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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Wouters (Competition) [2002] EUECJ C-309/99 (19 February 2002) URL: http://www.bailii.org/eu/cases/EUECJ/2002/C30999.html Cite as: Case C-309/99, [2002] ECR I-1577, [2002] EUECJ C-309/99 |
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JUDGMENT OF THE COURT
19 February 2002(1)
(Professional body - National Bar - Regulation by the Bar of the exercise of the profession - Prohibition of multi-disciplinary partnerships between members of the Bar and accountants - Article 85 of the EC Treaty (now Article 81 EC) - Association of undertakings - Restriction of competition - Justification - Article 86 of the EC Treaty (now Article 82 EC) - Undertaking or group of undertakings - Articles 52 and 59 of the EC Treaty (now, after amendment, Articles 43 EC and 49 EC) - Applicability - Restrictions - Justification)
In Case C-309/99,
REFERENCE to the Court under Article 234 EC by the Raad van State for a preliminary ruling in the proceedings pending before that court between
J.C.J. Wouters,
J.W. Savelbergh,
Price Waterhouse Belastingadviseurs BV
and
Algemene Raad van de Nederlandse Orde van Advocaten,
intervener:
Raad van de Balies van de Europese Gemeenschap,
on the interpretation of Articles 3(g) of the EC Treaty (now, after amendment, Article 3(1)(g) EC), 5 of the EC Treaty (now Article 10 EC), 52 and 59 of the EC Treaty (now, after amendment, Articles 43 EC and 49 EC), and 85, 86 and 90 of the EC Treaty (now Articles 81 EC, 82 EC and 86 EC),
THE COURT,
composed of: G.C. Rodríguez Iglesias, President, P. Jann, F. Macken, N. Colneric, and S. von Bahr (Presidents of Chambers), C. Gulmann, D.A.O. Edward, A. La Pergola, J.-P. Puissochet, M. Wathelet (Rapporteur), R. Schintgen, V. Skouris and J.N. Cunha Rodrigues, Judges,
Advocate General: P. Léger,
Registrar: H. von Holstein, Deputy Registrar,
after considering the written observations submitted on behalf of:
- Mr Wouters, by H. Gilliams and M. Wladimiroff, advocaten,
- Mr Savelbergh and Price Waterhouse Belastingadviseurs BV, by D. van Liedekerke and G.J. Kemper, advocaten,
- the Algemene Raad van de Nederlandse Orde van Advocaten, by O.W. Brouwer, F.P. Louis and S.C. van Es, advocaten,
- the Raad van de Balies van de Europese Gemeenschap, by P. Glazener, advocaat,
- the Netherlands Government, by M.A. Fierstra, acting as Agent,
- the Danish Government, by J. Molde, acting as Agent,
- the German Government, by A. Dittrich and W.-D. Plessing, acting as Agents,
- the French Government, by K. Rispal-Bellanger, R. Loosli-Surrans and F. Million, acting as Agents,
- the Austrian Government, by C. Stix-Hackl, acting as Agent,
- the Portuguese Government, by L. Fernandes, acting as Agent,
- the Swedish Government, by A. Kruse, acting as Agent,
- the Government of the Principality of Liechtenstein, by C. Büchel, acting as Agent,
- the Commission of the European Communities, by W. Wils and B. Mongin, acting as Agents,
having regard to the Report for the Hearing,
after hearing the oral observations of Mr Wouters, represented by H. Gilliams, of Mr Savelbergh and Price Waterhouse Belastingadviseurs BV, represented by D. van Liedekerke and G.J. Kemper, of the Algemene Raad van de Nederlandse Orde van Advocaten, represented by O.W. Brouwer and W. Knibbeler, advocaat, of the Raad van de Balies van de Europese Gemeenschap, represented by P. Glazener, of the Netherlands Government, represented by J.S. van den Oosterkamp, acting as Agent, of the German Government, represented by A. Dittrich, of the French Government, represented by F. Million, of the Luxembourg Government, represented by N. Mackel, acting as Agent, assisted by J. Welter, avocat, of the Swedish Government, represented by I. Simfors, acting as Agent, and of the Commission, represented by W. Wils, at the hearing on 12 December 2000,
after hearing the Opinion of the Advocate General at the sitting on 10 July 2001,
gives the following
The relevant national legislation
(1) Public professional bodies and other public bodies may be established and dissolved by or under statute.
(2) The duties and organisation of such public bodies, the composition and powers of the governing bodies and public access to their meetings shall be governed by statute. Powers to adopt regulations may be granted to the governing bodies by or under statute.
(3) Supervision of the governing bodies shall be governed by statute. Their decisions may be annulled only where they are contrary to law or to the public interest.
The Advocatenwet
(1) The Bar of the Netherlands, based in The Hague, shall be composed of all members of the Bar registered in the Netherlands and shall be a public body within the meaning of Article 134 of the Constitution.
(2) All members of the Bar registered with the same court shall form the Bar of the district concerned.
[T]he General Council and the Supervisory Boards shall ensure the proper practice of the profession and have the power to adopt any measures which may contribute to that end. They shall defend the rights and interests of members of the Bar as such, ensure that the obligations of the latter are fulfilled and discharge the duties imposed on them by regulation.
(1) The College of Delegates may adopt regulations in the interests of the proper practice of the profession, including regulations concerning provision for members of the Bar affected by old age or total or partial incapacity for work, and provision for the next-of-kin of deceased members. Furthermore, the College shall adopt the necessary regulations concerning the administration and organisation of the Bar.
(2) Draft regulations shall be submitted to the College of Delegates by the General Council or by at least five delegates. The General Council may invite the Supervisory Boards to state their views on a draft regulation before submitting it to the delegates.
(3) As soon as they have been adopted, regulations shall be communicated to the Ministry of Justice and published in the Official Gazette.
(1) Regulations shall be binding on the members of the Bar of the Netherlands and on visiting lawyers ...
(2) They may not contain any provision relating to matters governed by or under statute, nor may they concern matters which, on account of the differing situations in each district, do not lend themselves to uniform regulation.
(3) Any provision in a regulation which applies to a matter governed by or under statute shall by operation of law cease to be valid.
(1) Decisions adopted by the College of Delegates, the General Council or any other organs of the Bar of the Netherlands may be suspended or annulled by royal decree in so far as they are contrary to law or to the public interest.
(2) Such suspension or annulment shall be effected within six months of the communication referred to in Article 28(3) or, where the decision was adopted by the General Council or another body of the Bar of the Netherlands, within six months of its notification to the Minister for Justice, by reasoned decree prescribing, where relevant, the duration of the suspension.
(3) Suspension shall immediately cause the effects of the suspended provisions to lapse. The duration of the suspension may not be greater than one year, even after extension.
(4) If the suspended decision is not annulled by royal decree within the period prescribed it shall be deemed to be valid.
(5) Annulment shall entail annulment of all annullable effects of the annulled provisions, save as otherwise decided by royal decree.
The Samenwerkingsverordening 1993
(1) Members of the Bar shall not be authorised to assume or maintain any obligations which might jeopardise the free and independent exercise of their profession, including the partisan defence of clients' interests and the corresponding relationship of trust between lawyer and client.
(2) The provision contained in subparagraph (1) shall also apply where members of the Bar do not work in professional partnership with colleagues or third parties.
Members of the Bar shall not be authorised to enter into or maintain any professional partnership unless the primary purpose of each partner's respective profession is the practice of the law.
Members of the Bar may enter into or maintain professional partnerships only with:
(a) other members of the Bar registered in the Netherlands;
(b) other lawyers not registered in the Netherlands, if the conditions laid down in Article 5 are satisfied;
(c) members of another professional category accredited for that purpose by the General Council in accordance with Article 6.
(1) The authorisation referred to in Article 4(c) may be granted on condition that:
(a) the members of that other professional category practise a profession, and
(b) the exercise of that profession is conditional upon possession of a university degree or an equivalent qualification; and
(c) the members of that professional category are subject to disciplinary rules comparable to those imposed on members of the Bar; and
(d) entering into partnership with members of that other professional partnership is not contrary to Articles 2 or 3.
(2) Accreditation may also be granted to a specific branch of a professional category. In that case, the conditions set out in (a) to (d) above shall be applicable, without prejudice to the General Council's power to lay down further conditions.
(3) The General Council shall consult the College of Delegates before adopting any decision as mentioned in the preceding subparagraphs of this Article.
In their communications with other persons members of the Bar shall avoid giving any inaccurate, misleading or incomplete impression as to the nature of any form of joint activity in which they participate, including any professional partnership.
(1) Every professional partnership must have a collective name for all communications with other persons.
(2) The collective name must not be misleading.
(3) Members of the Bar who are members of professional partnerships shall be required to supply, on request, a list of the partners' names, their respective professions and place of establishment.
(4) Any written document produced by a professional partnership must include the name, status and place of establishment of the person who signs the document.
Members of the Bar shall not set up, or alter the constitution, of a professional partnership until the Supervisory Board has decided whether the conditions on which that partnership is formed or its constitution is altered, including the way in which it presents itself to other parties, satisfy the requirements imposed by or under this Regulation.
The directives concerning professional partnerships between members of the Bar and other (authorised) practitioners
1. Compliance with the rules of ethics and professional conduct
Rule No 1
Members of the Bar may not, as a result of participating in a professional partnership with a practitioner of another profession, limit or compromise compliance with the rules of ethics and professional practice applicable to them.
2. Separate files and separate management of files and archives
Rule No 2
Members of the Bar participating in a professional partnership with a practitioner of another profession are required, in respect of every case in which they act with that other practitioner, to open a separate file and to ensure, in relation to the professional partnership as such:
- that the management of the case file is kept separate from financial management;
- that files are kept in separate archives from those of practitioners of other professions.
3. Conflicts of interest
Rule No 3
Members of the Bar participating in a professional partnership with a practitioner of another profession may not defend the interests of a party where those interests are in conflict with those of a party who has been, or is being, assisted by that other practitioner or where there is a risk that such a conflict of interests may arise.
4. Professional secrecy and registration of documents
Rule No 4
Members of the Bar participating in a professional partnership with a practitioner of another profession are required, in respect of every case in which they act with that other practitioner, to keep an accurate register of all letters and documents which they bring to the attention of the practitioner of the other profession.
The disputes in the main proceedings
1 (a) Is the term association of undertakings in Article 85(1) of the EC Treaty (now Article 81(1) EC) to be interpreted as meaning that there is such an association only if and in so far as it acts in the undertakings' interest, so that in applying that provision a distinction must be drawn between activities of the association carried out in the public interest and other activities, or is the mere fact that an association can also act in the undertakings' interest sufficient for it to be regarded as an association of undertakings within the meaning of the provision in respect of all its actions? Is the fact that the universally binding rules adopted by the relevant institution are adopted under a statutory power and in its capacity as a special legislature relevant as regards the application of Community competition law?
(b) If the answer to Question 1(a) is that there is an association of undertakings only if and in so far as it acts in the undertakings' interest, is the question of when the public interest is being pursued also governed by Community law?
(c) If the answer to Question 1(b) is that Community law is relevant, can the adoption under a statutory power by an institution such as the Bar of the Netherlands of universally binding rules, designed to safeguard the independence and loyalty to the client of members of the Bar who provide legal assistance, on the formation of multi-disciplinary partnerships between members of the Bar and members of other professions be regarded for the purposes of Community law as pursuing the public interest?
2. If the answers to the first question indicate that a rule such as [the 1993 Regulation] is to be regarded as a decision of an association of undertakings within the meaning of Article 85(1) of the EC Treaty (now Article 81(1) EC), is such a decision, in so far as it adopts universally binding rules, designed to safeguard the independence and loyalty to the client of members of the Bar who provide legal assistance, on the formation of multi-disciplinary partnerships such as the one in question to be regarded as having as its object or effect the restriction of competition within the common market and in that respect affecting trade between the Member States? What criteria of Community law are relevant to the determination of that issue?
3. Is the term undertaking in Article 86 of the EC Treaty (now Article 82 EC) to be interpreted as meaning that where an institution such as the Bar of the Netherlands must be regarded as an association of undertakings, that institution must also be considered to be an undertaking or group of undertakings for the purposes of that provision, even though it pursues no economic activity itself?
4. If the previous question is answered in the affirmative and it must be held that an institution such as the Bar of the Netherlands enjoys a dominant position, does such an institution abuse that position if it regulates the relationships between its members and others on the market in legal services in a manner which restricts competition?
5. If an institution such as the Bar of the Netherlands is to be regarded in its entirety as an association of undertakings for the purposes of Community competition law, is Article 90(2) of the EC Treaty (now Article 86(2) EC) to be interpreted as extending to an institution such as the Bar of the Netherlands which lays down universally binding rules, designed to safeguard the independence and loyalty to the client of its members who provide legal assistance, on cooperation between its members and members of other professions?
6. If an institution such as the Bar of the Netherlands is to be regarded as an association of undertakings or an undertaking or group of undertakings, do Article 3(g) (now, after amendment, Article 3(1)(g) EC), the second paragraph of Article 5 and Articles 85 and 86 of the EC Treaty (now Articles 10 EC, 81 EC and 82 EC) preclude a Member State from providing that that institution (or one of its agencies) may adopt rules concerning inter alia cooperation between its members and members of other professions when review by the relevant public authority of such rules is limited to the power to annul such a rule without the authority's being able to adopt a rule in its stead?
7. Are both the Treaty provisions on the right of establishment and those on the freedom to provide services applicable to a prohibition on cooperation between members of the Bar and accountants such as that in question, or is the EC Treaty to be interpreted as meaning that such a prohibition must comply, depending for example on the way in which those concerned actually wish to model their cooperation, with either the provisions on the right of establishment or with those relating to the freedom to provide services?
8. Does a prohibition on multi-disciplinary partnerships including members of the Bar and accountants such as the one in question constitute a restriction of the right of establishment or the freedom to provide services, or both?
9. If it follows from the answer to the previous question that one or both of the abovementioned restrictions exists, is the restriction in question justified on the ground that it constitutes merely a selling arrangement within the meaning of the judgment in Joined Cases C-267/91 and C-268/91 Keck and Mithouard [1993] ECR I-6097, and that therefore there is no discrimination, or on the ground that it satisfies the criteria that have been developed in that respect by the Court of Justice in other judgments, in particular Case C-55/94 Gebhard [1995] ECR I-4165?
Request for reopening of the oral procedure
Question 1(a)
Question 1(b) and (c)
Question 2
Question 3
Question 4
Question 5
Question 6
Questions 7, 8 and 9
Costs
124. The costs incurred by the Netherlands, Danish, German, French, Luxembourg, Austrian, Portuguese and Swedish Governments, by the Government of the Principality of Liechtenstein and by the Commission, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the actions pending before the national court, the decision on costs is a matter for that court.
On those grounds,
THE COURT,
in answer to the questions referred to it by the Raad van State by judgment of 10 August 1999, hereby rules:
1. A regulation concerning partnerships between members of the Bar and other professionals, such as the Samenwerkingsverordening 1993 (1993 regulation on joint professional activity), adopted by a body such as the Nederlandse Orde van Advocaten (the Bar of the Netherlands), is to be treated as a decision adopted by an association of undertakings within the meaning of Article 85(1) of the EC Treaty (now Article 81 EC).
2. A national regulation such as the 1993 Regulation adopted by a body such as the Bar of the Netherlands does not infringe Article 85(1) of the Treaty, since that body could reasonably have considered that that regulation, despite effects restrictive of competition, that are inherent in it, is necessary for the proper practice of the legal profession, as organised in the Member State concerned.
3. A body such as the Bar of the Netherlands does not constitute either an undertaking or a group of undertakings for the purposes of Article 86 of the EC Treaty (now Article 82 EC).
4. It is not contrary to Articles 52 and 59 of the EC Treaty (now, after amendment, Articles 43 EC and 49 EC) for a national regulation such as the 1993 Regulation to prohibit any multi-disciplinary partnerships between members of the Bar and accountants, since that regulation could reasonably be considered to be necessary for the proper practice of the legal profession, as organised in the country concerned.
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Rodríguez Iglesias
Colneric
Edward
Wathelet
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Delivered in open court in Luxembourg on 19 February 2002.
R. Grass G.C. Rodríguez Iglesias
Registrar President
1: Language of the case: Dutch.
