Advocate General Wahl: Agriculturalists may be liable for concerted practices contrary to EU law

About this case:

• Judgment:
  External link

In 2007, the French competition authorities discovered practices that they considered anticompetitive in the endive production and marketing sector. Those practices, implemented by producer organisations (POs), associations of producer organisations (APOs) and various bodies and companies, consisted, in essence, of concertation on the price of endives and the quantities of endives placed on the market as well as the exchange of strategic information.

The producer organisations and the other penalised entities brought an action before the French courts contesting the fine of almost €4 million imposed on them, arguing that their practices did not fall within the scope of the prohibition of anticompetitive agreements, decisions and concerted practices under EU law.

They maintained that producer organisations and their associations are tasked, under EU law, with stabilising producer prices and adjusting production to demand. The performance of that task therefore justified the practices deemed anticompetitive by the French authorities.

The Cour de cassation (Court of cassation, France), before which the matter was brought, has asked the Court of Justice to clarify the issue.

In his Opinion (French), Advocate General Nils Wahl noted, first of all, that the POs and APOs have, among other tasks, the general objective of adjusting production to demand, reducing the costs of production and stabilising producer prices. Thus, the POs and APOs are required to play a decisive role in centralising the marketing of their members’ products and are, in essence, forums for collective concertation.

The Advocate General examined the facts relating to the alleged cartel on the French endive market. As regards, first of all, the concertation on the prices of endives, the Advocate General took the view that a policy of fixing a minimum price between producers cannot escape the prohibition of anticompetitive agreements, decisions and concerted practices under EU law, whether that policy is determined between different POs/APOs, or within the same PO or APO. The POs and APOs are responsible for negotiating with operators downstream of the industry (distributors) a single price applicable to all of the production and variable depending on marketing periods and the quality of the product concerned. However, the fixing, within a PO or APO, of a minimum price that cannot be varied would, by definition, not have any point.

As regards, next, the concertation on the quantities placed on the market, the Advocate General took the view that such concertation, within a PO or an APO in the context of production plans provided for in EU legislation, may, where it is genuinely intended to regulate production in order to stabilise the prices of the products concerned, escape the application of competition law. However, concertation between several POs and APOs, intended to limit and generally control the quantities placed on the market throughout the entire endive market and, consequently, to limit production over the long term (as appears to be the case here), does not escape the application of the competition rules.

Lastly, as regards the exchange of strategic information, the Advocate General considered that the tasks assigned to the POs and APOs necessarily involve exchanges of strategic information internally, with the result that the competition rules will generally not be applicable within a PO/APO. However, exchanges of information consisting in the communication of prices between POs, APOs and other competing entities (which appears to be case here) cannot be linked to the tasks assigned to POs/APOs and are therefore subject to the principle of the prohibition of anticompetitive agreements, decisions and concerted practices.