation to this notification.
However on the 6th November, 1992 the Competition Authority published a notice to the effect that it had received notification of some 57 agreements (or draft agreements). These included a document described as CA/77/92E. Texaco (Ireland) Ltd. Licensees. Licence Agreement (new version).
The Appellant and his fellow members were concerned about this and on the 20th November, 1992 the Solicitor acting on behalf of their association wrote to the Competition Authority and Texaco with a specific request to be supplied with the material the notification of which had been advertised on the 6th November.
On the 3rd December, 1992 the Competition Authority replied saying:-
" Details of a notification are confidential until a summary of the facts of the notification is published by the Authority at the notice of intention stage, with an invitation to interested parties to make submissions. At this stage it is open to you to seek details of the notifications from the notifying party".
The Solicitor had already written to Texaco and on the 9th December Solicitors on behalf of Texaco replied refusing the said request but stating:-
"The notification made by Texaco (Ireland) Ltd. to the Competition Authority contains confidential information and the business secrets of Texaco (Ireland) Ltd. While naturally our clients appreciate the interests of your clients and the importance of the Competition Act for the arrangements between Texaco and their partners in retailing, regrettably, they are not in a position to release the copy notification to your clients."
As you are aware, once the Authority has made an initial assessment, it has been the Authority's practice to publish a summary of the notification and to make that available to members of the public inviting submissions. Texaco welcomes any contribution which their clients can make to the Authority's consideration of the agreements which have been notified".
In this context it should be pointed out that while the parties referred to the " notification" of an agreement the Competition Authority expects to receive from the Applicant a great deal more than a mere covering letter enclosing the agreement. The guide published by the Competition Authority makes clear that the Competition Authority expects to receive from the Applicant not only the agreement but also an elaborate submission setting out why the Competition Authority should certify that the agreement is not caught by the provisions of S.4 s.s.1 of the Competition Act or alternatively why the Competition Authority should grant to the notifying party a licence in accordance with the provisions of S.4 s.s. 2 of the same Act.
On the 11th December, 1992 the Authority advertised it's intention to grant a category licence and a draft of that licence was made available to interested parties including the Appellant.
Again the " draft licence" was a great deal more than a mere licence. The draft was produced after a fairly detailed appraisal by the Competition Authority of the operation of the Act on existing contracts and of the proposals for new agreements which might be entered into. The Competition Authority gave it's appraisal of these factors and set out the proposed form of the category licence which was to be issued. The Competition Authority's preliminary reasoning justifying the issue of the category licence ran into some thirty-six pages of typescript and the licence itself was six pages long.
The Appellant availed of the opportunity given to him and his colleagues to make submissions as to why the draft licence should not be issued or should be modified.
On the 9th July, 1993 the Competition Authority gave notice that it had issued a category licence. This licence is a slightly modified version of the draft licence made available to the Appellant pursuant to the provisions of the Authority's advertisement of the 11th December, 1992.
It is the decision to issue this licence which the Appellant seeks to quash by way of certiorari.
This case is concerned with the provisions of the Competition Act, 1991.
That Act is described in the long title as being, inter alia, an Act to prohibit the prevention restriction or distortion of competition "by analogy with articles 85 and 86 of the Treaty establishing the European Economic Community and in the interests of the common good".
Section 4 of the Act provides that "subject to the provisions of this section" all agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect the prevention restriction or distortion of competition in trade in any goods or services in the State or in any part of the State are prohibited and void.
Section 4 s.s. 2 however provides for exceptions to this general prohibition, in respect of:-
(a) Any agreement or category of agreements,
(b) Any decision or category of decisions,
(c) Any concerted practice or category of concerted practices,
which, in the opinion of the Authority, having regard to all relevant market conditions, contributes to improving the production or distribution of goods or provision of services or to promoting technical or economic progress while allowing consumers a fair share of the resulting benefit and which does not:-
(i) Impose on the undertakings concerned terms which are not indispensable to the attainment of those objectives;
(ii) Afford undertakings the possibility of eliminating competition in respect of a substantial part of the products or services in question.
The Competition Act - following Article 85 of the Treaty of Rome - accepts that conditions of perfect competition may not always be attained or attainable. Article 85 allows to the European Commission a wide discretion to maintain what the European Court of Justice has described as "workable competition" (see Metro (no. 1) v. Commission 1977 ECR page 1875 at page 1904). For this reason the Court allows to the Commission a wide discretion to declare the provisions of Article 85 Section 1 inapplicable to certain agreements or categories of agreements in accordance with the provisions of Article 85 Section 3. Our Competition Act allows a similar discretion to the Authority to grant licences to certain agreements or categories of agreements by analogy with the provisions of Article 85 and in accordance...
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