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Competition Law

Analysis - debate - current awareness

14 FEB 2012

Court of Justice allows application of national competition law to penalise cartel activity prior to EU accession

On 14 February the Court of Justice of the European Union (CJEU) ruled in Toshiba Corporation and Others v the Czech competition authority that both the Czech competition authority and the European Commission could each penalise undertakings that had participated in a worldwide switchgear cartel prior to the Czech Republic's accession to the EU.

The Czech competition authority fined Toshiba and other companies in relation to pre-accession cartel activities, that took place in the Czech Republic. The undertakings concerned challenged this decision and the fines before the Regional Court at Brno, alleging that since the cartel activities ceased on 11 May 2004, after the Czech accession, and that both Czech and Commission proceedings were initiated after 1 May 2004, they were being doubly penalised for an infringement that ought to have been dealt with at EU level. The court at Brno requested a preliminary reference to the CJEU.

The CJEU held that the Czech competition authority could rule on anti-competitive effects of a cartel in the Czech Republic in the period preceding its EU accession, over which the Commission does not have jurisdiction. Given that the fines levied by the Commission did not take into account the cartel activities preceding the Czech accession, the court held that the principle of ne bis in idem, which prevents the accumulation of penalties in respect of the same infringing act, was not infringed in this case.

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