Is there “a meeting of the minds” when you receive an e-mail?

25/01/16

On 21 January 2015 the European Court of Justice issued a preliminary ruling, at the request of Lithuania’s Supreme Court, on procedural aspects related to Article 101 TFEU. In short, the Supreme Court had asked whether sending a message over an electronic system is sufficient proof of an illegal information exchange or a concerted practice when several competitors use that electronic system. What if there is no evidence of access to that message and neither has commercial behaviour been aligned with the content of such message? How do competition rules conform to the presumption of innocence then?

The questions were raised in a lawsuit between, on the one hand, several Lithuanian travel agencies using a particular electronic system (E-TURAS) for selling their products; and, on the other hand, the Lithuanian competition authority, that had imposed a fine for colluding. The behaviour was proven, according to the competition authority, by the message sent over E-TURAS informing participants of a 3% cap on discounts and of technical safeguards for applying such discount. The message could only be read if participants accessed E-TURAS and actually opened the message. Travel agencies could still offer larger discounts, but this required additional technical formalities. The competition authority based its decision on presumptive knowledge of the message’s contents and on lack of evidence of any public disagreement with the message.

If several competitors agree on maximum discounts, directly or indirectly, they are infringing competition law. This is beyond doubt. The question here was whether the standard of proof is met when competitors are only addressees of a message, but there is no proof of either actual receipt or knowledge of the contents.

Procedural rules –including evaluation of the standard of proof– differ among Member States. The burden of proof is always on the authority alleging the infringement, since the presumption of innocence protects the undertaking accused. This is also beyond doubt. But when is the standard of proof actually met? In the case at hand, does sending the message (without proof of receipt) and absence of public opposition suffice?

The Court of Justice had to strike a delicate balance between the need to safeguard Member States’ procedural autonomy (provided that the principles of equivalence and effectiveness are complied with) and the need to ensure that tacit consent to collusion continues to imply an information exchange and, therefore, constitutes an infringement.

Briefly, the Court said that sending the message, in the absence of any further evidence, does not meet the standard of proof. However, any other evidence of knowledge of the contents of the message and, in particular, the alignment of an undertaking’s commercial behaviour does suffice as proof of the infringement. Conversely, the undertaking concerned may rebut this presumption, for instance by proving that it did not receive the message; that some other reason explained its commercial decisions; or that it notified the administrator of the electronic system that it opposed the contents of the message.

Thus, we should answer the question raised in our title saying that even if just sending a message is not tantamount to an infringement, actual receipt is. Unless there is (further) evidence to the contrary…

Leaving aside the fact that the E-TURAS Case concerns a horizontal restraint, the Court’s conclusions seem in line with those of its classic Volkswagen and Bayer case-law. In these judgments the Court already emphasised the importance of the subjective element of an ‘agreement’. A unilateral communication (absent other circumstantial evidence or a contractual framework) does not suffice for proving an infringement. Nothing new under the sun, then, yet still a relevant reminder, particularly nowadays, since the Spanish Competition Authority (CNMC) sometimes relaxes its own standard of proof (see, for example, Resolution of 5 March 2015, file S/0487/13). It remains to be seen whether the Spanish judiciary will uphold this view and how will it tackle coordination between our procedural rules and EU case-law.