La función de costes en actividades multiproducto

2.2.1 Administrative Procedures Competition Law

As for the practical side, there is one pertinent example for the application of vertical cooperation already in force: the sanctioning of companies that infringe competition rules. In this sector, we have, or at least had until recently, a unitary European-wide system of law enforcement. The Commission has extensive investigative powers to discover violations of competition rules and ensure the enforcement of Art. 101 and 102 TFEU (ex-Art. 81 and 82 TEC). If a cartel or monopoly is detected, the sanctioning again lies with the Commission. Judicial review is ensured by the Court of Justice. This system, as created by the old Council Regulation 17/62, was a purely vertical one: Investigation, sanctioning and judicial review were conducted under the sole responsibility of Community bodies. The new Regulation 1/2003 further develops this system and does not change its basic functioning, but introduces some horizontal elements by giving competences to the national competition authorities.

One concession must be made, however, as to the context of this sanctioning system. According to the legislation itself (Art. 23(5) of the Regulation 1/2003), the decisions of the Commission are not of a criminal law nature. What relevance has the structure of the enforcement of competition law in our ambit of study then? The

See the judgm ent of the Court of First Instance of 5 April 2006, T-279/02, Degussa v

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Commission, [2006] ECR II-879 para. 66-98, and the judgm ent of the Court of Justice C- 266/06 of 22 May 2008, para. 36-63.

For a com parative overview of the various European jurisdictions see Bassiouni, in: id. (ed.),

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Int. Crim inal Law Vol. I, p. 73ss.; Bernardi, in: Bassiouni et al. (eds.), p. 94ss.

first answer is that irrespective of whether it forms part of criminal law or of an administrative law system, the structural importance of this truly vertical system of law enforcement remains pertinent. It shows how a harmonic Europe-wide system may work and what alternatives are possible for the current functioning of European Criminal Procedure. And the second answer is that it is highly dubitable whether the wording of Art. 23(5) can change the nature of the Commission’s decisions in substance. Apart from competence issues, this framing of the issue makes it easy on sovereigntist Member States to accommodate these activities within their conceptual outlook on the EU. If we consider the actual effects of such a decision, it gets very close to decisions in criminal matters. According to Art. 23(1) of Regulation 1/2003, the Commission may impose on undertakings fines of up to 1 % of their turnover for obstructing the investigations. If an infringement of Art. 101 and 102 TFEU (ex-Art. 81 and 82 TEC) is proven, the fine may be as high as 10 % of the turnover, according to Art. 23(2) of Regulation 1/2003. Revealingly, these fines are only imposed if intentional or negligent misconduct can be proven, which is an essential element of criminal law sanctions. And the fines are as high as 10 % of the turnover in order to deter the company from infringements – deterrence being a typical aim of criminal law sanctions. It can therefore hardly be denied that the Commission’s decisions according to Art. 23(2) of the Regulation 1/2003 have a criminal law nature. And in consequence even the Court of Justice considers it as a sanction similar to a criminal sentence. In the Degussa case, it is discussed whether the rather vague determination of the exact amount of the financial sanction is in conformity with the principle of legality of penalties. This principle, which has been developed in the58

ambit of criminal law, is at issue in the present context, too, which clearly shows the59

criminal nature of the financial sanctions under Art. 23(2). For our purposes, the mechanism of direct vertical enforcement gives a valuable example of a vertical cooperation system and may even serve as a model for future cooperation in criminal matters in general.

See for details W ahl, in: Sieber et al. (eds.), Europäisches Strafrecht, § 7 para. 5ss.

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1999/352/EC (OJ L 136/20, 31.05.1999).

61

For the history of OLAF see Brüner/Spitzer, in: Sieber et al. (eds.), Europäisches Strafrecht,

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§ 43 para. 17ss.

The purely vertical system of Regulation 17/62, however, has partly been abrogated by the new Regulation 1/2003. In the context of the present research, the introduction of horizontal elements is of great interest. It is rather unexpected that a measure of vertical cooperation that is supposed to be more efficient should be subjected to elements of horizontal cooperation at a later stage. According to its Articles 11-16, a close form of cooperation between the Commission and the Member States’ national competition authorities has been introduced. It was intended to unburden the Commission of its heavy work load in prosecuting competition infringements and enable it to concentrate on matters of importance after the enlargement of the European Union. From a structural point of view, it shows how60

a development in legal cooperation can take a turn and go in another direction as well. The purely vertical system has proven to be ineffective because too much responsibility lay with the Commission. Similarly, the purely horizontal system of cooperation in classical legal aid has proven to be ineffective, too, because the responsibility was entirely with the Member States. Both approaches have their undoubted merits: A horizontal cooperation preserves national legal traditions, a vertical cooperation leads to harmonic and unitary solutions. But in practice, both systems needed to be altered in the European judicial space. The European Union is neither a system of purely international cooperation, nor a unitary supranational body, but it has elements of both spheres. This is reflected in the forms of legal cooperation which are neither horizontal nor vertical but combine elements of both structures.

OLAF

OLAF, the European anti-fraud office, was founded in 1999 through a Commission decision and acts as successor to UCLAF. Its main task is to investigate fraud61 62

against the EU-budget, corruption and similar irregular activity. In contrast to Europol and Eurojust, OLAF does not have a legal personality, but forms a part of the

W ith the respective consequences for cooperation, see Schröder, in: Sieber et al. (eds.),

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Europäisches Strafrecht, § 33 para. 19, 60ss.

Court of First Instance, judgm ent of 6 April 2006, T-309/03 - Camos-Grau; Court of First

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Instance, judgm ent of 13 July 2004, T-29/03 - Comunidad Autonoma de Andalucia. Brüner/Spitzer, in: Sieber et al. (eds.), Europäisches Strafrecht, § 43 para. 61, 64.

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Civil Service Tribunal, judgm ent of 28 April 2009, joint cases F-05/05 and F-07/05 - Schmit,

66

Violetti et al.

General Court, judgm ent of 20 May 2010, T-261/09P.

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Commission. This means that OLAF can conduct both internal and external investigations and use the Commission’s competences for external investigations. It is, on the other hand, completely independent of the Commission in fulfilling its tasks which is even subject to judicial review. Both internal and external investigations are explicitly set down as administrative procedures. This has far-reaching63

consequences for the legal framework. Even though judicial review is granted, one prerequisite set up by the Court of First Instance is that the decision in question has binding effect on the individual and is not just preparatory. Therefore, judicial review64

is in fact very limited. The Civil Service Tribunal tried to change this, but was65 66

overruled by the General Court. This means that actions which in ordinary criminal67

proceedings are subject to judicial review can only be reviewed after a binding decision in the case of OLAF.

Conclusion

The procedures in the field of competition law and anti-fraud law are based on an administrative law rationale. That this is unsatisfactory, or even illegal, because it evades the application of fundamental guarantees of a criminal procedure has often been demonstrated and does not need to be reiterated here. Since this criticism has been taken on board, but the need for genuine European prosecution has remained, the institutional setting is subject to gradual change. The idea of a European public prosecutor has long been under discussion, but it is particularly relevant now that the Lisbon treaty has finally provided a basis for creating it. Since a European public prosecutor would in all probability take its basis in Eurojust as intended by the treaty, it is obvious that there is no clear distinction between horizontal and vertical cooperation and that both elements will always be prevalent in any form of

OJ C 316/2 of 27 Novem ber 1995.

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See Neumann, in: Sieber et al. (eds.), Europäisches Strafrecht, § 44 para. 5.

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cooperation. Still, it is necessary to clearly see the differences in the functioning of the horizontal and the vertical mechanism, and to know the advantages and disadvantages for the relevant area of criminal procedure so that a balanced legal framework can be developed for primarily vertical forms of cooperation. I will therefore first outline the existing European prosecution institutions and show their functioning, even though they are mainly founded on a horizontal cooperation basis. I will then outline how this will change when a European Public Prosecution is going to be set up, how this will affect the working of judicial cooperation and particularly individuals’ rights in this context.

2.2.2 Criminal procedures