Ireland: Post Modernisation Judgments Of Ireland’s Competition Court: A Quick Look Review

1. Introduction

Since modernisation of EU and Irish competition rules in the early 2000's, four major competition law judgments have been handed down by Ireland's Competition Court: ILCU, Hemat, BIDS and, most recently, Panda Waste. Each has been controversial. ILCU and BIDS were appealed, resulting in reversals of the Competition Court's approach on fundamental substantive issues in each case. Hemat, while upheld on appeal, was openly criticised by senior officials from the Irish Competition Authority.¹ No less controversial is Panda Waste, in which the Competition Court found local government policy on collection of municipal waste to be in violation of Irish competition rules (and, in so holding, ignored a Competition Authority decision on the pro-competitive benefits of the impugned practices). It too is to be appealed.

The foregoing has occurred notwithstanding two important modernisation-driven innovations: the practice, since 2004, of a single specialist judge hearing all substantive competition law cases, as well as the now near-standard inclusion of economics, particularly expert economic testimony and micro-economic analytical tools, into Competition Court assessments (with the Court in ILCU and BIDS going so far as to appoint its own expert economic assessor).² Why have these changes not improved predictability in judicial outcomes?

From a quick-look review of the four judgments, with particular focus on Panda Waste, two possible explanations are proposed.

First, key concepts that define the law's scope – in particular, related concepts of "undertaking" and "economic activity" – have been interpreted in a somewhat ad hoc manner, leading to major differences in outcomes. In Hemat, regulation with "economic consequences" is not an economic activity, so competition rules do not apply. But in Panda Waste, regulation "aimed at directly affecting the market" is such an activity, so competition rules do apply. As a direct result, in one case (Hemat) competition law has a relatively rare application to regulation, while in another (Panda Waste) competition law attains almost constitutional stature.

Second, while expert economic testimony and micro-economic analytical tools are now an established part of Competition Court judgments, there appears still to be some variance in the economic doctrine underlying the major cases. Does this matter? A quick look review of ILCU, Hemat, BIDS, and Panda Waste suggests it may: in each case, there appears to be a nexus between the economic underpinnings preferred by the Competition Court and the substantive liability standard applied. In Panda Waste, the Competition Court's strong affirmation of atomistic competition as the superior mechanism for governing the sector fairly jumps from the page. As a result, an expansive view of wrongful behaviour is applied. In contrast, in Hemat and BIDS, the Court seems to have less faith in free market competition, going so far in BIDS as to endorse a sector-wide private re-ordering of the market.

2. Background to Panda Waste

On 3 March 2008, Dublin's four local authorities agreed an important change to their joint approach to waste management. The change, which involved a formal variation to the Waste Management Plan for the Dublin Region 2005 - 2010 (referred to both in the Panda Waste judgment and in this note as "the Variation"), sought to significantly alter the way in which household waste was collected across Dublin. Henceforth, collection of household waste would be carried out by a single waste operator, to be either a Dublin local authority or a private operator selected via competitive tender.

The implications for private waste collection firms operating in Dublin were obvious: once implemented, the Variation would prevent multiple waste collectors operating within the same area in Dublin. In the words of the opening paragraph of the Panda Waste judgment, "[t]he Variation would have the effect of excluding private operators from the domestic waste collection market ... and would vest all rights to collect waste in a single operator."³

Two of Ireland's leading private waste operators – Nurendale Limited, trading as Panda Waste Services, and Greenstar Limited – challenged the Variation on both competition and administrative law grounds. This article discusses only the Court's competition law analysis of their challenge although, ultimately, the legal challenge succeeded on both fronts.

3. The Scope of Competition Law – What is An Undertaking?

Panda Waste

The most controversial aspect of the Panda Waste judgment is doubtless its finding that adoption of the Variation by the four local authorities can be construed as an economic activity, and therefore susceptible to review and prohibition under Irish competition law.

Following review of ECJ jurisprudence on the concept of an undertaking (and citing, in particular, Case C-49/07 MOTOE, Case T-196/04 Ryanair, and Case C-309/99 Wouters), the Court in Panda Waste adopted a "unified approach" test to determining when a public body or authority exercising regulatory powers constitutes an "undertaking."⁴

Applying this unified approach test to the action of the local authorities in adopting the Variation, the Court held that the local authorities' involvement in economic activities in downstream local waste markets meant that a policy decision on the future organization of such markets was also an economic activity.

Specifically, the Court held that " ... where the regulatory acts impact on private operators on the same market where also the [local authorities] commercially engage, the regulatory role performed will not preclude them from being found to be undertakings." The Court went on to determine that, because the Variation was " ... aimed at directly affecting the market for domestic waste collection," it followed that " ... the Variation is of an economic, rather than an administrative, nature."

ILCU

Like in Panda Waste, one of the most controversial aspects of ILCU related to the Competition Court's approach to the concept of an undertaking. In ILCU, a voluntary association of credit unions (the Irish League of Credit Unions) was found to be engaged in an economic activity via the provision to its members of an ill-defined, but "complex bundle" of "representation services" (including certain self-regulation activities carried out by the ILCU vis-à-vis its members).⁵ Accordingly, the ILCU was found to be an undertaking for purposes of EU and Irish competition law. On foot of that finding, the Competition Court held that the ILCU was (a) dominant in the provision of such representation services to credit unions (including to its own members), and (b) abusing that dominant position by refusing to provide non members access to the facilities of its own members.⁶

The Competition Court's decision that the ILCU constituted an undertaking was based primarily on the court's findings that the lobbying and representational services provided by ILCU were "tradable services" (by which the Court appeared to mean provided in return for payment). Hence, the judgment takes some care to reject defence arguments that the advocacy and other representation services provided by ILCU to its members were not traded. The Competition Court found that "[w]hile it may not be the case in Ireland, representational and lobbying services are both well established and well rewarded in other jurisdictions, notably the US."⁷

Thus, the test as to whether a particular service is an economic activity as per ILCU is whether the services at issue are "traded" (in other words, provided for reward) in Ireland or elsewhere.

Hemat

The foregoing may be contrasted with the approach in Hemat. In that case, adoption by the Medical Council of advertising restrictions on medical practitioners was found not to be an economic activity notwithstanding explicit Court acceptance that the advertising restrictions at issue had "economic consequences."⁸ Accordingly, the Medical Council was found to be neither an undertaking nor an association of undertakings for purposes of EU and Irish competition rules.

In so deciding, the Competition Court declined to follow a "unified approach," stating that " ... considerable caution must be used in assimilating different functions as in principle each separate activity must be individually considered. It is only in the rarest of occasions that a composite view will be appropriate." Rather, the test applied in Hemat was whether the Medical Council was " ... driven by public interest considerations, and the extent of these public interest considerations."⁹

Two key factual conclusions caused the Competition Court to find this "public interest" test met. First, the Competition Court noted that the " ... general underlying intention of the legislation was to protect the public interest."¹⁰ Second, the Competition Court noted that the level of input, influence, supervision and ultimate control which the governing legislation vested in the Minister for Health and Children, was "very significant." It followed in the Competition Court's view that the Medical Council was not engaged in an economic activity when enforcing restrictions on advertising.

BIDS

In BIDS, the High Court found it "uncontroversial" that each of the private firm beef processors involved in BIDS constituted an undertaking for purpose of Article 101 TFEU.¹¹ Accordingly, it was not disputed that BIDS constituted an "association of undertakings."

Undoubtedly, the BIDS approach to the concept of undertaking and association of undertakings is the least controversial among the four major cases. More notable is the BIDS verdict.¹² Notwithstanding that BIDS was found to be an association of undertakings, the Competition Court found the arrangement at issue – a sector-wide re-organisation via collaboration between competitors – to be outside the scope of EU and Irish competition rules.

Comment

As per the Competition Court, "[t]he definition of the term 'undertaking' is critically important ... as it directly determines the scope of competition rules."¹³ But the test applied by the Competition Court on this important point seems to vary.

In Panda Waste, regulation by a public body was considered an economic activity because it "directly affects" a market, with little or no reference to the public interest goal pursued. In Hamat, regulation by a professional association is found not to be an economic activity because a public interest goal was pursued, with the effect on the market considered largely irrelevant. In further contrast, in ILCU, "self regulation" via a trade association was found to be an economic activity, but because certain of the services provided by the ILCU were "traded services."

4. Economic Theory and the Liability Standard

According to the Supreme Court judgment in ILCU, "[Irish] courts are required to integrate economic principles into law." As the Supreme Court also acknowledged, this "is not an easy task" because economic principles are "in a state of constant development."¹⁴

Perhaps the most important legal consequence of a shift in the underlying economic theory in competition law cases is the impact that change may have on the liability standard applied.

To illustrate, when prevailing U.S. economic doctrine held that business-government collaboration was the best way to organise the economy (from circa 1915 – 1933), the U.S. courts adopted a tolerant attitude towards cooperation between firms, often treating suspect behaviour permissively. Similarly, during this period, "[w]hen the Supreme Court confronted cases involving market power measurement, it tended to accept broad market definitions that made a finding of dominance less likely."¹⁵

When the prevailing economic doctrine changed, and the statist assumptions of New Deal planning were assailed by economists, U.S. courts adopted a significantly more expansive view of wrongful behaviour, becoming in the process much more willing to find that firms acted improperly.¹⁶ As a result, the legal hurdles plaintiffs and particularly the U.S. federal enforcement agencies faced in prosecuting competition law cases were significantly reduced.¹⁷

Later, the "unmistakably profound" Chicago School influence was to inspire the U.S. courts to raise the standards that plaintiffs must satisfy to prevail in competition law cases.¹⁸ Or, as one commentator has put it, the Chicago School " ... catalyzed the retrenchment of liability standards" in antitrust law.¹⁹

As an inheritance from U.S. anti-trust rules, there appears little reason to suppose that Irish competition law should not similarly be influenced by prevailing economic theory.²⁰ Just as in the U.S. system, the underlying economic doctrine preferred by the Competition Court has substantial practical and legal significance for Irish competition law enforcement. The ideological subtext is important.

Panda Waste

The Panda Waste judgment goes to admirable lengths to identify a coherent theory of economic harm resulting from the impugned practices. According to the judgment, " ... competition in the market can only provide a reduction in costs to consumers, above and beyond that which is obtainable from either a local authority monopoly or by way of competitive tender."²¹

In addition, the judgment concludes that " ... where there is a public or tendered monopolist, any increase in price will merely be borne by the public, and there will be no constraining force preventing such situation. Further it will create a situation involving incumbent providers who will be at a significant advantage upon renewal of any contract. There is also the question of what the other competitors are to do in the meantime, while they do not have the contract."²²

A central assumption in this analysis is that commercial markets are more efficient than markets subject to government regulation. Fully de-regulated, atomistic competition is to be preferred over any form of competitive tendering or other regulated approach to competition. Hence, the local authorities' decision to provide for a "public or tendered monopolist" is deemed generally harmful for effective competition. Indeed, overall, the capacity of government institutions (such as local authorities) to make wise choices about when and how to intervene in the economy is doubted.

Consistent with that ideological approach, the Competition Court appears to have applied a relatively low liability standard in reaching a verdict that the market intervention at issue (i.e., the Variation) was unlawful and attributing competition law liability to the local authorities. The court's approach on market definition, dominance and on the anti-competitive object of the arrangement illustrates this.

-- Panda Waste on Market Definition

According to the Court, the relevant market for purposes of assessing the market power of the local authorities was the market for provision of household waste collection services in "the greater Dublin area."²³ In reaching this conclusion on the relevant geographic market, the Competition Court asked "... within what area are the terms of competition sufficiently homogenous with regards to household waste collection services?" The Competition Court found that this question was "easily answered." According to the Court, because the Waste Management Plan applied to all four local authorities, '[t]he conditions of competition in these areas are therefore homogenous." On that basis, the Court concluded that the relevant geographic market was the greater Dublin area.

This approach is notable on a number of fronts. First, it relies upon a relatively low test for defining the relevant market definition; namely, that the relevant market constitutes the area within which terms of competition are "sufficiently homogenous." Second, the evidence relied upon to demonstrate that this test is met is somewhat scant. Indeed, the fact that the Waste Management Plan applied to all four local authority areas was found, in itself, sufficient to prove a single relevant geographic market (notwithstanding that, as a matter of fact, the conditions of competition across the four local authority areas differ fundamentally).²⁴ Third, it is noteworthy that the geographic market definition is the output entirely of the Competition Court's own economic assessment, and was not supported by the expert economic evidence either of the prosecution or the defence.

-- Panda Waste on Dominance

The Competition Court considers it "patently clear" that the local authorities are individually and collectively dominant on the same relevant antitrust market (the collection of household waste in the Dublin region).²⁵ The co-existence of individual and collective dominance on the same market and at the same time is novel in competition law theory and conceptually difficult (particularly given that the Competition Court expressly defines dominance by reference to the ability to act independently of competitors).

Even ignoring that question, however, the Court's approach appears conducive towards a finding of dominance. For one thing, the Court facilitates the outcome on individual dominance by assessing the market power of each local authority not by reference to the relevant market, but by reference to a much narrower hypothetical market limited to the area within which each operates.²⁶ In other words, for purposes of finding single firm dominance, the Court does not appear to follow its own market definition. Rather, a much narrower hypothetical market is used by reference to which the "market shares" of each of the local authorities are greatly exaggerated.²⁷

This approach is then reversed for purposes of assessing collective dominance, with the Court relying on the market for the greater Dublin area to find each of the local authorities collectively dominant.28

-- Panda Waste on Anti-Competitive Object

According to the Competition Court, that the Variation " ... prevents, restricts or distorts competition is patent."²⁹ This conclusion is reached because "[t]he Variation seeks to remove private operators from a market in which there is currently competition, and instead replace it with a system whereby either the local authority or a successful tenderer (as the former decides), will be the sole collector within the entire region or within any single or multiple sections that the respondents so designate." This view is, in itself, sufficient to demonstrate that the Variation is an anti-competitive agreement by object (an issue that required a reference to the ECJ by the Supreme Court in BIDS). According to the Competition Court "[i]ts object is thus the removal of operators from the market and its effect will be likewise ... [i]t would cause the market to move from many multiple competing undertakings to only a few, or even perhaps one."

In so proceeding, the Court seems to endorse a highly structural (and from an economic theory perspective, somewhat outdated) approach to competition – that which promotes competition is legal, that which suppresses competition is illegal, end of story. Even if the result of the reduction of competition is unambiguously more efficient, the Competition Court's approach in Panda Waste suggests it is illegal.

According to the Competition Authority the pro-competitive benefits of competitive tendering for local municipal waste collection services far outweigh any associated anti-competitive harm. Thus, in 2005, following extensive comparative analysis of various methods of municipal waste across a number of different countries, the Competition Authority concluded that " ... competitive tendering is the best method of ensuring that household waste collection providers deliver consumers good service at competitive prices."³⁰

BIDS

In contrast to Panda Waste, in BIDS, the Competition Court is highly supportive of State intervention (and, indeed, private firm collaboration) aimed at achieving efficiencies. That approach is manifest from the verdict: a State sponsored rationalisation programme for the beef industry, involving collaboration between 10 leading Irish beef processors (representing around 93% of total beef processing in Ireland) to remove 25% of total processing capacity from the market, was found not to raise competition issues.³¹

The Court's positive attitude towards the arrangement is also evident from the first paragraphs of its decision.³² At the outset, the Court states that BIDS (referred to in the judgment as the Society) " ... acted in a manner which was totally the antithesis of how cartels usually operate ... [t]here were no secret meetings, no coded messages, no failure to record and keep minutes, and no obfuscation in requesting compliance." Further, the Court found that in its approach to processing the rationalisation plan " ... one could not under any circumstances levy criticism against the Society."³³

As regards the resulting liability standard applied, perhaps the starkest contrast between BIDS and Panda Waste is the Court's consideration of whether the BIDS collaboration constituted an agreement to restrict competition by object (rather than effect). Again, the stated intention of BIDS – a collaboration of the leading Irish beef processors – was to remove 25% of total capacity from the market.

In considering this matter, the Court took the position that only agreements to fix prices, limit output and share markets or customers are restrictive by object. Having concluded that the BIDS arrangement did not involve any of those aspects, the Competition Court concluded "I therefore do not believe that one can say, on the balance of probability that the arrangements under discussion are so objectionable as to restrict competition by object."³⁴

As confirmed in a terse ECJ response to the Supreme Court's preliminary reference on appeal of the Competition Court's judgment, the proper question in determining whether an "infringement by object" arises is whether the arrangement in question "... can be regarded, by its very nature, as being injurious to the proper functioning of normal competition."³⁵ According to the ECJ, the BIDS arrangement "conflicts patently with the concept inherent in the EC Treaty provisions relating to competition."³⁶

ILCU

As recognised by the Supreme Court on appeal, ILCU represented an ultra interventionist approach to competition law enforcement. So far did it expand the concepts of "undertaking" and "dominance" that it brought competition law into direct conflict with fundamental principles of freedom of association.³⁷ Thus, the underlying economic theory in ILCU appears similar to that motivating the court in Panda Waste.

In determining that an ILCU savings protection scheme (or SPS) – essentially a pool of money made up of contributions by members of the ILCU over a number of years – constituted a separate product market, the Competition Court adopted a "'intuitive' or 'innate characteristics' test. The Court preferred this test to the SSNIP and other economic evidence on market definition presented by the defence. Further, notwithstanding that the expert economist of the prosecution "lacked quantitative data for his own application of the SSNIP test," the Court "preferred" the approach of that witness, effectively shifting the burden of proof on market definition onto the defence.³⁸

The Court continued, "[h]aving concluded, as I do, that there is a separate product market for SPS services, the requirement to identify precisely what constitutes the ILCU bundle assumes a lesser significance. For present purposes, it is sufficient to state that there is a market for credit union representation services which includes advocacy, provision of insurance and financial services, and self regulation."

The relatively low standard to which the prosecution was held in proving this narrow market definition was implicitly criticised on appeal by the Supreme Court. According to the Supreme Court, the prosecution failed to produce "cogent factual evidence of the existence of a product market in representation services," and the matter was "not debated with the intensity of the SPS issue."³⁹

Thus, in a manner similar to Panda Waste, the economic theory preferred by the Competition Court in ILCU seemed to result in a lowering of the legal hurdles that the prosecution faced, in particular (but not solely) in respect of the critical market definition issue.

Hemat

Given the verdict in Hemat – namely, that the defendant was not an undertaking or association of undertakings and therefore that neither EU nor Irish competition law were applicable to the dispute at issue – the case provides less basis for illustration of a link between the underlying economic theory and the liability standard.

Comment

In determining what is the appropriate economic doctrine for the Competition Court to apply, the Supreme Court's unanimous judgment in ILCU is important and helpful.

First, as mentioned above, ILCU clearly and unequivocally affirms the Competition Court's obligation to integrate economic principles into its legal analysis. In addition, ILCU gives strong indication of the appropriate economic thinking and doctrine that should inform Competition Court judgments. This follows from two notable aspects of the Supreme Court judgment. First, the Supreme Court explicitly recognises that Irish competition rules " ... constitute a European inheritance from the anti-trust law of the United States, in particular ss. 1 and 2 of the Sherman Anti-trust Act (1890)."⁴⁰ Second, the Supreme Court accepts much of the modern economic thinking on tying arrangements that underpin U.S. antitrust law.

The Supreme Court's judgment also contains a number of important outward signs of modern economic thinking and influence. The judgment resonates with themes familiar to readers of modern economic literature – in particular, the pronouncement that " ... the entire aim and object of competition law is consumer welfare."⁴¹

Finally, the unanimous opinion also manifests a basic scepticism towards intervention to control the conduct of dominant firms and includes a memorable passage about the benefits of monopoly.⁴² More explicitly, the unanimous opinion goes so far as to cite a passage from leading Harvard School economists Professors Areeda, Elhauge and Hovenkamp.

5. Conclusion

The Competition Court's consideration of the Variation as an economic activity, together with the court's affirmation of competition as the superior mechanism for governing the sector, results in Irish competition law attaining almost constitutional stature: effectively, national competition law is used as a means to check quasi-political decisions on the regulation of and state involvement in markets. As a result, a fundamental aspect of Irish environmental and waste law – the regional Waste Management Plan – is rendered, as an anti-competitive agreement by object, presumptively unlawful.⁴³

As mentioned, an appeal of the judgment has been lodged. An important question in any such appeal is likely to be whether competition law is properly applicable to adoption of regulatory or policy decisions of the type impugned by the Competition Court (or, put another way, whether adoption of the Variation properly constitutes an economic activity).

More generally, given that four out of four cases to come before the Competition Court so far have resulted in appeals, with two out of three appeals heard to date successful, the question arises as to how predictability and certainty might be enhanced.

One possibility might be to seek to bolster the influence of the Competition Authority in the system. A key change brought about by the 2002 modernisation of Irish competition law was abolition of the notification regime to the Competition Authority. That regime permitted the Competition Authority to review and clear notified arrangements as compatible with competition law, thereby affording the agency an important decision-making and policy formulation role in the system. One possible suggest would be to re-inaugurate such a notification regime. Such a course would, however, run against the general trend for "best practice" competition law enforcement (according to which agencies should be primarily focused on investigating cartels).

It is also the case that the judicial outcome in the four major cases so far (ILCU, BIDS, Hemat and, pending appeal at least, Panda Waste) has been, in each case, forcefully and openly opposed by the Competition Authority. In other words, in 100% of the cases adopted since modernisation, Ireland's expert competition law agency – staffed with a number of highly qualified economists with long experience – has opposed the verdict; whether directly in court (à la BIDS and ILCU) or indirectly via published decisions or statements (à la Hemat and Panda Waste). So, given the evident tension between judicial and agency thinking on competition law (and the resulting incentives to appeal any agency decision), re-involving the Competition Authority in the decision-making process may not necessarily enhance legal certainty or improve result timeframes.

Undoubtedly, however, the existing system is concerning. In Panda Waste, the trial took 15 days and, as mentioned, the resulting judgment is now under appeal to the Supreme Court. BIDS, which commenced by way of plenary summons on 30 June 2003, and involved an 11 day trial, a Supreme Court appeal and a preliminary reference to the ECJ, is on-going and remains unresolved, with a date listed for mention before the Competition Court in October 2010 (i.e., over seven years from initiation). Final resolution of ILCU, which commenced on 22 July 2003, involved an 11 day trial and a Supreme Court appeal, took nearly four years with the Supreme Court verdict delivered on 8 May 2007. Hemat, which involved a two-day trial, commenced on 24 November 2003, with the Competition Court judgment delivered on 7 April 2006 and, following appeal, the Supreme Court judgment delivered on 29 April 2010 took just under six and a half years.

Not only is significant delay and uncertainty now a feature of the system. The legal costs associated with litigating in that environment are, it is fair to say, truly enormous. The Competition Authority's costs in ILCU alone – reportedly representing two-thirds of the total costs in the case – were reported to be €1.7 million.⁴⁴

The implications for competition law enforcement, and particularly private enforcement (generally considered an important plank in assuring effective enforcement of competition law), are obvious. At a time when the London bar is actively – and with some success – promoting England as the best jurisdiction for private action litigation in EU competition law cases, it may also undermine Ireland's attractiveness as a litigation centre in a growth area. Perhaps some greater coherence in the economic theory underpinning Competition Court judgments might go some way to addressing the controversy surrounding verdicts.

Footnotes

1. Gorecki, K. P. & Mackey, M. Hemat v Medical Council: Its Implications for Irish and EU Competition Law, [2007] ECLR, Volume 28, Issue 5, pages 285 – 293, in which the Competition Court's reasoning is described as "inconsistent" and "incorrect" (at page 293). At the time, Paul Gorecki was a Member of the Competition Authority. Noreen Mackey is Legal Advisor to the Competition Authority.

2. Order 63B of the Rules of the Superior Courts provides for a designated judge, selected from the current 36 Judges of the High Court, to sit in a specialist court for competition law matters. Pursuant to Order 63B, "[c]ompetition proceedings, and any motions or other applications in the competition proceedings, shall be heard in the Competition List by the Judge."

3. Nurendale Limited trading as Panda Waste Services v Dublin City Council, Dun Laoghaire/Rathdown County Council, Fingal County Council, and South Dublin county Council [2009] IEHC 588 and Greenstar Limited v Dublin City Council, Dun Laoghaire/Rathdown County Council, Fingal County Council, and South Dublin county Council [2009] IEHC 589.

4. Panda Waste Judgment, at para. 57. Ultimately, the Competition Court's adoption of a "unified approach" test in assessing whether the local authorities' constituted undertakings is almost entirely rationalised by reference to MOTOE. The Competition Court states that "[b]oth the Advocate General and the Court considered both the consent required from ELPA [the regulatory act] and its actions [the economic activities] on markets together, finding that its activities must be economic to and therefore it must be an undertaking." The Competition Court goes on to state that "[s]uch a unified approach can be seen in the way in which they phrased the questions for reference."

5. What was meant by representation services was not clearly defined during the court proceedings. The Court indicated that the services provided by ILCU " ... may be broken down in the following way: (a) pure representation services, i.e. advocacy, (b) LP/LS insurance, compulsorily obtained through ECCU, (c) SPS, compulsorily confined to ILCU members, (d) self regulation." However, finding that it was unnecessary for the purposes of its judgment to do so, the Court did not identify precisely what constituted credit union representation services. It would follow that the ILCU's "self regulation" activities were considered economic activities by the Court.

6. ILCU Judgment, at page 109. On appeal, the Supreme Court overturned the Competition Court's verdict on the basis that the market definition was flawed and the Supreme Court did not review or otherwise discuss the lower court's approach on the definition of an undertaking. Fennelly J, who drafted the unanimous Supreme Court verdict , does note in the judgment "I confess to finding it troubling that any and every association of business undertakings should be held, for purposes of competition law, automatically to be engaged in a business consisting of the provision of services for reward" (at para. 140).

8. According to the Court "[t]hat conclusion [i.e., that the restriction on advertising at issue has economic consequences] is one which I clearly accept as any measure which impacts upon the participation of an economic operator on a relevant market would most likely have such consequences" (at para. 15).

9. Ibid at para 51. In reaching this conclusion, the Competition Court noted that the legislation conferred on the Medical Council responsibility for registration, education and training, and fitness to practice and that " ... the structure and provisions of the Medical Council were focused almost exclusively on those who receive service from the medical profession and not on the profession itself."

10. BIDS concerned a State sponsored rationalisation programme for the beef industry, involving collaboration between 10 leading Irish beef processors (representing around 93% of total beef processing in Ireland) to coordinate the removal of 25% of total processing capacity from the Irish market. That collaboration was considered by the High Court not to prevent, restrict, or distort competition in any way (and as a result to fall outside the scope of Article 101 TFEU and its equivalent provision in Irish competition law, section 4 of the Competition Act 2002).

11.On appeal, the Supreme Court referred a question to the ECJ on 8 March 2008 (as to whether an agreement between competitors of the type at issue to remove capacity from the market was to be regarded as a restriction by object under Article 101 TFEU). By judgement delivered on 20 November 2008, the ECJ ruled that the agreement "has as its object the prevention, restriction or distortion of competition within the meaning of Article 101 TFEU." By judgment delivered on 3 November 2009, the Supreme Court remitted the matter back to the Competition Court to assess application of the criteria in Article 101(3) to the agreement. As of writing, the case was listed for mention before the Competition Court on 7 October 2010.

12. Hemat v Medical Council, at para. 19.

13. At para 47.

14. Supreme Court Judgment, at para. 105.

15. Kovacic & Shapiro, Antitrust Policy: A Century of Economic and Legal Thinking, 14 J. Econ. Persp. 43 (2000), page 48. The defining U.S. Supreme Court judgment of this era is Appalachian Coals, Inc v. U.S. (288 U.S. 344 [1933]), in which the Court refused to condemn an output restriction scheme embodied in a joint marketing agreement proposed by coal producers in the eastern United States. Commenting on the case, Kovacic & Shapiro state that " ... the Court appeared to have lost faith in free market competition and welcomed experiments with sector-wide private ordering." The case is now seen as "a Depression-era aberration."

16. By way of example, in U.S. v. Socony Vacuum Oil Co. (310 U.S. 150 [1940]), in a case bearing some resemblance to BIDS, the U.S. Supreme Court condemned collective efforts by refiners to buy "distress" gasoline produced by independents, warning that business managers who tried privately to recreate the planning schemes that government officials previously had approved acted at their peril. Socony's ban on all arrangements that affect price is generally regarded now as extreme.

17. Thus, in a famous dissent in Von's Grocery (384 U.S. at 301), Justice Potter Stewart captured the spirit of the time by lamenting that the sole consistency he could perceive in Supreme Court antitrust decisions was that "the Government always wins."

18. Kovacic The Intellectual DNA of Modern U.S. Competition Law for Dominant Firm Conduct: The Chicago/Harvard Double Helix, Columbia Business Law Review, Vol 2007. pages 1 – 78, at page 5. The most dramatic example of the influence of the Chicago School on judicial thinking is often cited as Continental T.V. Inc. v. GTE Sylvania Inc. (433 U.S. 36 [1977]), which held that all nonprice vertical restrictions warrant rule of reason analysis, and in which the U.S. Supreme Court prominently cited Chicago School commentary.

19. Kovacic, Failed Expectations: The Troubled Past and Uncertain Future of the Sherman Act as a Tool for Deconcentration. Iowa Law Review, 74 pages 1105 – 50. U.S. antitrust and government enforcement policy since the mid-1990s have generally preferred a more expansive antitrust intervention that builds upon the theoretical and empirical propositions advanced by Chicago School proponents, while qualifying Chicago views. This is in line with post-Chicago School literature, which generally defines a broader zone of antitrust intervention (see, e.g., Post-Chicago Analysis After Kodak: Interview with Professor Steve C Salop 7 Antitrust 20, 20 (1992)).

20. In ILCU, the Supreme Court explicitly recognises that EU and thereby Irish competition rules " ... constitute a European inheritance from the anti-trust law of the United States, in particular ss. 1 and 2 of the Sherman Anti-trust Act (1890)" (at para. 104). For support for this position, see O'Donoghue & Padilla, The Law and Economics of Article 82 EC, footnote 31 at page 11, where the influence of US antitrust thinking and US antitrust lawyers on the drafting of the competition provisions in the EU Treaties is discussed. See also Legal, H. Standards of Proof and Standards of Judicial Review in EU Competition law, where Legal states that " ... the vast experience of competition law accumulated in the U.S. yields considerable influence over the EU."

21. Panda Waste Judgment, at para. 118.

22. Ibid.

23. Panda Waste Judgment, at para. 76.

24. According to O'Donoghue and Padilla, The Law and Economics of Article 82 EC, Hart Publishing 2006, market definition " ... constitutes a critical step in the assessment of dominance: the Community Courts have consistently held that the definition of a relevant market is an essential prerequisite for the assessment of dominance" (citing Case 6/72, Europemballage Corporation and Continental Can v Commission [1973] ECR 215 para. 32 ("the definition of the relevant market is of essential significance").

25. Panda Waste Judgment, at para 123.

26. Panda Waste Judgment, at para. 132, where the Court concludes that each of the local authorities is dominant "in each of their individual areas" (which presumably is a reference to each of the separate and distinct functional areas within Dublin region in which the local authorities operate).

27. This is important because on the narrower hypothetical markets used by the Court each local authority (other than Dun-Laoghaire County Council) was found to have a market share of above 95%, which shares were relied upon to support a presumption of dominance. In contrast, on the relevant market defined by the Court, each of the local authorities' market shares would be significantly reduced such that, from the economic testimony produced by Panda Waste's economic expert, Dublin City Council would have a share of 38.8%, South Dublin Council a 21/3% share, Final Council 20.2%, and Dun Laoghaire/Rathdown 8.2%. Clearly, those shares are not of the order to support a presumption of dominance (which normally would only arise on a share of above 40%).

28. Panda Waste Judgment, at para. 134, where the Court concludes that the local authorities " ... are also collectively dominant in the greater Dublin area, in addition to being dominance individually within each of their respective geographical areas."

29. Panda Waste Judgment, at para. 81.

30. Enforcement Decision (Decision No. E/05/002), Alleged excessive pricing by Greenstar Recycling Holdings Limited in the provision of household waste collection services in northeast Wicklow, available at http://www.tca.ie/images/uploaded/documents/e_05_002%20Greenstar.pdf .

31. Planning for the rationalisation process was largely funded by Enterprise Ireland (a State agency responsible for supporting Irish businesses in the manufacturing and internationally traded service sectors), and representatives from a number of government agencies (including An Bord Bia and the Department of Agriculture and Food) were on a steering group that assisted in preparing the restructuring plan. The restructuring plan was also support by a report commission by the Minister for Agriculture and Food following establishment by the Minister of a Beef Task Force (chaired by the Secretary General of the Department of Agriculture and Food with members from various State agencies).

32. BIDS, para.'s 84 – 87. The decision section of the judgment commences at para. 84.

33. The Court does state that the above endorsement of BIDS's comportment did not have "a direct bearing on the case" (para. 84).

34. BIDS judgment, at para. 98.

35. At para. 17.

36. At para. 35.

37. According to the Supreme Court, "[o]ne of the most readily foreseeable implications of the Authority's analysis is that any trade association representing a significant percentage (which need not even amount to 50%) of a particular trade or profession might be held to enjoy a dominant position in the market for representation services for the trade or profession in question. A person denied admission to membership of the association, for whatever reason, might plausibly mount a case of abuse of a dominant position based on refusal to supply the association's services ... it seems at least conceivable that competition law could be deployed in pursuit of complaints of disappointed applicants for membership."

38. ILCU Judgment, at page 130.

39. Supreme Court Judgment, at para. 144.

40. Supreme Court Judgment, at para. 104. For support for this position, see O'Donoghue & Padilla, The Law and Economics of Article 82 EC, footnote 31 at page 11, where the influence of US antitrust thinking and US antitrust lawyers on the drafting of the competition provisions in the EU Treaties is discussed.

41. Supreme Court Judgment, at para. 109.

42. Supreme Court Judgment, at para. 109 ("Competition law does not outlaw economic power, only its abuse. Economic power may, indeed should, be the reward of effective satisfaction of consumer needs. It would be inconsistent with the objectives of free competition that successful competitors should be punished.").

43. The Waste Management Plans provided for in the 1996 Act, via which the State effectively sought to implement EU obligations in respect of non-hazardous waste, have been recognised as a "crucial component" of that statute (and, thereby, the Irish regulatory framework for waste). See Boyle, M. (2002) Clearing up after the Celtic Tiger: the politics of waste management in the Irish Republic, Journal of the Scottish Association of Geography Teachers, 30

44. Competition Press, Volume No. 16, Edition 8 (2009), at page 183.

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