This Week in Luxembourg

On Thursday, the ECJ rejected the appeal against case T-259/02 c.a., a cartel case regarding the Austrian banking industry. (Commission Decision.) Altogether, the ruling is a nice summary of the law on cartels, for example on the meaning of "may affect trade between MS" and how this is to be proved, the relative severity of infractions, the attribution of infractions to subsidiaries and previously independent companies, etc.

Erste Bank der Österreichische Sparkassen. (German)

Also on Thursday, AG Mazák discussed the distinction between sale of goods and delivery of services for the purposes of Regulation 44/2001, as well as their respective locations. He argues that the distinction is not (necessarily) the same as for the purposes of Internal Market law. (par. 18) He proposes that the Court should avoid defining the distinction in general terms, and instead should tackle the problem one case at a time. (par. 20) As for place of delivery, he recommends that the Court base this on the location of the transfer of physical control, not the delivery terms of the contract. Car Trim.

Spain failed to transpose Directive 2006/70. The intriguing thing about that is the title of the Directive: "[A Directive] laying down implementing measures for Directive 2005/60/EC of the European Parliament and of the Council as regards the definition of "politically exposed person" and the technical criteria for simplified customer due diligence procedures and for exemption on grounds of a financial activity conducted on an occasional or very limited basis". It's about money laundering and terrorism. Commission v Spain (French).

On Wednesday, the CFI ruled in two Carbon Trading cases: Poland v Commission and Estonia v Commission. Both of these cases concern the distribution of power between the Commission and the Member States under art. 9 of Directive 2003/87, concerning the National Allocation Plan. While the Commission may review and reject this plan, what they may not do is decide at what level the allowance should be set if not that proposed by the Member State. (EUObserver.)

On Tuesday, there was the eagerly anticipated opinion of AG Maduro in the IP case against Google. He recommends that Google should be allowed to continue to offer its AdWords service even for keywords that are registered trademarks, meaning that you type "Louis Vuitton" and the ad on the side of the screen might refer you to a site that sells counterfeit LV products, because that site paid Google for that privilige. (Cf. Directive 89/104.) Google France and Google (Cf. BBC)

This one is particularly interesting from a Public Administration point of view: Apparently, in French public procurement law (Code des Marchés publics) there is such a thing as a marché de définition, where the public authority awards a contract for the design of the terms of a marché d'exécution, i.e. a normal public procurement contract. Since the former aren't mentioned in the relevant directive, the French have been running them as they saw fit, i.e. intransparently and uncompetitively. To make matters worse, the winners of such a procedure can later be grandfathered into a protected position for the normal procurement. (art. 74-IV CMP) Like the Commission, AG Mazák now thinks all of this is not OK. Commission v France.

This Week in Luxembourg

On Thursday, Sept. 17, the ECJ discussed statutory assignment of rights from the insured to the insurer ("subrogatie") in the context of Regulation 44/2001. The conclusion was that the Austrian Krankenkasse could not sue the insurer of the person who caused the accident in Austria, since that person lived in Germany. Vorarlberger Gebietskrankenkasse v WGV-Schwäbische Allgemeine Versicherungs AG.

The ECJ rejected the Commission's appeal in one state aid case, MTU Friedrichshafen, and upheld it in another. In the latter case, the CFI erred by applying the principle that legitimate expectations are to be protected to the case at bar. Intriguingly, without using the exact words, par. 94 appears to require detrimental reliance, which the applicant here did not have. Koninklijke FrieslandCampina.

The Netherlands violated the standstill clause of art. 13 of Decision 1/80 of the Association Council of the EU and Turkey by introducing a new administrative charge for Turkish citizens working in the Netherlands. Sahin.

Also on Thursday, AG Kokott wrote an opinion about an appeal in an art. 82 EC case. He proposes the ECJ should overrule the CFI and find for the Commission (!). The root of the problem is an undertaking by a dominant firm, i.c. De Beers, not to do business with the applicant, Alrosa, any longer. Under art. 9 of Reg. 1/2003, this commitment was made binding. The CFI ruled that this decision violated the principle of proportionality. The AG now argues that this was wrong for more reasons than there is space here to list. (Quick count: at least a handful of different reasons.)Commission v Alrosa.

On Wednesday, Sept. 16, the CFI ruled in a case commenced by a Greek fishing company against the Community concerning complicated matters of customs law, form T2M, etc. The interesting part is that this action was - inevitably - based on art. 288, par. 2 EC. Finding no unlawful act on the part of the Community, the CFI also quickly considered whether there was a "convergence" among the legal orders of the member states regarding state liability for lawful acts. (par. 74-77) Finding no such convergence, they ruled for the defendants. Case T-162/07, Pigasos Alieftiki Naftiki Etaireia. (In French.)

On Tuesday, Sept. 15, there were three AG opinions: AG Mazák wrote about the rights of three Iraqi refugees underDirective 2004/83. Abdulla et al. v Germany. He also wrote an opinion on a case where legal certainty and other High Principles were confronted with the failure to translate a tax assessment notice. Unfortunately, the AG found that the question was hypothetical and therefore manifestly inadmissible, making further analysis unnecessary. Kyrian. (Cf.Adjudicating Europe.)

AG Mengozzi, finally, wrote about a case where the Commission and an NGO argued about the appropriate level of access to documents the latter should enjoy, in the course of another (legal) disagreement between them.Internationaler Hilfsfonds eV.

This Week in Luxembourg

Thursday, September 10^th:

- In Competition Law, Akzo Nobel had its appeal denied in its entirety, just like the CFI’s judgement dismissed Akzo’s action in its entirety. Akzo is still liable for the actions of its subsidiaries, and it still has to pay a fine of € 20,99 million. (See Commission decision here.) Akzo v Commission.

- The ECJ overturned the CFI’s decision to declare admissible the action by an Italian regional body asking for the annulment of a Commission Decision ending some financial assistance. (The CFI ruled for the Commission on the merits.) According to the ECJ, plaintiffs are not directly concerned, since the decision was addressed to the Italian Republic, and its effect on plaintiffs was not “purely automatic”. Ente per le Ville Vesuviane.

- Under the directive on legal expenses insurance, Directive 87/344, the insurer cannot tell you who your lawyer should be, not even in a “class action”-type situation. Eschig v UNIQA Sachversicherung.

- Tricky bit of insolvency law: German company sells and delivers a good to a Dutch company, reserving title. The Dutch company goes bankrupt. The German company petitions a German court for protective measures, which are granted. Can that decision be recognised in the Netherlands under the Insolvency Regulation (Regulation 1346/2000) or the general Mutual Recognition of Civil Judgements Regulation (Regulation 44/2001)? Given art. 7(1) of the insolvency Regulation, it wins. German Graphics Maschinen GmbH

- The Plantanol case isn’t very interesting, except for the fact that it involves the principles of legal certainty and legitimate expectation. A tax advantage designed to promote biofuel was abolished/replaced sooner than originally announced. The Court ruled that exceptional circumstances are not required in a situation like this one. I’m not sure how much it mattered that this was about a legislative enactment, not administrative law.

- The City of Gotha in Germany cheated a bit in awarding the contract for water supply and sewage contracts. They arranged for an informal tender, looking to keep the existing arrangement in place. (They had an independent company in place that was a joint venture between a number of local authorities.) Unfortunately, the fact that consideration consisted solely in the right to collect payment from citizens meant that this was a “service concession”, not a “service contract”, meaning that a formal tender should have been used. WAZV Gotha v Eurawasser.

- In another public procurement case, the ECJ clarified the meaning of “control similar to that which it exercises over its own departments”, i.e. the situation when no tender is necessary. Sea Srl v Comune di Ponte Nossa.

- AG Kokott delivered an opinion in a Belgian insider trading case: Spector Photo Group. (In Dutch) She proposes that someone does not automatically “use” inside knowledge when they possess it and trade anyway. To be continued...

Tuesday, September 8^th:

- The Grand Chamber upheld the Portugese state monopoly in gambling - including online gambling and - against a challenge under art. 49 EC. Fairly straightforward Internal Market case, although it might have been different under Bolkestein's original directive... Liga Portuguesa de Futebol Profissional and Bwin International v Departamento de Jogos da Santa Casa da Misericórdia de Lisboa. Cf. EU Law Blog.

- The Grand Chamber (Timmermans, rapporteur) handed down another ruling in the ongoing saga about Bud/Budweiser beer. This line of litigation is separate from the one that resulted in a ruling for the Czechs earlier this year. Instead, the Austrian court asked for a clarification of the ECJ's ruling in 2003. (Case C-216/01.) This case includes not only the usual problems of trademark and protection of geographical indications (PGI), but also problems with pre-existing treaties among Member States. Budejovicky Budvar.

- The Grand Chamber (Timmermans, rapporteur) ruled on the legality of Regulation 1013/2006 on shipments of waste, which I actually remember from my time in Brussels. (It took our friend Johannes Blokland, MEP three years to negotiate, until it was finally resolved as a second reading agreement in June 2006.) Fortunately for everyone, the Court agrees that this was an environment measure, even though it also covers the trading of waste into and out of the Common Market. The Rotterdam Convention cases (C-94/03 and C-178/03) are distinguished. Commission v. Parliament and Council.

- AG Trstenjak delivered an opinion about the defective products directive. He concludes that a British rule allowing for the substitution of the supplier of the good for the producer in certain circumstances is compatible with the directive.Aventis Pasteur. In addition, there is an opion by AG Mazák on food safety and art. 28. Commission v France. (in French), and an opinion by AG Trstenjak about consumer protection and contracts negotiated away from business premises, in this case participation (and its cancellation) in a real estate fund. Friz. (In German.).

- This is fun: to what extent does a third party complainant in a state aid case have the right to have access to the documents prepared and gathered by the Commission in its original investigation? Originally, the answer would be: very limited. Only parties to the original case would have access. But what if they make a request under the general access to documents Regulation? The Commission refused (“undermine (...) the purpose of inspections, investigations and audits”), the CFI overruled, and AG Kokott now agrees with the CFI. Technische Glaswerke Ilmenau. (In German.)

- Last Friday (Sept. 4) in Luxembourg: The CFI confirmed that an Italian scheme giving income tax relief to companies seeking a listing on a stock exchange was unlawful state aid. (Commission Decision 2006/261.) I'm not sure that I agree. If anything, it's probably the relatively short period (15 months) in which the scheme was available that damns it. I don't see why a permanent tax incentive encouraging companies to seek a listing, even if the incentive is unrelated to the costs involved in seeking a listing, should qualify as state aid. Italy v. Commission.

P.S. Here is EU Law Blog about last week's International Fund for Ireland case. Incidentally, it appears I made a mistake writing about that case. The Court's analysis of art. 308 was not dicta. Rather, it was a necessary step towards the court's conclusion that the appropriate legal basis was the combination of art. 159, third paragraph, and art. 308 EC. Art. 159 alone is not enough, because that only covers "independent action by the Community" (par. 64).

This Week in Luxembourg

The court is back from vacation...

- In the case about the International Fund for Ireland, the Court followed AG Bot an annulled for incorrect legal basis. They used 308 EC, when they should have used 159 EC, par. 3 (structural funds). According to the ECJ, the reintegration of Northern Ireland fits within the goal of "cohesion" of art. 158-162 EC. The ECJ also has some dicta about whether art. 308 EC would have been a possible legal basis anyway, given that the IFI has very little to do with "the operation of the common market", citing its precedent in Kadi. (par. 66-69). Parliament v Council.

- In consumer protection law (Directive 97/7/EC), a prejudicial question about revocation of a distance contract: Can the consumer be made to pay for the use value of the product during the period between its arrival and revocation? (In this case: 8 months use of a second-hand laptop, in the period until it broke down.) The answer is: generally no, unless [good faith], [unjust enrichment], etc. etc. Messner v Krüger.

- "The res judicata show goes on", meaning that there is another case where (the Italian approach to) res judicataclashes with Community law in the context of VAT law. Olimpiclub.

- In two cases, an appeal against a CFI ruling is dismissed: A competition case regarding the haberdashery (!) market,Prym & Prym v Commission, and an anti-dumping case about Indian CD-Rs (Moser Baer v Council). In both cases, the Community institution/defendant wins. In the former case, both CFI and Commission were not at there best (cf. par. 59-61 and par. 72-84, respectively), but the ruling below does stand. In a third appeal, Papierfabrik August Koehler, also a competition case, the CFI ruling is partially set aside. (A mistake with the Statement of Objections, meaning one of the plaintiffs gets off free.)

- AG Mazák tackles an Italian public works case, arguing unsurprisingly that non-profits (in this case: university affiliated research groups) are entitled to participate in a tender process, as long as their bylaws and the other law that governs such organisations do not say otherwise. CoNISMa.

- Finally, there is another CFI ruling on terrorism sanctions, in the joined case T-37/07 and T-323/07, El Morabit. (My apologies for the link. For some reason, it's not on Eur-Lex.) When the Court of Appeals in The Hague acquitted the plaintiff, he was removed from the list, but now he argues that he should not have been on it in the first place, given that there was no "final judgement" against him. The CFI rules that no final judgement is necessary.

P.S. Here is Barosso's long awaited vision for Europe.