“Recognition of such equivalence shall be subject only to such reasonable and proportionate conditions as are objectively justified by the need to ensure safety on the railway network.”
“(1) The purpose of this section is to ensure that so far as is possible (having regard to any relevant differences between the provisions concerned), questions arising under this Part in relation to competition within the United Kingdom are dealt with in a manner which is consistent with the treatment of corresponding questions arising in EU law in relation to competition within the European Union. (2) At any time when the court determines a question arising under this Part, it must act (so far as is compatible with the provisions of this Part and whether or not it would otherwise be required to do so) with a view to securing that there is no inconsistency between— (a) the principles applied, and decision reached, by the court in determining that question; and (b) the principles laid down by the Treaty and the European Court, and any relevant decision of that Court, as applicable at that time in determining any corresponding question arising in EU law. (3) The court must, in addition, have regard to any relevant decision or statement of the Commission. (4) Subsections (2) and (3) also apply to— (a) the [CMA]; and (b) any person acting on behalf of the [CMA], in connection with any matter arising under this Part. (5) In subsections (2) and (3), “court” means any court or tribunal. (6) In subsections (2)(b) and (3), “decision” includes a decision as to— (a) the interpretation of any provision of EU law; (b) the civil liability of an undertaking for harm caused by its infringement of EU law.”
“99. . . . Each of the Key Schemes in terms provides for responsibilities and obligations that are undertaken by the undertakings which sign up to them as a condition of being authorised. It does not matter that the agreements are imposed on suppliers rather than freely negotiated. By participating in the Key Schemes, undertakings acquiesce in their provisions. That is sufficient to constitute an agreement, as established by the car dealership cases relied on by Achilles. 100. As to whether the Key Schemes are subject to competition rules, we consider that the distinction sought to be drawn by Network Rail between its economic activity and the regulation of its managed infrastructure is not well founded and is not supported by the judgment of the Court of Justice in FENIN. 101. In FENIN, the issue was whether state-funded management bodies which purchased medical goods and equipment to be used to provide services to patients free of charge in the Spanish public health service were undertakings engaged in economic activity. The Court of Justice held that the management bodies’ purchasing activity should not be dissociated from the downstream use to which those purchases were put (which was not an economic activity) and that the management bodies were therefore not undertakings engaged in economic activity. 102. In the present case, allowing access to its managed infrastructure is an essential part of, and not dissociable from, Network Rail’s operation of the railway infrastructure which is an economic activity. The fact that in operating the Key Schemes Network Rail is setting out rules with a view to ensuring safety and to comply with regulatory obligations does not take it outside the scope of that activity.”
“151. In this context, the Tribunal attaches significant weight to the fact that Achilles, with its experience and detailed knowledge of the market, wishes to compete with RISQS and believes that it can do so. It has already incurred a substantial proportion of any costs of entry and has a recent presence in the market. The Tribunal accepts that there may well be real benefits to allowing that choice and allowing competition in the market to evolve. These benefits would include not just the general benefits which can be expected to flow from making the quality and pricing of the services currently provided subject to competitive constraints, but also the possibility of solutions better tailored to the needs of buyers and suppliers, whose activities are not limited to the GB rail sector. Whilst it might be argued that the impact of competition from Achilles (and other suppliers of assurance schemes) in other sectors would continue to be felt by members of the RSSB and the community of suppliers in the rail industry who are also active in other sectors even if Achilles was not active in the railway sector, that impact would be less direct. 152. Given that the RISQS-only rule in the Sentinel Scheme and OTPO Scheme has a prima facie restrictive effect on competition, in that it reserves to a single scheme provider a significant segment of the market for supplier assurance to the rail industry, the Tribunal would be reluctant to find that the restriction has no actual effect on the basis of Network Rail’s case that only the market would tip in favour of RISQS. It is fundamentally not for Network Rail to make the decision for other buyers and suppliers that they would prefer RISQS to other supplier assurance services. 153. Furthermore, the difficulties facing Achilles in establishing itself as a viable competitor to RISQS are partly attributable to the effects of the RISQS-only rule itself. If Achilles had been allowed to compete with RISQS for business from buyers and suppliers using the Sentinel Scheme and OTPO Scheme from May 2018 onwards, it might be at less of a competitive disadvantage now. The Tribunal considers that the issue whether the RISQS-only rule has an appreciable effect on the market should be assessed by reference to the state of the market as it would have been had the rule never existed rather than by the reference to the state of the market now.”
“Although the scope for price competition (in the absence of lossleading or cross-subsidisation on a long-term basis) and product differentiation would be limited, we conclude that the RISQS-only rule does cause significant foreclosure of demand in a significant segment of the market for supplier assurances schemes in the GB railway sector and that the RISQS-only rule has an appreciable effect on competition in that market.”
“. . . Network Rail has not established that those purposes would be impossible to achieve without the RISQS-only rule. The Tribunal considers that those safety purposes could be achieved by alternative providers of supplier assurance services working to the same standards as RISQS and subject to effective monitoring, with their IT platforms linked to RISQS’s and/or their data freely accessible to Network Rail and with the RISQS forum open to participation by other providers of supplier assurance services.”
“277. If we had found that the RISQS-only rule gave rise to safety benefits, it would have been necessary to consider whether Condition 3 (indispensability) was satisfied in relation to those benefits. Paragraph 75 of the Article 101(3) Guidelines states that Condition 3 “requires that the efficiencies be specific to the agreement in question in the sense that there are no other economically practicable and less restrictive means of achieving the efficiencies”. 278. In the OTOC case considered above the Court of Justice’s finding that OTOC’s requirement for institutional training was not objectively necessary (because its purpose could be achieved by less restrictive means) was determinative of the issue of indispensability. Similarly in the present case, it necessarily follows from our finding that the RISQS-only rule is not objectively justified on safety grounds because its safety purposes can be achieved by other less restrictive means, such that the RISQS-only rule is not indispensable. 279. If it had been necessary to consider Condition 4 (no elimination of competition), we would have found that the RISQS-only rule in the Sentinel Scheme and OTPO Scheme affords Network Rail the possibility of eliminating competition in respect of a substantial part of the market for supplier assurance services. Namely, that part of the market consisting of buyers and suppliers needing access to Network Rail’s managed infrastructure pursuant to those Key Schemes. The effect of the tender for the RISQS services is considered later in this judgment in the context of Achilles’ Chapter II claim.”
“The concept of abuse is an objective concept relating to the behaviour of an undertaking in a dominant position which is such as to influence the structure of a market where, as a result of the very presence of the undertaking in question, the degree of competition is weakened and which, through recourse to methods different from those which condition normal competition in products or services on the basis of the transactions of commercial operators, has the effect of hindering the maintenance of the degree of competition still existing in the market or the growth of that competition.”
“25. . . . any entity engaged in an economic activity, regardless of the legal status of that entity and the way in which it is financed (Höfner and Elser (C-41/90): [1991] E.C.R. I-1979; [1993] 4 C.M.L.R. 306 at [21]; and AOK-Bundesverband (C 264, 306, 354 & 355/01): [2004] E.C.R. I-2493; [2004] 4 C.M.L.R. 22 at [46]).”
“26. The Court of First Instance rightly deduced, in para.[36] of the judgment under appeal, that there is no need to dissociate the activity of purchasing goods from the subsequent use to which they are put in order to determine the nature of that purchasing activity, and that the nature of the purchasing activity must be determined according to whether or not the subsequent use of the purchased goods amounts to an economic activity.”
“25. As regards the possible effect of the exercise of public powers on the classification of a legal person such as ELPA as an undertaking for the purposes of Community competition law, it must be noted, as the Advocate General did at point AG49 of her Opinion, that the fact that, for the exercise of part 54. of its activities, an entity is vested with public powers does not, in itself, prevent it from being classified as an undertaking for the purposes of Community competition law in respect of the remainder of its economic activities (Aéroports de Paris v Commission of the European Communities (C-82/01 P) [2002] E.C.R. I-9297; [2003] 4 C.M.L.R. 12 at [74]. The classification as an activity falling within the exercise of public powers or as an economic activity must be carried out separately for each activity exercised by a given entity. 26. In the present case, it is necessary to distinguish the participation of a legal person such as ELPA in the decisionmaking process of the public authorities from the economic activities engaged in by that same legal person, such as the organisation and commercial exploitation of motorcycling events. It follows that the power of such a legal person to give its consent to applications for authorisation to organise those events does not prevent its being considered an undertaking for the purposes of Community competition law so far as concerns its economic activities referred to above. 27. As regards the effect that the fact that ELPA does not seek to make a profit may have on that classification, it should be noted that, in Ministero dell’Economia e delle Finanze v Cassa di Risparmio di Firenze SpA (C-222/04)[2006] E.C.R. I289; [2008] 1 C.M.L.R. 28 at [122] & [123]), the Court stated that the fact that the offer of goods or services is made without profit motive does not prevent the entity which carries out those operations on the market from being considered an undertaking, since that offer exists in competition with that of other operators which do not seek to make a profit.”
“. . . Such a regulation constitutes the expression of the intention of the delegates of the members of the profession that they should act in a particular manner in carrying on their economic activity.”
“40. In accordance with the case law of the Court, the FEU Treaty rules on competition do not apply to an activity which, by its nature, its aim and the rules to which it is subject, does not belong to the sphere of economic activity, or which is connected with the exercise of the powers of a public authority (see, inter alia, Wouters at [57], and the case law cited). 41. First, rules such as those at issue in the main proceedings cannot be regarded as not belonging to the sphere of economic activity. 42. It is common ground in that regard, on the one hand, that the OTOC itself provides training for chartered accountants and, on the other, that the access of other providers wishing to offer such training is subject to the standards set out in the contested regulation. Consequently, such a regulation has a direct impact on economic activity on the market of compulsory training for chartered accountants. 43. In addition, the obligation on chartered accountants to undertake training in accordance with the rules laid down by that regulation is closely linked to the practice of their profession, as the Polish government and the European Commission point out. Failure to comply with that obligation can therefore lead to disciplinary sanctions under arts 57(1)(a), 59(2), 63 and 64 of the Statute of the OTOC, such as suspension for a maximum period of three years or expulsion from that professional association. 44. Even if that regulation did not directly affect the economic activity of the chartered accountants themselves, as the referring court appears to suggest in its third question, that fact cannot, of itself, remove a decision of an association of undertakings from the scope of art.101 TFEU. 45. Such a decision can be such as to prevent, restrict or distort competition within the meaning of art.101(1) TFEU, not only on the market on which the members of a professional association practice their profession, but also on another market on which that professional association itself has an economic activity.”
“66. The case law shows that, where a decision on the part of a manufacturer constitutes unilateral conduct of the undertaking, that decision escapes the prohibition in Article 85(1) of the Treaty (Case 107/82. AEG v. E.C. COMMISSION; Joined Cases 25 & 26/84, FORD AND FORD EUROPE v. E.C. COMMISSION;Case T-43/92 , DUNLOP SLAZENGER v. E.C. COMMISSION). 67. It is also clear from the case law in that in order for there to be an agreement within the meaning of Article 85(1) of the Treaty it is sufficient that the undertakings in question should have expressed their joint intention to conduct themselves on the market in a specific way (Case 41/69.,ACF CHEMIEFARMA v. E.C. COMMISSION; Joined Cases 209215 & 218/78, VAN LANDEWYCK AND OTHERS v E.C. COMMISSION;Case T-7/89 , HERCULES CHEMICALS v. E.C. COMMISSION). 68. As regards the form in which that common intention is expressed, it is sufficient for a stipulation to be the expression of the parties’ intention to behave on the market in accordance with its terms (see, in particular, ACF CHEMIEFARMA, and VAN LANDEWYCK), without its having to constitute a valid and binding contract under national law (SANDOZ). 69. It follows that the concept of an agreement within the meaning of Article 85 (1) of the Treaty, as interpreted by the case law, centres around 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. 70. In certain circumstances, measures adopted or imposed in an apparently unilateral manner by a manufacturer in the context of his continuing relations with his distributors have been regarded as constituting an agreement within the meaning of Article 85(1) of the Treaty (Joined Cases 32, 36-82/78, BMW BELGIUM AND OTHERS v. E.C. COMMISSION; FORD AND FORD EUROPE; Case 75/84, METRO v. E.C. COMMISSION (“METRO II”); SANDOZ;Case C-70/93 , BMW v. ALD). 71. That case law shows that a distinction should be drawn between cases in which an undertaking has adopted a genuinely unilateral measure, and thus without the express or implied participation of another undertaking, and those in which the unilateral character of the measure is merely apparent. Whilst the former do not fall within Article 85(1) of the Treaty, the latter must be regarded as revealing an agreement between undertakings and may therefore fall within the scope of that article. This is the case, in particular, with practices and measures in restraint of competition which, though apparently adopted unilaterally by the manufacturer in the context of its contractual relations with its dealers, nevertheless receive at least the tacit acquiescence of those dealers. 72. It is also clear from that case law that the Commission cannot hold that apparently unilateral conduct on the part of a manufacturer, adopted in the context of the contractual relations which he maintains with his dealers, in reality forms the basis of an agreement between undertakings within the meaning of Article 85(1) of the Treaty if it does not establish the existence of an acquiescence by the other partners, express or implied, in the attitude adopted by the manufacturer (BMW BELGIUM; AEG; FORD AND FORD EUROPE; METRO II; SANDOZ; BMW v. ALD).”
“127. There were differences in the way that the two economic experts defined the scope of the relevant market for supplier assurance services, applying the SSNIP or “small but significant non-transitory increase in price” test. This test seeks to identify the smallest relevant market within which a hypothetical monopolist could impose a profitable significant increase in price. Mr Parker, Achilles’ economic expert, considered that the relevant market was the market for Key Scheme compliant supplier assurance schemes on the footing that it would not be possible for a provider operating a different supplier assurance scheme to start providing Key Scheme compliant supplier assurance services because only Network Rail can give the necessary recognition. Mr Holt, Network Rail’s economic expert, disagreed and considered that the relevant market should be more broadly defined as the market for supplier assurance schemes in the GB rail industry on the basis that there would be significant competitive restraints on a hypothetical monopolist from collective intervention from buyers and suppliers. If a hypothetical monopolist sought to increase prices or decrease qualities, buyers and suppliers could intervene collectively as happened in 2016 when the previous RISQS scheme was put out to tender by the RSSB. 128. We prefer the definition of the market advanced by Mr Holt, for the reasons he gave. This definition of the market corresponds to the way the relevant market is defined in Achilles’ claim form, i.e. the market for the provision of supplier assurance services in the GB rail industry.”
“(a) Market C (very narrow, vn): provision of supplier assurance services for commodity codes (services) that are currently covered by RISQS. This market definition also excludes other supplier assurance schemes (e.g. RISAS) which specialise in other service or product markets related to the rail industry. I note that this definition is narrower than the definition proposed in Achilles’ Claim Form. (b) Market C (narrow, n): provision of supplier assurance services for the rail industry in the (sic) Great Britain. This market definition includes supplier assurance schemes other than RISQS, which specialise in other service markets related to the rail industry (e.g. RISAS). (c) Market C (wide, w): the provision of supplier assurance services in safety critical industries in Great Britain. This market definition includes supplier assurance schemes that operate in non-rail safety critical industries. (d) Market C (very wide, vw): the provision of supplier assurance services across all industries – safety critical or otherwise.”
“Consequently, to assess whether there is a market for the provision of supplier assurance services to the rail industry in Great Britain, one needs to assess whether a hypothetical monopolist provider of supplier assurance services could profitably increase total fees charged to buyers and suppliers of services related to the rail industry in Great Britain (while reoptimising the price structure as required) or otherwise worsen quality. The answer to this question depends on the extent of demand-side and supply-side substitutability for the supplier assurance services concerned.”
“138. The narrowest market put forward in Achilles’ Claim Form is the market for the provision of supplier assurance services in the rail industry in Great Britain (Market C(n)) and the widest is for the provision of supplier assurance services in safety critical industries in Great Britain (market C(w)), but the market might be wider still (such as the provision of all closed related services to supplier assurance services, whether safety critical or not, C(vw)). 139. If one is purely considering demand-side factors, then neither of these alternative markets would be sustainable and the narrower definition associated with specific commodity codes would apply. 140. In this regard, as noted in paragraph 120 above, Achilles, Altius and Capita compete for the provision of supplier assurance in other industries. The IT and audit solutions required for these sectors may be easily adopted to meet the requirements of buyers and suppliers in the rail industry. This observation is in line with the fact that Achilles’ own proposed TransQ Global (“TransQ”) scheme aims to operate across the whole transport sector. 141. Consequently, a hypothetical monopolist in this market who decided to increase prices by a small but significant amount may be swiftly replaced by a new entrant and thus find it unprofitable. Accordingly, a wider definition of the market – to include credible prospective entrants – may be more appropriate. 142. However, I do not have sufficient information to identify the breadth of this wider supply-side market since this will depend on a wide range of facts, including the precise level of diversification costs and so on. However, this is not determinative as the relevant market power issue is whether an incumbent provider of supplier assurance services in the rail industry could increase prices above the competitive level (or worsen quality), and this does not require high supply-side substitutability from all providers of related services. As noted in the previous subsection, I proceed on the basis that the supplier assurance market is narrowly defined, but consider that there are important constraints on RISQS.”
“This definition is narrower than the one proposed in Achilles’ Claim Form (paragraph 28.3) and the market in which RISQS operates. This approach does not take account of supply-side substitution (the ability and incentive for the industry to sponsor entry)”
“[s]ources of supply-side substitution could be other rail schemes, schemes operating in other sectors (if their diversification costs are low) and potentially a wider set of IT and process management services providers”
“20. The assessment under Article 101 consists of two steps. The first step, under Article 101(1), is to assess whether an agreement between undertakings, which is capable of affecting trade between Member States, has an anti-competitive object or actual or potential restrictive effects on competition. The second step, under Article 101(3), which only becomes relevant when an agreement is found to be restrictive of competition within the meaning of Article 101(1), is to determine the pro-competitive benefits produced by that agreement and to assess whether those procompetitive effects outweigh the restrictive effects on competition. The balancing of restrictive and procompetitive effects is conducted exclusively within the framework laid down by Article 101(3). If the procompetitive effects do not outweigh a restriction of competition, Article 101(2) stipulates that the agreement shall be automatically void.”
“108. Having regard to all the foregoing considerations, the answer to the fourth question is that a regulation which puts into place a system of compulsory training for chartered accountants in order to guarantee the quality of the services offered by them, such as the contested regulation, adopted by a professional association such as the OTOC, constitutes a restriction on competition prohibited by art.101 TFEU to the extent, which it is for the referring court to ascertain, that it eliminates competition on a substantial part of the relevant market, to the benefit of that professional association, and that it imposes, on the other part of that market, discriminatory conditions to the detriment of competitors of that professional association.”
“160. . . the question of effect is not to be assessed simply on the basis of market share or complete foreclosure, but can result from a segmenting of the market and a distortion in the way competition operates affecting one segment.”
“Market definition is a tool to identify and define the boundaries of competition between firms. It serves to establish the framework within which competition policy is applied by the Commission. The main purpose of market definition is to identify in a systematic way the competitive constraints that the undertakings involve face. The objective of defining a market in both its product and geographic dimension is to identify those actual competitors of the undertakings involved that are capable of constraining those undertakings’ behaviour and of preventing them from behaving independently of effective competitive pressure.” (4) An effect on competition must be demonstrated by reference to the situation which would pertain on the market in the absence of the agreement or restriction in question: “the competition in question must be understood within the actual context in which it would occur in the absence of the agreement in dispute” (see LTM). This requires a consideration of the appropriate counterfactual situation. (5) An anti-competitive effect can consist in the segmenting of a market and a distortion or restriction of the way that competition operates in that segment of the market, even if competition may continue in other segments. See Socrates at [160].”
“. . . the correct counterfactual is one in which Achilles would compete with RISQS at least for a time and … its competition would lead to some benefits in terms of lower prices and product differentiation, as contended by Achilles.”
“Although the scope for price competition (in the absence of lossleading or cross-subsidisation on a long-term basis) and product differentiation would be limited, we conclude that the RISQS-only rule does cause significant foreclosure of demand in a significant segment of the market for supplier assurances schemes in the GB railway sector and that the RISQS-only rule has an appreciable effect on competition in that market.”
“Sixthly, we note that any other buyer of supplier assurance services for works on Network Rail managed infrastructure or other railway services would also have safety-related obligations under applicable legislation which would extend to supplier assurance. Consequently, it does not follow that Network Rail is the only party concerned with safety or that Network Rail should be the sole arbiter of the relevant standards when other buyers (or at least buyers who are not in the Network Rail supply chain) are involved. Achilles pointed to dicta inCase T-30/89 Hilti AG vCommission EU:T:1991:70 at [118] to [119] that it is primarily the role of public authorities, not dominant undertakings, to set and enforce safety standards.”
“An agreement or concerted practice entered into between two or more undertakings each of which operates, for the purposes of the agreement or the concerted practice, at a different level of the production or distribution chain, and relating to the conditions under which the parties may purchase, sell or resell certain goods or services.”
“The exemption provided for in Article 2 shall apply on condition that the market share held by the supplier does not exceed 30% of the relevant market on which it sells the contract goods or services and the market share held by the buyer does not exceed 30% of the relevant market on which it purchases the contract goods or services.”
“274. We conclude that, if Network Rail is required to recognise alternative providers of supplier assurance services, some additional costs of oversight will be required and that these would not be limited to occasional meeting attendance as contended by Achilles. We accept Network Rail’s argument that it would be appropriate for Network Rail to be involved in some monitoring rather than rely on a system of mutual recognition between supplier assurance audit providers as advocated by Achilles. Network Rail currently relies on internal RSSB oversight for monitoring of quality within the RISQS processes. Our assessment is that Network Rail will need to employ at least one full-time employee for the purposes of monitoring and coordinating safety processes. That suggests an upper limit for incremental HR costs of£65,000 to£85,000 (based on a pro rata adjustment to the estimates by Network Rail for a team of three employees), together with some additional technology costs which would not be significant. 275. In our view, these incremental costs are insufficient to outweigh the benefits of competition, either in terms of price or other benefits. Although the contestable market may only have a total estimated value of£1.8 million and the scope for price reductions is limited, the incremental costs are such that it would only take a slight reduction in margin, which would probably result from competition, to outweigh them. Moreover, any cost benefits are outweighed by the potential non-price benefits of competition such as the potential for offering supplier assurance crossing between different industry sectors.”
“wrongly ignored the significant advantages which the Mastercard system and the MIF bring for cardholders, and, moreover, the two-sided nature of the system and the optimisation of the system which the MIF helped to achieve.”
“230. The Court must reject at the outset the argument that the General Court wrongly ignored the advantages to cardholders resulting in the MasterCard scheme. It will be recalled that any decision by an association of undertakings which proved to be contrary to the provisions of art. 81(1) EC may be exempted under art. 81(3) EC only if it satisfies the conditions in that provision, including the condition that it contribute to improving the production or distribution of goods or to promoting technical or economic progress… Furthermore, as is apparent from [89] and [90] of the present judgment, where it is not possible to dissociate a decision by an association of undertakings from the main operation or activity with which it is associated without jeopardising its existence and aims, it is appropriate to examine the compatibility of that decision with art. 81 EC in conjunction with compatibility of the main operation or activity to which it is ancillary. 231. By contrast, where it is established that such a decision is not objectively necessary to the implementation of a given operation or activity, only the objective advantages resulting specifically from that decision may be taken into account in the context of Article 81(3) EC…”
“58. With regard to those arguments it must be emphasised that the Commission's task under Article 85(3) is to determine whether the contested recommendation contributes to improving the provision of services on the insurance market. In that connection the Commission correctly took the view that its task was not merely to check whether the aim of the recommendation was to deal with the actual problems confronting the market as a result of the continuing fall in premiums for industrial fire and consequential loss insurance and to consider whether the recommendation was a proper means of dealing with that situation, but also to assess whether the measures put into effect by the recommendation went beyond what was necessary to that end. 59. … The question to be considered is whether the collective, fixed-rate and across-the-board increase in premiums was justified by the objective pursued. 60. By reason of its general and undifferentiated nature the increase involved a rise in premium rates which encompassed not only cover for the expenses resulting from insurance claims but also the operating costs of the insurance companies. It is apparent from the documents before the Court that there were considerable differences in the level of operating costs between different insurance companies. The global nature of the increase was therefore likely to result in restrictions on competition going beyond what was necessary to achieve the intended objective. 61. By taking the view that in those circumstances the disadvantages arising from the solution chosen were, from the point of view of competition law, greater than the advantages and that, consequently, there was no improvement in the provision of services in the insurance market, the Commission did not exceed the limits of the discretion vested in it in connection with the application of Article 85(3) EEC.”
“Finally, and very importantly, it is necessary to balance the two opposing forces resulting from the restriction of competition and the cost efficiencies. On the one hand, any increase in market power caused by the restrictive agreement gives the undertakings concerned the ability and incentive to raise price. On the other hand, the types of cost efficiencies that are taken into account may give the undertakings concerned an incentive to reduce price…”
“294. In response, Achilles pointed out that the RSSB did not tender for the provision of an end-to-end pre-qualification service, but for the provision of certain inputs and that the RSSB Board retains control over pricing for the RISQS scheme. Whilst the RSSB as a whole acts as a not-for-profit body, its constitutional objective is to promote the interests of its members, a group largely distinct from RISQS users, and there is no formal requirement on the RSSB that Network Rail could point to which would require the RSSB to operate RISQS as a not-for-profit activity. 295. In response to Mr Holt’s suggestion that tendering for the IT and audit inputs to RISQS was particularly effective because more firms can bid to provide IT and audit inputs than an endto-end solution, Achilles noted that in fact only one bidder was left for the provision of audit services following Achilles’ withdrawal from the bidding process and that two bidders submitted bids for both lots, which would suggest that there was no advantage in the separate tenders in terms of numbers of potential bidders. 296. The Tribunal agrees with Achilles’ contention that opening a market up to competition only periodically in the form of a tender limits the dynamic evolution of the market and risks locking in a sub-optimal outcome as a result, for example, a bidder under-bidding and having to compromise on delivery quality or not being subject to sufficient competition in the tendering process. There was no evidence that Network Rail or the RSSB ever considered these in opting for the tender of the RISQS inputs. 297. In our view, whilst Achilles remains able at some future date to compete to replace the RISQS scheme or to replace the suppliers of the outsourced components of the RISQS scheme (should Network Rail consider moving away from the RISQS scheme supplied by the RSSB or when the RSSB re-tenders the IT and audit components of the RISQS scheme), the RISQSonly rule has the effect, in the interim, of weakening competition in the market. The tender exercise that was carried out, and the possibility of a further tender exercise for the market in the future, do not affect, justify or compensate for the elimination of competition in the meantime.”
“the Tribunal erred in law in finding that a dominant company need not benefit commercially from the relevant conduct for such conduct to be found abusive without also finding that the dominant company is an essential trading partner of the party alleging abuse (and therefore misappliedCase T-128/98 Aéroportsde Paris v Commission)”
“In the Tribunal’s view, Network Rail’s argument that it is necessary for there to be some commercial benefit to be gained by the dominant undertaking from its conduct before that conduct can be condemned is inconsistent with the law as explained by the General Court in Aéroportsde Paris and the High Court in Arriva the Shires. The case law does not support the distinction, contended for by Network Rail, depending on whether the dominant company is, or is not, an essential trading partner of the party alleging abuse.”
“… where the undertaking in receipt of the service is on a separate market from that on which the person supplying the service is present, the conditions for the applicability of Article 86 are satisfied provided that, owing to the dominant position occupied by the supplier, the recipient is in a situation of economic dependence vis-à-vis the supplier, without their necessarily having to be present on the same market. It is sufficient if the service offered by the supplier is necessary to the exercise by the recipient of its own activity.”
“In that regard, it should be recalled that the concept of abuse is an objective concept and implies no intention to cause harm. Accordingly, the fact that ADP has no interest in distorting competition on a market on which it is not present, and indeed that it endeavoured to maintain competition, even if proved, is in any event irrelevant. It is not the arrival on the market in groundhandling services of another supplier that is in issue, but the fact that at the time of the adoption of the contested decision, the conditions applicable to the various suppliers of those services were considered by the Commission to be objectively discriminatory.”
“In my judgment, the ruling of the General Court in Aéroports de Paris shows that it is not necessary for there to be some commercial benefit to be gained by the dominant undertaking from its conduct before that conduct can be condemned as abusive... The complete absence of any commercial gain on the part of the dominant undertaking may well be highly relevant in a particular case, for example on the issue of objective justification… I do not accept, however, that as a matter of law, a foreclosure of the downstream market distorting competition among competitors on that market should be an abuse only if it generates an economic gain on the part of the dominant undertaking. That is inconsistent with the case law which emphasises the objective nature of abuses and which establishes that motivation and intention are generally not relevant to the question of infringement (otherwise than in some clearly established instances such as predatory pricing).”
“162. The applicant relies essentially on four arguments in support of its complaint that its conduct does not fall within the scope of Article 86 of the Treaty. 163. First, it contends that Article 86 cannot be applied to it because it is not present on the markets in respect of which the Commission found… that competition was affected. It is said to follow from the judgment of the Court of Justice in TETRA PAK v E. C. COMMISSION that Article 86 of the Treaty cannot be applied in such circumstances. 164. That argument is entirely unfounded in law. The Court of Justice quite clearly stated inCase C-333/94 P TETRA PAK v E. C. COMMISSION that [two other cases] provide examples of abuses having effects on markets other than the dominated markets. There is no doubt, therefore, that an abuse of a dominant position on one market may be censured because of effects which it produces on another market. It is only in the different situation where the abuse is found on a market other than the dominated market that Article 86 of the Treaty is inapplicable except in special circumstances… 165. In the present case, although the conduct of ADP to which the contested decision objects, namely the application of discriminatory fees, has effects on the market in groundhandling services and, indirectly, on the market in air transport, the fact remains that it takes place on the market in the management of airports, where ADP occupies a dominant position. Furthermore, where the undertaking in receipt of the service is on a separate market from that on which the person supplying the service is present, the conditions for the applicability of Article 86 are satisfied provided that, owing to the dominant position occupied by the supplier, the recipient is in a situation of economic dependence vis-à-vis the supplier, without their necessarily having to be present on the same market. It is sufficient if the service offered by the supplier is necessary to the exercise by the recipient of its own activity.”
“226. There was no issue as to the vital importance of the Key Schemes in ensuring the safety on the railway network. Achilles accepted that the purpose of the Key Schemes is to ensure the safety of workers carrying out work and ultimately the safety of rail passengers. Nor was there any issue as to the need for suppliers working on the railway to be subject to supplier assurance. Achilles did not dispute that supplier assurance is part of Network Rail’s safety management system, that it plays an important role in ensuring that suppliers adhere to high safety standards and that it contributes to a reduction in accident rates. 227. The issue for the Tribunal is a narrower and more specific one, namely whether the requirement in the Sentinel Scheme and OTPO Scheme that suppliers must use the supplier assurance provided by RISQS is objectively necessary to achieve the safety purposes of the Key Schemes. In other words, is it essential to the fulfilment of those purposes that supplier assurance be provided by the RISQS scheme to the exclusion of any other suitably qualified provider including Achilles? Would it be impossible to achieve those safety objectives if Network Rail were required to recognise other suitably qualified and competent providers of supplier assurance schemes?”
“254. In summary, for the reasons set out above, the Tribunal is not persuaded that the RISQS-only rule is objectively justified as being ancillary to the safety purposes of the Key Schemes. Network Rail has not established that those purposes would be impossible to achieve without the RISQS-only rule. The Tribunal considers that those safety purposes could be achieved by alternative providers of supplier assurance services working to the same standards as RISQS and subject to effective monitoring, with their IT platforms linked to RISQS’s and/or their data freely accessible to Network Rail and with the RISQS forum open to participation by other providers of supplier assurance services. 255. The Tribunal appreciates that if a change to Network Rail’s HSMS so as to permit multiple assurance providers was considered to be a significant change it would have to be reviewed by the ORR [Office of Rail and Road – the railway regulator]. The Tribunal expects that this review process would be handled appropriately.”