Kate McKenna: EU seeks interim order in competition investigation for first time in nearly 20 years
Kate McKenna, partner in the EU, competition and regulatory law group at Matheson, highlights a recent EU case involving interim measures for competition law concerns and shares the Irish perspective.
On 26 June 2019, the EU Commission opened a formal investigation to determine whether US chip-making company, Broadcom, is abusing its alleged dominant position in breach of EU competition law and, simultaneously, notified Broadcom of its intention to impose an interim order to cease its allegedly unlawful conduct prior to the conclusion of the investigation. This was the first time in nearly twenty years that the Commission has pursued interim measures.
The granting of interim relief for competition breaches is equally unusual at Irish level. We are aware of only a small number of Irish cases where the courts have granted an interim injunction for anti-competitive behaviour. The first was over 30 years ago and was an unreported judgment, Leanort Ltd, Hytherm (Ireland) Ltd and Hytherm Ltd v Southern Chemicals Ltd, Aircell Ltd (the interim relief was granted in 1988, and the judgment first reported in the Irish Journal for EU law, 1992, 1(1), 143-151), wherein the court granted an interim injunction restraining the defendants from selling or offering for sale expanded polystyrene panels in the State or Northern Ireland at unreasonably low prices until the trial of the Action or until a further order was made.
The second case was in 1997 wherein the High Court granted an interim injunction against the Irish Road Haulage Association (IRHA) and a number of individual hauliers, to prevent the blockading of Dublin Port, on the basis that the blockade was an attempt to implement a collective agreement on a schedule of “minimum haulage rates” to be put to ship owners.
Interim orders in respect of conduct raising competition law concerns may be granted in Ireland under section 14 of the Competition Act 2002. This section states that both “the Authority” (i.e. the Competition and Consumer Protection Commission) and “any person” who suffers as a consequence of an anti-competitive offence under the 2002 Act may seek interim orders from the Irish courts during the course of litigation. In particular, sections 14(1) and 14A(1) give jurisdiction to the Irish courts to grant interim injunctions, interlocutory injunctions and injunctions for definite or indefinite duration. In order to obtain interim orders from an Irish court, it is generally necessary to demonstrate that the following conditions of the “Campus Oil Test” for injunctive relief is met:
- there is a stateable case on the substantive issue in dispute;
- damages would not be an adequate remedy; and
- the “balance of convenience” is in favour of granting the injunction.
It will be interesting to see whether the investigation of Broadcom may reignite the use of interim measures in competition law actions at EU and Irish level in the years to come, noting that interim measures may be sought for merger control as well as behavioural competition law conduct, including for example where the CCPC becomes aware that a merger is about to be consummated without first being approved by it.