Intel v Commission: Keep Calm and Carry on!

Abstract

Few competition law cases have excited as much attention as the General Court’s Intel judgment of 12 June 2014, in which it upheld the Commission’s finding that Intel had infringed Article 102 and the fine of E1.06 billion that it had imposed on it. The judgment has been greeted with huge hostility. At a recent conference I heard a senior economist refer to it as a ‘return to the Dark Ages’; a session at the GCR conference in Brussels in November will include a session on ‘sifting the wreckage of the Intel General Court judgment’; Jim Venit’s commentary on the judgment is entitled ‘All Steps Backward and No Steps Forward’. One law firm’s briefing declares that the judgment ‘bans’ rebate schemes that may be beneficial to consumers and may chill legitimate business behaviour; another says that the judgment creates more legal uncertainty, which is not easy to reconcile with the common criticism that it reverts to a form-based system that automatically prohibits exclusivity rebates: if that is the case, it makes the law more certain, not less. The judgment is also said to widen the gap between what the Commission intended to achieve by its Guidance on Article 102 Enforcement Priorities and the jurisprudence of the Courts in Luxembourg. Of course there have also been more measured commentaries on Intel, not least by Paul Nihoul in this journal who helpfully examines why the EU courts do not adopt the same line as the Federal Courts in the US in their application of section 2 of the Sherman Act. Wouter Wils has argued powerfully that Intel is both legally and economically sound, and that the so-called ‘more economic approach’ to the enforcement of Article 102 is unsound. The debate now moves to the Court of Justice. Intel’s grounds of appeal have recently been published in the Official Journal: it argues that the General Court erred in law by concluding that the rebates in question were inherently capable of restricting competition; it was wrong to proceed on the basis of ‘abstract considerations rather than likely or actual effects’; and it should have taken into account a number of factors such as the market coverage of the practices, their duration, falling prices and a lack of foreclosure, as well as the conclusions that should properly have been drawn from the Commission’s analysis of the ‘as-efficient competitor’ test in its decision. Other grounds of appeal address, among other issues, extraterritorial jurisdiction and the level of the fine. It can hardly be an exaggeration to suggest that the Court of Justice’s judgment in Intel will be one of the most important on competition law for many years, and it will certainly be eagerly anticipated. My expectation is that the