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The European Union Is a Federation Under Competition Law? Understanding of the Complex System of the EU with the Perspective of Competition Law

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The European Union Is a Federation Under Competition Law? Understanding of the Complex System of the EU with the Perspective of Competition Law The European Union is a Federation under Competition Law? Understanding of the Complex System of the EU with the Perspective of Competition Law Baris Ozturk* 1. Introduction There has been a heated debate about the position of competition law in the European Union (EU) because of the commission’s largely involvement on Member-states internal affairs and competition policies to ensure the single market. Nowadays, the issue is becoming more popular with the consideration of the populist member-states’ governments and the its effect on EU parliament election. The plural voices on the competition policies from member-states will affect the nature of ensuring the single market. This essay will discuss and show the aspects of federal characteristic in the scope of the EU competition law. The doctrine of supremacy and the direct effect of competition law will be covered by considering the EU Treaties, Regulations and cases. Additionally, institutions and the relationship of institutions is another significant aspect to cover and understand the system of EU competition law. Next, the procedural law of competition law which was believed a part of internal affair for each member-states and the highly broad definitions in the treaties will be the second part of this essay. How much the EU is a union or federation with perspective of competition law practise will be discussed. 2.Analysing Federal Characteristic of EU Competition Law Under the Supremacy and Direct Effect 2.1 The doctrine of Supremacy The European Union has a unique structure called an autonomous system of law1. Treaty on European Union (TEU) and the Treaty on the Functioning of the European Union (TFEU) are the constitutional basis of the EU. Even though these treaties explain the most structural organisations, policies and aims, there is surprisingly not statement about conflict of laws between EU law and national law of the member-states in Treaties. It should be noted that there is a statement in the declaration of Treaty of Lisbon(ToL) which is about the principle of supremacy of the case law (without directly mentioning) for the European Court of Justice(CJEU), European Union(EU) laws has a primacy over national laws of member-states developed by European Court of Justice in the case called Costa v. ENEL(Case 6/64) and addition to EU law supremacy on the national law, the court held that EU has also superseded over any national law in clashing including member-states’ constitutional law. Moreover, it is also clear that national courts have to follow EU law under any condition and give a full effect to any laws from the EU in the case of conflict of laws. In the light of the CJEU decision, the supremacy of EU law is absolute however, there is an exemption that should be considered. The EU only has supremacy in the scope of its competences which are in the TEU Article 4(1) and Article 5(1). These articles provide that the EU law’s limit is based on *Baris Ozturk; LLB, Istanbul Bilgi University, LLM Candidate, Trinity College Dublin, The University of Dublin 1 Diarmuid Rossa Phelan, Revolt or Revolution: The Constitutional Boundaries of the European Community (Round Hall Sweet & Maxwell 1997), 11 the principle of conferral, and if areas not conferred by the EU remain the member-states, whereas TFEU article 3(1) shows that EU has exclusive competence on the competition law, and member-states confer it. The supremacy of European Union law does also cover that when there is an Eu law, national courts should disapply their national law. Likewise, if there is not Eu in the situation, National courts can apply their national law2. This supremacy of EU law does also cover the administrative body of each member-states3. In the light of article 3(TFEU) the exclusive competence and the supremacy coming from the European court of justice, the EU has a full access competence and supremacy on the competition law considering its competence and scope. Therefore, the EU has the ultimate power and central authority. Regulation 1/2003 should be mentioned under that part because it highlights and ensures pure supremacy of EU law over national law4 and it is an evidence of evolving supremacy of EU law. After that point, it can be seen that the EU, similar to a central government, meaning that draws a line for the national government whether what they can do or not. It is one of the main federal characteristics of EU competition law. 2.2 The direct effect of European Union Law The direct effect of the EU is another aspect which could be seen as a federal character. There is no article or statement of the direct effect of European Union law in the treaties. It has been introduced by the court of justice, similar to the doctrine of supremacy. In the case of Van Gend(Case 26/62), the CJEU held the direct effect of EU law on individuals5. There are two different approaches to direct effect; these are primacy and dual. Rather than going deep into the approaches to direct effect and regulation’s vertical and horizontal side of direct effect, aspects of federalist character is more important because the relationship between Eu law and member-states has a resemblance from the federalism. One of the resemblances is that international agreements in public international system should not directly affect the individual because they are not subject to the international agreements. Generally, agreements in public international law should be recognised in parliaments, however, the direct effect of EU law bypass all this procedure, and it becomes closer to the federalist system. It is an essential tool for EU law because of the unification and standardisation. The CJEU took all of these aspects from Public international law. In that 2 Joined Cases C-10/97 to C-22/97 Ministero Delle Finanze v. IN.CO.GE.’90 Srl and Others [1998] ECR I- 6307 as cited by alina Kaczorowska-Ireland, European Union Law (4th Edition, Routledge 2016), 273 3 Case 103/88 Fratelli Costanzo v. Comune di Milano [1989] ECR 1839; Case 224/97 Erich Ciola v. Land Vorarlberg [1999] ECR I-2517 as cited by alina Kaczorowska-Ireland, European Union Law (4th Edition, Routledge 2016), 273 4Thomson Reuters, EC Regulation 1/2003: a systemic change in the enforcement of articles 81 and 82 https://uk.practicallaw.thomsonreuters.com/9-102- 4430?transitionType=Default&contextData=(sc.Default)&firstPage=true&bhcp=1 accessed on 22 October 2019 5 Diarmuid Rossa Phelan, Revolt or Revolution: The Constitutional Boundaries of the European Community (Round Hall Sweet & Maxwell 1997), 26 system, there are self-executing treaties, and which are automatically become a part of the national law of the signatory parties6. When these elements come to together on the competition law, it can be concluded that Eu competition law has a federalist character compared to other than any areas in the EU. 3.Analysing Federalism Under the Institutions and the Relationship of Institutions There are three leading institutions in the EU, namely, parliament, commission and general council7. Moreover, there are 28 countries in the Union, and all countries have their institutions. The general principle of the public international law is that counterpart’s interaction, equal positions interact with equal positions. In this respect, the EU has the same principle coming from public international law, and it shows the equality between countries and institutions. It is remarkably tough to see one of the countries’ presidents with other countries’ senators or secretary of ministry because countries take into account this issue as showing sovereignty, power and equivalence of their country. It is considered this principle even in the ‘Union’, however the relationship between equals is different in the subject of competition law. In the light of the regulation 1/2003 article 15(3) which is the main aspect of this headline, it is evidence of the interaction amongst the commission, competition authorities and national courts. Commission directly submit written or oral observation to a national court or national competition law authority along a similar line of central governments which means that the commission bypassing the head of any member- states can contact to national courts or National Competition Authority(NCA). Similarly, the exchange of information under article 12 of Regulation 1/2003 is an unusual procedure. Three institutions can share information, including confidential information. The commission, NCA and national court of member-states have broken a principle of public law, and they can share all kind of information without consent from the head of government of member-states. In the light of article 18 about requests for information, it is evident in passing all diplomatic process. The article provides that the commission may require all information by simple request or by a decision from institutions. Furthermore, the commission has the power to take a statement from undertakings either natural or legal person by article 19 of Regulation 1/2003. Likewise, the commission makes a connection directly to individuals without any consent or using diplomatic channels and can take statements from undertakings bypassing national authorities. Under the regulation 1/2003 sections, it seems to be federalist order between central government and regional government because the commission gives directions to national courts, and NCAs how they should approach the competition law of the EU by using this regulation and the commission can actively be a part of the national law system by submitting written and oral observations, sharing information. 6 Alina Kaczorowska-Ireland, European Union Law (4th Edition, Routledge 2016), 305 7 European Parliament, THREE: 3main institutions of the EU (EU,2009) https://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+IM- PRESS+20090525STO56250+0+DOC+XML+V0//EN accessed on 21 October 2019 4.Analysing the Federal Character of EU Competition Law under the Procedural Law and Broad Definitions 4.1 Procedural Law First of all, the regulation1/2003’s substantial part is procedural regulating many relationship and procedure between institutions.
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