Keywords
Summary

Keywords

1. Appeals – Legal interest in bringing proceedings – Condition – Appeal capable of procuring an advantage for the party bringing it

2. Competition – Administrative procedure – Commission’s powers of investigation – Power to require the production of a communication between a lawyer and client – Limits – Protection of confidentiality of such a communication – Extent – Exclusion of communications with in-house lawyers

3. European Union law – Principles – Equal treatment – Concept – Limits

(Charter of Fundamental Rights of the European Union, Arts 20 and 21)

4. Competition – Administrative procedure – Commission’s powers of investigation – Power to require the production of a communication between a lawyer and client – Limits – Protection of confidentiality of such a communication – Extent – Exclusion of communications with in-house lawyers

(Council Regulation No 1/2003)

5. European Union law – Principles – Rights of the defence – Application to proceedings in which sanctions may be imposed

(Charter of Fundamental Rights of the European Union, Art. 48(2))

6. Competition – Administrative procedure – Commission’s powers of investigation – Power to require the production of a communication between a lawyer and client – Limits – Protection of confidentiality of such a communication – Extent – Exclusion of communications with in-house lawyers

(Arts 101 TFEU and 102 TFEU; Council Regulations No 17 and No 1/2003)

7. European Union law – Direct effect – Individual rights – Safeguard by the national courts – Action at law – Principle of national procedural autonomy

8. Competition – Administrative procedure – Commission’s powers of investigation – Power to require the production of a communication between a lawyer and client

(Council Regulations No 17, Art. 14(6), and No 1/2003, Art. 20(6))

9. European Union – Exclusive jurisdiction – Provisions necessary for the functioning of the internal market – Rules of procedure with respect to competition law – Included

(Art. 3(1)(b), TFEU, 101 TFEU to 103 TFEU and 105 TFEU; Council Regulations No 17, Art. 14, and No 1/2003, Art. 20)

Summary

1. A legal interest in bringing proceedings is a condition of admissibility which must continue until the court has adjudicated on the substance of the case.

Furthermore, in appeal proceedings such an interest exists as long as the appeal may, if successful, procure an advantage for the party bringing it.

With respect to competition law, an undertaking’s legal interest in bringing proceedings against a Commission decision refusing to return to it documents or to destroy any copies of them, by reason of a breach of legal professional privilege between a lawyer and his client in the course of investigations, continues at least as long as the Commission has the documents or copies of them. Any breach of legal professional privilege in the course of investigations does not take place when the Commission relies on a privileged document, but when such a document is seized by one of its officials.

(see paras 22-23, 25)

2. The benefit of legal professional privilege with respect to communications between lawyers and their clients is subject to two cumulative conditions. First, the exchange with the lawyers must be connected to the client’s rights of defence and, second, the exchange must emanate from independent lawyers, that is to say, lawyers who are not bound to the client by a relationship of employment.

It follows that the requirement of independence means that there should exist no employment relationship between the lawyer and his client, so that legal professional privilege does not cover exchanges within a company or group with in-house lawyers.

The concept of the independence of lawyers is determined not only positively, that is by reference to professional ethical obligations, but also negatively, by the absence of an employment relationship. An in-house lawyer, despite his enrolment with a Bar or Law Society and the professional ethical obligations to which he is, as a result, subject, does not enjoy the same degree of independence of his employer as a lawyer working in an external law firm does in relation to his client. Consequently, an in-house lawyer is less able to deal effectively with any conflicts between his professional obligations and the aims of his client.

An in-house lawyer cannot, whatever guarantees he has in the exercise of his profession, be treated in the same way as an external lawyer, because he occupies the position of an employee which, by its very nature, does not allow him to ignore the commercial strategies pursued by his employer, and thereby affects his ability to exercise professional independence.

Furthermore, under the terms of his contract of employment, an in-house lawyer may be required to carry out other tasks which may have an effect on the commercial policy of the undertaking and which cannot but reinforce the close ties between the lawyer and his employer.

It follows that, because both of an in-house lawyer’s economic dependence and of the close ties with his employer, he does not enjoy a level of professional independence comparable to that of an external lawyer.

In-house lawyers being in a fundamentally different position from that of external lawyers, so that their respective circumstances are not comparable, no breach of the principle of equal treatment results from the different treatment of those professionals with respect to legal professional privilege.

Even assuming that the consultation of in-house lawyers employed by the undertaking or group were to be covered by the right to obtain legal advice and representation, that would not exclude the application, where in-house lawyers are involved, of certain restrictions and rules relating to the exercise of the profession without that being regarded as adversely affecting the rights of the defence.

Finally, the fact that, in the course of an investigation by the Commission, legal professional privilege is limited to exchanges with external lawyers in no way undermines the principle of legal certainty.

(see paras 40-41, 44-45, 47-49, 58-59, 95, 106)

3. The principle of equal treatment, which requires comparable situations not to be treated differently and different situations not to be treated in the same way unless such treatment is objectively justified, is a general principle of European Union law, laid down in Articles 20 and 21 of the Charter of Fundamental Rights of the European Union.

(see paras 54-55)

4. The Court stated, in its reasoning in the judgment in Case 155/79 AM & S Europe v Commission [1982] ECR 1575 relating to legal professional privilege in investigation procedures in matters of competition law, that that area of European Union law must take into account the principles and concepts common to the laws of the Member States concerning the observance of confidentiality, in particular, as regards certain communications between lawyer and client. For that purpose, the Court compared various national laws. The Court acknowledged, on the basis of that comparison, that legal professional privilege should be protected under European Union law, so long as certain conditions were fulfilled.

In the years that have passed since the judgment in Case 155/79 AM & S Europe v Commission was delivered, no predominant trend towards protection under legal professional privilege of communications within a company or group with in-house lawyers may be discerned in the legal systems of the 27 Member States of the European Union. The legal situation in the Member States of the European Union has not evolved to an extent that would justify a change in the case‑law and recognition for in-house lawyers of the benefit of legal professional privilege.

Furthermore, although it is true that Regulation 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty, has introduced a great number of amendments to the rules of procedure relating to European Union competition law, there is nothing in those rules to suggest that they require lawyers in independent practice and in-house lawyers to be treated in the same way with respect to legal professional privilege, for that principle is not at all the subject-matter of the regulation which aims to reinforce the extent of the Commission’s powers of inspection, in particular as regards documents which may be the subject of such measures. Nor, therefore, can the amendment of the rules of procedure for competition law, resulting in particular from that regulation, justify a change in the case-law established by the judgment in AM & S Europe v Commission.

(see paras 69-70, 74, 76, 83, 86-87)

5. In all proceedings in which sanctions, especially fines or penalty payments, may be imposed observance of the rights of the defence is a fundamental principle of European Union law laid down in Article 48(2) of the Charter of Fundamental Right of the European Union.

(see para. 92)

6. The Commission’s powers under Regulation No 17 and Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty may be distinguished from those in enquiries which can be carried out at national level. Both types of procedure are based on a division of powers between the various competition authorities. The rules on legal professional privilege may, therefore, vary according to that division of powers and the rules relevant to it.

Restrictive practices are viewed differently by European Union law and national law. Whilst Articles 101 TFEU and 102 TFEU view them in the light of the obstacles which may result for trade between the Member States, each body of national legislation proceeds on the basis of considerations peculiar to it and considers restrictive practices solely in that context.

In those circumstances, the undertakings whose premises are searched in the course of a competition investigation are able to determine their rights and obligations vis-à-vis the competent authorities and the law applicable, as, for example, the treatment of documents likely to be seized in the course of such an investigation and whether the undertakings concerned are entitled to rely on legal professional privilege in respect of communications with in-house lawyers. The undertakings can therefore determine their position in the light of the powers of those authorities and specifically of those concerning the seizure of documents.

The principle of legal certainty does not, therefore, require identical criteria to be applied as regards legal professional privilege in those two types of procedure.

(see paras 102-105)

7. In accordance with the principle of national procedural autonomy, there being no European Union rules to govern the matter, it is for the domestic legal system of each Member State to designate the courts and tribunals having jurisdiction and to lay down the detailed procedural rules governing actions for safeguarding rights which individuals derive from European Union law.

That principle may not be relied on against a decision taken by an institution of the European Union on the basis of a regulation adopted at European Union level, which, moreover, makes no renvoi back to national law.

(see paras 113-114)

8. The uniform interpretation and application of the principle of legal professional privilege at European Union level are essential in order that inspections by the Commission in anti-trust proceedings may be carried out in conditions in which the undertakings concerned are treated equally. If that were not the case, the use of rules or legal concepts in national law and deriving from the legislation of a Member State would adversely affect the unity of European Union law. Such an interpretation and application of that legal system cannot depend on the place of the inspection or any specific features of the national rules.

In investigations conducted by the Commission as European competition authority, national law is applicable only in so far as the authorities of the Member States lend their assistance, in particular with a view to overcoming opposition by the undertakings concerned through the use of coercive measures, in accordance with Article 14(6) of Regulation No 17 or Article 20(6) of Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty. However, the question of which documents and business records the Commission may examine and copy as part of its inspections under antitrust legislation is determined exclusively in accordance with EU law.

(see paras 115, 119)

9. The rules of procedure with respect to competition law, as set out in Article 14 of Regulation No 17 and Article 20 of Regulation No 1/2003 on the implementation of the rules of competition laid down in Articles 81 and 82 of the Treaty, are part of the provisions necessary for the functioning of the internal market whose adoption is part of the exclusive competence conferred on the Union by virtue of Article 3(1)(b) TFEU.

In accordance with the provisions of Article 103 TFEU, it is for the European Union to lay down the regulations or directives to give effect to the principles in Articles 101 TFEU and 102 TFEU concerning the competition rules applicable to undertakings. That power is, in particular, intended to ensure observance of the prohibitions referred to in those articles by the imposition of fines and periodic penalty payments and to define the Commission’s role in the application of those provisions.

In that connection, Article 105 TFEU provides that the Commission is to ensure the application of the principles laid down in Articles 101 TFEU and 102 TFEU and to investigate cases of suspected infringement.

Accordingly, neither the principle of national procedural autonomy nor the principle of conferred powers may be invoked against the powers enjoyed by the Commission in the area in question.

(see paras 116-118, 120)