ECJ speaks out on confidentiality of leniency statements

On March 14, 2017 the Court of Justice of the European Union (“ECJ”) issued an important judgment on the protection of leniency statements under the EU rules on leniency.

On May 3, 2006, the European Commission (“Commission”) adopted a Decision in case COMP/F/38.620 – Hydrogen Peroxide and Perborate (“HPP Decision”) finding that several undertakings, under which Evonik Degussa, infringed Art. 101 TFEU (European cartel prohibition). Under the EU rules on leniency, Evonik Degussa received full immunity from fines, as it was the first to come forward and confess.

In the course of 2007, a non-confidential version of the HPP Decision was published on the Commission’s website. In 2011, the Commission informed all parties to the infringement that it intended to publish an extended, non-confidential version of the HPP Decision. In this context, Evonik Degussa was asked to identify confidential information. Evonik Degussa objected to the proposed publication because the extended, non-confidential HPP Decision contained information submitted by Evonik Degussa under the EU rules on leniency. It concerned, interalia, information on business relations. According to Evonik Degussa, publishing this information would run counter to the principles of the protection of legitimate expectations and equal treatment.

After some disagreement with the Commission and its hearing officer about whether or not to publish the extended, non-confidential version of the HPP Decision, the ECJ ended up ruling on the confidential status of leniency statements.

No verbatim quotations
The ECJ ruled that the Commission could not include verbatim quotations from Evonik Degussa’s leniency statement in the extended, non-confidential version of the HPP Decision.

Rather, so the ECJ emphasised, it is under no circumstance permitted to publish verbatim quotations of leniency statements. This is different for documents provided by undertakings in support of leniency statements. Subject to the normal confidentiality requirements, verbatim quotations from these ‘supporting documents’ are allowed.

Leniency statements in the Netherlands
It remains unclear whether a leniency statement filed with ACM (under Dutch leniency rules) benefits from the same protection as its European equivalent. After all, in the Netherlands there is no similar judgment to the one in Evonik Degussa that sees on the publication of verbatim quotations in leniency statements.

However, the Dutch Trade and Industry Appeals Tribunal (“CBb”) ruled that the rights of defence of cartel participants outweigh considerations regarding the effectiveness of ACM’s leniency programme. This was determined in proceedings concerning the flour cartel before the CBb, in which ACM submitted oral leniency statements only to the CBb, in order to prevent that cartel participants who did not receive leniency would have access to the oral leniency statements of other cartel participants. The CBb ruled that in light of the rights of defence of the undertakings concerned, ACM could not exclude them from inspecting the oral leniency statements. It has to be kept in mind however, that this is a procedure before the administrative court in which the cartel participants challenged a decision of ACM.

For procedures in civil courts that concern private damages claims from cartel participants, absolute protection of leniency statements is provided for by law. Article 846 of the Dutch Code of Procedure, based on Directive 2014/104/EU (on antitrust damages actions), stipulates that no access can be given to leniency statements held by competition authorities.

Leniency statements can also not simply be obtained with a request based on the Public Access Act. The CBb indicated in 2016 that Article 7 of the Establishment Act of ACM is a special provision that works as an exception on the rights of access based on the Public Access Act. This means that a party requesting access to certain leniency statements from ACM, will be rejected. However, ACM is subject to an obligation to give reasons why information it does not want to disclose falls under the confidentiality guaranteed by Article 7 Establishment Act of ACM. Given the sensitive information in leniency statements, this is very unlikely to be problematic.

That verbatim quotations from leniency statements may never be published, is a step in the right direction for leniency applicants. The judgment of the ECJ can provide for a – by the Commission much desired – increase in the number of leniency applications. It is also good to realise that this ‘ban on quotations’ does not concern documents supporting leniency statements. For this type of documents, undertakings will still have to resort to often-difficult negotiations with the Commission on the confidentiality of information for the publication of a decision. Regarding the publication of verbatim quotations from leniency statements in the Netherlands, it remains to be seen whether and when ACM or the (administrative) court will give clarity.