European Ombudsman finds that the European Commission committed maladministration in its Intel investigation

On 18 November 2009, the European Ombudsman published a non-confidential version of its decision on a complaint by Intel against the European Commission. The complaint relates to alleged procedural errors by the Commission during its investigation into Intel’s abuse of dominance as a result of which the Commission imposed a fine of 1.06 billion Euro on Intel in May 2009.

According to Intel, the Commission failed to take minutes of the 23 August 2006 meeting with representatives of Dell, despite the fact that the meeting was directly concerned with the subject-matter of its investigation. As a result, according to the chip maker, the Commission did not make a record of potentially exculpatory evidence arising from this meeting.

In its opinions to the Ombudsman, the Commission argued that it is under no obligation to draft any minutes of meetings with any person or undertaking and that, in accordance with its own Notice on Access to the File, if the Commission chooses to make notes of meetings, such documents constitute its own interpretation of what was said at the meetings, for which reason they are classified as internal documents. The Commission submitted that its view is consistent with the rulings of the Court of First Instance in TACA and Group Danone.  In particular, the Commission maintained that the meeting of 23 August 2006 was not an “interview” pursuant to Article 19 of Regulation 1/2003.

According to the Ombudsman, in examining the classification of a legal act, the analysis cannot be restricted to considering the official title of a measure, but must be based on objective factors which are amenable to judicial review. Those factors include, in particular, the aim and content of the measure.  Since the choice of form cannot alter the nature of a measure, it must be ascertained whether the content of a measure is wholly consistent with the form attributed to it by the institution concerned.  The Ombudsman considers that an interview will only fall within the scope of Article 19 of Regulation 1/2003, if its purpose is to collect information relating to the subject-matter of an investigation, which was the case of the 23 August 2006 meeting

The Ombudsman found the 23 August 2006 meeting had the aim and the content of an “Article 19 interview” since the Commission sought information from a senior Dell executive which was related directly to the subject-matter of the investigation, and the issues actually discussed in the meeting of 23 August 2006 related directly to the subject-matter of the investigation and the senior Dell executive provided concrete information to the Commission which was related directly to the subject-matter of the investigation. Yet, the Ombudsman further observed that the Community Courts have not yet had the opportunity to provide an interpretation of Article 19 of Regulation 1/2003.

Accordingly, the Ombudsman found maladministration on the grounds that the Commission failed to make a proper note of the 23 August 2006 meeting, but made no finding that Intel’s rights of defence had been infringed.  To make a finding that rights of defence were infringed in a particular competition case would require a careful analysis of the entire file, carried out in conjunction with a careful analysis of the Statement of Objections and, eventually, the decision. The Ombudsman had not reviewed the entire file or the Statements of Objection issued.  In any event, although it could not conclude on whether the rights of defence had been infringed, the Ombudsman further considered that a friendly solution was not possible in the present case.

Intel also made a second allegation, notably that the Commission actively encouraged Dell to enter into an information exchange agreement with micro-chip producer AMD (Intel’s competitor in the x86 CPU market) – on this claim the Ombudsman made no finding of maladministration.

The Ombudsman did find, however, that the Commission failed to make a proper note of a telephone call between the Commission and Dell, in which the information exchange agreement was discussed.  Such a note would have helped to clarify the relevant facts. On this point, the Ombudsman recommended in future that the Commission should make “proper internal notes of any meetings or telephone calls with third parties concerning important procedural issues”. [Gabriele Accardo]