Procedural Rights in EU Administrative Competition Proceedings: Ex Ante Mergers

Abstract

The present contribution has two inter-related purposes: first, to analyse the context and legal framework of procedural rights in EU competition law, in particular, the administrative notification of mergers, and second, to critically review any perceived flaws in the substantive, institutional design or exercise of these procedural rights in practice, thereby offering proposals for institutional reform.

The first and second sections provide an overview of the purpose and scope of application of the EU Merger Control Regulation 139/2004, including its Implementing Regulation 1269/2013, highlighting the major principles underpinning the informal stage, Phase I and II investigations, and procedural deadlines. The third section goes on to question why procedural rights in mergers are contestable and offers constructive reviews of the criticism of the current system. This section questions primarily whether there should be social responsibility for corporations’ procedural rights as is the case under the ECHR regime. Since the administrative procedure of notification of mergers aims to protect the public choice of individual consumers before the corporatist intentions to merge and expand, the EU Merger Regulation produces a contrasting ‘vertical’ rather than ‘horizontal’ effect (supra-national competition law protecting the public, not the individual citizen). The section also prepares the ground for the fourth section, which thoroughly examines whether a human rights inspired catalogue is also feasible for corporations in merger proceedings. The fourth section offers a comparative analysis of the ECHR system to distinguish ‘original’ or ‘express’ procedural rights in mergers, such as the right to good administration of justice, namely, the right to a fair hearing, within a reasonable time, and before an independent and impartial tribunal; ‘implied’ rights, such as the right to due process, including the right to a fair presentation of evidence through the sending of the statement of objections, the right to an adversarial hearing by replying to the statement of objections, the right to have access to one’s file, and the right to a reasoned decision; and ‘derived’ rights, such as the right not to give evidence against oneself. The most heated debate concerns the independence of the European Commission as public administration and the decision-making process in merger cases, which demands institutional reform, both from inside because of a strongly hierarchical administration of justice, thus combining both investigative and prosecutorial functions, and from outside because of the perception of politicisation of economic merger decisions by the College of Commissioners and by the mandate of the Commissioner for Competition. The paper argues in favour of a de-centralisation of such internal and external administrative competences, including a Public Hearing Office. The fifth section concludes.

Keywords: EU competition law, administrative law, EU mergers, EU Merger Control Regulation 139/2004, Implementing Merger Control Regulation 1269/2013