Integrating environmental protection and EU competition law: Why competition isn't special

European Law Journal

Volumn 16, Issue 6, 2010, Pages 780-805

  Kingston, Suzanne ^a  

^a UNIVERSITY COLLEGE DUBLIN   (Ireland)

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EID: 78549275804     PISSN: 13515993     EISSN: 14680386     Source Type: Journal    
DOI: 10.1111/j.1468-0386.2010.00533.x     Document Type: Article

References (112)

1. For examples of the Commission's emphasis on economics-driven competition law, see the White Paper on Modernisation of the Rules Implementing Articles 85 and 86 of the EC Treaty, OJ C132/1, para 75 (the approach to Art 101 TFEU (ex Art 81 EC) will be 'rigorously economic'); Guidelines on Vertical Restraints, [2000] OJ C291/1; the creation in 2003 of the position of Chief Economist within Directorate-General Competition; Guidelines on Technology Transfer, [2004] OJ C101/2; Guidelines on the application of Article 81(3) of the Treaty, [2004] OJ C101/97; and Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings, [2009] OJ C45/7. See also, the Commission's XXIX Report on Competition Policy, 1999 (Commission of the European Communities, 2000), at 6: 'The first objective of competition policy is the maintenance of competitive markets. Competition policy serves as an instrument to encourage industrial efficiency, the optimal allocation of resources, technical progress and the flexibility to adjust to a changing environment'. An emphasis on consumer welfare is present to a lesser extent in the case-law of the EU courts: see, for instance, Case T-168/01, GlaxoSmithKline[2006] ECR II-2969, para 118 (the aim of Art 81 EC is to 'prevent undertakings, by restricting competition between themselves or with third parties, from reducing the welfare of the final consumer of the products in question '), [1999] .
2. It should be noted that, in the field of state aid-as opposed to antitrust-environmental considerations have long been taken into account (see, for instance, the Commission's most recent guidelines on the topic, Guidelines on state aid for environmental protection, [2008] OJ C82/1). Clearly, there is a fundamental distinction between state aid control and the rest of competition policy in that, while state aid is, in principle, prohibited (Art 87(1)), the Art 87(2) and (3) exemptions are premised on a recognition that markets may not always work properly left alone-due, for example, to the present of externalities-and may need some intervention from the state to work more effectively, and ultimately raise consumer welfare. While the relevance of environmental factors to state aid policy is not, therefore, disputed, the arguments developed in this article can nonetheless be applied in considering how such factors should be taken into account in the state aid area.
3. Carbon Gas Technologie, [1983] OJ L376/17, BBC/Brown Boveri, [1988] OJ L301/68, VOTOB, [1992] XXIInd Competition Report, paras 177-186, Assurpol, [1992] OJ L37/16, Philips/Osram, [1994] OJ L378/37, Notice pursuant to Article 19(3) ZVEI/Arge Bat, [1998] OJ C172/13, Commission Decision 2001/837, DSD, [2001] OJ L319/1, confirmed by Case T-289/01, DSD[2007] ECR II-1691. On the relationship between EU competition law and environmental objectives generally, see F. Vogelaar, 'Towards an Improved Integration of EC Environmental Policy and EC Competition Policy: An Interim Report', (1994) Fordham Corporate Law Institute 529, D. Geradin, 'EC Competition Law and Environmental Protection', (2002) 2 Yearbook of European Environmental Law 117, V. Baccaro, 'Collecte et recyclage des batteries usagées en Italie: droits exclusives, exigences environnementales et droit de la concurrence' (2001) 1 Competition Policy Newsletter 39, H. Vedder, Competition Law and Environmental Protection in Europe: Towards Sustainability? (Europa Law Publishing, 2003), and G. Monti, EC Competition Law (Cambridge University Press, 2007), at 91-94.
4. See Horizontal Cooperation Guidelines, [2001] OJ C3/2, ch 7, Draft Horizontal Cooperation Guidelines, SEC (2010) 528/2, ch 7, Commission Decision 2000/475, CECED, [2000] OJ L187/47, EACEM, [1998] Competition Report, at 152, CEMEP, Commission Press Release IP/00/58 (23 May 2000).
5. See, for instance, Guidelines on the application of Article 81(3) of the Treaty, OJ C101/97, para 33., [2004]
6. Though influential, it would be wrong to characterise present EU competition policy as based exclusively on Chicago School theory. The better view is that current EU competition policy displays attributes of a mixture of theoretical models, combining elements of the Chicago School with Harvard School and ordoliberal influences. See further O. Budzinski, 'Monoculture Versus Diversity in Competition Economics', 32 Cambridge Journal of Economics 295. (2008)
7. R. Bork, The Antitrust Paradox (The Free Press, Basic Books, 1978), at 9. See also, eg, R. Posner, 'The Chicago School of Antitrust Analysis', (1979) 127 University of Pennsylvania Law Review 925 and A. Harberger, 'Three Basic Postulates for Applied Welfare Economics: An Interpretive Essay', (1971) 9 Journal of Economic Literature 785, at 785, who argues that welfare outcomes, 'may be exceedingly important, perhaps the dominant factors governing any policy decision, but they are not part of the package of expertise that distinguishes the professional economist from the rest of humanity. And that is why we cannot be expected to reach a professional consensus concerning them'.
8. See, for instance, Bork, ibid, at 51: 'The antitrust laws have only one legitimate goal, and that goal can be derived as rigorously as any theorem in economics the only legitimate goal of American antitrust law is the maximization of consumer welfare '.
9. ibid, at 429.
10. An obvious problem for proponents of this approach in the EU is the fact that market integration has traditionally been viewed as an important goal of EU competition policy, and does not fall within the goal of economic efficiency in the narrow sense. See, for instance, the XXIX Report on EU Policy, where the Commission states its view that the second objective of Community competition policy 'is the single market objective. An internal market is an essential condition for the development of an efficient and competition industry' (XXIX Report on Competition Policy, 1999 (Commission of the European Communities, 2000), at 6), and the ECJ's judgment in Joined Cases C-501/06P, C-513/06P, C-515/06P and C-519/06P, GlaxoSmithKline, judgment of 6 October, para 62. 2009
11. In the EU context, this type of approach has been argued for by G. Amato in Antitrust and the Bounds of Power (Hart Publishing, 1997), who argues that antitrust should be 'liberalised' from objectives extraneous to it, and in particular from industrial policy and regional policy (at 117), as well as by O. Odudu, The Boundaries of EC Competition Law: The Scope of Article 81 (Oxford University Press, 2006), ch 6 and at 7 ('the extent to which non-efficiency goals trump efficiency is a constitutional question external to competition law that ultimately requires resolution at the constitutional level'. Balancing Treaty goals within the competition provisions would mean that these provisions would become 'non-justiciable'), H. Maks, 'The "New" Horizontal Agreements Approach in the EU: An "Economic" Assessment', (2002) 37(1) Intereconomics 28, at 28 and 32-33 ('we conclude that it might be a proper choice for competition policy to concentrate on its traditional core business and not to bungle around with environmental externalities in an ineffective way'), and G. Van Gerven, 'The Application of Article 81 in the New Europe', (2003) Fordham Corporate Law Institute 415, at 429-431.
12. On ordoliberal theory generally and in relation to competition law, see D. Gerber, Law and Competition in Twentieth Century Europe: Protecting Prometheus (Clarendon Press, 1998), ch VII, D. Gerber, 'Constitutionalizing the Economy: German Neo-liberalism, Competition Law and the "New" Europe', (1994) 42(1) American Journal of Comparative Law 25, R. Sally, 'Ordoliberalism and the Social Market; Classical Political Economy from Germany', (1996) 1(2) New Political Economy 233, M. Streit and M. Wohlgemuth, The Market Economy and the State: Hayekian and Ordoliberal Conceptions, Diskussionsbeitrag 06-97 (Max-Planck-Institut zur Erforschung von Wirtschaftssystemen, 1997), C. Joerges, Law in the Process of Constitutionalizing Europe, Paper delivered to the 2002 ARENA Conference on Democracy and European Governance, at 10-12, available at , V. Vanberg, The Freiburg School: Walter Eucken and Ordoliberalism, Freiburg Discussion Papers on Constitutional Economics 04/11 (Walter Eucken Institut, 2004), W. Eucken, Grundsätze der Wirtschaftspolitik, Principles of Economic Policy (Mohr Siebeck, 7th edn, 2004), C. Joerges, 'What is Left of the European Economic Constitution? A Melancholic Eulogy', (2005) 30 European Law Review 461, at 469-474. J. Venit, 'Article 82: The Last Frontier - Fighting Fire with Fire?', (2005) 28 Fordham International Law Review 1157 and C. Joerges, 'A New Alliance of De-legalisation and Legal Formalism? Reflections on Responses to the Social Deficit of the European Integration Project', 19 Law and Critique 235 (2008), at 237-241.
13. See, eg, P. Pescatore, The Law of Integration (Sijthoff, 1974), at 41.
14. See, further, eg, L. Krämer, 'Thirty years of EC Environmental Law: Perspectives and Prospectives', Yearbook of European Environmental Law 155., (2000)
15. Thus, according to the Preamble to the 1957 Treaty, Europe was to be built 'through practical achievements which will first of all create real solidarity, and through the establishment of common bases for economic development'.
16. National laws had, however, long existed governing certain aspects of the field (such as rules on private property and public health). See R. Lazarus, The Making of Environmental Law (University of Chicago Press, 2004).
17. UNGA Res 2398 (XXIII) (1968). See P. Sands, Principles of International Environmental Law (Cambridge University Press, 2nd edn, 2003), at 36-40.
18. [1973] OJ C112/1.
19. On neo-functionalism generally, see, eg, E. Haas, 'European Integration: The European and Universal Process', 4 International Organization 607., (1961)
20. Art 2 TEU.
21. Contrast this with the arguable demotion of competition policy in Art 3 TEU, with, as discussed below, the removal from the list of the former Art 3(1)(g) EC activity of 'a system ensuring that competition in the internal market is not distorted' at the behest of French Premier Nicolas Sarkozy.
22. Art 11 TFEU substitutes a reference to the Union for the reference to the Community in Art 6 EC. The integration obligation is also present in the Charter of Fundamental Rights, to which Art 6 TEU accords binding status by reference, at Art 37.
23. See generally, the EU's Sustainable Development Strategy put forward in 2001 and renewed in 2006 (Commission, 'A Sustainable Europe for a Better World: A European Union Strategy for Sustainable Development', COM (2001) 264 final and Council Doc 10117/06 of 9 June 2006) and, for instance, M. Jacobs, 'Sustainable Development as a Contested Concept', in A. Dobson (ed), Fairness and Futurity: Essays on Environmental Sustainability and Social Justice (Oxford University Press, 1999).
24. The mere qualification of Art 11 TFEU as a general principle of EU law does not in itself, however, allow a comprehensive definition of its effect in the EU legal order: the Mangold judgment, in particular, has led to much uncertainty about whether general principles of EU law (in that case, the general principle of non-discrimination on grounds of age) have horizontal direct effect (Case C-144/04, Mangold[2005] ECR I-9981 (in which the ECJ seemed, controversially, to ascribe horizontal direct effect to the general principle of non-discrimination on grounds of age, though it had not previously been clear that general principles could have such an effect)).
25. On general principles of EU law, see generally T. Tridimas, The General Principles of EU Law (Oxford University Press, 2nd edn, 2007).
26. See further N. Dhondt, Integration of Environmental Protection into Other EC Policies (Europa Law Publishing, 2003), M. Wasmeier, 'The integration of environmental protection as a general rule for interpreting Community law' (2001) 38 Common Market Law Review 159.
27. See further, for instance, Tridimas, op cit n 25 supra.
28. See, eg, the Opinion of Advocate-General (AG) Kokott, Case C-304/01, Spain v Commission[2004] ECR I-7655; Joined Cases T-74/00 etc, Artegodan[2002] ECR II-4945, Opinion of AG Jacobs in Case C-126/01, GEMO[2003] ECR I-13769, and the Opinion of AG Alber in Case C-444/00, Mayer Parry Recycling[2003] ECR I-6163.
29. Case C-300/89, Commission v Council (Titanium Dioxide)[1991] ECR I-2867, paras 22-24. See analogously Case C-17/90, Pinaud Wieger[1991] ECR I-5253, Opinion 2/00 [2001] ECR I-9713, where the ECJ confirmed that what was formerly Art 6 EC was 'in full harmony' with the Titanium Dioxide doctrine, Case C-336/00, Huber[2002] ECR I-7699, the Opinion of AG Kokott in Case C-94/03, Commission v Council[2006] ECR I-1 and the Opinion of AG Geelhoed in Case C-161/04, Austria v Parliament and Council[2006] ECR I-7183, who concluded that, in cases of manifest disregard of environmental interests, what was formerly Art 6 EC should function as a standard of review of the legality of Community legislation.
30. Case C-379/98, PreussenElektra[2001] ECR I-2099, Case C-2/90, Commission v Belgium[1992] ECR I-4431, Case C-320/03, Commission v Austria[2005] ECR I-9871.
31. A number of Member States have 'general principles' of environmental protection in their constitutions. See, eg, the Opinion of AG Léger in Case C-227/02, Wood Trading[2004] ECR I-11957, who refers to Belgium, Greece, Spain, Finland and Hungary in this regard, as well as to the Charter for the Environment recently attached to the French Constitution; and the Opinion of AG Ruiz-Jarabo Colomer in Case C-176/03, Commission v Council[2005] ECR I-7879.
32. See, similarly, F. Jacobs, 'The Role of the European Court of Justice in the Protection of the Environment', (2006) 8 Journal of Environmental Law 185 (the nature of Art 11 TFEU is 'not merely programmatic but imposes legal obligations'), and the Opinion of AG Geelhoed in Case C-161/04, n 29 supra, paras 50-60.
33. At least some parts of the Commission are of the view that it does so apply. See, eg, the speech of Jean-François Pons, 'European Competition Policy for the Recycling Markets', Speech of 20 September 2001, and DG Competition paper concerning issues of waste management in recycling systems of 22 September 2005.
34. Supported, for instance, by Dhondt, op cit n 26 supra.
35. Supported, for instance, by Wasmeier, op cit n 26 supra, at 160. See also G. Monti, 'Article 81 EC and Public Policy, 39 Common Market Law Review 1057', (2002), at 1078.
36. See, by analogy, the ECJ's classic teleological reasoning in Case 26/62, Van Gend en Loos[1963] ECR 1.
37. See Commission Communication on Impact Assessment, COM (2002) 276 final. The Communication defines 'major' initiatives as 'those which are presented in the Annual Policy Strategy or later in the Work Programme of the Commission' (at 1).
38. See the latest (2007) report of the UN's Intergovernmental Panel on Climate Change, available at For a more pessimistic view, see J. Lovelock, The Vanishing Face of Gaia: A Final Warning (Allen Lane, 2009).
39. For a detailed estimate of the economic costs of climate change, see the Stern Review of the Economics of Climate Change, available at .
40. See J. Steenbergen, 'Proportionality in Competition Law and Policy, Legal Issues of Economic Integration 259', (2008) 35(3), at 266.
41. See, eg, Joined Cases 133-136/85, Rau[1986] ECR I-2289.
42. See, eg, Joined Cases 154 and 155/04, Alliance for Natural Health[2005] ECR I-6451.
43. See by analogy cases such as Case C-105/03, Pupino[2005] ECR I-5285, which makes clear that such interpretative requirements cannot require a judge to interpret contra legem. See also, G. Winter, 'On the Effectiveness of the EC Administration: The Case of Environmental Protection, 33 Common Market Law Review 689', (1996), at 700.
44. This was insisted on by the French President Sarkozy with a view to protecting national champions. See, eg, the report of 25 June 2007 of the EU Observer, 'Sarkozy Claims "Competition" Victory at Summit' and the press release of M. Sarkozy at the time: '[W]e have obtained a major reorientation on the objectives of the Union. Competition is no longer an objective of the Union or an end in itself, but a means to serve the internal market .'.
45. Protocol to the Treaties on European Union and on the Functioning of the European Union on the internal market and competition, which states that 'the internal market as set out in Article 3 of the Treaty on European Union includes a system ensuring that competition is not distorted'.
46. See, eg, the letter of 27 June 2007 to the Financial Times from Mr Michel Petite, Director-General of the European Commission's Legal Service, in which he rejected the arguments of Financial Times' columnist Wolfgang Munchau that the removal of the competition principle from the then Reform Treaty threatened the status of competition in the single market.
47. See, for instance, Case 13/77, INNO v ATAB[1977] ECR 2115 and, generally, A. Riley, 'The EU Reform Treaty and the Competition Protocol: Undermining EC Competition Law', (2007) 28 European Competition Law Review 703. See also, B. Drijber, 'Het Hervormingsverdrag van de EU: stap vooruit of stap achteruit?, 5/6 Markt en Mededinging 131.' (2007)
48. See Art 51 TEU (ex Art 311 EC).
49. See, contra, eg, Odudu, op cit n 11 supra, at 167 who characterises the use of a teleological approach as a 'Trojan horse', citing R. Wesseling, The Modernisation of EC Antitrust Law (Hart Publishing, and 61-64 (though on closer analysis, Wesseling's argument seems in fact to be that non-economic factors may indeed be relevant to competition analysis overall) 2000), at 34-50.
50. See Eucken, op cit n 12 supra, at 304.
51. See further R. Sally, 'Ordoliberalism and the Social Market; Classical Political Economy from Germany, New Political Economy 233.', (1996) 1(2)
52. See J. Baquero Cruz, Between Competition and Free Movement: The Economic Constitutional Law of the European Community (Hart Publishing, 2002), at 1, who argues forcefully that the competition and free movement rules, as the 'oldest layer of the Community constitution', should 'not be seen as isolated and independent groups of norms, but rather as inextricably linked in a functional sense'. He criticises a 'growing tendency among competition specialists to treat their topic in a highly technical way, as distinct from the economic constitutional law of the Community'. See, similarly, N. Hervouët, 'La dérive de l'Union européenne: de l'objectif de l'Union entre les peuples à celui de la concurrence, 514 Revue du Marché commun et de l'Union européenne 9', (2008).
53. See also, the Spaak Report which led to the signature of the 1957 Treaty of Rome, 'Des règles de concurrence qui s'imposent aux entreprises sont donc nécessaires pour éviter que les doubles prix aient le même effet que des droits de douane, qu'un dumping mette en danger des productions économiquement saines, que la répartition des marchés se substitute à leur cloisonnement' (Brussels Report on the General Common Market, presented to the founding Member States on 21 April 1956, at 16).
54. For instance, their personal scope and the presence of the de minimis rule in competition law, which does not apply in free movement law. This is not to deny that shifts in emphasis on achieving different aims have occurred over the years. For instance, as major steps have been made towards achieving the goal of market integration since the EEC's foundation, less emphasis is now placed by the Commission on achieving this goal in EU competition law than was the case originally. See D. Gerber, Law and Competition in Twentieth Century Europe: Protecting Prometheus (Clarendon Press, 1998), at 389.
55. See, for instance, R. Stewart, 'The Importance of Law and Economics for European Environmental Law', 2 Yearbook of European Environmental Law 856, (2002).
56. This approach draws, inter alia, on Hayek's view that, 'it seems unwise to draw a sharp distinction between economic and political autonomy, for it is difficult to distinguish economic action from political action .': F. Hayek, The Constitution of Liberty (University of Chicago Press, 1960).
57. See, eg, Case C-415/93, Bosman[1995] ECR I-4921, Case C-379/98, n 31 supra.
58. See, eg, K. Mortelmans, 'Towards Convergence in the Application of the Rules on Free Movement and on Competition?, 38 Common Market Law Review 613', (2001).
59. L. Gyselen, The Emerging Interface between Competition Policy and Environmental Policy in the EC', in J. Cameron, P. Demaret and D. Geradin (eds), Trade and the Environment: The Search for Balance (Cameron May, 1994), 242.
60. Case 36/74, Walrave and Koch[1974] ECR 1405, Case 13/77, n 47 supra. See, similarly, Baquero Cruz, op cit n 52 supra. With the entry into force of the Treaty of Lisbon, the Art 10 EC obligation is found at Art 4 TEU, while, as discussed above, Art 3(1)(g) EC is no longer to be found in the EU Treaties in its pre-Lisbon form.
61. See, eg, F. Cafaggi, 'Gouvernance et Responsabilité des Régulateurs privés, 2 Revue Internationale de Droit Économique 111', (2005).
62. See also Vogelaar, op cit n 3 supra.
63. Mortelmans, op cit n 58 supra. He notes that the court almost had the opportunity to develop a systematic approach in Case 2/91, Meng[1993] ECR I-5751, in which, in considering the application of Arts 3(1)(g), 10 and 81 EC to actions of public authorities which restrict competition, it had asked the intervening parties whether such public authorities should be able to rely on the justifications set out in Art 81(3) or, alternatively, the mandatory requirements of public interest in Arts 28 and 49 EC. The matter did not ultimately have to be decided, however, as there was no violation of Arts 3(1)(g), 10 and 81 EC on the facts. See also, however, Gyselen, op cit n 29 supra, at 242 and J. Stuyck, 'Libre circulation et concurrence: les deux piliers du Marché commun', in Mélanges en homage à Michel Waelbroeck (Bruylant, 1999), at 1478.
64. Case 120/78, Rewe-Zentrale AG (Cassis de Dijon)[1979] ECR 649. See, eg, Joined Cases C-51/96 and C-191/97, Deliège[2000] ECR I-2549, Case 26/76, Metro I[1977] ECR 1875 and Case 161/84, Pronuptia[1986] ECR 353 and Mortelmans, op cit n 58 supra, at 627-630.
65. See, eg, Case 72/83, Campus Oil[1984] ECR 2727 and Case C-158/96, Kohll[1998] ECR I-1931. One might also include examples from the ECJ's case-law on direct taxation, such as Case C-204/90, Bachmann[1992] ECR I-249.
66. An obvious example is the state aid field (see, for instance, Guidelines on state aid, n 2 supra) but this has also occurred in the antitrust sphere (eg Case C-360/92P, Netbook agreement[1995] ECR I-23 (culture)).
67. Case C-415/93, n 57 supra. Though the manner in which the justification may apply differs; see Mortelmans, op cit n 58 supra, at 645.
68. Case C-379/98, n 30 supra, Case C-2/90, n 30 supra.
69. See, further, W. Van Gerven, The European Union: A Polity of States and Peoples (Hart Publishing, 2005), S. Kadelbach, 'European Administrative Law and the Law of a Europeanized Administration', in C. Joerges and R. Dehousse (eds), Good Governance in Europe's Integrated Market (Oxford University Press, 2002), D. Wincott, 'Looking Forward or Harking Back? The Commission and the Reform of Governance in the European Union', (2001) 39(5) Journal of Common Market Studies 897, and M. Jachtenfuchs, 'The Governance Approach to European Integration, Journal of Common Market Studies 245', (2001) 39(2).
70. COM (2001) 428 final. It defines governance as the 'rules, processes and behaviour that affect the way in which powers are exercised at European level' (at 8).
71. Ibid, at 10.
72. See, eg, M. Everson, 'The Crisis of Indeterminacy: An "Equitable" Law of "Deliberative" European Market Administration?,' in Joerges and Dehousse, op cit n 69 supra, 232.
73. R. Dworkin, Law's Empire (Fontana 1986), at 225.
74. See ibid, at 225 and see further L. Morel Soriano, 'A Modest Notion of Coherence in Legal Reasoning. A Model for the European Court of Justice, Ratio Juris 296', (2003) 16(3), at 303.
75. J, Bengoetxea, N. MacCormick and L. Morel Soriano, 'Integration and Integrity in the Legal Reasoning of the European Court of Justice', in G. de Búrca and J. Weiler (eds), The European Court of Justice (Oxford University Press,. See further, R. Posner, How Judges Think (Harvard University Press, 2008), 2001).
76. Morel Soriano, op cit n 74 supra, at 298.
77. See, for instance, D. Edward, 'Judicial Activism: Myth or Reality?', in A. Campbell and M. Voyatzi (eds), Legal Reasoning and Judicial Interpretation of European Law (Trenton Publishing, 29, and Jacobs, op cit n 32 supra. 1996), at 66
78. Examples of this approach are plentiful, including the ECJ's classic effet utile reasoning in the early foundational cases of Community constitutional law, such as Case 26/62, n 36 supra. See further A. Stone Sweet, The Judicial Construction of Europe (Oxford University Press, 2004).
79. See, for instance, Case C-379/98, n 30 supra, Case C-2/90, n 30 supra, Case C-320/03, n 30 supra, and Jacobs, op cit n 32 supra.
80. Under what may be termed dualist models of competition enforcement, a NCA consists of, on the one hand, a body in charge of investigations and, on the other, a body with decision-making power, which may be administrative or judicial. Most Member States (as well as the USA) have this model, including Austria, Belgium, Finland, France, Ireland, Spain and Sweden. Contrast monist NCAs, consisting of integrated independent administrative NCAs, which have full powers to hear, decide and impose penalties, subject to review by national courts. Examples include the German Bundeskartellamt.
81. viz Art 4 TEU (ex Art 10 EC).
82. See the examples referred to in n 31 supra. The weight which different national courts might assign to environmental factors and competition factors will, of course, differ. This problem applies, however, to all aspects of Arts 101 and 102 TFEU (ex Arts 81 and 82 EC), and is an unavoidable consequence of decentralisation of enforcement of EU competition law.
83. Note, however, that Regulation 1/2003 provides for a possibility for Commission to file amicus briefs and for the NCAs to ask the Commission's or an economist's opinion. See, for the few environment-related judgments to date reported on DG Competition's website of national court judgments, the judgment of the Oberlandesgericht of Düsseldorf of 16 March 2005 (34 0 (Kart) 54/03 [VI-U (Kart) 39/03]), and the judgment of the Landgericht of Potsdam of 23 September, (51 0 204/03). 2004
84. This push resulted in a White Paper on Reforming the Commission in 2000, and subsequent reform and progress updates in 2003 and 2005 (the Kinnock reforms).
85. See A. Schout and A. Jordan, 'The European Union's Governance Ambitions and its Administrative Capacities, Journal of European Public Policy 957.', (2008) 15(7)
86. The equilibrium between Commissioners may be viewed from a game theory perspective. See D. Neven, 'Competition Economics and Antitrust in Europe, Economic Policy 741.', (2006) 21(48)
87. See Gordon Brown's proposal reported in the Financial Times of 20 April 2005, G. Amato, Antitrust and the Bounds of Power (Hart, 1997) and C.-D. Ehlermann, 'Reflections on a European Cartel Office, 32 Common Market Law Review 471.', (2005)
88. Though it falls outside the scope of the theoretical nature of this article, it should be noted that the Commission has not excluded the relevance of environmental protection factors in practice, though it has often assigned inadequate weight to such factors and been inconsistent in their consideration. See, for instance, the literature at n 3 supra.
89. It is possible, and interesting, to consider whether the application of public choice theories to DG Competition might suggest a different conclusion. For instance, one might employ capture theory to suggest that DG Competition may be susceptible to influence by environmentally motivated actors, and a modified principal-agent theory to suggest that DG Competition case-handlers are ultimately subject to the wishes of the Competition Commissioner, who in turn is influenced in taking competition decisions by the wishes of EU citizens (via, for instance, supervision by the European Parliament). A rich literature exists on the application of public choice theories to the Commission. See, for instance, R. Revesz, 'Federalism and Environmental Regulation: A Public Choice Analysis', (2001) 115 Harvard Law Review 553, D. Spence and F. Cross, 'A Public Choice Case for the Administrative State', (2000) 89(1) Georgetown Law Journal 97 and D. Curtin, 'Holding (Quasi-)Autonomous EU Administrative Actors to Public Account, European Law Journal 523.', (2007) 13(4)
90. See, eg, the Spanish, German and Finnish systems, and WT/WGTCP/W/172 6 July 2001 WTO Working Group on the Interaction between Trade and Competition Policy, which contains a list of those members where general public interest exemptions may be granted by ministers.
91. As noted above, the 'economic approach' in this sense refers to a greater use of economic analysis by the Commission, and greater emphasis on consumer welfare and economic efficiency as the primary goal of competition law (ie neo-classical competition economics). Clearly, many other strands of economic thought exist which approach the issue of the environment from a different perspective to that of neo-classical competition economics. An example is classical Malthusian economic theory, which focuses on the limits to growth imposed by the environment, holding, inter alia, that the fact that only a limited quantity of land is available means that, ultimately, economic growth will stop and the economy will reach a stationary state-which, in Malthus' view, will be at a rather bleak subsistence level (see T. Malthus, Essay on the Principle of Population (Ward Lock, 1798)). On the approach of classical economics to the environment, see E. Kula, A History of Environmental Economic Thought (Routledge, 1998). See also, for instance, those 'post-Chicago' commentators in the USA who reject the Chicago School's emphasis on the supremacy of economic efficiency as a goal of competition law, such as E. Fox, 'The Modernization of Antirust: A New Equilibrium', (1981) 66 Cornell Law Review 1140, L. Sullivan, 'Economics and More Humanistic Disciplines: What are the Sources of Wisdom for Antitrust?', (1977) 125 University of Pennsylvania Law Review 1214, R. Pitofsky, 'The Political Content of Antitrust, 127 University of Pennsylvania Law Review 1051)', (1979).
92. See, for instance, Case T-168/01, n 1 supra, para 118 and the classic definition of abuse under Art 102 TFEU (ex Art 82 EC) given in cases such as Case 85/76, Hoffmann-La Roche[1979] ECR 461; in the context of Art 101 TFEU (ex Art 81 EC), Joined Cases T-213/01 and T-214/01, Österreichische Postsparkasse[2006] ECR II-1601, para 115; and the statement by Mr Justice Fennelly (formerly AG at the ECJ), 'The entire aim and object of competition law is consumer welfare', judgment of the Irish Supreme Court in Competition Authority v O'Regan[2007] IESC 22, para 106.
93. Environmental economics may be defined as the study of problems caused by environmental externalities, and ways to remedy such market failure within the neo-classical economic model. On environmental economics generally, see W. Oates: 'From Research to Policy: The Case of Environmental Economics', [2000]University of Illinois Law Review 135. For reasons of space, this article does not deal with other strands of economic thought, such as the growing field of ecological economics, which reject many of the axioms of neo-classical economic theory, including the primacy of the goal of economic efficiency (ie which argue from 'outside' the neo-classical model). On ecological economics, see J. Gowdy and J. Erickson, 'The Approach of Ecological Economics', (2005) 29 Cambridge Journal of Economics 207, K. Mayumi, 'Reformulating the Foundations of Consumer Choice Theory and Environmental Valuation', (2001) 39 Ecological Economics 223, R. Costanza (ed), Ecological Economics: The Science and Management of Sustainability (Columbia University Press, 1991).
94. See generally S. Bishop and M. Walker, The Economics of EC Competition Law: Concepts, Application and Measurement (Sweet & Maxwell, 3rd edn, 2009), at 2.17, D. Hildebrand, The Role of Economic Analysis in the EC Competition Rules (Kluwer, 3rd edn, 2009) and D. Carlton and J. Perloff, Modern Industrial Organisation (Addison Wesley, 4th edn, 2004). On allocative and productive efficiency, see Bork, op cit n 7 supra, at 429. On dynamic efficiency, see J. Schumpeter, Capitalism, Socialism and Democracy (Harper, 1975).
95. See further R. Willig, 'Consumer Surplus without Apology', (1976) 66 American Economic Review 589, J. Stennek, 'The Expected Consumer's Surplus as a Welfare Measure', (1999) 73(2) Journal of Public Economics 265; and E. Schlee, 'Expected Consumer's Surplus as an Approximate Welfare Measure, 34 Economic Theory 127.', (2008)
96. See Carlton and Perloff, op cit n 94 supra.
97. On the environment as an externality, see W. Baumol and W. Oates, The Theory of Environmental Policy: Exernalities, Public Outlays and the Quality of Life (Prentice-Hall, 2nd edn, 1988).
98. See, eg, R. Frank, Microeconomics and Behaviour (McGraw-Hill/Irwin, 6th edn, 2006), ch 3 and at 78. Similarly, a decrease in a consumer's willingness to pay, where the environmental performance of a good decreases, might mean a decrease in consumer surplus, even where actual prices remain the same or fall.
99. An alternative way of incorporating environmental performance in the utility function might be on the basis that a consumer's willingness to pay for an environmentally superior product might be greater if increased environmental awareness means that the consumer gains less pleasure from consuming a good where environmentally friendlier substitutes are available. However, this seems a weaker position, as price remains a major factor in utility. For a model based on this hypothesis, see K. Conrad, 'Price Competition and Product Differentiation When Consumers Care for the Environment, Environmental and Resource Economics 1.', (2005) 31(1)
100. See further C.-M. Alves, 'La Protection intégrée de l'environnement en droit communautaire, 2 Revue juridique de l'environnement 1', (2003).
101. See further, a 2007 report commissioned by DG Environment looking directly at the contributions the environment makes to the EU economy: Links between the Environment, the Economy and Jobs (November 2007), available at The report concluded that, based on a definition of core environmental resources, environmental protection, and management and environmental quality, the total turnover in the European economy which was linked to the environment was c405 billion along with 4.4 million jobs. On a broader definition of environmental resources-including, eg, environment-dependent areas such as agriculture-total direct turnover would be c3 trillion and 21 million direct jobs. In addition, the report concluded that broader links, such as biodiversity and ecosystem services, could not be measured statistically.
102. See R. Perman et al, Natural Resources and Environmental Economics (Pearson, 3rd edn, 2003), at 400.
103. See F. Bonnieux and P Rainelli, 'Contingent Valuation Methodology and the EU Institutional Framework', in I. Bateman and K. Willis (eds), Valuing Environmental Preferences, Theory and Practice of the Contingent Valuation Method in the US, EU and Developing Countries (Oxford University Press, 1999), 585 and C. Sunstein, 'Two Conceptions of Irreversible Environmental Harm', John M. Olin Law & Economics Working Paper No 407 (May 2008). Bonnieux and Rainelli give the example of the natural amenity value for visitors or potential visitors to the UK's Yorkshire Dales National Park being measured, via contingent valuation method techniques, on average at £24 per annum.
104. See F. Knight, Risk, Uncertainty and Profit (Houghton Mifflin, 1921), R. Jensen, 'Innovation, Adoption and Welfare under Uncertainty', (1992) 40(2) Journal of Industrial Economics 173, and A. Lange, 'A Note on Decisions under Uncertainty: The Impact of the Choice of the Welfare Measure, Theory and Decision 51', (2001) 51(1).
105. See the reports by P. Sukhdev et al, The Economics of Ecosystems and Biodiversity (2008-2010), commissioned by the EU and the German federal government, available at .
106. See, eg, M. Dore and D. Webb, 'Valuing Biodiversity: Reality or Mirage?', (2003) 86(1-2) Environmental Monitoring and Assessment 91 and the 2007 report prepared for the Commission, Links between the Environment, the Economy and Jobs, op cit n 101 supra.
107. Perman et al, op cit n 102 supra, at 68.
108. See also Monti, op cit n 35 supra, at 1075. This would be consistent with the polluter pays principle. See Organisation for Economic Cooperation and Development, Competition Policy and the Environment (OECD, 1996).
109. See, eg, the judgment of the ECJ in Case C-13/03P, Tetra Laval[2005] ECR I-1113, para 44.
110. See similarly Commissioner Kroes, 'Preliminary Thoughts on Policy Review of Article 82', speech at the Fordham Law Institute (SPEECH/05/537, 23 September 2005), the DG Competition discussion paper on the application of Art 82 of the treaty to exclusionary abuses, Brussels, December 2005 and the Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings, OJ C45/7., [2009]
111. Since the 'economisation' of the Commission via the increase in recent years in the number of economists in the Commission's staff, and the creation of the office of Chief Economist, there has been a large development in the complexity of economic theories used in the Commission's decisional practice.
112. See R. Thaler and C. Sunstein, Nudge (Yale University Press, 2008). On the shift in environmental governance, see, for instance, Stewart, op cit n 55 supra and S. Kingston, Greening EU Competition Law and Policy (Cambridge University Press, forthcoming).