M. J. Gleeson Company v Competition Authority

• Jurisdiction: Ireland
• Judgment Date: 01 January 1999
• Date: 01 January 1999
• Court: High Court

(H.C.)

M. & J. Gleeson & Co

and

Competition Authority

- Bias or prejudgment - Standard of impartiality required - Rights of third parties - Whether Competition Authority had prejudged the grant of a licence - Whether Competition Authority can suggest possible solutions.

1. S. 4(1) of the Competition Act, 1991, prohibits 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. Under s. 4(2), the Competition Authority may grant a licence for any agreement or category of agreements 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 impose on the undertakings concerned terms which are not indispensable to the attainment of those objectives or afford undertakings the possibility of eliminating competition in respect of a substantial part of the products or services in question. Such a licence can permit the doing of acts which would otherwise be prohibited under s. 4(1). Further, under s. 4(4), the authority may certify that in its opinion, on the basis of the facts in its possession, a notified agreement, decision or concerted practice does not offend against s. 4(1). S. 7(1) provides that every agreement, decision and concerted practice of a kind described by s. 4(1), in respect of which the parties thereto request a licence under s. 4(2) or a certificate under s. 4(4), shall be notified to the authority. S. 9 of the 1991 Act provides that any undertaking or association of undertakings concerned, or any other person aggrieved by the grant by the authority of a licence or a certificate can appeal to the High Court and on the hearing of any such appeal, the court may confirm, amend or revoke the licence so appealed against, or, in the case of a certificate, may cancel or refuse to cancel the certificate. Guinness Ireland Group Ltd. ('Guinness') had shareholdings in a number of drinks distribution companies including a 31% shareholding in United Beverage Holdings ('UBH') and a 49.6% shareholding in Cantrell & Cochrane Wholesale Ltd ('C & C'). On 30 May, 1997, Guinness entered into a share subscription agreement to acquire the outstanding share capital of UBH, bringing its total shareholding to 100%. James Crean plc and Fyffes plc were, after Guinness, the biggest shareholders in UBH. This deal would have given Guinness 100% control of UBH. On 14 July, 1997, Irish Wholesalers made a complaint to the Competition Authority concerning the proposed acquisition. On 4 September, 1997, Guinness notified the agreement to the authority and sought a certificate in respect of it. In its final decision published on 10 July, 1998, the authority gave the deal a licence up to 31 December, 1999, on condition that Guinness and its parent company, Diageo, reduce their holding in C&C below 10% by 15 January, 1999, give up all rights to...