This paper, available here , discusses the first deportation of an EU citizen to the US for competition law infringements. It focuses on a recent judgment by the Court of Justice of the European Union on this matter.
A first section outlines the factual background of the case.
In 2010, a US arrest warrant was issued for Italian businessman Romano Pisciotti on account of his involvement in the marine hoses cartel. In 2013, the German federal police arrested Mr. Pisciotti at Frankfurt Airport during a stopover of his flight from Nigeria to Italy. He was provisionally detained and, a few months later, the German authorities accepted the US request for extradition despite Mr. Pisciotti’s legal appeals, inter alia before the German Federal Constitutional Court.
Other extradition requests from the US authorities had so far been unsuccessful, mainly because most international extradition agreements (including the Treaty between Germany and the US) require that the sanctioned conduct must be a crime in both the requesting and the extraditing country. Most EU Member States do not regard competition law infringements as criminal offences. However, Germany punishes bid rigging as a crime under § 298 of the German Criminal Code. This meant that the ‘double criminality requirement’ was fulfilled, and Mr. Pisciotti was extradited in April 2014.
It was the first time that a European citizen was extradited to the USA because of a violation of competition law (the extradition of Ian Norris from the UK to the US in 2010 had been based on obstruction of justice charges concerning an antitrust investigation. This reflects the fact that pure price-fixing could not serve as a basis for his extradition, since price-fixing was not a crime in the UK). Mr. Pisciotti pled guilty to the US Department of Justice’s charges and was sentenced to two years of prison and a USD 50,000 criminal fine.
Subsequently, Mr. Pisciotti brought an action for damages before the Regional Court of Berlin requesting that Germany be held liable for authorising his extradition to the US. He claimed that Germany had breached the EU non-discrimination principle (Article 18 TFEU), by refusing to allow him to benefit from the prohibition of extradition provided for in the German constitution for all German nationals. The Berlin Regional Court referred the question to the Court of Justice for a preliminary ruling.
A second section analyses the European court’s decision.
In short, the Court found that the extradition of Mr. Pisciotti falls within the scope of EU law, since he was an EU citizen exercising his right of free movement and the request for extradition had been made under the EU-USA Extradition Agreement.
The Court of Justice has previously ruled that a distinction between nationals of the requested Member State and nationals of other Member States may restrict the free movement of citizens of the Union. Such restrictions can only be justified if they pursue a legitimate purpose, are necessary to achieve that purpose and are proportionate to the objective pursued. The Court found that avoiding the risk of impunity for persons who have committed an offence constitutes a legitimate objective. Regarding proportionality, the Court found that Germany could have pursued a less restrictive measure consisting in the surrender of the Union citizen to his Member State of origin (i.e. Italy). However, such a measure would only be available if Italy had issued a European arrest warrant covering the same acts as those alleged in the extradition request and had the jurisdiction, pursuant to its national law, to prosecute that person for such offences, even if committed outside its territory. In the present case, the Italian authorities were informed both of the allegations against Mr. Pisciotti and of the extradition request, but did not issue a European arrest warrant against him. Therefore, the Court of Justice concluded the German authorities complied with the principle of proportionality and, hence, did not breach the EU law.
A third section discusses the practical implications of this case.
This was the first extradition of a European Union citizen purely to the US based solely on cartel charges. In addition, the US authorities issued another arrest warrant against a German national, Mr. Bangert, due to his alleged involvement in the same cartel as Mr. Pisciotti. Unlike Mr. Pisciotti, Mr. Bangert has since refrained from travelling outside Germany, since he can rely on his constitutional right of not being extradited by Germany.
The fact that the extradition was effected by a Member State that was not the criminal’s State of origin can lead some to conclude that this case allows the introduction of US cartel criminal sanctions ‘through a back door’ in Europe. It is also worth noting that the German Constitutional Court had held in the same matter that questions of extradition do not fall in the scope of EU law and that the EU principle of non-discrimination does not have to be taken into account at all (BVerfG, decision of 17 February 2014 – 2 BvQ 4/14, para. 22). This view is inconsistent with settled case-law on the applicability of EU law in cross-border cases and also with the judgment of the Court rendered in the Pisciotti case, so one can wonder about how the German courts would react to a German national being deported to the US from another Member State.
Finally, as described above, the Court of Justice found that surrendering Mr. Pisciotti to Italy would have amounted to a less restrictive measure compared to his extradition to the US, and that this could have been achieved through a European arrest warrant issued by Italy. However, numerous submissions of Member States emphasised the legal and practical difficulties associated with this approach. The author considers that it would have been interesting for the judgment to have a fuller discussion of why the Court of Justice still thought that such a less restrictive approach was viable, alongside an explanation as to why Mr. Pisciotti’s argument that Germany should have prosecuted him in Germany under § 7(2) of the German Criminal Code was not accepted as a plausible less restrictive measure to extradition.