Ryanair Holdings Plc (Ryanair) v Competition Commission (CC) & Anor

The duty of sincere co-operation is fact-sensitive. It does not automatically require a national competition authority to suspend an investigation whenever the European Commission is examining a related concentration. Under Council Regulation (EC) No 139/2004, European and national merger jurisdictions are mutually exclusive: if European Commission jurisdiction is engaged, it is exclusive; otherwise the Member State has exclusive jurisdiction. A stay may be required where pending European proceedings could establish that national steps were unlawful. That principle did not apply where the Commission had no jurisdiction over the minority shareholding. The national authority could continue its investigation, while deferring or reconsidering remedies if later events made that appropriate.

Following an OFT reference under the Enterprise Act 2002, the Competition Commission investigated Ryanair’s minority shareholding in Aer Lingus. Ryanair subsequently announced a public bid for the remaining shares, which was under examination by the European Commission pursuant to the Merger Regulation.

The CAT dismissed Ryanair’s application under section 120 to quash or stay the investigation and a section 109 information notice: [2012] CAT 29. The appeal concerned whether Article 21(3) of the Merger Regulation or the duty of sincere co-operation under Article 4(3) TEU required the Competition Commission to suspend its investigation pending the European Commission’s decision.

Appeal dismissed. Etherton LJ delivered the judgment, with Pill and Lewison LJJ agreeing.

1. The duty of sincere co-operation under Article 4(3) of the Treaty on European Union subsists at all times. Whether it requires a Member State to act or refrain from acting, and what timing or procedure fulfils the duty, is highly fact-sensitive. Several courses may be available, and the Member State may choose the appropriate course provided the duty is fulfilled.
2. The jurisdictions under the Merger Regulation and domestic merger legislation are mutually exclusive, rather than overlapping in the strict sense. If the European Commission’s jurisdiction is engaged, it is exclusive. If it is not engaged, the Member State has exclusive jurisdiction. The Commission had no jurisdiction over Ryanair’s minority shareholding, so Article 21(3) did not bar the domestic investigation.
3. The earlier decision in Ryanair Holdings plc v the Office of Fair Trading and Aer Lingus plc [2012] EWCA Civ 643 was materially different. Its ratio required abstention while pending appeals could establish that Article 21 gave the Commission exclusive jurisdiction over the entire concentration. The earlier references to oppressive and mutually destructive concurrent investigations were confined to that situation and did not establish a general rule requiring a stay whenever investigations concerned related matters.
4. Applying the first principles, a stay was neither necessary nor appropriate. Even if the two investigations could produce relevant or inconsistent analyses, the European Commission was expected to decide first. If the Competition Commission reported first and found an anti-competitive outcome, section 41(3) of the Enterprise Act 2002 allowed it, where appropriate, to defer remedial action and reconsider it in light of the European decision.
5. Continuing the investigation was therefore not a breach of the duty of sincere co-operation and was not unlawful on judicial review principles under section 120 of the Enterprise Act 2002. The application to quash or stay the investigation and section 109 notice was correctly dismissed.

• Court of Appeal (Civil Division): appeal dismissed; [2012] EWCA Civ 1632.
• Competition Appeal Tribunal: Ryanair’s application to quash or stay the Competition Commission’s investigation and section 109 notice dismissed; [2012] CAT 29.