Intel(ligence) in the application of competition law

The European Court of Justice decision in the Intel case makes waves across the competition world and it is perceived as a revolution-in-judges-clothes in the realm of the enforcement of the competition rules.

Is it so? The answer is affirmative, in my view, but only to the extent that it reminds the European Commission the spirit of the prohibition laid down in the article 102 TFEU and its general duty to pay attention to the individual conditions of a case, notwithstanding what the Commission thinks is wrong. 

Among the paragraphs in which the reasoning of the Grand Chamber of ECJ is encapsulated, para.138 marks the turning point in the approach to abuse of dominance cases. Whilst upholding the precedent case law which established that companies in dominant positions have a ”special responsibility” not to affect competition (Michelin, 1983 and Post Danmark, 2012) and that loyalty rebates are per se unlawful (Hoffman-LaRoche, 1979), the Court draws the attention to the fact that a company in dominant position should be allowed to demonstrate/be listened when it does so ”that its conduct was not capable of restricting competition and, in particular, of producing the alleged foreclosure effects.”

This consideration seems to take into account that the European Commission is not relieved of its duty to demonstrate the ”intrinsic capacity of that practice to foreclose competitors which are at least as efficient as the dominant undertaking.” and, moreover, that the competition enforcer is bound ”to assess the possible existence of a strategy aiming to exclude competitors that are at least as efficient as the dominant undertaking from the market”. Ups!  The special responsibility is not an absolute obligation and it does not trigger an objective liability of a dominant undertaking. The old issue of the fault remains applicable and must be included in the analysis of the enforcers. The burden of proof is not reversed even if the case at stake seems to match the findings of ECJ in Michelin, Post Denmark or Hoffman-La Roche.  

The ECJ decision in Intel is sending a strong signal to the European Commission that even if the law and the case-law established legal presumptions, working in its favour, these do not exempt the authority from putting at least a thin layer of facts and analysis at the basis of its case. From the law school, we learned that legal presumptions are instruments which facilitate the application of a legal provisions if a given set of facts exist, based on precedents showing that such an outcome is very likely.  Legal presumptions assist but do not replace a full-fledged analysis and reasoning, and do not diminish the legal standards for the burden of proof. Presumptions allow their beneficiaries to jump over a long and sometimes complicated process for proving the entire chain of causation but absent a layer of facts and basic analysis, that could be well a jump into the void – a false positive, in other words. 

In this respect, Intel is similar to the decision of ECJ in Groupement de Cartes Bancaires (2014), in which ECJ basically issued an implicit warning to the European Commission that is too superficial when assessing potential infringements of article 101 TFEU.

Hence, ECJ is consistent with its approach when asking the European Commission not to jump into the void and if Intel signals a revolution, this had to happen.  Competition law is a serious matter and this holds true also for the competition authority, which have the skills, the information and the duty to assess the behaviours of the undertakings in an intelligent manner.