Corrigendum to the translation into the Croatian language of the Council Regulation (EC) No 1/2003 of 16 December 2002 published in the Official Journal of the European Union

Given the fact that the previous translation into the Croatian language of Article 5 paragraph 2 of the Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty produced unwanted legal effects the Official Journal of the European Union L 173/108 of 30 June 2016 published the Croatian corrigendum to the Regulation concerned.

Out of fourteen corrections that have been carried out the most important is the one in Article 5 paragraph 2.

The original text in the English language reads as follows:

“Where on the basis of the information in their possession the conditions for prohibition are not met they may likewise decide that there are no grounds for action on their part.”

The previous translation read as follows:

„Ako na temelju informacija koje posjeduju nisu ispunjeni uvjeti za izricanje zabrane, nacionalna tijela za tržišno natjecanje mogu također odlučiti da ne postoji temelj za pokretanje postupka“.

The new translation reads as follows:

„Ako na temelju informacija koje posjeduju nisu ispunjeni uvjeti za utvrđivanje zabrane, nacionalna tijela za tržišno natjecanje mogu također odlučiti da ne postoji temelj za njihovo daljnje postupanje.“

Namely, the Council Regulation (EC) No 1/2003 empowers the national competition authorities for the parallel or consecutive application of the national competition law (Croatian Competition Act) and Articles 101 and 102 of the Treaty on the Functioning of the European Union (Treaty).

Where the proceeding is initiated on the basis of parallel application of the national law and the EU law, in other words, on the basis of Article 8 of the Croatian Competition Act and Article 101 of the Treaty, or on the basis of Article 13 of the Competition Law and Article 102 of the Treaty, within the meaning of the EU acquis the national competition authorities are not empowered to take a negative decision (a decision on non-infringement of competition rules) within the meaning of Articles 101 and 102 of the Treaty.

Namely, in conformity with the Council Regulation (EC) No 1/2003 the European Commission is exclusively empowered to take a negative decision within the meaning of Articles 101 and 102 of the Treaty. This means that in spite of the fact that the national competition authorities are empowered to directly apply the provisions at issue, where within the proceeding they establish that there is no evidence that the alleged infringement has been committed, they can only close the proceeding without taking a decision on the merits. This was also confirmed by the European Court of Justice in Case C-375/09 concluding that if the national law would provide for an obligation by the national authority to take a negative decision in the sense of Articles 101 and 102 of the Treaty, such a provision of the national law would contravene with the EU law and challenge the direct applicability of Article 5 paragraph 2 of the regulation concerned.

However, the Croatian High Administrative Court held the view that in line with Article 5 paragraph 2 of the Council Regulation (EC) No 1/2003 the Croatian Competition Agency (CCA) once it has initiated the proceeding cannot terminate it but should close it by taking a decision on the merits.

Yet, the Council Regulation (EC) No 1/2003 in Article 5 paragraph 2 does not say anything whatsoever about any initiation of the proceeding. In addition, it is in the sense of the provision concerned that it relates to the establishment of the conditions for prohibition, in other words, the establishment of distortion of competition due to the existence of a prohibited agreement or abuse of a dominant position, where these conditions may be established only within an infringement proceeding. Consequently, it is clear that the Croatian Competition Agency cannot decide on the existence or non-existence of the conditions for prohibition before it initiates a proceeding.

Should the CCA take a negative or a non-infringement decision within the meaning of Article 101 or Article 102 of the Treaty, it would be the only national competition authority within the EU whose decisions in the sense of the ne bis in idem principle would preclude the European Commission from subsequently establishing that the practice concerned after all constitutes an infringement of Article 101 or 102 of the Treaty. Such decisions would constitute a breach of the EU competition acquis.

Taking everything said into account, Article 5 paragraph 2 of the Council Regulation (EC) No 1/2003 should be interpreted in the following way: Where in the proceedings initiated pursuant to Article 101 or 102 of the Treaty the CCA establishes that there is no distortion of competition, it should not and it may not decide on the merits but terminate the proceeding in line with the interpretation provided by the EU Court cited before.

For all the above stated reasons it was necessary to make a formal corrigendum that was published in the Official Journal of the European Union on 30 June 2016.

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