On July 14 2011 Tribunal A of the Court of Appeals on Economic Criminal Matters issued a resolution annulling a decision of the Antitrust Commission issued under Section 35 of the Antitrust Law (25,156).
The case at hand involved Papel Prensa SA - an Argentine corporation dedicated to the production of newsprint paper - and the supplier to most national newspapers. The resolution imposed a judicial limit on the commission's powers when issuing preventive measures.
A client of Papel Prensa, the editor of a newspaper from the province of La Rioja, alleged that Papel Prensa had unjustifiably delayed the delivery of newsprint paper and that such conduct had harmed the newspaper.
Section 35 of the Antitrust Law enables the commission to issue, during the course of an investigation, preventive measures requiring compliance with certain conditions or ordering the cessation of anti-competitive behaviour when such conduct has the potential to damage competition.
The commission concluded that in this case Papel Prensa had caused an important delay in the delivery of an essential component of the business. Thus, on October 6 2010 the commission issued Decision 132/10, through which it set down a preventive measure designed to prevent significant harm to the competition regime. The decision ordered Papel Prensa not to engage in conduct that constituted unjustified discrimination towards its clients when compared to the company's behaviour towards its shareholders and controller and/or its subsidiaries. Papel Prensa appealed the decision, claiming that the commission lacked the power to adopt such measures, and requesting annulment of the decision.
Tribunal A of the Court of Appeals on Economic Criminal Matters focused its analysis on the powers of the commission with regard to antitrust regulations. The resolution of Tribunal A states that the commission is a public agency, created by a law that is no longer in force (Law 22,262), whose duties consist of the assessment, study and instruction of issues as decided by the minister of the interior. In addition, it states that Section 58 of the Antitrust Law provides that the commission should continue to deal with such matters until the creation of the National Antitrust Tribunal. Finally, the resolution states that the antitrust regulations gave the commission no legal power to issue this type of decision, and therefore the court ordered the annulment of the decision.
The resolution imposes limits on the commission's powers to issue preventive measures. It also confirms the 2009 decision of the Federal Court of Appeals on Civil and Commercial Matters in the Telefónica/Telecom case (for further details please see "Preventive measures in antitrust investigations must be guaranteed"). In that case, the commission concluded that a certain transaction that was not notified pursuant to Section 8 of the Antitrust Law was actually subject to antitrust clearance. As the transaction was closed before the commission reached such conclusion, the court ordered the buyer, by means of a preventive measure, to refrain from exercising its voting rights in the acquired company until the transaction was authorised. This decision was appealed to the Federal Court, which on July 27 2009 stated that the commission lacked adequate powers to issue the preventive measure. In addition, it stated that in any case, the issuance of such type of measure should be requested from a judge.
Thus, in Telefónica/Telecom the Federal Court stipulated that the commission is not competent to issue preventive measures. It also emphasised that the commission's duties are limited to investigating infringements of the Antitrust Law and issuing certain decisions.
Thus, both Tribunal A of the Court of Appeals on Economic Criminal Matters and the Federal Court of Appeals on Civil and Commercial Matters have now held that the Antitrust Commission cannot issue preventive measures under Section 35 of the Antitrust Law.
For further information on this topic please contact Alfredo M O'Farrell or Miguel del Pino at Marval O'Farrell & Mairal by telephone (+54 11 4310 0100), fax (+54 11 4310 0200) or email ([email protected] or [email protected]). The Marval O'Farrell & Mairal website can be accessed at www.marval.com.ar.