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Schneider Electric SA v. Commission: Regarding the Non-contractual Liability of the Commission the Decision of the Court of First Instance is Consistent with Precedent
Published online by Cambridge University Press: 06 March 2019
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The question before the Court of First Instance concerned the legitimacy of the Commission's decision on a merger of two French companies incorporated under French law, Schneider Electric SA (hereafter Schneider SA) and Legrand SA (hereafter Legrand). On 16 February 2001 Schneider SA and Legrand, in accordance with the requirements on Regulation of mergers, notified the Commission of Schneider's proposal to make a public offer in respect to all the shares in Legrand held by the public. The judgment of the Court of First Instance can be considered an important step in the development of the European Commission's liability, particularly in respect to the Commission's liability in its role as watchdog of the common market. The judgment puts flesh on the skeletal set of existing principles concerning the liability of the European Community, and contributes to the creation of a systematic approach to the case law.
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References
1 See “Whereas No. 782”: “OVERALL CONCLUSION (782) For the reasons set out above, the Commission has come to the conclusion that the notified transaction would create a dominant position with the effect of significantly restricting effective competition on the following markets: the markets in moulded case circuit breakers, miniature circuit breakers and cabinets for distribution boards in Italy; the markets in miniature circuit breakers, earth leakage protection and enclosures for final panelboards in Denmark, Spain, Italy and Portugal; the markets in mains connection circuit breakers in France and Portugal; the market in cable trays in the United Kingdom; the market in sockets and switches in Greece; the market in weatherproof wiring accessories in Spain; the market in fixing and connecting equipment in France; the market in transformation equipment in France; the market in control and signalling units in France”. 2994/275/EC Commission Decision of 10 October 2001 declaring a concentration to be incompatible with the common market – Council Regulation (EEC) No 4064/89 (Cesa Comp/M. 2283 – Schneider/Legrand) (Notified under document number C (2001) 3014), in 2004 O.J. (L 101) 1-133.Google Scholar
2 Case T-77/02, Schneider Electric SA v. European Commission, 2002 E.C.R. II-4201 (Schneider II). The same day, the Court of First Instance decided also on the case arising on 13 December 2001 (Case T-310/01 [Schneider I]), annulling the decision on separation: Case T-310/01, Schneider Electric SA v. Commission of European Community, 2002 E.C.R. II-4071. For a casenote see, J. Steenbergen, Schneider/Legrand – Early Conclusions for Merger Control and its Review by the European Court of First Instance, Europäisches Wettbewerbsrecht im Umbruch 271 (2004).Google Scholar
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6 See C-308/87, Grifoni v. Euratom, 1994 E.C.R. I-753: “The Court has consistently held that the Community's non-contractual liability and the right to compensation for damage suffered depend on the coincidence of a set of conditions as regards the unlawfulness of the acts alleged against the institution, the fact of damage, and the existence of a direct link in the chain of causality between the wrongful act and the damage complained of.”Google Scholar
7 The expression is used by Schousboe, C. U., The Concept of Damage as an Element of the Non-contractual Liability of the European Community, available at http://www.rettid.dk/artikler/2003.afh-3.pdf. See T. C. Hartley, The Foundations of European Community Law 451 (4th ed. 1998).Google Scholar
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9 1997 O.J. (L 180) 1.Google Scholar
10 2004 O.J. (L 024) 1-22. See Article 26.Google Scholar
11 See “Whereas No. 28 and 29” Reg. n. 4064/89.Google Scholar
12 See par. 16 of the judgment: Case C-26/81, SA Oleifici Mediterranei v. EEC, 1982 E.C.R. 3057. The judgment recalls the case law. See Joined Cases 5, 7, 13 A 24/66, E. Kampffmeyer et al. v. Commission CEE, in 1967 E.C.R. 288 (the Commission was declared liable but there was not a systematic framework of non-contractual liability). See also Case T-267/94, Oleifici Italiani Spa v. Commission, 1997 E.C.R. II-1239 (also mentioning the principle of protection of legitimate expectations). See, for example, paragraph 27 of the Spa decision: “[…] The principle of protection of legitimate expectations requires steps to be taken to avoid the economic interests of traders who have made major investments and have definitively undertaken, vis-ä-vis the public authorities, to carry out particular operations, being injured as a result of the entry into force of rules whose adoption was not foreseeable.” See also Case T-175/94, International Procurement Services v. Commission, 1996 E.C.R. II-179, par. 44; Case T- 336/94, Efisol SA v. Commission, 1996 E.C.R. II-546, par. 30; Case T-383/00, Beamglow Ldt v. European Parliament et al., 2005 E.C.R. II-5459, par. 95 (“It is settled case law that in order for the Community to incur non-contractual liability under the second paragraph of Article 288 EC for unlawful conduct of its institutions a number of conditions must be satisfied: the institutions’ conduct must be unlawful, actual damage must have been suffered and there must be a causal link between the conduct and the damage pleaded.”); Joined Cases T-198/95; T-171/96; T-230/97; T-174/98 and T-225/99, Comafrica SpA et al. v. Commission C, 2001 E.C.R. I-3408, par.134; Court of First Instance, Third Chamber, 17 October 2002, n. 180, 10, Foro Amm. CdS 2306 (2002); Court of First Instance, Fourth Chamber, 24 April 2002, n. 220, Ellliniki Viomichania Opion AE European Community Council, Riv. dir. internaz. priv. e proc. 1104 (2002); Court of First Instance, Second Chamber, 15 January 2003, n. 377, Philips Morris International Inc. v. Commission, 1, Foro Amm. CdS 14 (2003); Court of First Instance, Fifth Chamber, 6 March, 2003, n. 57, Banan Kompaniet AB et al. v. European Community Council, 4, Foro It. 573 (IV) (2003). On the causal link see, in particular, Case T-178/98, Fresh Marine SA v. Commission, 2000 E.C.R. II-3331, par. 118 (“There is a causal link for the purposes of Article 215 of the Treaty where there is a direct causal nexus between the fault committed by the institution concerned and the injury pleaded, the burden of proof of which rests on the applicant […]. The community cannot be held liable for any damage other than that which is sufficiently direct consequence of the misconduct of the institution concerned […]”); Case C-308/87, Grifoni v. European Community for Atomic Energy, 1990 E.C.R. I-1203, par. 6.Google Scholar
13 See Case 5/71 Zuckerfabrik Schöppenstedt v. Counc. 1971 E.C.R. 975 (“in cases involving measures of economic policy, the breach of the superior rule of law has to be sufficiently serious.“).Google Scholar
14 See Case C-352/98, Bergaderm e Goupil v. Commission, 2000 E.C.R. I-5291, par. 42; Case C-237/98 P, Dorsch Consult Ingenieursellschaft mbH v. Council UE and Commission, 2000 E.C.R. I-2938, par. 17; Case C-146/91, Koinopraxia Enópraxia Georgikón Synetairismón Diacheiríseos Enchorín Proïónton Syn. PE (KYDEP) v. Commission, 1995 E.C.R. I-4199, par. 19.Google Scholar
15 See Case C-285/05, Holcim (Deutschland) AG v. Commission, 2007 E.C.R. I-1347, par. 47 and 50.Google Scholar
16 Case C-472/00, Commission v. Fresh Marine, 2003 E.C.R. I-5647, par. 25-27; Case T-178/98, Fresh Marine v. Commission, 2000 E.C.R. II-3331. See also Case T-170/00, Förde-Reederei GmbH v. Council and Commission, 2000 E.C.R. I-239, par. 37. These three conditions are the same requested for the liability of Member States in case of breach of Community Law. See Joined Cases 6 and 9/90, Francovich and Bonifaci v. Italy, 1, Giur. It. 1169 (1992). See also Joined Cases C-46/93 and C-48/93, Brasserie du pecheur SA, 2, Giur. It., 145 (1997).Google Scholar
17 See, in particular, paragraph 125 of the judgment.Google Scholar
18 It is worth mentioning that the judicial review of the Court is expressly stated in Article 9, paragraph, Regulation n. 139/2004. “In accordance with the relevant provisions of the Treaty, any Member State may appeal to the Court of justice, and in particular request the application of Article 243 of the Treaty, for the purpose of applying its national competition law”.Google Scholar
19 See Schousboe, supra note 7, at 11.Google Scholar
20 Paras. n. 345 and 346 of the judgment.Google Scholar
21 Toth, A.G., The Concepts of Damage and Causality as Elements of Non-contractual Liability, in The Action for Damages in Community Law 179 (Heukels & McDonnell eds., 1997). Recently, see Case 331/05, Internationaler Hilfsfonds eV v. Commission EC, 2007 E.C.R (not yet published).Google Scholar
22 As mentioned above, the Court came to the following conclusion, at para 288 of the judgment: “Il existe en revanche un lien de causalité suffisamment étroit pour ouvrir un droit ä indemnisation entre l'illégalité commise et deux types e préjudice supportés par la requérante.”Google Scholar
23 Para. 270 of the judgment. See also Case C-104/89 DEP J.M. Mulder and Others v. Council of the European Union and Commission of the European Communities, 2004 E.C.R. I-1.Google Scholar
24 “The poison is in the tail.”Google Scholar
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