I
Privilege against self-incrimination in EU Competition law – Undertaking's
right to remain silent
The University of Amsterdam The Faculty of Law
European Competition Law and Regulation
Master’s thesis Lauri Putkonen 18.7.2016
II Abstract
This thesis analyses the substantive and the personal scope of the privilege against self-incrimination in European Union competition law. This privilege in the field of competition law is a judicial creation established by the European Court of Justice and the European Court of First Instance. The examination of the subject is divided into two sections; first the personal scope of the privilege according to the Regulation 1/2003 which gives the Commission the power to investigate and second, the substantive scope according to the case law regarding the privilege.
The original EU treaties did not contain any system of fundamental rights protection and it was not until late 60s when the European courts started to pay attention to these rights. Nowadays fundamental rights are part of the primary law in the European Union and their importance is increasing. Also certain administrative proceedings, such as competition law proceedings, could be considered criminal by its nature as meant in ECHR 6(1) if the Engel criteria are fulfilled, which means that also the privilege against self-incrimination could be invoked by the undertakings in competition law proceedings.
Even though not particularly mentioned in Article 6 of the ECHR, the article grants an undertaking under investigation a right to avoid self-incrimination and/or the right to remain silent when questioned. The substantive scope covers the clarification between permitted questions, which the Commission is allowed to ask from the undertakings, such as purely factual questions, and non-permitted, incriminating questions, which are relating more on subjective notions such as the purpose or objectives of conduct. The personal scope in turn encompasses the consideration that who can use the voice of the undertakings and therefore enjoy the privilege. Based on the assessment of these two main issues, the thesis provides an answer to how broad is the undertaking’s right to remain silent in EU competition procedures when alleged to have infringed the competition rules covered in Articles 101 and 102 TFEU. Keywords: article 6 ECHR; articles 101 and 102 TFEU; Commission; competition enforcement; competition law; dawn raids; European Union; European Court of Human Rights; European Court of Justice; fundamental rights; notion of undertaking; privilege against self-incrimination; Regulation 1/2003; request for information; right to remain silent
II
Table of contents
LIST OF ABBREVIATIONS ... III
1. INTRODUCTION ... 1
1.1 Background ... 1
1.2 Defining the scope ... 3
2. PRIVILEGE AGAINST SELF-INCRIMINATION IN EUROPEAN COMPETITION LAW ... 7
2.1 Fundamental rights in European Union law ... 7
2.2 Privilege against self-incrimination ... 8
2.2.1 Criminal proceedings ... 8
2.2.2 Applying the privilege in EU competition law proceedings ... 10
2.2.3 Who can enjoy the privilege against self-incrimination? ... 12
2.3 The legal framework of the privilege against self-incrimination ... 14
3. THE COMMISSION’S POWERS OF INVESTIGATION VS. UNDERTAKINGS’ DUTY TO COOPERATE AND THE PERSONAL SCOPE OF THE PRIVILEGE AGAINST SELF-INCRIMINATION ... 16
3.1 Regulation 1/2003 – Legal basis for the privilege ... 16
3.1.1 Commission’s investigatory powers ... 16
3.1.2 Article 18 of Regulation 1/2003 – Requests for information ... 17
3.1.3 Article 20 of Regulation 1/2003 – Powers of inspection ... 19
3.1.4 Article 21 of Regulation 1/2003 – Inspection of other premises ... 20
3.1.5 Self-incrimination principle and dawn raids ... 20
3.1.6 Self-incrimination and leniency ... 21
3.1.7 Obligation to cooperate actively vs. privilege against self-incrimination ... 22
3.1.8 Exchange of information and differing national standards ... 23
3.2 The current personal scope of the privilege – What the notion of undertaking covers? ... 24
4. SUBSTANTIVE SCOPE OF THE PRIVILEGE AGAINST SELF-INCRIMINATION – DEVELOPMENT THROUGH CASE LAW ... 25
4.1 The Orkem rule – Setting up the scope of the privilege against self-incrimination ... 25
4.2 Expanding the substantive scope – Challenge of the Orkem principle ... 29
4.3 Use of coercive powers ... 30
4.4 Return to Orkem rule ... 31
4.5 Answers obtained by under compulsion – Excluded from the privilege ... 32
4.6 Separation between purely factual and incriminating questions ... 33
4.7 The current substantive scope of the privilege ... 34
5. CONCLUSIONS ... 35
III
LIST OF ABBREVIATIONS
CBb College van Beroep voor het bedrijfsleven
CFI The Court of First Instance
CHARTER The Charter of Fundamental Rights of the European Union
CML Rev Common Market Law Review
CMLR Common Market Law Reports
CONVENTION The European Convention for the Protection of Human Rights and Fundamental Freedoms
EAGCP Economy Advisory Group on Competition Policy
EC The European Community
ECHR European Convention on Human Rights
ECtHR European Court of Human Rights
ECJ The European Court of Justice
ECN European Competition Network
ECLR European Competition Law Review
ECR European Court Report
EGC The General Court of the European Union
EHRR European Human Rights Reports
EU European Union
IDEM Previously cited source
DG COMP Directorate General for Competition
OJ Official journal of the European Union
NCA National Competition Authority
TEU Treaty on European Union
1
1. INTRODUCTION
1.1 Background
This paper aims to assess the substantive (material) and the personal scope of the undertakings right to remain silent when investigated by the Commission or national competition authority. This particular topic was selected due to the fact that either the relevant courts or the legal journals and literature had not discussed it properly so far.
Privilege against self-incrimination, as many other privileges in European Union (EU) competition law level, is a judicial creation established by the European Court of Justice (ECJ) and the European Court of First Instance (CFI).1 The real challenges appear when there is an issue that the aforesaid courts have not handled yet. Even though we can find some amount of case law about the interpretation of the substantive and personal scope of the privilege, a lot of questions remain still undiscovered. I will give one example of the challenges of both, the personal and the substantive scope of the privilege.
First the personal scope; could an ex-employee invoke a right to remain silent when questioned by the national competition authority in connection with an investigation into his former employer? The question sounds simple. It related to the bigger question about who can use the voice of the undertaking and represent it. As this paper will show, the answer is anything but a clear-cut.
There seems to be no straight answers for this question by the European Union courts, but only one national ruling from the Netherlands. In that case, Dutch Trade and Industry Appeals Tribunal (College van Beroep voor het bedrijfsleven, CBb) gave two judgments on 21 December 2012 (LJN: BY70312, LJN: BY70263), in which it overruled both of the Dutch Competition Authority’s decisions to impose fines to ex-employees who had refused to cooperate with the officials of the Dutch national competition authority (NCA). These employees had failed to answer questions during the NCA’s investigation into the historical behaviour of their former employer. Contrary to NCA’s opinion, CBb stated that also former
1 Case 155/79 AM&S (1982) ECR 1575, paras 18 – 28. 2 ECLI:NL:CBB:2012:BY7031.
2 employees can enjoy the privilege against self-incrimination and have the right to remain silent to the extent that the inquiries made by the NCA concerned a period in which the person was still employed by the Undertaking alleged to have infringed the competition rules and was under investigation. Dutch NCA’s reasoning was totally rejected and CBb considered that it would be an unwarranted restriction of the right against self incrimination if the former employees could not invoke the right to remain silent when they are questioned on the behaviour of their former employer during a time they were still working for that company.
CBb referred to the broad scope of the duty to cooperate4 under Dutch law and after all, it seems pretty clear that former employees can invoke the undertaking’s right to remain silent under Dutch competition law. In most of the EU competition law cases, a former employee is interrogated without being suspected of “de facto directorship5” and therefore enjoys a right to remain silent.
In European Union system the obligation to cooperate with investigations is limited to undertakings and there is no obligation for individuals to cooperate with the Commission or national competition authorities. It is somewhat surprising that the personal scope of the privilege against self-incrimination is far from clear and the significant questions – who can “act as an undertaking” or “use the voice of undertaking” during the investigation processes are not ascertained.
Second example is about the substantive scope; what kind of documents the undertaking alleged to have infringed the competition law is obliged to produce, when the Commission is asking questions from it? The substantive scope of the privilege against self-incrimination is built on the grounds of the case law from the ECJ and CFI. The challenge here occur because of the fact that when these two European courts are developing EU law, they have to take account the rulings from the European Court of Human Rights (ECtHR).6 However, these have taken a different way of an approach when determining the substantive scope of the
4 As stated in Regulation 1/2003, in European Union system, the obligation to cooperate with investigations is limited to undertakings and therefore individual are excluded from that obligation.
5 The CBb used the Dutch word ”feitelijk leidinggeven”, which means a person who performs the acts or duties
of a director (not a de jure director) or is judged to be a director in law.
6 Although the legal system of EU is not bound by the case law of the ECtHR, the ECHR can be seen as a compilation of common constitutional traditions of the Member States, which the ECJ has to respect. The relation between ECJ and ECtHR will be discussed in more detailed level in Chapter 2.
3 privilege.7 The ECJ has applied a bit narrower scope for the privilege stating that the requests of information, which are factual by their nature (factual questions), should be allowed to be made by the Commission. The ECtHR by contrast, has excluded the use of evidence of any answers that are obtained from the alleged undertaking through compulsory questioning during non-judicial investigations. That includes also answers given to purely factual question.8 This contradiction between the courts together with the fact that the substantive scope privilege is evolving all the time will leave many questions open. This thesis will try to give answers for these questions.
1.2 Defining the scope
In this study, “Privilege against self-incrimination in EU Competition law – Undertakings
right to remain silent”, the research question consists of two main aspects, which are the
substantive and the personal scope of the privilege against self-incrimination in European competition law. Answering the research question will help to clarify the scope of the privilege for undertakings under investigation. Undertakings have certain rights when the Commission is investigating them and these rights include the privilege against self-incrimination. This paper aims to find out, how broad is the right to remain silent when the Commission (or NCA) has performed a dawn raid and is asking questions from alleged undertaking and what it actually covers, meaning factual questions, pre-existing documents, voluntary answers, exchange of information etc. (substantive) and who can use the voice of the undertaking and therefore enjoy the privilege (personal scope).
Chapter 2 will set out the standards for applying fundamental rights in European competition law focussing naturally on privilege against self-incrimination. The relation between fundamental rights issues and the general European Union law is complicated; Cases against the EU cannot be brought in ECtHR but the ECJ has ruled that the Member States cannot escape their human rights obligations by stating that they were actually implementing EU law.9
7 Chapter 4 will go more deep in analysing the differences between the ECtHR and European courts when determining the substantive scope of the privilege against self-incrimination.
8 Wils (2003), p. 22.
9 Opinion 2/13 of the Court of 18 December 2014: Accession by the Union to the European Convention for the Protection of Human Rights and Fundamental Freedoms, ECLI:EU:C:2014:2454, paras 37 – 40.
4 We have already seen a lot, and are likely to see more and more fundamental rights arguments in competition law proceedings in the future. One reason for this is the increasing amount of competition law offences being criminalized in the last couple of decades. Since the increasing impact of fundamental rights arguments, the privilege against self-incrimination will most probably be more and more significant tool for undertakings to defend themselves against the accusations of violating the competition rules.
It is crucial to know the circumstances under which the undertakings can invoke the privilege, which means that certain criterions have to be fulfilled in order to apply the privilege. Only after that it makes sense to analyse the substantive and personal scope of the privilege in more detailed level.
Chapter 3 is the starting point for the analysis of research question. The Commission’s powers to investigate and undertakings rights to remain silent (which are limitations to the Commission’s powers) could be seen as counterparts. This relation is important to clarify in order to make clear the tension between these two. This chapter covers both the substantive and personal scope of the issue but will concentrate more on the personal scope.
Because of the fact that Member States of European Union (Member States) have granted large amount of investigative and procedural powers in the Regulation 1/2003 (former Regulation 17/65) to the European Commission for the implementation of Articles 101 and 102 TFEU (former Articles 81 and 82 of the EC Treaty), the Commission has a major role in the competition law investigations. Undertakings have an obligation to cooperate actively with the Commission, when the latter is fulfilling its duties assigned by the Regulation 1/2003 (Regulation). According to the Article 18 of the Regulation, undertakings are obliged to provide all necessary information, when the Commission has made a request or decision to provide such information whereas the Article 19 gives the Commission the right to take statements. That means that the Commission may interview any natural or legal persons who consent to be interviewed for collecting information relating to the subject matter of an investigation. The owners of the undertakings or other persons authorised to represent them by law are obliged to supply the information on behalf of the undertaking concerned.
This thesis is focusing especially on undertakings and tries to uncover what are the rights of the undertaking to remain silent and to what extent they should cooperate with the Commission and national competition authorities during the investigation procedures.
5 Comparison between the obligation to cooperate and its relation to the right to remain silent is really important in order to reveal the status of the undertaking alleged to have infringed the competition rules – To what extent the undertakings have to produce documents and answer questions? This interplay between the Commission’s powers to investigate and ask questions and the undertakings duty to cooperate is core of the chapter 3. After this we have the framework of the relation of these two counterparts and it is easier to move on to chapter 4 and reveal the substantive scope more precisely.
Chapter 4 continues the analysis by clarifying the substantive scope with the help of case law from CFI, ECJ and ECtHR. In European competition law level, the privilege against self-incrimination was established and developed by the ECJ and CFI. These two in turn have to take account the jurisdiction of the ECtHR. The substantive scope of the privilege is mainly built up by means of the judgments of these courts. It has developed a lot since the first ruling in Orkem.10This chapter will continue from where the chapter 3 left and give a detailed analysis of the substantive scope. It is very common for competition regulation that the definitions in acts are left quite open and are also flexible, which intrinsically increases the value of case law. Competition authorities and the European courts therefore have a great influence on the future development of the competition law.11 Together with the wording of the competition regulation in question, the interpretation of case law often helps to find the outcome that contributes the development of competition law in the best possible way. After analysing both substantive and personal scope of the privilege, it is time to make conclusions in chapter 5.
When interpreting the EU competition law, it is extremely important to be aware of the relevant case law and the treaties, which the whole legal system in Europe is based on. The importance of primary sources is emphasized in the classical legal method. That is why this thesis is written from the classical legal method (doctrinal/positivist) perspective, and therefore will concentrate on answering the questions of law from internal perspective. Classical legal method is built on the existing legal sources, such as laws, international treaties (e.g. TEU and TFEU), relevant case law (case law of the CFI, ECJ, ECtHR), the
10 Case 347/87 Orkem v Commission (1989) ECR 3283. 11 Kuoppamäki, p. 10.
6 existing legal doctrine and legislative proposals.12 The wording of competition regulation is usually enough to determine how competition law should be interpreted in concrete. However, since the privilege against self-incrimination is not outright established in the treaties or regulations, we also have to concentrate on the wording and development of the case law in order to get the bigger picture.
This thesis encompasses only the competition regulation in European Union and does not go deep in analysing the situation in any specific Member States. The used source material contains legal publications, books, case law and other sources such as discussion papers from the Commission, opinions of Advocate Generals and different guidance papers from the Commission. With the help of the above-mentioned sources, this study will aim to clarify the existing legal framework, which is affecting to the self-incrimination rule in the field of competition law. Main focus is on the primary sources but secondary sources13 are also used to explain and interpret the primary sources.
The privilege against self-incrimination provides to separate rights – a right to remain silent and a right not to incriminate oneself.14 Therefore the wording “privilege against self-incrimination” will be used in this paper to denote both of these elements. The wording competition law infringements/enforcement in turn refers mainly to anti-competitive behaviour prohibited under articles 101 and 102 TFEU.15
12 E.g. the Commission’s working papers and documents, which have been made for helping the interpretation of certain competition regulations. We still have to take into account that the legislative proposals do not have the same value than for example in Nordic legal system.
13 Privilege against self-incrimination is not comprehensively dealt with the secondary sources, and that was one reason to put more effort on the primary sources.
14 Ovey – White, p. 174. The privilege underlies the fundamental legal principle, that a person is innocent until proven guilty.
7
2. PRIVILEGE AGAINST SELF-INCRIMINATION IN EUROPEAN
COMPETITION LAW
”The Court recalls that, although not specifically mentioned in Article 6 of the Convention,
the right to silence and the right not to incriminate oneself are generally recognized international standards which lie at the heart of the notion of a fair procedure under Article 6.”16
- Saunders v United Kingdom (1996) 2.1 Fundamental rights in European Union law
When the Lisbon Treaty came into force on December 1 in 2009, the Charter of Fundamental Rights of the European Union (the Charter) became legally binding in accordance with Article 6(1) of the TEU.17 Article 6(1) TEU states stat “The Union recognises the rights,
freedoms, and principles set out in the Charter of Fundamental Rights of the European Union… which shall have the same legal values as the Treaties.” Article 6(2) TEU in turn
opened up the possibility for EU to accede to the European Convention for the Protection of Human Rights and Fundamental Freedoms (the Convention). Article 6(3) TEU refers to general principles of law as guaranteed by the ECHR and constitutional traditions common to the Member States.
The original EU treaties18 did not contain a system of fundamental rights protection. The emphasis at that time was more on the creation of the common market establishing the free movement of persons, capital, services and goods.19 Member States thought that their own national constitutions were the best guarantee of protection of these rights.20 In series of cases in the 1950s and 1960s, the ECJ was unwilling to treat fundamental rights as a part of EU’s legal order.21After the signature of the Treaty of Rome in 1957, it took more than 10 years from the ECJ to make any reference to the protection of fundamental rights.22 Since cases
16 Saunders v United Kingdom (17.12.1996), para 68.
17 See Opinion 2/13 of the Court of 18 December 2014: Accession by the Union to the European Convention for the Protection of Human Rights and Fundamental Freedoms, ECLI:EU:C:2014:2454.
18 Treaty establishing the European Coal and Steel Community, 18.4.1951, Paris and Treaty establishing the European Economic Community, 25.3.1957, Rome.
19 Arestis, p. 2.
20 Craig – De Búrca (2011), p. 465 – 477.
21 Case 1/58 Stork v High Authority (1959) ECR 17, Case 40/59 Geitling v High Authority (1960) ECR 423 and Case 40/64 Sgarlata v Commission (1965) ECR 215.
8
Van Eick23 in 1968 and Stauder24 in 1969, the case law started to change in a way that also EU institutions were bound to take fundamental principles account while exercising their powers.25 That basically meant that the ECJ would interpret EU measures in the light of fundamental rights instruments, although these rights still had second-order status, without having any written provision in the Treaties.26 After Stauder, the well-known Internationale
Handelsgesellschaft judgment was published. The German Federal Constitutional Court was
asked to revoke an EU measure concerning forfeiture of an export-licence deposit which was claimed to violate German constitutional rights and principles. The ECJ held that there was no violation of fundamental rights but stated that respect for fundamental rights forms an integral part of the general principles of law, which the ECJ has to protect and the protection of such rights (inspired by the constitutional traditions common to the Member States) must be ensured within the framework of the structure and objectives of the Union.27 Forty years from these rulings, Treaty of Lisbon attached fundamental rights to primary sources. The Charter and the general principles of EU law are now ranked as primary law of EU law and the number of case law dealing with the fundamental rights issues is growing rapidly.28 2.2 Privilege against self-incrimination
2.2.1 Criminal proceedings
The privilege against self-incrimination (nemo tenetur) means the act of incriminating yourself, or saying something, which shows you are guilty.29 The right to remain silent constitutes a small but significant part of the defendant’s rights as a whole. The right to remain silent and the general right to a fair trial have a strong relation to each other’s. The right to a fair trial is dealt in Article 6 of the European Convention of Human Rights (ECHR) but that specific Article says nothing about the right to remain silent.
23 Case 35/67 Van Eick v Commission (1968) ECR 329.
24 Case 29/69 Stauder (1969), ECR 419, para 7, which stated the following: “Interpreted in this way the
provision at issue contains nothing capable of prejudicing the fundamental human rights enshrined in the general principles of Community law and protected by the Court.“
25 Idem. According to the Court, EU institution staff disciplinary procedures were ”bound in the exercise of its
powers to observe the fundamental principles of the law of procedure.”
26 Chalmers – Monti, p. 251.
27 Case 11/70 Internationale Handelsgesellschaft v Einfuhr- und Vorratstelle für Getreide und Futtermittel (1970) ERC 1125.
28 Craig – De Búrca 2015, p. 380. 29 Collin, p. 272.
9 The right to remain silent is a legal right recognized in many of the world’s legal systems. The cover of principle is usually known as the right of the accused or the defendant to refuse to give any comments or provide answer when questioned prior to or during legal proceedings in a court of law. This can mean either right to avoid self-incrimination or the right to remain silent when questioned. In criminal investigations, the prosecution must prove its case without forcing the accused to give evidence through coercion and oppression. The accused cannot be compelled to say where documents are hidden or how other evidence against him may be provided nor be compelled to give access to incriminating evidence or to admit one’s part in the crime.30
Self-incrimination can occur directly or indirectly. Directly means that the suspect made a statement, which was self-incriminating during the interrogation, while indirectly means that the statement was made voluntarily without the pressure from another person. Therefore, the privilege against self-incrimination equals the right not to be obliged to produce evidence against oneself, which encompasses the right to remain silent and not to answer questions.31 Article 6 of the ECHR is a provision, which aims to protect the right to fair trial. Article 6(1) protects mainly the public hearing in front of an independent and impartial tribunal, Article 6(2) the presumption of innocence and Article 6(3) other minimum rights for those charged in a criminal case. Even though not particularly mentioned in the Article, undertakings privilege against self-incrimination and right to remain silent have been implied into the Article by the ECtHR in various judgments on the fairness of criminal trials, which constitute the main framework for the principle.32The European Court of Human Rights stated in
Saunders, that the reasoning of the privilege against self-incrimination ”lies, inter alia, in the protection of the accused against improper compulsion by the authorities thereby contributing to the avoidance of miscarriages of justice and to the fulfilment of the aims of Article 6”.33
30 Steytler, p. 335 – 342.
31 Wils (2003), p. 9 – 10.
32 E.g. Case 374/87 Orkem (1989) ECR 3283, Case 27/88 Solvay & Cie v Commission (1989) ECR 3355, Engel and others v Netherlands (1976) 1 EHRR 647, Funke v France (1993) 16 EHRR 297 and Saunders v United Kingdom (1997) 23 EHRR 313, which all had a major impact on both the establishment and development of the principle. See also Ashworth, p. 751 – 752.
10 Support for the privilege could also be found from the Chapter VI of the Charter of Fundamental Rights of the European Union. Articles 47 (right to an effective remedy and to a fair trial) and 48 (presumption of innocence and right of defence) prevent the Commission from compelling undertakings to provide answers, which would involve an admission to their participation in competition law infringements.34
2.2.2 Applying the privilege in EU competition law proceedings
Although the privilege against self-incrimination in most often applicable only to criminal offences, there are some circumstances under which the scope of the principle could be extended also to administrative decisions in which certain sanctions could be imposed. In order to determine whether the proceedings involve the determination of criminal charge under Article 6 ECtHR, the Court has to analyse the nature of the offence, the classification of the offence under domestic law and the nature and severity of the penalty. These requirements are called the Engel criteria according to the case Engel.35
By means of the Engels criteria courts can assess whether certain administrative proceeding could be considered criminal by its nature as meant in ECHR 6(1).36 The first Engel criterion is the categorisation of an alleged offence in the domestic law as criminal nature; the second is the nature of the offence and third nature and degree of severity of the possible penalty. Article 6 ECHR is applicable if any of these three elements is fulfilled, so the Engels criteria are non-cumulative. The courts have to perform an overall consideration when deciding whether certain act matches with one of these criterions. 37
In Jussila v Finland, the ECtHR separated the “hard core of criminal law” apart from other types of criminal process, such as administrative and competition law sanctions. In competition law proceedings it is not usually a matter of hard core of criminal law and
34 Cardonnel – Wahl, p. 427.
35 Engel and others v Netherlands (1976) 1 EHRR 647, para 82, in which the Court said the following: ”In this
connection, it is first necessary to know whether the provision(s) defining the offence charged belong, according to the legal system of the respondent State, to criminal law, disciplinary law or both concurrently. The very nature of the offence is a factor of greater import. When a serviceman finds himself accused of an act or omission allegedly contravening a legal rule governing the operation of the armed forces, the State may in principle employ against him disciplinary law rather than criminal law.” See also Slater – Waelbroeck, p. 6.
36 Jones – Sufrin, p. 936.
11 interpreting analogically the Jussila distinction, the requirement to use Article 6 of the ECHR are not that strict these types of infringements:38
“There are clearly ''criminal charges'' of differing weight. What is more, the
autonomous interpretation adopted by the Convention institutions of the notion of a ''criminal charge'' by applying the Engel criteria have underpinned a gradual broadening of the criminal head to cases not strictly belonging to the traditional categories of the criminal law, for example --- competition law.”39
In Jussila, the ECHR broadened the area of criminality stating that competition law is an example of a field of law that falls inside the boundaries of criminal law. After the jurisprudence of the ECtHR in Jussila and Engel, it was cleat that Article 6 ECHR covered also wide range of administrative proceedings.40 In Menariri, the ECtHR reaffirmed its stance that competition law proceedings fall under the full protection of Article 6 ECHR.41 The ECJ in turn accepted the criminal character of competition law fines in Hüls42 and in Dansk Rørindustri43. In competition law procedures, the protection of ECHR starts when the
Commission informs the alleged undertakings in writing of the objection against them. Therefore, the applicability of Article 6 ECHR requires that there is a trial.44
The problematic issue here is that what types of competition procedures could be considered criminal under the ECHR. The ECtHR and academic literature have not so far dealt with the issue whether the scope should be extended to all competition procedures such as fining, commitment, leniency (immunity or reduction) and settlement procedures.45 Wouter Wils, the Hearing officer of the Commission, took the view that a distinction should be made “between
the review which the General Court exercises as to the finding of the antitrust infringement, and the review exercised by that court over the fine.” According to his opinion, the difference
38 Jussila v Finland (2007) 45 EHRR 39. 39 Idem, para 43.
40 Temple Lang, p. 464 – 480.
41 ECtHR judgment of 27 September 2011 in case Menarini Diagnostics S.R.L. v Italy App, paras 40 – 45. 42 C-199/92 P Hüls AG v Commission (1999) ECR I-4287, para 150.
43 C-189/02 P, C-202/02 P, C-205/02 P to C-208/02 P and C-213/02 P Dansk Rørindustri v Commission (2005) ECR I-5425, para 202.
44 Beumer, p. 15 – 16. 45 Idem.
12 has to be made between imposing fines for infringements of 101 and 102 TFEU and deciding whether to accept commitments or not pursuant to Article 9 of Regulation 1/2003.46
In summary all types of competition law proceeding could in theory be considered criminal by its nature and therefore Article 6 of the ECHR.47 This paper is focusing on infringements of 101 and 102 TFEU, which most often include the fining aspect and therefore the starting point is that alleged undertaking undertakings have the right to remain silent if the substantive criteria is met. Next chapter clarifies what a notion “undertaking” means in competition law, which is important for the reason that only undertakings can enjoy the privilege in competition law proceedings.
2.2.3 Who can enjoy the privilege against self-incrimination?
The question about who actually can enjoy the privilege is quite challenging. Since the competition rules are applicable only to agreements, decisions or concerted practices between undertakings or associations of undertakings, it is the notion of undertaking that basically determines who can enjoy the privilege.
The notion of undertakings is not defined in the Treaties but has been settled as a result of case law. The Court of Justice has defined undertakings as entities engaged in an economic activity, regardless of their legal status and the way in which they are financed.48 Contrary to the internal market rules, where the applicability of the rules relies to the nature of the entity, for competition rules, the nature is irrelevant.49
Vice versa, the nature of the entities’ activities is the most relevant factor when determining whether it is an undertaking or not. The status of the entity under national law is not decisive and the only relevant criterion is whether it carries out an economic activity.50 According to the case law of the Court of Justice and the General Court, fulfilling the definition of an undertaking does not depend on whether the entity is established for generating profits, and
46 Wils (2014), p. 5 – 7. 47 Jones – Sufrin, p. 936.
48 Joined Cases C-180/98 to C-184/98 Pavlov and Others (2000) ECR I-6451, para 74. See also Case C-41/90 Hofner and Elser v Macrotron GmBH, para 21 and the opinion of AG Roemer in Case 32/65 Italy v Council, in which he stated that: "Apart from legal form or the purpose of gain, undertakings are natural or legal persons
which take part actively and independently in business and are not, therefore, engaged in a purely private activity".
49 Hatzopoulos, p. 16.
13 non-profit entities can also offer goods and services on a market.51 The classification of an entity as an undertaking is relative to a specific activity and therefore in a case where an entity carries out both economic and non-economic activities, it is to be viewed as an undertaking only regard to the former.52 This situation is made clear in the ECJ’s theory of severability:
”However, since the Treaty provisions on competition are applicable to the activities of an entity which can be severed from those in which it engages as a public authority, the various activities of an entity must be considered individually and the treatment of some of them as powers of a public authority does not mean that it must be concluded that the other activities are not economic.”53
Usually in competition law cases in which the Commission is using its enforcement powers, there is no question, whether the alleged undertaking(s) fulfil(s) the criterion to be treated as an undertaking. It is still crucial to determine whether there is economic activity involved or not, because competition law rules only apply when the criterion is met. In this thesis the term undertaking denotes either undertaking or the association of undertaking54.
According to Article 20(2)(e), of any representative or member of staff of the undertaking is obliged to give information relating to the subject matter and purpose of the inspection to the Commission. That means that when the Commission or national competition authorities are using their power of investigation, they have to collect the evidence usually from undertakings and their staff or from other sources, such as complainant or third parties. Since the former is usually the most knowledgeable party, the undertakings concerned are the primary source of information for the Commission.55
Staff members could in theory be held liable for refusing to response to information requests, but since the EU competition rules do not allow any penalties to be imposed to individuals and the information given by the staff members could not be used by NCAs to impose stricter
51 Joined Cases 209/78 to 215/78 and 218/78 Van Landewyck (1980) ECR 3125 paragraph 88 and Case C-49/07 MOTOE (2008) ECR I- 4863, paras 27 – 28.
52 Draft Commission Notice on the notion of State aid pursuant to Article 107(1) TFEU, para 8. 53 Case T-155/04 SELEX Sistemi Integrati SpA v Commission, para 54.
54 The competition rules (Articles 101 and 102 TFEU) apply to all agreements between undertakings, decisions by associations of undertakings and concerted practices, which may affect trade between Member States and have a harmful effect for competition.
14 custodial sentences, the liability does not practically exists.56 The general opinion seems to be that when an officer or staff member of a company is required to provide information about a document, he will not incriminate himself because he is actually giving answers on behalf of the undertaking.57 The ECtHR has also dealt with the issue in Peterson Sarpsborg AS v.
Norway, in which it considered ”whether or to what extent these companies can incriminate themselves through statements made by their employees.” The ECtHR stated that the right to
remain silent is not distinctly guaranteed by Article 6 of the Convention but privilege still plays an important role in safeguarding the accused from coercion during criminal proceedings. The Court also said that whether a particular applicant has been compelled to incriminate himself depends on an overall assessment, which the Court has to go through in each individual case. In this case under examination, the Commission did not speak out the issue in further because complaint itself was manifestly ill-founded.58
Practically undertakings can act only through its employees and agents and when the Convention protects the undertaking with the privilege against self-incrimination, the privilege should be extended to the statements made on its behalf.59 This important issue will be addressed more precisely in next chapter 3 while going through the relation between the Commission’s investigation powers and undertakings’ obligation to cooperate.
2.3 The legal framework of the privilege against self-incrimination
The Commission and national competition authorities of the Member States are subject to certain limitations when using their powers of investigation.60 The entitlement for these powers is set out in Regulation 1/2003 (Regulation), which is based on a system of decentralised ex post enforcement.61 Also the basis for the privilege against self-incrimination flows from the Regulation.
56 Wils (2003), p. 13 – 14.
57 Willis, p. 4.
58 Peterson Sarpsborg AS and others v Norway, No. 25944/94, dec. 27.11.96. 59 Willis, p. 4.
60 Wils (2003), p. 9 – 10.
61 Regulation 1/2003 forms guidelines for the enforcement of 101 and 101 TFEU. It replaced the Regulation 17 (1962) which was characterised by a centralised notification system for Article 101(3) TFEU. See also Wils (2013).
15 Recital 23 of the Regulation states that undertakings cannot be forced to admit their participation to an infringement but they are still obliged to answer factual questions and provide documents even if it is used against them to establish an infringement.62 In other words Regulation confirms the case law and states that although undertakings cannot be forced to incriminate themselves, they do not have an express right to silence and they must provide all the necessary information for the Commission.63 Chapter IV of the Regulation determines the Commission’s powers of investigations and its relation to the undertakings’ duty to cooperate.64
Although now the foundation of the privilege could be found from the Regulation 1/2003 and Article 6 ECHR, the self-incrimination principle has evolved into what it is today mostly because the case law from the European Court of Human Rights, the General Court of the European Union and the European Court of Justice. We should not forget the national courts either, but their affect is no match for the judgments of European courts. The most important cases for the privilege against self-incrimination are discussed in chapter 4. Not all the cases in the that chapter are competition law related but all of them are still very important in order to clarify the scope of the privilege against from the undertakings’ perspective. The reason for that is that the first self-incrimination related judgments of ECtHR, such as Engel65,
Funke66, John Murray67 and Saunders68, created the substantive scope for the privilege,
which is highly relevant for competition law as well. In these cases the ECtHR has held that the self-incrimination principle forms part of the fair procedure under Article 6 of the European Convention of Human Rights69 and that is why they will help to understand the outline of the privilege in general, its scope and rationale for competition law cases.
62 Recital 23 states the following: ”The Commission should be empowered throughout the Community to require
such information to be supplied as is necessary to detect any agreement, decision or concerted practice prohibited by Article 81 of the Treaty or any abuse of a dominant position prohibited by Article 82 of the Treaty. When complying with a decision of the Commission, undertakings cannot be forced to admit that they have committed an infringement, but they are in any event obliged to answer factual questions and to provide documents, even if this information may be used to establish against them or against another undertaking the existence of an infringement.”
63 Case 347/87 Orkem v Commission (1989) ECR 3283, para 34, Joined Cases C-204/00 Aalborg Portland etc, para 61, Case C-301/04 P SGL Carbon, paras 39 and 41, Case T-112/98 Mannesmannröhren-Werke, para 65, Case T-34/93 Société Générale, para 74.
64 This issue is discussed in more detailed way in chapter 3. 65 Engel and others v Netherlands (1976) 1 EHRR 647. 66 Funke v. France (1993) 16 EHRR 297.
67 John Murray v United Kingdom (1996) 22 E.H.R.R. 29. 68 Saunders v United Kingdom (1997) 23 EHRR 313. 69 Wils (2005), p. 137.
16 The first major cases in which the applicability of the privilege and the scope of the protection it generates have been clarified, were Orkem v Commission70 and Solvay & Cie v
Commission71. In these cases, the ECJ considered for the first time whether undertakings could refuse to answer certain questions in a Commission request for information in a situation when to do so would be self-incriminating.
Next chapter is the starting point for the analysis of both the substantive and personal scope (with the emphasis on personal cope) of the privilege against self-incrimination. It starts with going through the investigative and procedural powers given to the Commission by the Regulation 1/2003 and draws the conclusion of the personal scope with the help of the Regulation. The Commission’s powers to investigate and undertakings right to remain silent, which is a limitation to the Commission’s powers, could be seen as counterparts and the tension between them forms also the basis for the privilege against self-incrimination.
3. THE COMMISSION’S POWERS OF INVESTIGATION VS.
UNDERTAKINGS’ DUTY TO COOPERATE AND THE PERSONAL
SCOPE OF THE PRIVILEGE AGAINST SELF-INCRIMINATION
“The fundamental principle of Community law that the rights of defence must be respected in all proceedings in which sanctions may be imposed.”72 Judge Pernilla Lindh (2000) 3.1 Regulation 1/2003 – Legal basis for the privilege
3.1.1 Commission’s investigatory powers
The Commissions powers of investigations are subject to two different sets of limitations: Legal professional privilege (LPP) and the privilege against self-incrimination. Due to the LPP, the Commission cannot exercise its powers to take by force, or compel the production of communications between lawyer and client, which are made for the purpose and in the
70 Case 347/87 Orkem v Commission (1989) ECR 3283. 71 Case 27/88 Solvay & Cie v Commission (1989) ERC 3355.
72 Joined Cases 25/95, 26/95, 30/95 to 32/95, 34/95 to 39/95, 42/95 to 46/95, 48/95, T-50/95 to T-65/95, T-68/95 to T-71/95, T-87/95, T-88/95, T-103/95 and T-104/95 Cimenteries CBR and others v Commission (2000) ECR II-491, para 106.
17 interest of defense and that they emanate from a qualified lawyer.73 If undertakings refuse to cooperate (or attempts to obstruct) with the Commission when it is carrying out its investigation, it could lead to an increased fine for the competition law violations found following the investigation.74
The Commission’s powers of investigation are set out in Chapter V of the Regulation 1/2003, and more precisely in Article 18 (request for information) and Articles 20 and 21 (about inspections).75 Also under Article 19 of the Regulation, the Commission can interview natural and legal person if they give their consents to be interviewed for the purpose of collecting information relating the subject matter of the investigation, although there are no penalties for providing misleading information. That is why Article 19 is excluded from area of the powers of investigation.
Together with the competition authorities of the Member States, the Commission forms a network of competition authorities, whose conduct is regulated in Regulation 1/2003.76 Together these competition authorities have the task of punishing and detecting violations of Articles 101 and 102 TFEU. While implementing this task, the competition authorities have to gather the necessary evidence and intelligence from various sources, e.g. complainants, third parties or the undertakings (and their staff) alleged to have committed the competition violation. The latter is usually the best source of information. Many times, the undertakings and their staff are the only ones who actually have the information needed by the authorities. This is typical for example in price cartels and other serious competition law infringements.77 3.1.2 Article 18 of Regulation 1/2003 – Requests for information
According to the Article 18 of Regulation 1/2003, the Commission is enabled, in order to carry out its duties under the Regulation, to require all necessary information.78 Article 18(1) of the Regulation enables the Commission to simply request information, or require it by decision. Article 18(2) clarifies that when sending a simple request, the Commission must ”state the legal basis and the purpose of the request, specify what information is required and
73 Turno – Zawlocka-Turno, p. 196. 74 Wils (2005), p. 133 – 134.
75 Wils (2003), p. 3. Also according to Article 19 of the Regulation, the Commission can interview natural and legal person if they give their consents to be interviewed.
76 Idem.
77 Wils (2008), p. 1.
18
fix the time-limit within which the information is to be provided, and the penalties provided for in Article 23 for supplying incorrect or misleading information.” The same rule applies
for Article 18(3) when the Commission requires undertakings to supply information by decision. It also has to fix the time- limit for undertaking to provide the requested information.
The Commission targets its request for undertakings, which usually are legal persons. According to Article 18(4), it is owners or their representatives of the alleged undertaking who shall supply the information on behalf of the undertaking concerned. If the company concerned does not have a legal personality, the persons authorised to represent them by law is responsible for supplying the requested information. In most cases it is the lawyers who may supply (and are responsible for) the information on behalf of their client. The Commission also has to inform the Member State in whose territory the seat of the company is situated and send a copy of the request to the NCA in question (18(5)). The Member States in turn have to provide at the request of the Commission, with all the necessary information, which would be needed to carry duties mentioned in the Regulation.
When the Commission makes a request for information under Article 18 of the Regulation and asks the undertaking to describe e.g. the object, results or amount of meetings in which the undertaking has participated and it suspects the undertaking to have infringed or restricted competition, the undertaking is not required to answer questions of that type.79 If the undertaking however supplies information on those points, it must be “regarded as
spontaneous cooperation on the undertaking's part capable of justifying a reduction in the fine in application of the Leniency Notice”80 and they cannot claim that their right not to incriminate themselves has been infringed when they have voluntarily given the answers.81In other words, the undertakings do not have an obligation to provide answers for questions that might lead to admission of the infringement, but if they voluntarily reply for such request of information, they cannot claim that their right not to incriminate themselves has been infringed.
79 Case T-446/05 Amann & Söhne v Commission, (2010) ECR II-1255, para 329. 80 Case T‑48/02 Brouwerij Haacht v Commission (2005) ECR II‑5259, para 107. 81 T-50/00 Dalmine v Commission (2004) ECR II-2395, para 46.
19 3.1.3 Article 20 of Regulation 1/2003 – Powers of inspection
Article 20(2)(a–d) states that the Commission has the right to conduct inspections in any premises, land and means of transport of undertakings and to examine the books and records related to the business and to take or obtain any copies from such material and to seal any business premises and books or records for the extent necessary for the inspection.
Article 20(2)(e)82 allows the Commission to ask questions also to staff members of the undertaking in question. In theory this could mean that a staff member could be held liable for refusing to answer, but that is not the case, because Regulation 1/2003 does not allow any penalty to be imposed on staff members nor could this information obtained by the Commission to be used in evidence by NCAs to impose any custodial sentences or other sanctions which would make the stricter case law83 of ECtHR applicable.84
As with the request for information, Article 20(4) states that the decision ordering the inspection has to show the subject matter and purpose of the inspection. In Ventouris, the Court clarified this saying that the obligation to specify both the purpose and the subject-matter of the investigation “is a fundamental requirement, designed not merely to show that
the proposed entry onto the premises of the undertakings concerned is justified but also to enable the undertakings to assess the scope of their duty to cooperate whilst at the same time safe-guarding their rights of defence.” 85
If the undertaking opposes the inspection, Member State concerned can use assistance of the police or other enforcement authority, to conduct the inspection. If coercive measures from article 20(6) of the Regulation are used, the national court from the Member State concerned has the obligation to ensure, “that the coercive measure envisaged is not arbitrary or
disproportionate to the subject-matter of the investigation ordered”.86 The standard for using coercive measures is quite high and the national court must verify that the measure is
82 20(2)(e) states the following: ”to ask any representative or member of staff of the undertaking or association
of undertakings for explanations on facts or documents relating to the subject-matter and purpose of the inspection and to record the answers.”
83 This stricter case law of ECtHR means that the use of evidence of any answers obtained from the accused through compulsory questioning is always prohibited, including also answers to purely factual questions. See Wils (2003), p. 12 – 13.
84 Wils (2003), p. 13 – 14.
85 Case T-59/99 Ventouris Group Enterprises SA v Commission of the European Communities, para 124. See also Hoechst v Commission, para 29, and Roquette Frères, para 47.
20 appropriate in order to carry out the investigation.87
3.1.4 Article 21 of Regulation 1/2003 – Inspection of other premises
According to the Article 21(1) of the Regulation, there must exist a reasonable suspicion that documents related to the business and subject-matter of the inspection would being kept in other premises, such as homes of directors, managers and other member of staff of the undertaking, in order for Commission to be able to order an inspection to be conducted there. The standard for that is relatively high. There must be an assumption or strong suspicion that books or other important material which would actually be relevant to prove serious violation of 101 or 102 TFEU, are being kept in the investigated premises.88 A decision adopted under Article 21(1) also has to be authorized from a national judicial authority of the Member State concerned in order to be executed. The personnel authorised to carry out the inspection shall have the same powers set out in Article 20.
The Commission’s obligation to state precisely what it is looking for is really important for undertakings in order to built its defence and to be assured what type of information it is obliged to provide. This applies for both Articles 20 and 21 of the Regulation 1/2003.
3.1.5 Self-incrimination principle and dawn raids
The Commission’s investigation procedure starts often with the dawn raid, and that procedure requires certain procedural steps to be fulfilled. According to the case law, rights of defence must be respected already at the preliminary stage.89 When the Commission is carrying out its dawn raid, the undertakings under investigation are protected by certain guarantees, including the right to legal representation.90 When the undertaking is exercising its right to legal consultation, it must not delay or impede the investigation.91
Dawn raids may potentially infringe some procedural rights (such as right to remain silent, right not to incriminate oneself, right to have a lawyer at the hearing etc.) of the inspected undertakings according to the ECtHR.92 The dawn raid procedure is criminal for the purpose
87 Idem, para 71. 88 Wils (2011), p. 6.
89 Case 374/87 Orkem v Commission, (1989) ECR 3283, para 33. 90 Case C-94/00 Roquette Frères (2002) ECR I-9039, para 46. 91 Kerse, section 3.40.
21 of Article 6 of the ECHR and therefore legal persons who are the target of the dawn raid should have the same rights as persons charged with a criminal offence under Article 6(1), which means that they should be able to avail themselves of the privilege.93
The Courts have extended the protection against self-incrimination only to the extend which grants the protection to answers gotten from information requests made for the purpose of investigation and which would lead to an admission of the existence of an infringement.94 If the parties alleged to have infringed the competition rules feel that they should not be compelled to answer to questions that could force them to admit the infringement, they can direct the matter to the Hearing officer. He/she may adopt a reasoned recommendation as to whether the privilege against self-incrimination applies or not.95 The information discovered and collected during the dawn raids or supplied in response to an information request is however free from the protection of self-incrimination principle.96
Under some circumstances, the ECtHR applies the privilege also to pre-existing documents, e.g. when an individual would be compelled to provide evidence against itself.97 However, that does not protect the undertaking, when it by itself must provide answers requested by the authority or when the Commission or NCA is collecting evidence during a dawn raid.
3.1.6 Self-incrimination and leniency
Leniency means an opportunity for undertaking to cooperate with the Commission and get a reduction or total immunity from fines in cartel cases.98 In theory, the privilege against self-incrimination could be contrary to the Commission’s fining procedure. Leniency notice sets a framework in which the undertaking using the leniency could actually get immunity by the Commission. In order to get the immunity or reduction of fines, the undertaking has to incriminate itself by disclosing incrimination evidence. The principle of the presumption of innocence could be damaged when the undertakings are giving too extensive information, in
93 Aslam – Ramsden, p. 72.
94 Calzado – De Stefano, p. 3.
95 Art 4(2)(b) of the Decision of the President of the European Commission of 13 October 2011 on the Function and Terms of Reference of the Hearing Officer in Certain Competition Proceedings, (2011) OJ L/275/29. 96 Wils (2003), p. 11 – 13.
97 Idem.
98 Commission Notice on Immunity from fines and reduction of fines in cartel cases (2006/C 298/11) (Leniency Notice), para 1.
22 which the Leniency Notice aims for. This in turn could lead to the burden of proof to be reversed when the alleged undertaking must provide most of the evidence.99
However, the European Courts have so far rejected the argument that the use of leniency program would be contrary to fundamental rights. In Metsä-Serla, the ECJ clarified that when an undertaking limits its cooperation “to that which is required to provide under Regulation
No 17 will not, on that ground, have an increased fine imposed on it.” In a case where the
undertaking has ended the cooperation and the Commission considers that the undertaking is responsible for the infringement, it will be fined it should be “fined in accordance with
criteria which may lawfully be taken into account –“.100
The alleged undertakings have the freedom to decide whether to take advantage of the leniency program. The privilege of self-incrimination should not attach to the evidence outside the mind of the evidence (e.g. pre-existing documents and recorded information). The utilization of leniency regime and encouraging undertakings to voluntarily give incriminating testimony does not therefore fall within the terms of compulsion.101
3.1.7 Obligation to cooperate actively vs. privilege against self-incrimination
Undertakings have an obligation to cooperate actively when the Commission is investigating them. Commission is entitled to oblige undertakings to provide all the information that it needs in order to use its powers provided in the Regulation.102 The obligation to cooperate actively is unwrapped in Aalborg, in which the Commission stated that Regulation 1/2003 places the alleged undertaking ”under a duty of active cooperation”.103 Active cooperation means that the undertaking must be prepared to produce the information relating to the object of the inquiry.104 The Commission is entitled to make questions to undertaking(s) about the conduct of all undertakings concerned.105
The obligation to cooperate requires that undertakings cannot refuse to provide documents, even if it would be required to give evidence against itself.106 The Commission cannot force
99 Schwarze – Bosch, p. 31.
100 C-298/98 P Metsä-Serla Sales Oy (Finnboard) v Commission (2000) ECR I-10171, para 58. 101 MacCulloh, p. 237.
102 Case 347/87 Orkem v Commission (1989) ECR 3283, para 34. 103 Joined Cases C-204/00 Aalborg Portland etc., para 62. 104 Case 347/87 Orkem v Commission (1989) ECR 3283, para 27.
105 Ibid, para 207. See also Case C-301/04 P SGL Carbon, paras 40 and 47. 106 Case C-301/04 P SGL Carbon, para 48.
23 an alleged undertaking to provide it with answers, which actually contains an admission from the undertaking on its participation to the infringement. It is an obligation of the Commission to prove that the alleged undertaking is actually involved for certain competition infringement.107
The balance between active cooperation and privilege against self-incrimination requires an overall assessment of the facts in each individual case. From the competition law perspective, it is extremely important to ensure that the Commission has enough tools to use the powers of investigation that are given to it under Regulation 1/2003. On the other hand, the Commission cannot act against the Fundamental rights (the Charter and the Convention) which are legally binding and set out in Article 6(1) of the TEU. Balancing these two aims is like fighting with a double-edged sword; you cannot favour one without damaging the other. The Commission and national authorities must be careful when limiting the right to remain silent but they still have to make certain that they are effectively performing their duties set out in the Regulation.
3.1.8 Exchange of information and differing national standards
The powers of investigation of the national competition authorities of the Members States are set out in their own national laws and regulations. In some Member States, these powers are stronger compared to powers of the Commission.108 This basically means that the national rules can be more protective or less protective for the undertakings.
If the national authorities want to rely on statements compelled by the Commission, they will have to comply with the stricter standards.109 This situation can actualize where the Member States afford either more protection against self-incrimination, or imposes wider disclosure obligation (less protection). The alleged undertakings cannot rely on these national standards against the Commission. An example of such “less protective” national standards could be private enforcement proceedings.110
107 Idem. See also Joined Cases C-65/02 P and C-73/02 P ThyssenKrupp Stainless v Commission (2005) ECR I-06773, para 49.
108 Wils (2005), p. 134.
109 Case T-112/98 Mannesmannröhren-Werke, paras 80 – 85.
110 Case C-60/92 Otto v Postbank, para 18, which stated the following: ”…if the limitation on the Commission's
power of investigation under Regulation No 17 is not applied in the national proceedings, that limitation would be deprived of any practical effect, since the Commission could obtain through the national proceedings the information which it cannot obtain directly under the procedure governed by Regulation No 17.”
24 3.2 The current personal scope of the privilege – What the notion of undertaking covers?
Since the Article 20(2)(e) of Regulation No 1/2003 gives the Commission a permission to ask questions from individual members,111 it should be undisputed that all these individuals using
the voice of the undertaking would also be able to invoke the privilege. The company’s staff
covers basically directors, managers, company officers and corporate bodies, which could in theory be liable to punishment if they have assisted or consented an offence or in other ways been neglect. When the Commission is asking questions from individuals, it can address them only as regards explanation of documents or facts that is linked to the subject matter and purpose of the investigation.
Because of the fact that these individuals acting behalf of the undertaking cannot face any custodial sanctions, the stricter case law from ECtHR should not be applicable for their situation. The stricter case law112 of the ECtHR is only applicable to the investigation by national competition authorities in Member States whose national laws allows criminal sanction on natural persons for violations of Articles 101 and 102 TFEU or other related competition law offences.113 The stricter case law could also in theory be applicable for the Commission, when it would be investigation an undertaking of an unincorporated business, such as a single trader, unincorporated professional or natural persons operating a single business.114
Some national laws of Member States enable stronger powers to their national competition authorities for investigating violations of Articles 101 and 102 TFEU than Regulation 1/2003 gives to the Commission even if these Member States do not have stronger sanctions for these violations. In some Member States, production of specified documents and information could be required not only from undertakings, but also individual members or staff and failure to cooperate with the investigation could lead to criminal charges.
111 The former Regulation No 17 only gave the Commission the power to seek explanations relating to the books and records under examination. See Wish (2003), p. 5.
112 This stricter case law of ECtHR means that the use of evidence of any answers obtained from the accused through compulsory questioning is always prohibited, including also answers to purely factual questions. See Wils (2003), p. 12 – 13.
113 Wils (2005), p. 139. 114 Idem.
