General Court annuls Air Cargo decision

17 Dec 2015

In judgments handed down yesterday the General Court of the EU has annulled the Commission’s 2010 decision finding the applicant companies to have infringed the competition rules by participating in a cartel to fix surcharges for air freight and imposing heavy fines upon them.

The basis for the Court’s ruling was that the reasoning in the decision found a single infringement: however, the final part of the decision setting out the infringement (“the operative part”) set out four separate infringements with different airlines participating in each.  The Commission argued at the hearing that that was because, over the period of the cartel, the EU Treaty, the EEA agreement, and the EU/Switzerland Agreement applied to different routes (e.g. the EU/Switzerland Agreement applied only to routes between the EU and Switzerland) and that the airlines listed in relation to each of those provisions were the airlines that flew the routes to which the provision applied (so that only airlines that flew between the EU and Switzerland were listed as having infringed the EU/Switzerland agreement).  However, the Court considered that there was such a contradiction between the reasoning in the decision and the operative part that the decision had to be annulled on the basis of contradictory reasoning.

The Court found it unnecessary to deal with any of the other arguments put forward by the applicants contesting their participation in the infringement or the amount of the fine.

As matters stand, to the extent that the decision is annulled, it no longer stands against any of the applicants to the Court, and no longer binds national courts (which are currently considering a number of follow-on actions based on the Commission’s decision).

George Peretz QC, Josh Holmes, Alan Bates and James Bourke acted for the European Commission; Jon Turner QC acted for British Airways and Ronit Kreisberger acted for Cathay.  In the follow-on damages actions in the English High Court: Paul Harris QC, Ben Rayment and Anneliese Blackwood are acting for Emerald Supplies Limited, Rob Williams acts for the Allston Landing Claimants, Jon Turner QC and Michael Armitage are acting for British Airways, Michael Bowsher QC, Tim Ward QC, Daniel Beard QC, Kassie Smith QC, Meredith Pickford QC, Ronit Kreisberger, Philip Woolfe, Laura Elizabeth John and Thomas Sebastian are acting for numerous Part 20 Defendants.