Confirmation of annulment of EPT fine for abuse of dominance

In a judgment of 1 June 2017, the Administrative Court confirmed the annulment by the Administrative Tribunal of Decision 2014-FO-07 of the Competition Council ("Council”). In that decision, the Council had imposed a fine of 2.52 million euros on "Entreprise des Postes et Télécommunications" (“EPT”), known as “POST Luxembourg”, for abuse of its dominant position in fixed telephony and internet access services through the use of bundled discounts for fixed telephony, internet access and mobile telephony services in 2006 and 2007. This decision, adopted in November 2014, closed an examination procedure triggered by a competitor complaint in 2006.

Upon appeal, the Administrative Tribunal quashed Decision 2014-FO-07. It held that the contested decision was in manifest breach of the reasonable time requirement considering, in particular, the fact that the statement of objections was issued only in January 2014. Further, it considered that EPT’s right of access to the file was violated, notably because no access was granted to certain statistics in support of the Council’s market definition analysis. It also found one information request addressed to EPT to have presented material flaws implying its nullity. On substance, the Administrative Tribunal considered that the Council’s market definition analysis was subject to criticism and that it applied a method of analysis of the contested rebate scheme which did not respect the European Commission’s guidance in this area. The Administrative Tribunal concluded that, independently of the question of the consequences to be attached to these flaws individually, taken together, they were cause for annulment. It also concluded that a renewed analysis of the merits of the case would violate the reasonable time requirement and the principle of legal certainty.

In its appeal before the Administrative Court, the Luxembourg State contested these findings and argued that the Administrative Tribunal erred in law since it limited itself to considering that, taken together, the alleged flaws of Decision 2014-FO-07 justified its annulment.

In its judgment of 1 June, the Administrative Court confirmed with vigour the violation of the reasonable time requirement. As to the main plea, it considered that, in view also of the evolving and complex nature of competition law matters, a balancing analysis can be made on the basis of which the cumulative effect of different flaws can lead to the annulment of an administrative decision even if each of them taken individually would not have had such effect. It further found that the Administrative Tribunal rightly criticised the extent of access to the file that had been granted to EPT and the effects of certain formal defects of an information request. It also confirmed the flaws with respect to the methodology applied by the Council to analyse the alleged anti-competitive behaviour.

The judgment confirms the need for due process considerations, notably as far as the length of administrative proceedings is concerned as well as with regard to the respect of procedural guarantees, such as access by the defendant to all key documents. It is a victory for EPT whereas the fact that both courts declined to review the merits of the case leaves the complainant and possibly affected consumers empty-handed if seeking compensation for damages of the alleged anti-competitive behaviour. Finally, since there is no further appeal, the principle of the balancing analysis, retained without any precedent being cited, cannot be challenged on its legal merits, at least not within the context of this particular case.