Case C-671/15, APVE – How to grow a price-fixing cartel and weed out EU cartel law

Are there any limits to the scope of EU cartel law? Yes, in the interstices of agricultural policy. The legal issue in this case is whether France’s growers of endives can talk to each other and fix prices in order to serve EU agricultural policy without incurring the wrath of EU competition law.

Endive is a leafy, lettuce-like vegetable. It is grown on an industrial scale. There are nurseries that specialise in growing young endive plants. There are also commercial associations of companies that sell endives.

French nurseries and endive distributors have been accused of running a price-fixing cartel. They have already been fined by the French competition authority (l’Autorité de la concurrence).

The authority has sanctioned the APVE (the Association des producteurs vendeurs d’endives) and other producer organisations, and professional organisations including the Association Comité économique régional agricole fruits et légumes de Bretagne (Cerafel), Société Fraileg, Société Prim’Santerre, Union des endiviers, Société Soleil du Nord, Comité économique fruits et légumes du Nord de la France (Celfnord), Association des producteurs d’endives de France (APEF), Section nationale de l’endive (SNE), Fédération du commerce de l’endive (FCE), Société France endives, Société Cambrésis Artois-Picardie endives (CAP’Endives), Société Marché de Phalempin, Société Primacoop, Société Coopérative agricole du marais audomarois (Sipema), Société Valois-Fruits, Société Groupe Perle du Nord.

The French nurseries and endive distributors have appealed the authority’s decision, and have even been successful before the Paris Court of Appeal.

According to the Paris court, EU competition law does not prevail over the importance of agriculture and the need to avoid economic crises in that sector.

To start with, there is a raft of EU legislation which is built on that principle:

– Council Regulation (EEC) No 26 of 4 April 1962 applying certain rules of competition to production of and trade in agricultural products;

– Council Regulation (EC) No 1184/2006 of 24 July 2006 applying certain rules of competition to the production of, and trade in, agricultural products (OJ [2006] L214/7);

– Council Regulation (EC) No 1234/2007 of 22 October 2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (OJ [2007] L299/1);

– Council Regulation (EC) No 2200/96 of 28 October 1996 on the common organization of the market in fruit and vegetables (OJ [1996] L297/1);

– Council Regulation (EC) No 1182/2007 of 26 September 2007 laying down specific rules as regards the fruit and vegetable sector, amending Directives 2001/112/EC and 2001/113/EC and Regulations (EEC) No 827/68, (EC) No 2200/96, (EC) No 2201/96, (EC) No 2826/2000, (EC) No 1782/2003 and (EC) No 318/2006 and repealing Regulation (EC) No 2202/96 (OJ [2007] L273/1).

In that context, Regulation 1234/2007, is perhaps the most pertinent. It allows nurseries to come together to form administrative associations which are to regulate product prices.

Furthermore, there is also CJEU case law that confirms it is up to the EU Council to determine the scope of EU competition law’s subjection to agricultural policy (see further, Case C-280/93 Germany v. Council ECLI:EU:C:1994:367).

However, the Cour de Cassation recognises that in general EU cartel law is applicable to agriculture (C-137/00, Milk Marque et national farmer’s union, and C-373/11 Panellinios Syndesmos Viomichanion Metapoiisis Kapnou).

In light of this uncertainty, Madame Mouillard did not know how EU law should be interpreted and decided to make a preliminary reference to the CJEU.

Questions Referred
According to the Curia website, the Cour de Cassation has asked:

1. Can agreements, decisions or practices of producer organisations, associations of producer organisations and professional organisations which could be classified as anticompetitive under Article 101 TFEU escape the prohibition laid down in that article on the sole ground that they could be linked to the responsibilities assigned to those organisations under the common organisation of the market, even if they are not covered by any of the general derogations provided for in turn by Article 2 of Regulation (EEC) No 26 of 4 April 1962 […] and Regulation (EC) No 1184/2006 of 24 July 2006, […] and by Article 176 of Regulation (EC) No 1234/2007 of 22 October 2007? […]

2. If so, must Article 11(1) of Regulation (EC) No 2200/1996, [4] Article 3(1) of Regulation (EC) No 1182/2007 […] and the first paragraph of Article 122 of Regulation (EC) No 1234/2007, which include, among the objectives assigned to producer organisations and their associations, those of stabilising producer prices and adjusting production to demand, particularly in terms of quantity, be interpreted as meaning that practices whereby those organisations or their associations collectively fix minimum prices, concert on the quantities placed on the market or exchange strategic information escape the prohibition of anticompetitive agreements, decisions and practices in so far as they are aimed at achieving those objectives?

Update – 8 January 2017
The Grand Chamber will hear this dispute on 31 January 2017.