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Transport – Competition: CFI Makes Landmark Decision in MyTravel Dilemma
Emanuel De Duonni
On 9 September 2008, the European Court of First Instance (CFI) rejected the claim for EUR 654 million in damages against the European Commission brought before them by MyTravel, a UK-based holiday company. In September 1999, the Commission had rejected MyTravel’s application to merge with a well-established UK competitor, First Choice, on the basis that it would lead to a collective dominant position within the UK market. In 2002, the CFI annulled the Commission’s decision, holding that the requisite degree of negative effects on competition had not been proven. In that decision, the CFI pointed out that the Commission had made errors of assessment.
The CFI decided, however, that the Commission’s decision to prohibit the acquisition of First Choice did not make the Community liable for damages, since it did not manifestly and gravely infringe Community law. The decision clearly reflects the high threshold required to bring a damages claim against the Commission, and it appears to remain a priority for the European Courts to insulate the Commission in its role as a regulatory authority. An appeal (concerning solely the relevant points of law) may be brought before the European Court of Justice.
Food & Beverage – Trade: European Community Not Liable for Infringing WTO Law
The European Court of Justice (ECJ) has dismissed appeals by two Italian companies seeking damages from the European Commission. The claim was made in relation to revenue lost due to US-imposed tariffs that were created in response to an EC quota system for banana imports. The ECJ decided that the European Community cannot be held liable under existing laws for damages arising out of EU laws that infringe the World Trade Organisation Agreement. This case confirms that those caught in the crossfire of a trade war cannot expect compensation from the European Union.
Finance: Commission Supports Launch of Pan-European SEPA Direct Debit Scheme
The European Commission and the European Central Bank (ECB) are encouraging the European Payments Council to move ahead with the launch of the Single Euro Payments Area (SEPA) Direct Debit Scheme. Direct debits allow bank customers to pay their bills by authorising companies to withdraw money directly from their bank accounts. Currently there are separate national schemes and it is not possible to establish direct debit arrangements across European borders. Under the SEPA Direct Debit Scheme, bank customers would be able to arrange direct debits to pay companies in any of the 31 European countries (the 27 EU Member States plus Iceland, Liechtenstein, Norway and Switzerland) participating in SEPA. The Commission and ECB recognise the potential advantages of such a scheme in terms of economies of scale and increased competition, allowing consumers and companies to benefit from improved efficiency and innovation. In order to facilitate the implementation of the scheme, interchange fees may be imposed for a limited transitional phase, with the SEPA Direct Debit Scheme taking effect in November 2009.
Chemicals – Regulatory: New EU Pesticide Rules Take Effect on 1 September 2008
New harmonised rules concerning Maximum Residue Levels (MRLs) for pesticides took effect in the European Union on 1 September 2008. The new rules, contained in Regulation (EC) No 396/2005, harmonise the MRL rules of all 27 Member States and provide for a common EU assessment of pesticides. The new rules cover approximately 1,100 pesticides used in connection with agriculture inside or outside the European Union. They also identify specific MRLs for over 300 agricultural products as well as certain processed food products. The MRLs prescribed in the new rules also account for different sensitivities among certain consumers, e.g., babies and children.
Food & Beverage – Regulatory: Commission Clears Imports of GM Soybean Strain
The European Commission has approved the import of a strain of genetically modified (GM) soybean. The bean, which bears the moniker A25704-12, was developed by a German biotechnology firm and is now authorised to be brought into Europe to be used in food or animal feed for the next ten years. The decision was taken by the Commission after EU Member States failed to reach an agreement on the subject. The Commission has given its approval following the opinion of the European Food Safety Authority, which found in August 2007 that the soybean is unlikely to have any adverse effect on human or animal health or on the environment. The Commission has also stressed that any product generated from this GM soybean will be subject to the European Union’s labelling and traceability rules.
Justice & Home Affairs: ECJ Declares EU Implementation of UN Sanctions Illegal
Contact Philip Bentley
The European Court of Justice (ECJ) has annulled the European Union’s implementation of the UN sanctions against the Taliban and Al Qaeda. The UN Sanctions Committee requires UN member countries to freeze the assets of people put on a “blacklist” who are believed, or proven to be, associated with the Taliban or Al Qaeda. The blacklist is enforced in the European Union by means of Regulation 881/2002 which is binding in its entirety upon all 27 EU Member States. The ECJ was asked to rule on Case C-402/05 P, Kadi v Council and Commission. This case involved a challenge to Regulation 881/2002 by two individuals placed upon the UN blacklist who, as a consequence, were made subject to Regulation 881/2002. The parties considered that the European Union did not have competence to act in this area and that the EU Regulation infringed human rights, in particular the right of property and rights of defence.
The ECJ held that the European Union did have competence to legislate in this area. However, while the ECJ recognised the importance of such sanctions for security, it considered that Regulation 881/2002 nonetheless failed to conform with human rights. In particular, the ECJ considered that the rights of defence were not satisfied because there were no means for an individual to be informed of the reasons for their placement on the UN blacklist or to challenge this. This is the first time the ECJ has taken jurisdiction over UN sanctions, which had been thought to fall outside the ECJ’s competence. The Judgment means that such UN sanctions must conform to basic EU norms when implemented in the European Union. The ECJ has given the European Union three months to re-adopt a new Regulation that puts in place the necessary guarantees for the protection of human rights.
NEXT WEEK’S EVENTS
Monday 15 September – Friday 19 September 2008
General Affairs & External Relations Council (15 – 16 September 2008)
COURT OF JUSTICE
Joined Cases C-468/06, C-469/06, C-470/06, C-471/06, C-472/06, C-473/06, C-474/06, C-475/06, C-476/06, C-477/06, C-478/06 Sot. Lélos kai Sia
C-514/06 P Armacell v Office for Harmonisation in the Internal Market
C-288/07 Isle of Wight Council and Others
C-391/07 Glencore Grain Rotterdam
Approximation of laws
C-442/07 Verein Radetzky-Orden
Free movement of capital
C-282/07 Truck Center
Freedom of establishment
C-161/07 Commission v Austria
COURT OF FIRST INSTANCE
T-47/07 ratiopharm v OHMI (BioGeneriX)
T-48/07 ratiopharm v OHMI (BioGeneriX)
T-218/06 Neurim Pharmaceuticals (1991) v OHMI - Eurim-Pharm Arzneimittel (Neurim PHARMACEUTICALS)
T-10/07 FVB v OHMI - FVD (FVB)
T-226/07 Prana Haus v OHMI (PRANAHAUS)