C-360/92

PUBLISHERS ASSOCIATION v COMMISSION

OPINION OF ADVOCATE GENERAL LENZ delivered on 16 June 1994 *

Mr President, lishers who are members of the appellant Members of the Court, association, whereas the parties to the second agreement are publishers who are not mem­ bers of the association. The contents of the two agreements are largely identical.

A — Introduction

1. The present proceedings concern an 3. The NBA lay down standard conditions appeal by the Publishers Association against for the sale of books at fixed prices •— the judgment of the Court of First Instance so-called net books — to be applied by the of 9 July 1992 in Case T-66/89. ' In that publishers in question. Under those standard judgment the Court of First Instance dis­ conditions, wholesalers and retailers are in missed the application brought by the Pub­ principle prohibited from selling such a book lishers Association against the decision of the in the United Kingdom or Ireland at a price Commission of 12 December 1988 relating lower than that prescribed by the publisher. to the Publishers Association — Net Book Exceptions to that rule are contained in the 2 Agreements proceeding. NBA themselves and in additional rules which the Publishers Association is author­ ized to issue by the NBA. Those additional regulations include rules on discounts for libraries, quantity buyers and so-called book agents.

2. The appellant is an association of publish­ ers in the United Kingdom. The present pro­ ceedings concern two agreements drawn up by the appellant and concluded in 1957. Those agreements are called 'Net Book Agreements' (hereinafter 'NBA'). The parties to the first of those agreements are all pub­

6. According to the findings of the Court of 4. In connection with the NBA and the First Instance, about 40 000 new titles are implementing rules, the appellant also pub­ published each year in the United Kingdom, lished a 'Code of Allowances' for the sale of 80% of which are published by members of new, revised or cheap editions, books with the appellant association. reduced net prices and remainders, and rules for book clubs ('Book Club Regulations') and the annual national book sale. Finally, the appellant published a trade directory ('Directory of Booksellers') listing all book­ sellers who met certain requirements and had undertaken to apply the abovementioned standard conditions for the sale of 'net books'. Only a small part of United Kingdom book production (approximately 1.2%) is ex­ ported to Ireland. However, those exports amount to 80% of imports of books into Ireland and over 50% of total book sales in that Member State. It is also established that about 75% of books sold in the United Kingdom or exported by British publishers 5 to Ireland are marketed as 'net books'.

3 — Cited above (note 2), paragraphs 6 to 30 and 38 to 39. 5. Those rules are described in detail in the 4 — Cited above (note 1), paragraphs 4 to 16. Commission's decision of 12 December 5 _ Judgment cited above (note 1), paragraphs 17 to 18 and 56.

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6 — [1962] 3 All ER 751. 7 — As at the date of the hearing before the Court of Justice, however, no further steps appear to have been taken. The Commission then describes the argu­ 8 — Sec paragraphs 3 to 4 above. ments put forward by the appellant on the

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question of indispensability (point 72). taking into account the higher discounts According to the Commission, it was argued which would be requested by the trade from firstly that it would not be practicable for the publishers, book prices would therefore publishers themselves to have to notify every rise. At the same time titles with small print bookseller of their individual conditions of runs would possibly not be published at all.' sale. Secondly, it would not be possible for booksellers to apply and comply with a large number of differing conditions for the resale of books with fixed prices. It was also neces­ sary that each bookseller could be confident that his competitors were subject to the same terms as he was in relation to a particular book; the NBA provided booksellers with that confidence. Finally, compliance with the After various other observations (which I standard conditions and their enforcement will discuss below) the Commission could in practice be monitored only by the addresses the four arguments put forward by appellant association. the appellant on the question of indispens­ ability and comes to the conclusion that none of those arguments is convincing (points 76 to 85).

decision, and dismissed them. In the second — an order that the Commission pay the part (paragraphs 60 to 116 of the judgment) costs of the appeal, the proceedings at the Court of First Instance considered the first instance and the proceedings for the pleas brought against Article 2 of the deci­ adoption of interim measures. sion and dismissed them. Those pleas included inter alia an alleged discrepancy between the objections notified to the appel­ lant and those contained in the decision (paragraphs 61 to 70 of the judgment).

The appellant requests the Court of Justice to give final judgment on the application itself, in accordance with Article 54 of the Statute of the Court of Justice, or in the alternative to refer it back to the Court of First Instance for judgment. 11. The appellant seeks

— an order setting aside the judgment,

12. The Commission asks the Court of Jus­ tice

— part of the same form of order as that sought by it from the Court of First Instance, namely — to dismiss as inadmissible the arguments and conclusions of the appellant in grounds 4(c) to (d) of the appeal,

(i) annulment of Article 2 of the decision in so far as it refused an exemption under Article 85(3) for the NBA and certain related decisions, regulations and other documents referred to in — to dismiss the appeal as in any event Article 1 of the decision, and unfounded, and

14. In view of the somewhat peculiar formu­ lation of the appellant association's appeal, the first question to be examined is the scope 15. In its response the Commission has of the appeal. It is apparent from the appeal rightly raised the question whether the that the Publishers Association attacks the appellant's appeal relates to all the agree­ judgment of the Court of First Instance only ments and other rules mentioned in Arti­ in so far as it upholds Articles 2 to 4 of the cle 1 of the Commission's decision. The Commission's decision. The judgment is not appellant's statements in the appeal were not challenged, on the other hand, in so far as it entirely clear in this respect. The appellant dismisses the pleas directed against Arti­ put an end to this uncertainty only in its cle 1 of the decision. The Publishers Associa­ tion thus no longer contests the Commis­ sion's finding, which was confirmed by the Court of First Instance, that the NBA and 10 — See paragraph 10 above.

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16. As I have already stated, the Commis­ sion's decision relates to the NBA and the 17. The Commission argues that some of the other rules only to the extent that they affect points raised by the appellant are inadmis­ trade between Member States. " As the sible, since they relate to questions of fact, not Commission again emphasized in its of law. Under Article 168(a)(1) of the EC response to the appeal, the decision thus did Treaty and the first paragraph of Arti­ not extend to the application of the NBA and the related rules in the United Kingdom cle 51 of the EEC Statute of the Court of Justice, appeals are of course limited to points of law. For simplicity, however, I shall deal with this objection when discussing the 11 — According to the Commission's obscrvntions in its reply to the appeal, that inter-State trade consists essentially of the individual pleas affected by it. export of 'net books' from the United Kingdom to Ireland, the import into the United Kingdom from other Member States of books which after import were made 'net books' by the importer or distributor, and the reimport into the United Kingdom of books previously exported to other 12 — It may also be noted, incidentally, that Pentos in fact inter­ Member States (particularly Ireland). vened in the proceedings in support of the Commission.

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Substance ket of the United Kingdom and Ireland, hitherto a single unit, will now be divided along the national frontiers. The appellant and both the Booksellers Association and Clé are not wrong in drawing attention to this consequence, which at least at first sight Preliminary observation appears paradoxical.

19. The Commission rightly points out, however, that in determining whether the conditions for an exemption under Arti­ cle 85(3) of the EC Treaty are satisfied, the 13 The arguments put forward by the appellant Commission has a certain discretion. Judi­ also raise some doubt as to whether the deci­ cial review of such assessments must take sion of the Commission is appropriate. The account thereof and confine itself to 'an appellant's assertion that one can hardly con­ examination of the relevance of the facts and ceive of a system of resale price maintenance of the legal consequences which the Com­ for books which restricts competition less 14 mission deduces therefrom'. It is for the than the NBA has something to be said for Court of First Instance to carry out that it. Also noteworthy — although of course of review. no relevance for the legal appraisal — is the circumstance that according to the Booksell­ ers Association not only the publishers 13 — See the judgment in Case 71/74 Frubo v Commission [1975] involved, but also the overwhelming major­ ECR 563, paragraph 43. ity of booksellers who belong to that associ­ 14 _ Judgment in Joined Cases 56/64 and 58/64 Consten and Grundig v Commission [1966] ECR 299, p. 347. By con­ ation are in favour of the NBA. Finally, it trast, the view expressed by Pentos, namely that a decision must be noted that the Commission's deci­ by the Commission under Article 85(3) is unlawful only if based on a 'manifest' error of fact or a "manifest' error of sion has the consequence that the book mar­ law, is of course wrong.

If an appeal is brought against a judgment of The individual pleas in law on the appeal the Court of First Instance, the appeal is lim­ ited to points of law. As I have already stated 15 on another occasion, in interpreting the term 'point of law' a restrictive approach is appropriate. That is consistent with the case- law to the effect that an appeal is admissible (1) The nature of the NBA only 'in so far as it is claimed that the deci­ sion of the Court of First Instance is incom­ patible with the rules of law the application 16 of which it had to ensure'. The appeal must relate to the infringement of rules of law 'to the exclusion of any appraisal of the facts'. 17 20. The appellant complains that the Court of First Instance was guilty of a 'fundamen­ tal' misinterpretation in paragraph 72, by approving the opinion of the Commission that by means of the NBA a 'collective' sys­ tem had been created for imposing the same price for any given book on all booksellers. It argues that the NBA in fact enable the individual publisher to practise resale price maintenance for specific books on an indi- vidual basis, without the publisher being obliged to do so; that is therefore not a col- lective decision. It submits that the system established by the NBA does, however, have certain collective characteristics: thus it The pleas in law put forward by the appel­ enables the appellant, on behalf of the pub­ lant must be considered in that light below. I lishers concerned, to give notice of the stan­ must first mention that in the appeal the dard conditions of the sale of 'net books' to appellant has set them out in two sections all booksellers in the United Kingdom and (the first entitled 'The grounds of the appeal' Ireland. It also enables booksellers to operate and the second entitled 'Pleas in law in sup­ on the basis of clear and uniform conditions port of the grounds of appeal') without the of sale. The conditions of sale also provide relationship between those two sections for uniform exceptions. Finally, the system being made clear. As some of the pleas in law enables the appellant to monitor compliance overlap in any case, I will use my own with the standard conditions. In the appel­ arrangement of them below. lant's opinion that does not, however, mean that the NBA are a collective system. It sub­ mits that the Commission itself called the 15 — Sec my opinion of 10 February 1994 in Case C-39/93 P system established by the NBA an 'individ­ SFEl and Others v Commission, [1994] ECR 1-2681, para­ graph 30 et seq. ual system of maintained prices which has 16 — Judgment in Case C-283/90 P Vtdrányi v Commission certain collective characteristics' during the [1991] ECR 1-4339, paragraph 13; judgment in Case ls C-346/90 P f v Commission [1992] ECR 1-2691, para­ procedure in the VBVB and VBBB case, as graph 7. 17 — Judgment in Vidrányi, cited above (note 16), paragraph 12; judgment in F, cited above (note 16), paragraph 7; most recently confirmed by the judgment in Case C-136/92 P Commission v BrazzeUi Umidi and Others, 1 lune 1994 18 — Judgment in Joined Cases 43/82 and 63/82 VBVB and [1994] ECR 1-1981, paragraph 48. VBBB v Commission [1984] ECR 19.

22. The Commission's view is in my opin­ ion correct. The observations in paragraphs 45 and 95 of the judgment under appeal show that the Court of First Instance was perfectly well aware that the publishers who were parties to the NBA had the possibility, In so far as those observations concern the but not the duty, of making the books pub­ question of the extent to which the NBA lished by them 'net books' and applying the restrict competition, they relate to Arti­ standard conditions laid down in the NBA cle 85(1) and therefore need not be discussed to sales of those books. Those uniform con­ further here, since the findings of the Court ditions of resale apply in fact only if a pub­ of First Instance on that point are not con­ lisher has made a book a 'net book'. Whether tested in the appeal. The same applies to the

19 — Ibid., page 47. 20 — See paragraphs 24 to 28 below.

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PUBLISHERS ASSOCIATION v COMMISSION

opinion, expressed by the appellant during decision in the VBBB and VBVB case that 2I

24. In point 75 of its decision, the Commis­ 21 — OJ 1982 L 54, p. 36. That decision was the subject of the Court of Justice's 1984 judgment referred to above sion notes that it has 'already' stated in its (note 18).

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them. The reference to that case in the Com­ mission should in its decisions include, in mission's decision was therefore a serious addition to the observations which are abso­ error, and the Court of First Instance failed lutely necessary for the particular case, rea­ to recognize this. soning of a more general nature which could serve as guidance to other economic opera­ tors. It adds that the appellant has moreover not disputed that the principle referred to at that point in the decision is correct.

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trative economy, and the Court of First this must in my opinion be regarded as a Instance was right in not objecting to the question which is amenable to review by the Commission's approach. It submits that this appellate court, since if the Commission in criticism is moreover a question of fact considering the question of Article 85(3) had which cannot be made the subject of a proceeded from a wrong starting point, it ground of appeal. would have committed an error of law. The same would apply to the judgment of the Court of First Instance if it approved an approach which was thus vitiated by an error of law.

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PUBLISHERS ASSOCIATION v COMMISSION

33. It is self-evident, however, that the Com­ of stockholding booksellers in the market. mission and the Court of First Instance had The Commission has not disputed that those to examine first what benefits were to be are benefits within the meaning of Arti­ attained by means of the NBA system. To cle 85(3), so that I need not discuss questions that extent I agree with the appellant's argu­ on that point. However, I wish to observe ment. Consideration of the question whether that I was impressed by the observations of a restriction on competition is indispensable the Booksellers Association, during the oral to the attainment of the desired objectives hearing before the Court of Justice, on the presupposes that it has first been established last of those benefits. The intervener stated what those objectives are. On the other on that occasion that the presence of a large hand, the Commission could leave open the number of stockholding booksellers in the question whether those objectives actually market guaranteed the widest possible distri­ were attained, once it was certain that the bution of books — and I would add that that restrictions on competition in question were is certainly in everyone's interest. 24

not indispensable for attaining them.

The Commission argues that it well appreci­ ated the benefits which the NBA system was The Court of First Instance recognized those intended to bring about and which the objectives of the NBA too, as the Commis­ appellant relies on, as can be seen from point sion submits. In paragraph 72 of the judg­ 73 of the decision, cited above, 23 and that in ment under appeal the Court of First its further examination of the question, it Instance summarizes the contents of the assumed that the NBA did in fact bring Commission's observations on that point. As about those benefits. The passage referred to the Court of First Instance put it, the aims in fact deals with precisely those circum­ pursued by the NBA were to avoid a decline stances which the appellant used as argu­ in stock levels which would result in shorter 25

whether the Court of First Instance in those what other means, less restrictive of compe­ words in fact gave a reasonable summary of tition, there were for attaining the objectives the aims of the NBA as put forward by the of the NBA. The Commission rightly refers appellant. It is noticeable above all that the in this connection to the judgment of the risk of a decline in the number of stockhold­ Court of Justice in the VBVB and VBBB ing booksellers is not expressly mentioned. case. The Court of Justice held that it was in However, I need not go into this question the first place for the parties seeking an further, since the appellant has made no spe­ exemption 'to present to the Commission cific complaint in that respect. It must also the evidence intended to establish the eco­ be presumed in favour of the Court of First nomic justification for an exemption and, if Instance that it was familiar with point 73 of the Commission has objections to raise, to the decision (which it refers to in para­ submit alternatives to it. Although it is true graph 72 of its judgment) in its entirety. that the Commission, for its part, may give the undertakings indications as regards any possible solutions, it is not legally required 27 to do so ...' If the Commission denies that particular restrictions on competition are indispensable, it will at least have to indicate what alternatives it has in mind. Otherwise — as the appellant expressively puts it — the 34. Even if the Commission and the Court Commission would in fact be given 'carte of First Instance were thus aware of the blanche' and would be enabled simply to objectives of the NBA, it is not yet certain deny the indispensability of restrictions on whether they also correctly appreciated their competition in abstracto without any expla­ extent. As mentioned above, the appellant nation. complains that both the Court of First Instance and the Commission misunderstood what it regards as the central feature of the present case — namely, that the NBA system is indispensable for ensuring that the benefits sought occur in Ireland as well. That ques­ tion — which goes to the heart of the present case — is in my opinion best exam­ ined in connection with the appellant's criti­ cism of the opinion expressed by the Court of First Instance in paragraph 84 of the judg­ 26 ment under appeal.

vidual resale price maintenance agree­ Commission's suggestions. Even if the Com­ ments'. As the Commission has rightly mission might in other cases be able to stated, it did not have to decide at that stage restrict itself to refusing a request for exemp­ whether such individual agreements would tion without putting alternatives to the par­ be compatible with Article 85. It should be ties concerned, an exception must be made in observed that the Commission at that time the present case, since it concerns agreements had no knowledge, nor could it have, of the which have been applied over many years specific content of such individual agree­ and are in the public interest. ments. That question would have had to be answered only if corresponding agreements had been notified to the Commission. It was sufficient that the Commission stated that the NBA system was not the only conceiv­ able means of attaining the desired benefits. The Commission did that. It was thus for the appellant to show that such individual agree­ ments between publisher and bookseller were not likely to bring about the benefits It does not appear to me to be necessary to aimed at by means of the NBA system. The consider the details of that argument devel­ Commission's approach can therefore not be oped by the intervener. This is probably a objected to, and the Court of First of new legal ground which should be regarded Instance was able to reject the appellant's as inadmissible, as the Commission rightly objections on this point. 29 That plea in law observes. It should be emphasized in any in support of the appeal must therefore fail. event that a rule with the content argued for by the intervener does not exist in Commu­ nity law.

38. The appellant first asserts that it at no time put forward the argument discussed by the Court of First Instance. That is contra­ dicted by the Commission. However, in its opinion the objection could not succeed even if the appellant had in fact not put forward that argument, since it is not clear what influence the fact that the Court of First 39. It is less easy to find an answer to the Instance dismissed an argument that had not questions thrown up by the appellant's sec­ been advanced could have on that Court's ond criticism of paragraph 84 of the judg­ conclusions on those arguments which the ment. In that passage the Court of First appellant did in fact advance. Instance rejects the aforesaid alleged argu­ ment of the appellant with the comment that a price maintenance system which restricts competition within the common market can­ not qualify for exemption on the ground that it must continue to operate in order to pro­ duce its beneficial effects within the market of a Member State. The judgment then states: It would in my opinion be pointless to examine whether the appellant made use of the argument in question in the course of the procedure before the Commission and the Court of First Instance. That Court itself states in paragraph 82 of its judgment that the appellant accepted at the hearing that the confinement of the application of the NBA to the British market would not lead to the 'It should further be noted that the [appel­ collapse of the system. Why the Court of lant], which is an association consisting of First Instance nevertheless then discussed the publishers established in the United King­ argument in question in paragraph 84 of its dom, is not entitled to rely on any negative judgment and rejected it is a mystery. I am effects which might be felt on the Irish mar­ inclined to believe that it was due to a mis­ ket, even though that market belongs to the take by the Court of First Instance. Be that same language area.' as it may, the fact that that Court deals with an argument which was not (or no longer) raised may admittedly give rise to doubt as 30 — See the judgment in Case C-244/91 P Pincberle v Commis- to whether the Court applied the necessary sion [1993] ECR 1-6965, paragraph 31.

41. It cannot be denied that the passage in the judgment cited above contains a manifest error of law. An exemption under Article 85(3) presupposes that the agreement in question brings about certain positive effects. Article 85(3) contains no provisions as to 43. Those observations are not convincing. where those benefits are to occur. It is self- Paragraph 84 of the contested judgment can evident, however, that all beneficial effects indeed — as I have already stated — be which come into being in the Community regarded as superfluous and therefore are of relevance in that context. The compe­ ignored. The passage in question can more­ tition rules of the EC Treaty are intended to over in view of its wording be regarded as an ensure the functioning of the internal mar­ obiter dictum in the context of paragraph 84, ket. It would be incompatible with that which reduces its significance even further. objective if an economic operator from a Attacks against that passage as such therefore specific Member State were prevented from miss the mark. It cannot be denied, however, relying in the context of Article 85(3) on that the Court of First Instance states here benefits occurring in another Member State. that the appellant can in its opinion not rely That conclusion seems to me so trite that it on benefits in Ireland in order to be granted 31 requires no further explanation. an exemption. As I have already stated, however, the question of the indispensability of a restriction on competition can be prop­ erly assessed only if there is clarity as to the objectives of the agreement in question. In the present case those objectives included the

bringing about of those beneficial effects in exports to Ireland represent only a very Ireland too. Since the Court of First Instance small share — about 1.2% — of United clearly seems not to have realized this, it Kingdom book production. It is therefore proceeded from an incomplete, and hence not likely that if the application of the NBA wrong basis when examining the indispens- were confined to the United Kingdom, there ability of the restrictions on competition. would be an appreciable effect on the activi­ That is in my opinion an error of law which ties of publishers in that territory. Print runs, — as it is a fundamental error — would jus­ costs and the number and variety of books tify quashing the judgment. published by British publishers would not alter appreciably. Irish book buyers would therefore be able to benefit in that respect in the same way as book buyers in the United Kingdom. The Commission also considers that the adverse effects feared by the appel­ lant with respect to the number of stock­ holding booksellers in the United Kingdom would also not be likely to materialize. The possible effects on the number of booksellers 44. The Court of Justice has already held, in Ireland, on the other hand, are merely however, that an appeal must be dismissed 'if mentioned in a footnote to the response. It is the grounds of a judgment of the Court of also noticeable that in the rejoinder the First Instance reveal an infringement of Commission complains that the appellant Community law but the operative provisions has shifted its ground and now relies on an appear well founded on other legal 32 argument which is very different from the grounds'. So if the Commission's decision argument it advanced in the proceedings on this point were correct, that would be before the Court of First Instance. Those justification for upholding the judgment observations give the impression that the regardless of the error of law on which it is Commission originally took no account of based. That would presuppose that the Com­ the question of the possible effects on Irish mission itself was well aware of the extent of booksellers. the benefits alleged by the appellant when it considered the question of the indisp ens abil­ ity of the restrictions on competition.

rectly on book buyers in Ireland and Irish taken account, or not adequately taken publishers. The Commission interprets that account of the effects on booksellers in Ire­ statement to mean that the appellant bases its land. application for exemption for the NBA on the ground that they lead to benefits for the competitors of the appellant association's members. It says that such an argument must be regarded as unusual at the least. It sug­ gests that it is possible that the observations at the end of paragraph 84 of the contested judgment can be explained by the fact that the Court of First Instance had consider­ 47. The appellant's submission that the ations of that type in mind. Court of Justice should quash the judgment of the Court of First Instance and the deci­ sion of the Commission in this respect and thereby cause the Commission to make a fresh decision on its application for exemp­ tion therefore has much to be said for it. I have nevertheless reached the conclusion that the ground of appeal in question ought not to succeed, since the appellant has in my opinion nevertheless in the end failed to prove that the Commission when adopting its decision failed to take into account the possible beneficial effects of the NBA on the structure of the book trade in Ireland. As stated above, in points 76 to 85 of the deci­ sion the Commission discussed the specific Those observations testify to the imagination arguments which the appellant considered and ingenuity of the Commission's represen­ proved the indispensability of the NBA. It is tatives, but fail to convince. Clé explained at not apparent that the Commission examined the hearing before the Court of Justice how those arguments only in respect to the the said argument of the appellant is to be United Kingdom. On the contrary, the rele­ understood. The argument is that the present vant observations of the Commission 33 case concerns the continued existence and expressly refer to Ireland at two points. It viability of stockholding booksellers in Ire­ would have been for the appellant to advance land, and the existence of those booksellers further arguments to demonstrate that the of course also — indirectly — benefits the application of the NBA to trade between Irish publishers. The appellant's argument is Member States was indispensable in order to therefore perfectly logical and coherent in bring about certain benefits in Ireland. That this respect. The observations of the Com­ was clearly not done. The appellant appears mission, on the other hand, are if anything to have restricted itself to putting forward its likely to divert attention away from the four arguments generally and with no par­ actual problems in the present case. The ticular emphasis on the Irish market. Commission's observations would have been unnecessary if it had had specific evidence to refute the appellant's assertion that it had not 33 — Sec points 77 and 81.

48. Additional observations made by the Booksellers Association in this connection need be discussed only briefly. The inter­ vener submits that the Commission and the 49. The appellant criticizes the Court of Court of First Instance failed to take proper First Instance for attributing to it, in para­ account of the importance of the NBA graph 77 of the judgment, an argument within the common language territory of the which it never used. The Court of First United Kingdom and Ireland. It argues that Instance states at that point that the appel­ to give certain benefits to the residents of lant asserted that the finding by the Restric­ one territory and refuse them to the resi­ tive Practices Court that the NBA was indis­ dents of another territory is an infringement pensable applied both to sales in the United of the principle of equality. That argument Kingdom of books produced there and to cannot be followed. There can be no ques­ trade between Member States. The appellant tion of inequality of treatment, since the contends that it merely submitted that the Commission merely decided that the appel­ evidence before the British court and the lant had not succeeded in demonstrating that conclusions of that court were just as rele­ the restrictions on competition in the NBA vant for Ireland as for the United Kingdom. were indispensable in order to bring about It states that the Commission gave no rea­ the benefits sought. sons for its conclusion that the consequences which in the opinion of the Restrictive Prac­ tices Court would occur in the United King­ dom if the NBA came to an end would not occur in Ireland. The Commission thereby infringed Article 190 of the EC Treaty.

was apparent from point 43 of the decision Court's rejection of the arguments actually that the Commission was aware of the deci­ advanced by the appellant. sions of the Restrictive Practices Court. In fact neither that passage nor any other pas­ sages in the decision show that the Commis­ sion took those decisions into account. The appellant accepts that there is no obligation on the Commission to deal with all the evi­ dence put before it. It argues that in the present case, however, the Commission omitted to evaluate some of the most impor­ tant items of evidence, namely the evidence produced to the Restrictive Practices Court The Commission further submits that point and the conclusions of that court. The Com­ 43 of its decision shows that it did not over­ mission ought not to have rejected the look the decisions of the British court. How­ request for exemption without examining ever, it had not been necessary to deal that evidence carefully and completely. Had expressly with the findings of the Restrictive it carried out such an examination, it could Practices Court and the evidence before that not logically have reached the conclusion court, since they were not directly relevant which it actually did reach. The argument to the questions to be discussed by the Com­ used by the Court of First Instance in para­ mission in the present proceedings. Firstly, graph 79 of its judgment, namely that the British court did not directly express any national judicial practices cannot obstruct view on the indispensability of the restric­ the application of the competition rules in tions on competition within the common the EC Treaty, is admittedly correct. That market arising from the NBA. Secondly, the consideration is in the appellant's opinion Restrictive Practices Court had not regarded irrelevant, however, since the present case is it as proved that the abolition of the NBA merely concerned with whether the appellant would lead to a significant reduction in earn­ could rely on the said evidence in the context ings from export trade (which includes of its application for the grant of an exemp­ exports to Ireland). Finally, the British court tion. considered exclusively whether the mainte­ nance of the NBA was compatible with the public interest in the United Kingdom.

52. As to the question whether the Commis­ I am puzzled as to why the Commission did sion took into account the decisions of the not deal with the proceedings before the Restrictive Practices Court, it must be Restrictive Practices Court in more detail. If observed that they are merely mentioned in the appellant regarded those proceedings as point 43 of the decision. Neither the specific of such great importance for the present case, content of those decisions nor the evidence the obvious thing to do would have been to before that court is discussed in more detail deal with those proceedings, even if only by the Commission at that or any other briefly. The omission cannot be attributed to point in the decision. There is merely lack of time, in view of the length of the pro­ another reference to the proceedings before cedure. In the proceedings before the Court the national court in point 71 of the decision. of First Instance and in the appeal proceed­ There the Commission asserts that the argu­ ings the Commission stated the reasons ments on the question of the indispensability which had led it to the view that the said of the NBA put forward in those national national proceedings were of no particular proceedings had concerned not so much the importance for the present case. Why it did necessity of a common application of stan­ not previously do this in the decision itself is dard conditions in the case of fixed book inexplicable. prices but much more the question whether resale price maintenance for books as such was indispensable in order to attain the desired objectives. The Court of Justice has already pointed out, in the order it made in the proceedings for interim measures, that the said national decisions did indeed also examine the question of the indispensability of laying down standard conditions of 53. I am nevertheless of the opinion that the 35 sale. That order also held that the Com­ Commission is in the right on the substan-

The appellant and Clé appear to assume that in the national proceedings the British court reached the conclusion for the United King­ dom that the restrictions on competition contained in the NBA were indispensable in order to attain the desired benefits, and that the Commission therefore had to prove that the same reasoning did not apply to Ireland. In my opinion it can be left open whether That cannot be followed. Such a reversal of the Commission's objection that this is an the burden of proof is not compatible with inadmissible new submission is correct. The Article 85(3). It was for the appellant to (in any case very vague) argument of the prove that the restrictions on competition intervener can in any event not be followed. were indispensable with respect to trade The intervener's argument ultimately amounts to imposing a duty on the Commis­ sion to bring the application of the Commu­ 38 — For this reason the observations of the British court on the nity competition rules into line with national possible effects on export trade of the abolition of the NBA, referred to by the Commission, also seem to me to competition rules and their application in the be of no importance. particular case. As the Commission has

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OPINION OF MR LENZ — CASE C-360/92 P

rightly stated, the basic principle of Commu­ The appellant submits that it always empha­ nity law that it takes precedence over sized that a system of resale price mainte­ national law would thereby be turned upside nance for books must be simple to operate in down. order to bring about positive effects. The cumulation of difficulties arising from indi­ vidual agreements without the benefit of the means provided by the NBA would render such individual agreements impracticable in view of the number of publishers, the num­ ber of publications and of individual copies of a book stocked by booksellers and the nature of the book trade.

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PUBLISHERS ASSOCIATION v COMMISSION

Booksellers Association spoke of a danger to Instance on the individual arguments need smaller booksellers. Clé even spoke of the not be considered. This ground of appeal 'collapse' of the book market in Ireland and must therefore also fail. expressed its fear that the Commission's decision would lead to practical difficulties which would have to be regarded as a 'night­ mare'.

(7) Considerations of legal policy

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OPINION OF MR LENZ — CASE C-360/92 P

It cannot be seen how the argument Parliament favours the maintenance of resale advanced by the appellant could help the price maintenance for books in common lan­ appeal succeed. As the Commission rightly guage areas. The Commission rightly points stresses, the appellant has not claimed that out that that submission is irrelevant simply the communication in 1985 gave rise to an because the resolution was passed long after expectation — which might deserve legal the adoption of the contested decision by the protection — on its part to the effect that the Commission. Commission would not object to the NBA system. I consider, moreover, that these are questions of policy which are of relevance de lege ferenda, but whose consideration — as Pentos rightly argued — is not within the jurisdiction of the Community courts. 62. This ground of appeal must therefore also be rejected.

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PUBLISHERS ASSOCIATION v COMMISSION

C — Conclusion

64. I therefore propose that the Court dismiss the appeal and order the appellant to pay the costs of the appeal proceedings, with the exception of the costs of the inter­ veners, who are to bear their own costs.

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