The European Union's highest court yesterday dealt a rebuff to the European Commission by confirming that the Brussels body had been wrong to sanction Bayer for limiting the supply of a high-profile drug.
The ruling, in line with earlier verdicts, could make it more difficult for the Commission to use antitrust legislation to extend the EU single market.
In 1996, the Commission fined Bayer €3 million for a policy that limited supply of Adalat, a cardio-vascular drug, to Spanish and French wholesalers. Bayer's UK subsidiary had seen its revenues fall because of imports from Spain and France, where prices were 40 per cent lower.
Yesterday the European Court of Justice ruled that the Commission decision lacked the necessary proof because the Brussels body failed to demonstrate an agreement between Bayer and its wholesalers. The ruling endorsed a 2000 verdict by the more junior Court of First Instance.
Under EU law, practices that restrict competition are only illegal if there is an agreement between firms or if one group enjoys a dominant position.
"There is no other jurisdiction that uses antitrust law as a means of economic integration," said Mr Ian Forrester QC at White & Case law firm in Brussels. He added that now the freedom to export was well established in the EU, the court was becoming "a bit more critical" of the legal base for such cases. The Court of First Instance also held that the Commission had failed to prove the existence of an agreement when it struck down a Commission decision on Volkswagen last year.
Bayer welcomed the latest judgment, adding that it had assumed that "pharmaceutical manufacturers are under no obligation to supply the entire European market from the member state with the lowest state-regulated prices". The Commission said it was disappointed with the ruling, but added that it would "continue to monitor the behaviour of this industry".
- (Financial Times Service)
