Competition chief supports plan to solve court case deluge

By Peter Chapman

Date: 03/06/04

PHILIP Lowe, director-general of the Commission's competition department, has voiced his support for a radical plan to free up the over-worked European Court of First Instance (CFI) - the Luxembourg tribunal responsible for hearing appeals against merger and anti-trust rulings.

Last year, 26.61% of cases - 124 out of 466 - at the CFI involved staff disputes, such as complaints from officials denied promotion or unfairly dismissed or suspended, witness Marta Andreasen, the Commission's former accounting officer.

In stark contrast, the court handled 100 intellectual property cases, covering patent disputes, 25 fisheries and state aid cases apiece - and just 43 competition cases (9.27% of the total).

Lowe said he supports an idea, mooted in last week's European Voice, to allow judges to demand that parties in staff disputes should try and thrash out their differences beforehand with independent mediators, trained in solving such problems.

This approach is the linchpin of a law being drafted by António Vitorino, the European Commission's justice and home affairs chief, that will apply to civil and commercial disputes in national courts. But the plan is not expected to extend to judges at the chronically understaffed Court of First Instance.

The Commission currently has in- house staff trained in resolving disputes. Moreover, in the vast majority of cases, staff must launch formal complaints internally before the court can accept a case.

Commission personnel experts say this gives the EU executive a chance to sort out 20-25% of disputes before the lawyers get involved. But Lowe told this newspaper: "I personally think some enhanced role for the mediator, with independence from the administration as well as more resources, would free up the CFI from some of its existing workload.

"It's clear that if there were less staff cases, then there would be more room to deal with competition and patent cases.

"I expect, however, that the patent and staff aficionados would argue for a specialist court for competition cases for the same reason," Lowe added.

The clogged-up CFI causes headaches for industry. Firms appealing against a blocked merger, for example, have little chance to resurrect their deals.

The story is true, even though the court can award 'fast-track' key cases, with rulings in just under a year - less than half the time it normally takes.

One of the main culprits causing the delays is the sheer number of disputes between EU officials and their employees that currently clog up the court.

Experience of mediation in the US shows that it can help parties reach an amicable solution to a problem in up to 80% of cases, at a fraction of the cost of court proceedings.

However, Lowe, who took over the reins of the competition directorate-general from German Alex Schaub two years ago, said he sees little scope for mediators sitting in the middle between spurned deal-makers and the Commission's merger watchdogs.

"I don't see the point of a mediation function in competition cases. Either we have reached a settlement with parties through negotiation or we haven't and we go down the official route.

"It is conceivable that the president of the court would like to mediate on some points, but that is a more exceptional role for him to perform," he added.