This paper – which you can find here – focuses on the arbitrability of competition law in Europe.
The paper is clearly concerned with the implications of the European courts’ decisions in the CDC Hydrogen Peroxide case, but also takes the opportunity to take a deeper look at the interface between arbitration and competition law. The paper begins by acknowledging that it is consensual that Articles 101 and 102 TFEU are fully arbitrable, but then moves on to assess whether other competition provisions of the Treaty on the Functioning of the European Union, i.e. Articles 106 to 108, as well as in secondary EU competition legislation (e.g. the EU Merger Control Regulation) are arbitrable as well.
The article is divided into three parts:
- With a brief detour into the United States, section 2 discusses the progressive recognition by national and EU courts of the arbitrability of EU competition law, and discusses outstanding questions regarding the arbitrability of EU competition law. It begins by describing how, originally, it was thought in the US that arbitration was not an appropriate option when dealing with antitrust issues; and how the Supreme Court in its 1985 Mitsubishi decision established the arbitrability of antitrust matters. It also describes how, in Europe, national courts have assumed that competition law can be subject to arbitration, and how this view was implicitly endorsed by the European courts in its EcoSwiss case.
The authors then move on to discuss a number of topics which subjection to arbitration, in the event of private disputes, is doubtful, namely: (i) Art. 101(3) (regarding efficiencies); (ii) Art. 106 (which prohibits national rules applicable to “public undertakings and undertakings to which Member States grant special or exclusive rights” from infringing competition law); (iii) state aid; and (iv) merger control.
All topics are ultimately found to be arbitrable, even if subject to certain conditions (e.g., regarding merger control, matters should be arbitrable inasmuch as “the parties to a merger agreement are not entitled to refer to arbitration a claim where the arbitrators would be requested to declare that a merger operation is or is not compatible with the EU common market.”). This section also quickly reviews the type of remedies that may be ordered by arbitral tribunals (e.g. in Europe, it is unlikely that arbitral tribunal can order the payment of punitive damages).
- Section 3 deals with the possible implications of the Advocate General’s Opinion in CDC Hydrogen Peroxide case for the arbitrability of certain competition law-based claims. The question in this case was whether jurisdiction and arbitration clauses validly entered into between two commercial entities (the supplier of goods who later turned out to be part of a cartel, on the one hand, and the purchaser of such goods who suffered damages in consequence of the cartelistic behaviour of the supplier, on the other) could exclude the jurisdiction of civil courts. The Advocate General seemed to hold that such a clause could not be enforced if, at the time the contract was entered into, the victim was unaware of the existence of a cartel. Underlying this opinion is a concern with the fact that most victims of cartels will have entered into multiple supply contracts with multiple distinct entities, and that the management of arbitral proceedings may give rise to complexities that would undermine the victims’ practical ability to obtain compensation from their suppliers. The Court avoided addressing the matter as far as it concerned arbitration clauses. Regarding jurisdiction clauses, they can only apply to claims for damages arising from an infringement of Article 101 TFEU insofar as the parties to the contract expressly stated that the jurisdiction clause extends to disputes concerning liability incurred as a result of an infringement of competition law.
This paper is, arguably, only for those interested in (the role of arbitration in) the private enforcement of antitrust. It is solid fare which, even if it is slightly pro-arbitration (understandably, given the professional occupation of the writers), is quite fair and balanced in its assessment of the case law and its implications.