Prestaciones del Sistema Nacional de Pensiones

The doctrine of provisional validity introduced a qualification to the principle that Article 85 (2) applies automatically to agreements within Article 85 (1) . Briefly summarised, in accordance with Article 7 of Regulation 17 and the principle of legal certainty^\ the Community Court ruled in the Bosch case“

“ Compare the "dilatory notifications" made to prevent or block proceedings before national authorities. Commission Notice on cooperation with national authorities, O.J. C 313, of 15.10.97, p 3, point 55. The Commission will not give such notifications priority. See on the possibility to notify after a national court has rendered a decision, 5.5.4 below.

” The principle of legal certainty means that the application of the law to a specific situation must be predictable. This is a firmly established principle of EC law.

“ De Geus v Bosch. Case 13/61, [1962] E.C.R. 45, [1962] C.M.L.R. 1. The Community Court relied on the principle of legal certainty which it derived from the general principles of law in Member States and ruled that agreements made before Regulation 17 came into force and duly notified should be treated as provisionally valid until the Commission had issued a decision. This provisional validity was justified also on the ground that Article 7 of Regulation 17 provides for retrospective validation if the agreement is later altered so as not to infringe Article 85 (1) or to merit exemption. Regulation 17 was passed after the start of proceedings in De Geus v Bosch so there was time to verify the situation.

that agreements that have either been duly notified to the Commission or are excused from notification under Article 4 (2) of Regulation 17^ enjoy provisional validity until the Commission has issued a decision.

In subsequent cases“ , the Court went further and ruled that, until that time, the notified agreement should be given its full legal effect and be treated by a national court as legally enforceable^*.

For the doctrine to apply, however, the agreement in question must not only be notified or exempt from notification but it must also be old, i.e. made before the date of entry into

Pursuant to Article 4 (2) (1) of Regulation 17, an agreement is exempt from notification when only undertakings from a single Member State are parties to it and it does not relate to imports or exports between Member States.

See for example. De Bloos v Bouyer. case 59/77 [1977] E.C.R. 2359, [1978] 1 C.M.L.R. 529; Portelanae v Smith Corona Marchant Int'1 [1974] C.M.L.R. 397 at 419; and Bilaer v Jehle. case 43/69, [1970] E.C.R. 127, [1974] 1 C.M.L.R. 382 at 393.

-* In De Bloos. see previous footnote, the agreement included an export ban which would have prevented not only the group exemption Regulation 67/67 from applying, but also the Commission from granting an exemption. Nevertheless the Community Court ruled that at paras 8-16:

"during the period between notification and the date on which the Commission takes a decision, courts before which proceedings are brought relating to an old agreement duly notified or exempted from notification, must give such an agreement the legal effects thereto under the law applicable to the contract, and those effects cannot be called in question by any objection which may be raised concerning its compatibility with Article 85 (1)."

During the period prior to the Commission's decision on a duly notified old agreement, a national court was therefore held to have no jurisdiction to make a finding of nullity under Article 85 (2), not even for the future. Provisional validity enabled these agreements to be enforced under domestic contract law despite infringement of Article 85 (1).

The doctrine thus increased legal certainty in respect of old agreements and clarified the situation for national courts. National courts could not invoke EC competition law to adjourn

the case in order to enable the Commission to condemn it. Instead, a party wanting to rely on the nullity of the agreement had to make a complaint to the Commission and wait for the Commission to condemn it before deciding to infringe it. Korah, Provisional Validity and the Rule of Reason, [1981] 3 Northwestern Journal of Int'l L&B, p 320 at 332.

force of Regulation 17/62: 13 March 1962. This was decided in Brasserie de Haecht v Wilkin JJ” by an explicit rejection by the Community Court of provisional validity for new agreements^®.

One reason for this limitation to old agreements is that the doctrine of provisional validity represents a compromise developed by the Community Court between, on the one hand, the need for legal certainty^® underlying the special provisions for such agreements laid down in Article 7 of Regulation 17^° and, on the other hand, the intention of Article 85 (2) which is to attach severe sanctions to the prohibition^^.

Case 48/72) [1973] E.C.R. 77.

® [1973] E.C.R. 77 at 86 and 87. After having observed that there were no transitional provisions in Regulation 17 and that the national court was required to treat agreements within Article 85 (1) as void without enjoying the power to grant retrospective exemptions as conferred on the Commission, the Court decided to confirm provisional validity for old agreements but in respect of new agreements that fall within Article 85 (1) , the Court held, at paras 9 and 10, that these are invalid even before being condemned by the Commission:

"In the case of old agreements, the general principle of contractual certainty requires, particularly when the agreement has been notified in accordance with the provisions of Regulation No 17, that the [national] court may only declare it to be automatically void after the Commission has taken a decision by virtue of that Regulation. In the case of new agreements, as the Regulation assumes that so long as the Commission has not taken a decision the agreement can only be implemented at the parties’ own risk, it follows that notifications in accordance with Article 4 (1) of Regulation No 17 do not have suspensive effect."

For national courts the doctrine had the advantage of clarity: notified old agreements might be enforced regardless the risk of conflict in the form of a subsequent Commission condemnation.

This Article provides for retrospective validation of old agreements if the agreement is later altered so as to not infringe Article 85 (1) or to merit exemption.

See EEC Competition Law in National Courts, ed. Behrens, 1992, part I, United Kingdom and Italy, by Shaw and Ligustro, p 91.

A second reason was that the doctrine was difficult to reconcile with Article 85 (2) of the Treaty^^.

Thirdly, the extent of the validity was unclear too: what if the Commission would later condemn an agreement which was enforced earlier by a national court? Presumably, the validity for the period before the decision will remain, otherwise the position for the parties would be impossible: a national court would, upon request, have to enforce the contract and the same contract might later be condemned by the Commission with retroactive effect^\ The issue was never decided.

Finally, the Commission, short of resources, preferred to rely on the automatic nullity of Article 85 (2) rather than having to intervene in every case enjoying provisional validity. The Community Court therefore limited the doctrine of provisional validity to old agreements only and held that notification of new agreements did not have suspensive effect.

In later case law, provisional validity was also held to apply in the same way to new agreements that are exact reproductions of a standard contract concluded before 13 May 1963 and duly notified^*.

Although the Community Court never expressed a view as to whether the doctrine of provisional validity applies to "accession agreements" (agreements which became subject to EC

Waelbroeck, 4 Le Droit de la Communauté Economique Européen. Concurrence, Megret, 1972 at 161 - 178.

This book was written before de Haecht II and probably accounts for the judgment. The second edition of this book came out in 1996 under the same title. Vol. 4 Concurrence, Brussels.

See on retrospective exemption in respect of new agreements 5.2.2. and 5.5.4. below.

Parfums Rochas v Bitsch. case 1/70, [1970] E.C.R. 515, [1971] C.M.L.R. 104, at para 6. Note, moreover, VBBB v Eldi, case 106/79, [1980] E.C.R. 1137, [1980] 3 C.M.L.R. 719 where an agreement which was not an exact copy of an old agreement was held to enjoy provisional validity. The case concerned an agreement which, after it was notified in 1962, had been made less restrictive but which was modified again at a later stage in order to make it more restrictive. The Community Court treated the agreement nevertheless as an old agreement enjoying provisional validity because the agreement was not more restrictive than it had been at the moment it was notified.

competition law owing to accession of new Member States), it is commonly accepted that it does“ . Duly notified agreements entered into before the relevant date of accession of a Member State and notified within six months of accession enjoy provisional validity.

In De Bloos^^, the doctrine was held to end where the Commission has taken a decision. However, in Lancome^’’, the Community Court decided that legal certainty no longer necessitated provisional validity for old agreements where the

“ In 1973, the Commission argued that it should apply to accession agreements (Third Report on Competition Policv. p 19). A literal reading of Article 25 of Regulation 17/62, added in

1972 and adapted by each of the accession Treaties, supports this view and it has been applied subsequently at national level. See for example, an English court in Esso Petroleum Co Ltd v Kinaswood Motors (Addlestone) Ltd. [1974] QB 142. This case concerned an exclusive purchasing contract concluded in 1969. The Judge referred to the classification in Regulation 17 between old and new agreements :

"in the original regulation that meant agreements which had been entered into before the making of the Regulation in 1962 and after, but as that Regulation is adapted to apply to the countries who entered the Community on January 1 1973, the Regulation has the effect of treating pre-1973 agreements as old agreements and post 1973-agreements as new agreements. We are therefore concerned with an old agreement".

The Judge then relied on Bilaer v Jehle. case 43/69, [1970] E.C.R. 127, and concluded that the agreement was exempt from notification under Article 4 (2) (1) of Regulation 17 since it did not concern import or export between Member States. He then concluded on the basis of Brasserie de Haecht (II). case 48/72,

[1973] E.C.R. 77, that the agreement was clearly enforceable pending a Commission decision. See also: L*Créai v De Nieuwe

[1980] E.C.R. 3775, [1981] 2 C.M.L.R. 235.

De Bloos V Bouyer. see footnotes 15 and 16 supra.

SA Lancome and Cosparf ranee Nederland BV v Et os BV and Albert Heiin Supermarkt B V . case 99/79 [1980] E.C.R. 2511 [1981]