Roche Products Ltd and Others v Provimi Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Aikens |
| Judgment Date | 06 May 2003 |
| Neutral Citation | [2003] EWHC 961 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Claim No. 2002 Folio 470 |
| Date | 06 May 2003 |
The Honourable Mr Justice Aikens
Claim No. 2002 Folio 470
Claim No. 2003 Folio 475
Claim No. 2002 Folio 473
Claim No. 2002 Folio 476
IN THE HIGH COURT OF JUSTICE
Queens Bench Division
Commercial Court
Royal Courts Of Justice
Strand, London. Wc2a 2ll
Christopher Carr QC and Derek Spitz (instructed by Linklaters) for the_Claimants/Respondents in all four actions
Thomas de la Mare and Brian Kennelly (instructed by Ashurst Morris Crisp) for the Defendants/Applicants in Claim No. 2002 Folio 470 and the Defendants/Applicants in Claim No. 2002 Folio 475
Mark Hoskins (instructed by Freshfields Bruckhaus Deringer) for the Defendants/Applicants in Claim No. 2002 Folio 473 and the Defendants/Applicants in Claim No. 2002 Folio 476
Approved Judgment
Hearing dates: 5th, 6th, 10th, 11th,12th, 13th, February 2003
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Synopsis
In May 1999 the European Commission started an investigation into the vitamins and pigment markets in Europe. On 21 November 2001 the European Commission ("the Commission") made a Decision, ("the Decision") which was published on 10 January 2003. The Decision held that various manufacturers of vitamins had operated cartels, contrary to Article 81 (formerly Article 85) of the EC Treatyi, in relation to the sale of vitamins ii within the EU and the European Economic Area ("EEA") for periods of up to ten years between 1989 and 1999. The Decision held that F. Hoffmann-La Roche AG ("Roche Switzerland"), a Swiss company, had participated in the cartels in relation to all the vitamins covered by the investigation. It also held that Aventis SA (which was known at the time as Rhône-Poulenc SA) was responsible for an infringement of Article 81 through the participation of its subsidiary, Rhône-Poulenc Animal Nutrition (which has since become Aventis Animal Nutrition SA —"AAN France"). AAN France was involved in the same cartels as F. Hoffmann-La Roche AG, but in relation only to vitamins A and E. I will refer to companies in the Hoffmann-La Roche group of companies as "the Roche" group. I will refer to companies in what was the Rhône-Poulenc group (now called Aventis) as "the Aventis" group.
In 1999 criminal proceedings were started in the USA, alleging that F Hoffmann-La Roche AG had taken part in various cartels for vitamins sold in the US and elsewhere in the world. There were also investigations in the USA against Aventis companies. There have been proceedings in Canada and investigations in Australia concerning vitamin cartels in which it is said that Roche and Aventis companies were participants.
The Commission's Decision resulted in four actions in the Commercial Court against various companies in the Roche and Aventis groups. The actions were started in May 2002. The claimants are two English companies and a German company. Those companies were all direct purchasers of vitamins from companies within the Roche and Aventis groups. The defendant companies are sellers and associated companies in those two groups. The claimants' principal allegation in all the proceedings is that the defendant companies participated in various cartels, contrary to Article 81 of the EC Treaty, and that the claimant companies have suffered damage because vitamins were sold at an inflated price as a result of the formation and implementation of the cartels. This is alleged to give the claimants a right to damages for breach of a statutory duty not to infringe EC competition laws, in particular Article 81. iii
In the present series of applications before the court, the defendants' aim is to strike out and/or set aside part of these proceedings. The applications are made on the grounds that the claimants do not have an arguable case and/or that the English Courts do not have jurisdiction to determine these claims against most, but not all defendants. The applications raise issues about what a claimant has to prove to succeed in a claim for damages said to arise out of a breach of Article 81. They also raise questions on the proper application of EC Regulation 44 of 2001 ("Regulation 44" or "the Regulation") iv and the Lugano Convention, in circumstances when one side alleges that a foreign jurisdiction clause applies and this is challenged.
The questions argued in these applications are complex, not least because of the multiplicity of actions and parties. v This was not one of those jurisdiction challenges where I could read the papers in my room and hear only short oral argument. vi The helpful submissions of Mr Hoskins (for the Roche group of defendants), Mr de la Mare (for the Aventis group of defendants) and Mr Carr QC for the claimants lasted six days. I am very grateful to them all. I will consider the applications under the following broad headings: (A) The Commission Decision; (B) the actions and the jurisdictional framework; (C) the parties, the allegations, the applications and the issues that arise; (D) the applications to strike out parts of the cases or dismiss them as having no reasonable prospect of success; (E) the challenges to the jurisdiction based on Article 17 of the Lugano Convention and Swiss jurisdiction clauses; (F) the challenges to the jurisdiction based on Article 23 of Regulation 44 and German jurisdiction clauses; (G) the challenges to the jurisdiction based on Article 23 of Regulation 44 and French jurisdiction clauses; (H) conclusions.
A. The Commission Decision vii
This is central to the case, so it is necessary to set out some of the details.
(1) Section 1 is headed "The Facts" and Recital (1) sets out a "Summary of the Infringement ". It states:
"This Decision imposing fines for infringement of Article 81(1) of the [EC] Treaty and Article 53 of the EEA Agreementviii is addressed to the following undertakings….F Hoffmann-La Roche AG; ….Aventis SA".
The use of the word "undertakings" is important. It is a concept of the competition rules which have been developed from the EC Treaty. The concept of an "undertaking" is explained in Recitals 635 and 636 of the Decision, which state:
"[635] A change in legal form or corporate identity does not relieve an undertaking of liability to penalties for the anti-competitive behaviour. Liability for a fine may thus pass to a successor where the corporate entity which committed the violation has ceased to exist in law. This is because the subject of the competition rules in the [EC] Treaty and the EEA Agreement is the undertaking, a concept not necessarily identical to the notion of corporate legal personality in national commercial company or fiscal law".
[636] The "undertaking" is not defined in the Treaty. The Court of First Instance has found that "Article 81(1) of the Treaty is aimed at economic units which consist of a unitary organisation of personal, tangible and intangible elements which pursues a specific economic aim on a long-term basis and can contribute to the commission of an infringement of the kind referred to in that provision" (Case T-532/94Mo Och Domsjo AB v Commission [1998] ECR II —1989 at paragraph 87)".
Recital 637 of the Decision points out that the EC competition law concept of the "undertaking", which can embrace a number of corporate entities within one economic unit, is to be contrasted with the need to identify one specific legal personality which is responsible for the "undertaking", to which a Decision concerning an infringement of Article 81 can be addressed. It is that legal entity which will be held liable to enforce the rules and which will have to pay any penalty imposed for infringement of Article 8 1(1).
(2) Recital (2) summarises the basic facts of the EU cartels:
"For the periods and for the different vitamin products specified in this section the manufacturers of [various] vitamins… and carotinoids supplying the Community and the EEA entered into and participated in a series of continuing agreements contrary to Articles 81(1) of the Treaty and Article 53 EEA by which they fixed prices for the different products, allocated sales quotas, agreed on and implemented price increases, issued price announcements in accordance with their agreements, sold the products at the agreed prices, set up a machinery to monitor and enforce adherence to their agreements and participated in a structure of regular meetings to implement their plans".
The verbs used —"entered into", "participated in", and "implemented" are significant. They are also used in the claimants' pleadings. It is clear that the meaning in the pleadings is intended to reflect that used in the Decision itself.
(3) Section 1.2.5 of the Decision is headed "The Producers"....
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