The Gazette 1993

SEPTEMBER 1993

extent with the Commission's views on

the rules on State aids in Article 92 of

the Treaty. As with Article 85, the

point of departure is a blanket

prohibition, followed by the criteria for

suspending this prohibition. The

grounds on which the Commission

may consider State aid compatible with

the Treaty set out in Article 92.3 must

always be assessed on the basis of

Community, not national or purely

regional objectives and from a

Community rather than a national

standpoint

. If, for example, reduction

in overcapacity is claimed as the

justification for exempting a restrictive

agreement or allowing State aid, the

anticipated resulting benefits will be

considered from a Community, rather

than a national or regional, sectoral

perspective.

Exemptions and national

competition law

The Court of Justice accepts the

principle of the concurrent jurisdiction

of Community and national

competition law codes in recognition

of the fact that they are designed to

protect different interests, i.e. the

preservation of effective competition in

intra-Community trade

and

within

national territories

respectively. In

examining the precise question of the

extent to which an Article 85.3

exemption, given its nature as

described above, can in some sense

predetermine or limit the application of

national law, two general and well

established principles of EEC law

should be of help to us:

• the supremacy of Community law

over national law where their provis-

ions or application are in conflict,

! • the need for uniform application of

Community law.

One of the main Court judgments on

this question of the relationship

between Community and national

competition was in the

Walt Wilhelm

case (1969)

. This was an Article 177

referral. Walt Wilhelm argued at the

German Court hearing that proceedings

against them under German anti-trust

law should not be maintained because

they were at the same time the subject

of parallel proceedings by the EEC

Commission under Article 85. The

Court of Justice said:

"Conflicts between the rules of the

Community and national rules in

the matter of the law on cartels

must be resolved by applying the

principle that Community law

takes precedence.

It follows from the foregoing that

should it prove that a decision of a

national authority regarding an

agreement would be incompatible

with a decision adopted by the

Commission at the culmination of

the procedure initiated by it, the

national authority is required to

take proper account of the effects

of the latter decision.

Where, during national

proceedings, it appears possible

that the decision to be taken by the

Commission at the culmination of

a procedure still in progress

concerning the same agreement

may conflict with the effects of

the decision of the national

authorities, it is for the latter to

take the appropriate measures."

A more recent relevant Commission

decision was the

Synthetic Fibres

case

of 1984 where the Commission

authorised a limited cartel arrangement

between producers designed to achieve

a reduction in Community over-

capacity which met all the standard

conditions for exemption. The cartel

arrangement could have fallen foul of

competition law in some individual

Member States but the Commission

decision which drew exclusively on

| Community criteria prevailed

In practical terms it would seem that a

national court or authority is prohibited

I from taking a decision which would

take from or frustrate the effectiveness

of an exemption granted to the parties

to an agreement under Article 85.3. To

quote the Court in

Walt Wilhelm

again:

"The imperative force of the

Treaty and of acts issued in

implementation of it could not

vary from State to State by the

effect of internal acts, without the

functioning of the Community

system being obstructed and the

attainment of the aims of the

Treaty being placed in peril".

In theory a national authority could

! find that on examining the facts of a

particular case that the provisions

governing its purely "domestic"

content could somehow be isolated

from its "intra-Community trade"

content and a more strict national

competition law could be applied to the

latter without frustrating the protection

of the Community exemption afforded

to the former. But if this latter

protection is put at risk by a national

authority, then there would appear to

i be no longer uniform or effective

application of Community law and the

parties would suffer as a consequence,

The more an agreement is designed to

apply uniformly throughout a Member

State (e.g. appointing a single

exclusive distributor for a product

imported into the Republic) the more

theoretical this isolation of the

"domestic" and "intra-Community

! trade" elements becomes.

I The scope for conflict between an

i individual

exemption decision and

national competition law may initially

appear less than in the case of a

block

exemption because the facts underlying |

the former will have been scrutinised

by both authorities under the elaborate

consultation process between the

Commission and Member States in

Article 85/86 cases. A block exemption !

does not consider the facts of an

| individual case.

Against this, however, there are strong

arguments against attaching any lower !

status to the protection afforded by a

block exemption than that afforded by

I an individual exemption:

! • The drafting of the Block

Exemption Regulation is itself the

subject of elaborate consultations

with the Member States. The

Commission can only adopt it if

and when it has built up a sufficient

individual case experience

• A block exemption sometimes has

a "safety valve" clause whereby the

Commission can withdraw the

protection afforded by it in a

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