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Bayer (Adalat) case (ECJ)

European Court of Justice judgment (about 24 pages, HTML) of 6 January 2004
BAI and Commission of the European Communities v Bayer AG, Cases C-2/01 and C-3/01

Court of First Instance judgment (about 30 pages, HTML) of 26 October 2000
Bayer AG v Commission of the European Communities, Case T-41/96

European Commission decision (about 65 pages, HTML) of 10 January 1996

Article 81: concept of agreement/concertation
Article numbers refer to the 1997 consolidated version of the EC Treaty.

The judgment of the Court of Justice in the Bayer (Adalat) case is a leading authority on the concept of agreement or concerted practice caught by Article 81.

The case relates to parallel trade in Bayer's drug Adalat.

The Commission decision was that arrangements between Bayer and the French and Spanish wholesalers buying Adalat that prohibited exportation of the drug to other countries in the EU had infringed Article 81.

The Court of First Instance, on Bayer's application, quashed that decision, holding that the restriction on competition and parallel trade complained of by the Commission was not the object or effect of any agreement between Bayer and wholesalers, but rather the result of a unilateral policy of withholding supplies that had been implemented by Bayer in its dealings with wholesalers.

The Court of Justice rejected challenges by parallel traders and the Commission to the Court of First Instance's judgment. It endorsed the Court of First Instance's characterisation of the matters regulated by Article 81 by “the existence of a concurrence of wills between at least two parties, the form in which it is manifested being unimportant so long as it constitutes the faithful expression of the parties' intention” (paragraph 97) and held that (paragraphs 100-103):

... it is true that the existence of an agreement within the meaning [of Article 81] can be deduced from the conduct of the parties concerned.

However, such an agreement cannot be based on what is only the expression of a unilateral policy of one of the contracting parties, which can be put into effect without the assistance of others. To hold that an agreement prohibited by Article 81(1) of the Treaty may be established simply on the basis of the expression of a unilateral policy aimed at preventing parallel imports would have the effect of confusing the scope of that provision with that of Article 82 of the Treaty. ...

Therefore, the Court of First Instance was right to examine whether Bayer's conduct supported the conclusion that the latter had required of the wholesalers, as a condition of their future contractual relations, that they should comply with its new commercial policy.

and (paragraph 141):

The mere concomitant existence of an agreement which is in itself neutral and a measure restricting competition that has been imposed unilaterally does not amount to an agreement prohibited by that provision.

The judgment is explicitly limited to Bayer's challenge of the Commission's Article 81 infringement decision on the grounds that there was no relevant agreement, and does not consider whether Bayer's conduct might have been an abuse of a dominant position prohibited by Article 82.

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Last changed by Franck at 7:55 PM on Monday 2 October 2006.

Reference for this page:
Reckon Open "Bayer (Adalat)" 2006-10-02T19:55:52
Link within Reckon Open: [[Bayer (Adalat)]]