The Revised Informal Guidance Regime Brings Little to the Table – If Any

The Revised Informal Guidance Regime Brings Little to the Table - If Any

Previous 7 days, the European Fee adopted an up to date variation of its Casual Steering Discover (“the IGN”), the mechanism that allows firms to search for clarity about the compliance of specific routines with EU competition regulation. The material of the IGN is animated by “steering letters”, informal paperwork intended to give lawful certainty to undertakings facing novel or unresolved issues that are not able to be answered by way of recourse to current means, this kind of as circumstance legislation of the Union Courts or Fee rules. The Detect replaces its former counterpart, which was issued after the entry into drive of Regulation 1/2003. This transient piece evaluates no matter if the current Discover provides about substantial differences. As the title implies, it is extremely tough to argue that it does.



As acknowledged, the modernization of European level of competition regulation observed the discontinuation of the notification treatment, in accordance to which, undertakings were being expected to notify their intended operations to the Commission. Immediately after evaluation, the Commission would in turn present the undertaking with a adverse clearance choice, reworking the provisional validity of a observe into official validity. On the other hand, Union enlargement and the completion of the single market in the 1990s greatly elevated the workload of the Fee, prompting it to depend on fast and informal approaches to offer assurances to firms. In opposition to this background, the convenience letter was born.

Due to the fact Regulation 1/2003 abolishes the notification treatment, undertakings in essence relied on present guidance, in the kind of decisional practice, rules, and scenario legislation, to self-assess the compatibility of their pursuits with opposition regulation. Back in the day, several commentators lamented the diminished possibility for the Commission to situation casual assistance. Some, like Cortese, (inaccurately) speculated that non-infringement choices enshrined beneath Article 10 of the Regulation could confirm fruitful. As an alternative, the Commission opted for adopting a straightforward Detect, below the auspices of which only those people ventures elevating truly novel level of competition law issues would be gained.

The observe document of the old Detect has been nothing short of abysmal. As the Fee by itself concedes, given that 2004, several undertakings approached it to get hold of advice letters, and none succeeded. The principal rationale behind the disappointment is the truth that steering letters represented an “all-loss, no-acquire” predicament. In particular, the Notice required numerous criteria to be glad for the Fee to consider issuing a advice letter – which delivered small worth to its receiver owing to a lack of binding legal consequences.


Various Various but Exact?

How does the revised Informal Steering Notice fare in assuaging the deficiencies of its expired edition? In line with the more mature Discover, the IGN sets out a selection of strict criteria that undertakings require to satisfy in get to be qualified for a direction letter. In other text, gratifying these ailments only opens the route to an application for the letter, not its reception. In essence, there are two these ailments: a truly novel competition law concern that continue being unanswered by existing sorts of steerage, and a favourable preliminary assessment by the Commission regarding the soundness of the software.

The next criterion establishes no matter whether it is legitimate to provide steerage on the software of Article content 101 and 102 TFEU to the agreement or unilateral practice in query. It depends on the evaluation of a plethora of more sub-criteria, which includes:

  • The Commission’s curiosity in supplying steerage, which refers to the likely existence of included value to be derived from clarifying the software of the law by means of a direction letter. The Fee determines this added worth to lawful certainty by thinking about the economic relevance of the goods and expert services concerned by the exercise, irrespective of whether the activity is in line with its enforcement priorities or Union fascination, the magnitude of investments accompanying the exercise, and no matter whether it expects the exercise to manifest commonly through the EU.
  • Lis pendens, which suggests that in scenarios in which the contents of the novel issue (or very similar issues) are the subject matter to proceedings in advance of the Union Courts, Member Condition courts, or a nationwide competitors authority.

There are other questionable factors of the IGN that did not go through any transformation in any way. For occasion, there still is a need to offer thorough details for the envisaged settlement/practice, and the Commission receives to maintain that facts for any long run proceedings. Moreover, in scenarios where undertakings control to conquer the earlier mentioned hurdles and get a assistance letter, the steering contained therein is conditional upon the factual situations furnished.

Also, the Commission emphasizes that direction letters issued through the IGN remain a mere part of the overall “self-assessment package deal” they confer no rights on undertakings and create no binding pressure.

Lastly, the IGN preserves the need to have for a dilemma to conform to the enforcement priorities of the Fee. [1] The reasoning behind this rule is to reduce the oblique resurrection of comfort letters. This criterion lowers the chance of an software remaining built. Considering that undertakings want to give in-depth details on their real or prospective enterprise methods, the vast swath of discretion accorded to the Commission with regard to designating its enforcement priorities endangers the prospective clients of getting a direction letter. [2]

It is not tricky to envisage that in such a condition, undertakings will really feel as if they effectively incriminate on their own, in particular looking at that the Fee is at liberty to open up infringement proceedings less than Regulation 1/2003, based mostly on or relying on the information and facts provided by the undertaking. The Commission’s independence to do so has been prolonged verified in instances like BVGD and Diamanthandel.


In Look for of a Drop of Change

Even though the IGN mostly reflects the point out of engage in of the old mechanism, it also brings about minimal dissimilarities. Having said that, these improvements are generally cosmetic and reflect the proven scenario legislation.

As recognized, the Commission may perhaps not be estopped from relying on the contents of a request for a advice letter to initiate even more proceedings. The new IGN qualifies this statement by introducing that, in circumstances exactly where an undertaking relies on a guidance letter, in good faith, to go forward with an agreement or exercise, the Fee will not impose financial penalties.

At initial glance, this modification may perhaps feel like a welcomed improvement. Even so, the fact is additional intricate and largely illusory. Initially, think about that pecuniary penalties represent merely the immediate prices an enterprise faces in circumstance of a productive prosecution. There are also oblique expenses concerned when the Fee strikes down a complex world wide web of agreements or a significantly pricey company undertaking.

As quite a few Advocate-Common thoughts remarked, the direction presented by the Commission could direct undertakings to derive realistic anticipations that need to have to be accounted for, really should the authority wish to convert again on an before blessing, significantly as the interval amongst the letter and an investigation extends further more.

Second, the commitment that bona fide undertakings will not incur a high-quality arrives with its individual clarification. Accordingly, if the factual components provided by the endeavor that gave rise to a assistance letter materially improve, the endeavor can’t be taken to have acted in excellent religion. Even even though the IGN does not determine “material change”, facts can be teased out from circumstance law. For instance, Langnese – Iglo, confirms that the entry of new opponents or a (slight) alteration in the current market construction (these kinds of as an raise/lessen of industry shares) qualify as variations major adequate to justify the retraction of a steerage letter. If a eco-friendly-lighted settlement turns out to be a profitable organization and generates current market shares for the undertaking, it would hence be relatively uncomplicated for the Commission to invoke that content change has occurred, and the undertaking had as a result not acted in excellent religion. In my look at, this sort of a threat by itself transforms the IGN system into an effectiveness offence in disguise. [3]

Apart from the higher than details, a accurate novelty does current itself in the IGN: the inclusion of “Union curiosity” in the requirements for assessing whether or not to challenge a assistance letter. Set briefly, together with its enforcement priorities, the Fee will be empowered to also consider the value of an envisaged arrangement (these kinds of as a non-entirely purposeful joint venture) vis-à-vis jobs of popular European interest. The prospect of elevating the pandemic-induced Short-term Framework of comfort and ease letters into a normalized framework has been permeating antitrust conversations currently. In that regard, the provision of a comfort and ease letter to GAIA-X, a consortium of European know-how firms doing the job on details interoperability and cybersecurity, appears like a frontrunner of an emerging trend.



The revised casual steerage see delivers very little additional worth. Much of the document continues to be faithful to its former counterpart, and the revisions that do adhere out have a tendency to be either recitations of current case regulation or incapable of inducing extraordinary adjust.

Whilst the explicit inclusion of a Union interest criterion in the conditions for issuing a steerage letter is definitely novel, its concrete outcomes may possibly leave anything to be ideal. All in all, it would be rather surprising not to see another footnote in a Commission report many years from now, lamenting that undertakings are reluctant to use the IGN. The underlying motive would be relatively obvious: steerage letters however symbolize an all-reduction, no-get circumstance.



[1] Back again in the times of Regulation 17 (changed by Regulation 1/2003), the Commission would sometimes near a request for a ease and comfort letter by assuring the endeavor that its carry out does not constitute an enforcement precedence (“soreness letter”).

[2] Whilst the extent of discretionary flexibility the Fee enjoys is not easily discernible from the circumstance law. For instance, in Beef Sector Advancement Modern society, there is an implicit argument that, even in times of crisis, the Commission cannot shy away from investigating methods that are perhaps anticompetitive by item. One more case in point in this regard is BP v Fee. Perplexingly, in those situations involving possible “by object” arrangements, where it may be argued that the Commission is “compelled” to concern a assistance letter, it would have no incentive to do so – since it can initiate proceedings to assess a opportunity infringement instead.

[3] There is also controversy concerning regardless of whether the Commission would be ready to merely adjust its lawful assessment of an arrangement/practice to override an earlier steering letter. The circumstance legislation solutions that dilemma in the optimistic, diminishing the small benefit provided by the IGN even more.

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