Trinidad Cement Ltd v The Competent Commission

• Jurisdiction: Caribbean States
• Judge: Byron, P.
• Judgment Date: 12 November 2012
• Court: Caribbean Court of Justice
• Docket Number: CCJ Application 1 of 2012
• Date: 12 November 2012

Caribbean Court of Justice

Byron, P. CCJ.; Saunders J. CCJ.; Bernard, J. CCJ.; WIT, J. CCJ.; Anderson, J. CCJ.

CCJ Application 1 of 2012

Trinidad Cement Limited

and

The Competent Commission

International Law - Treaty — Revised Treaty of Chaguaramas — Jurisdiction of the Caribbean Court of Justice to review the decision of the defendant — Whether claimant was an interested party.

EXECUTIVE SUMMARY

Without notifying Trinidad Cement Limited (“TCL”), the Investigating Panel of the CARICOM Competition Commission (the “Commission”) initiated and conducted an investigation into alleged anti-competitive business conduct by TCL. Following the investigation, the Executive Director of the Commission instructed TCL to appear at an Enquiry so that the Commission's Adjudicating Panel could decide upon the matters raised by the investigation.

This prompted TCL to immediately file an application before the CCJ, claiming that the decisions both to conduct the investigation and to hold the Enquiry were void. TCL alleged that the Commission had acted wrongly in two main regards: (a) There had been no proper request for the investigation; and (b) The Commission had failed to respect the rights of TCL as an “interested party” within the meaning of Article 175(6) (a) of the Revised Treaty of Chaguaramas (the “Revised Treaty”). The Commission rejected these allegations. It also objected to the Court's jurisdiction to hear this matter, contending that it was not a proper party to these proceedings in that it did not have full juridical personality under the Revised Treaty, and further, that this Court lacked jurisdiction generally, or in any event at this stage, to review actions of the Commission in relation to the initiation and conduct of the investigation.

The Court first addressed the Commission's claim that it was not a party to the proceedings because the Treaty did not confer on it full juridical personality. The CCJ dismissed this contention, emphasizing that Article 174 of the Revised Treaty confers upon the Commission extensive powers in suppressing anti-competitive business conduct, and that Articles 175 and 180 allow the Commission to initiate legal proceedings before the CCJ in its own name in furtherance of those functions and powers conferred by Article 174. Further, the Court recalled that Article 175 also allows parties aggrieved by Commission decisions to initiate proceedings before the Court. The Court also pointed to the Agreement between the Government of Suriname and the Community Establishing the Seat of the Commission, and noted that Article II specifically states that the Commission “shall have full juridical personality” and full capacity to institute legal proceedings. The Protocol on the Privileges and Immunities of the Competition Commission contains a similar provision.

The Court went on to address the Commission's claim that the CCJ was not competent to review the Commission's decision relating to the investigation. The CCJ stressed that there was no conduct or exercise of power on the part of a Treaty-created institution which could escaped its judicial scrutiny, due to the CCJ's compulsory and exclusive jurisdiction to adjudicate disputes concerning the interpretation and application of the Revised Treaty, as well as the Treaty's normative structure geared at transforming the CSME into “a regional system under the rule of law”. The Court was also of the view that the term ‘determination’ under Article 174(4) necessarily included procedures and practices at the investigation and enquiry stage. In this context, a subsidiary argument put forward by the Commission was that Article 175(12) of the Revised Treaty provides only for a review after (and not before) the Commission has given a determination on the issues before it. The CCJ, noting that arguments of this kind are often categorized as going to the admissibility of the claim, agreed with the Commission in principle, provisionally holding that “where no Enquiry of the Commission has as yet been held, the Court will not ordinarily take cognizance of allegations that certain procedural steps taken by the Commission during the investigation stage are unlawful or void”.

The Court then examined the question of whether the claimant was in fact an ‘interested party’, within the meaning of Articles 175(4) and 175(6) (a) of the Treaty, which prescribe that interested parties and COTED are to be consulted in preliminary assessments, and are to be notified when the Commission decides to conduct an investigation related to alleged anticompetitive business conduct. TCL advanced the argument that it was an ‘interested party’ in the matter since it was the target of the Commission's investigation and could be subjected to financial penalties and public humiliation if the Commission were to find it liable at the Enquiry stage. The Court disagreed, pointing out that during the preliminary assessment phase, the Commission only carries out preliminary discussions around whether a potential investigation is within its jurisdiction and is justified under the circumstances.

The Court added that Article 176 of the Treaty, which sets out how the Commission can go about making a determination of anti-competitive business conduct, does not grant a targeted enterprise any role in consultations related to the Commission's jurisdiction to initiate an investigation into that enterprise's conduct. The Court went on to find that TCL did not have any legitimate interest which could have been affected at the preliminary stage, in which the Commission was merely deciding whether an investigation was within its jurisdiction and was justified in the circumstances of the case. Furthermore, the Court found that although it could be said that a targeted enterprise like TCL had an interest in being able to convince the Commission that under the terms of Article 175, the proposed investigation was not justified in all the circumstances of the case, such interest is clearly outweighed by other considerations, particularly the need to safeguard the effectiveness of the investigation which should not be compromised. Recalling that TCL only became aware of the investigation into its conduct when it was notified of the Enquiry, the Court could not find any interest of TCL's that could have been impacted at the preliminary stages.

The CCJ went on to determine whether a proper request for investigation had been directed at the Commission, recalling that Article 175(2) of the Revised Treaty empowers COTED to request an investigation where it has reason to believe that an enterprise's conduct prejudices trade and prevents, restricts or distorts competition within the CSME. The Court assessed the relevant correspondence between COTED and the CARICOM Secretariat and, notwithstanding a certain ambiguity in the recommendation from COTED, found it arguable that the CARICOM Secretary-General was entitled to make a request on COTED's behalf for an investigation, as COTED had stated that it did have reason to believe TCL was engaged in anti-competitive conduct. The Court also determined that COTED's substantive intention had always been to request that the Commission investigate TCL, and that the CARICOM Secretariat had made a proper request to conduct an investigation into TCL's activities, since the Secretary-General's letter of 15th December, 2009 clearly stated that he was requesting that the Commission initiate an investigation pursuant to Article 174(1).

In all the circumstances, the Court dismissed TCL's Originating Application, refusing the declarations and orders sought by TCL, and ordered that written submissions as to costs be filed and exchanged within 21 days of its decision. The Court also pointed to some possible flaws in the Commission's Rules of Procedure, and in this light, the Court encouraged the Commission to review its Rules and ensure their conformity with the Revised Treaty and appropriate standards of fairness.

This is an unofficial document provided to assist in understanding the decision of the Court. It does not form part of the reasons for the decision. The full judgment of the Court is the only authoritative document.

THE COURT, composed of D. Byron, President and A. Saunders, D. Bernard, J. Wit and W. Anderson, judges having regard to the originating application filed at the Court on the 1st day of February 2012 with annexures, the Defence filed on the 19th day of March 2012, the Reply to the Defence filed on behalf of the claimant on the 3rd day of April 2012, the written submissions of the defendant filed on the 10th day of April 2012, the claimant's written submissions and statement of issues filed on the 24th day of April 2012, the two witness statements filed on behalf of the claimant on the 1st and 3rd days of May 2012 and the witness statement filed on behalf of the defendant on the 2nd day of May 2012 and to the public hearings held on 23rd and 24th days of May 2012 after considering the oral evidence submitted on behalf of the claimant and the defendant and taking into account the oral observations made on behalf of:

- the claimant by Dr. Claude Denbow, SC appearing together with Mr. Darrell Allahar, Mr. Jerome Rajcoomar and Mrs. Donna Denbow, attorneys-at-law

on the 12th day of November 2012 delivers the following

INTRODUCTION

Byron, P.

1 This case arose from the first matter undertaken by the Competition Commission (“the Commission”) in fulfilment of its role under the Revised Treaty of Chaguaramas (“the Revised Treaty” or “the Treaty”) to protect and promote competition within the Community. The proceedings give rise to important questions concerning judicial review of the work of the Commission. The resolution of these questions hopefully will assist in clarifying and thus making more effective the role and function of the Commission.

2 The proceedings have their origin in...