ON APPEAL FROM THE HIGH COURT OF JUSTICE
THE HONOURABLE MR JUSTICE MANN
THE HONOURABLE MR JUSTICE MORGAN
Strand, London, WC2A 2LL
B e f o r e :
THE RIGHT HONOURABLE LORD JUSTICE HENDERSON
THE RIGHT HONOURABLE LADY JUSTICE ASPLIN DBE
| THE LCD APPEALS
Mr Neil Calver QC & Mr Colin West (instructed by Stewarts Law LLP) for the Appellants
Mr Paul Stanley QC & Mr Robert O'Donoghue QC (instructed by Covington & Burling LLP) for the First to Fourth Respondents
Mr Daniel Piccinin (instructed by Cleary Gottlieb Steen & Hamilton LLP) for the Fifth Respondent
In the CRT Appeal
Mr Aidan Robertson QC and Mr Gerard Rothschild (instructed by Stewarts Law LLP) for the Appellants
Mr Daniel Beard QC and Mr James Bourke (instructed by Allen & Overy LLP) for the First and Second Respondents
Mr Daniel Jowell QC and Mr David Bailey (instructed by Simmons & Simmons LLP) for the Third to Fifth Respondents
Ms Marie Demetriou QC (instructed by Slaughter & May) for the Sixth and Seventh Respondents
Hearing dates: 12, 13 and 14 December 2017
Crown Copyright ©
The parties and relevant procedural history
The Interlocutory Applications in more detail
The decisions of Mann and Morgan JJ
" I can summarise the essential reasoning of Mann J in relation to the territorial scope of Article 101 as follows (references to numbers in square brackets are to the paragraphs of his judgment):
(1) Article 101, which expressly refers to a cartel which has as its object or effect competition within the internal market, is set out at ;
(2) there are territorial limits on the scope of Article 101: ;
(3) the leading authority as to the territorial scope of Article 101 is Woodpulp I: -;
(4) cartelists cannot avoid an infringement of Article 101 merely by entering into the relevant agreement outside the EU: ;
(5) the decisive matter is whether the cartel is implemented in the EU: ;
(6) if the cartel, wherever made, is implemented in the EU then Article 101 is infringed: ;
(7) there is room for discussion as to what amounts to implementation; direct sales into the EU are a way of implementing in the EU a cartel wherever made: ;
(8) there is no decision that the concept of implementation is wider than the normal meaning of that word: ;
(9) sales by cartelists outside the EU are not an implementation within the EU: ;
(10) even if sales outside the EU have an indirect effect (an "end of the road effect") within the EU, those sales are not an implementation of the cartel within the EU: ;
(11) Gencor was a case about a proposed merger: ;
(12) Gencor referred to it being "foreseeable that a proposed concentration will have an immediate and substantial effect in the Community": ;
(13) there is room for debate whether the formulation in Gencor was a different test from the implementation test or whether it was a justification for imposing a duty under Article 101:  and ;
(14) if the Gencor formulation did identify a test which was different from the implementation test, then there was no sign of an even wider test as to the territorial scope of Article 101: ;
(15) if the Gencor test is different from the implementation test, then whilst there might be room for argument on the facts of a case whether the effect was foreseeable or substantial, the effect must be "immediate": ;
(16) the reference to "immediate" does not extend to "knock on" effects e.g. from direct sales outside the EU: .
In the case before Mann J, the Claimants claimed damages because the cartelists had made sales at cartel prices which contained an element of overcharge made possible by the existence of the cartel and the overcharge was passed on to the Claimants. However, Mann J rejected these claims because:
(1) the cartel in question was entered into outside the EU;
(2) the sales which involved the overcharge were outside the EU;
(3) sales outside the EU were not the implementation of the cartel in the EU;
(4) accordingly, those sales were not an infringement of Article 101;
(5) the effect of those sales in the EU was not an immediate effect (if one were to apply the test in Gencor)."
". . . European courts have set limits to define the circumstances in which cartel conduct outside the EEA can be held to give rise to an actionable infringement in the EU so as to fall within the wording and jurisdictional limits of Article 101. In Woodpulp (Ahlstrom Osakeyhtio v The Commission  ECR 5193), the case heavily relied on by the Commission in the CRT Decision, the Commission had to consider a cartel formed outside the EEA which sold cartelised products (wood pulp) to customers in the EEA with the benefit of prices affected by the cartel conduct. The Commission held that it had jurisdiction to act in relation to such conduct. Before the ECJ the addressees took the jurisdictional point that the Commission was seeking to exercise jurisdiction over entities outside the EEA contrary to international law (and Article 85, the then equivalent of Article 101):
"6. All the applicants which have made submissions regarding jurisdiction maintain first of all that by applying the competition rules of the Treaty to them the Commission has misconstrued the territorial scope of Article 85. They note that in its judgment of 14 July 1972 in Case 48/69 (ICI v Commission  ECR 619) the Court did not adopt the "effects doctrine" but emphasized that the case involved conduct restricting competition within the common market because of the activities of subsidiaries which could be imputed to the parent companies. The applicants add that even if there is a basis in Community law for applying Article 85 to them, the action of applying the rule interpreted in that way would be contrary to public international law which precludes any claim by the Community to regulate conduct restricting competition adopted outside the territory of the Community merely by reason of the economic repercussions which that conduct produces within the Community."
The Court ruled against those submissions under the heading: "Incorrect assessment of the territorial scope of Article 85 of the Treaty and incompatibility of the decision with public international law." In paragraph 12 it noted that the main sources of supply were outside the Community, but there was still an infringing effect on competition within the Community:
"12. … Where wood pulp producers established in those countries sell directly to purchasers established in the Community and engage in price competition in order to win orders from those customers, that constitutes competition within the common market.
13. It follows that where those producers concert on the prices to be charged to their customers in the Community and put that concertation into effect by selling at prices which are actually coordinated, they are taking part in concertation which has the object and effect of restricting competition within the common market within the meaning of Article 85 of the Treaty.
14. Accordingly, it must be concluded that by applying the competition rules in the Treaty in the circumstances of this case to undertakings whose registered offices are situated outside the Community, the Commission has not made an incorrect assessment of the territorial scope of Article 85."
The Court went on to reject the complaint that assuming jurisdiction was contrary to international law in terms which also provided a test as to when extra-Community conduct could give rise to an infringement in the EEA:
"16. It should be observed that an infringement of Article 85, such as the conclusion of an agreement which has had the effect of restricting competition within the common market, consists of conduct made up of two elements, the formation of the agreement, decision or concerted practice and the implementation thereof. If the applicability of prohibitions laid down under competition law were made to depend on the place where the agreement, decision or concerted practice was formed, the result would obviously be to give undertakings an easy means of evading those prohibitions. The decisive factor is therefore the place where it is implemented.
17. The producers in this case implemented their pricing agreement within the common market . It is immaterial in that respect whether or not they had recourse to subsidiaries, agents, sub-agents, or branches within the Community in order to make their contacts with purchasers within the Community.
18. Accordingly the Community's jurisdiction to apply its competition rules to such conduct is covered by the territoriality principle as universally recognized in public international law."
The Court then went on to reject other grounds for saying such conduct was contrary to international law and principles of comity.
The important paragraph for present purposes is paragraph 16. It makes the whereabouts of the formation of the offending conduct subsidiary. What is important is "the place where it is implemented". Thus, on the facts of that case, the foreign cartel, conducted by foreign (ie extra-EEA) entities outside the EEA, was "implemented" in the EEA when the cartelised goods were sold into the EEA by the cartel participants (sold "directly to purchasers established in the Community" - paragraph 12). The test is said to be implementation. There is no suggestion that infringement can be found where the effects of the cartel are somehow felt in a more indirect way.
This sort of directness in "implementation" is supported by the CFI in Innolux. That was a case of direct sales of the cartelised products, or transformed products, by the cartelists into the EEA. The Court considered the question of territoriality in the context of an appeal about the fine, because it was said that the calculation of the fine (which invoked the same two heads as the fines in the present case, rejecting the third) involved the Commission exceeding its territorial jurisdiction. In the course of its deliberations the court rejected the place of the cartel as being the appropriate criterion.
"What counts is therefore the place in which it [ie the infringement] is implemented." (para 59).
This is a clear implementation of Woodpulp. The Court went on to determine that Woodpulp was followed in Gencor (see below) and reflected further on the effects of the direct sales into the EU which were the subject of consideration. While the decision does not consider whether there are any limits to what is meant by "implementation", it clearly espoused it as a concept and there is not a hint that it should be widened beyond a normal meaning of that word. It is true that whether or not the word (or test) should be widened was not in issue. In fact the point in that case concerned whether there should be a narrowing of the territorial scope of infringement (for fining purposes) but the whole tenor of the judgment is to apply Woodpulp in a non-extended way."
"140. In my view, taking Mr Robertson's factual case at its most favourable, and ignoring the absence of a properly pleaded case, there is no arguable case for saying that the cartels relied on were implemented in the EEA. They were foreign cartels implemented, probably, in Asia, but in any event not in the EEA. The mere fact that, even if true, there is some end of the road effect in the pricing of iiyama purchases in Europe does not mean that the cartel was implemented there. The proper analysis and balancing of the principles of Article 101 and principles of international law and comity require a closer connection than that before intervention by the Commission can be justified under the Article."
"This analysis would suggest that the claims brought by C1 to C6 ought to fail because the supply chains on which they rely did not involve the implementation of the cartel within the EU. However, the basic flaw in this analysis is that it has regard only to the supply chains in this case. It is true that those supply chains did not involve the implementation of the cartel [within] the EU. However, the Commission has decided that the cartel was implemented in the EU and therefore there was an infringement of Article 101, within the territorial scope of that Article. It is true that the conduct and activity which amounted to implementation within the EU did not involve the supply chains in this case but that does not matter. The real question which needs to be addressed is: can the Claimants show that they suffered harm by reason of the implementation of the cartel in the EU? Based on the above analysis, it is not enough for the Claimants to say that they are indirect purchasers downstream from the implementation of the cartel in Asia, at Step 1 above.
I also point out that the application of the test in Gencor as to the territorial scope of Article 101 does not depend upon an analysis of the individual steps in the supply chain and where those steps took place. Instead the test in Gencor focusses upon the foreseeable effect of the cartel and how immediate that effect in the EU will foreseeably be. The findings of the Commission which I have summarised earlier make it clear that there was a foreseeable immediate and substantial effect of the cartel in the EU.
In view of the fact that the Commission has held that the worldwide cartel in this case was implemented in the EU, I am not able to accept the Defendants' submission that I should adopt the approach which was adopted in the United States decisions to which I referred earlier and therefore conclude that the worldwide cartel in this case did not involve an infringement of Article 101 on the grounds that the cartel fell outside the territorial scope of Article 101.
. . . .
However, one paragraph of the draft amended pleading in particular does identify how the damages are said to flow from the implementation of the cartel within the EU, as the Commission held had occurred. This is paragraph 75 of the draft amended pleading. This follows an earlier plea that the cartel was implemented in, and had a foreseeable immediate and substantial effect in the EU (as the Commission held). It is then said that if the cartel had not been implemented within the EU then LCDs and products incorporating LCDs would have been available within the EU at prices which were not inflated by the worldwide cartel. It is then pleaded that if that had been the situation, purchasers of LCDs and LCD products could have bought the same within the EU at non-cartel prices and would have done so. Accordingly, when the LCDs and LCD products were sold outside the EU at an overcharge, the purchasers and indirect purchasers all suffered loss and damage (subject to any defence of passing on). That way of putting the case is pleadable. There is not much evidence which specifically supports that plea. The furthest the matter is taken in the Claimants' evidence is that Mr Takeichi, the managing director of C3, has prepared a witness statement in which he refers to the fact that some of the Claimants bought LCD monitors from OEMs in the EU and he adds that if LCD panels had been offered for sale in the EU at prices below those fixed by the cartelists, then those OEMs in the EU would have purchased LCD panels in the EU at prices below the cartel price. I imagine that the evidential basis for this plea will be closely scrutinised by the Defendants but at this stage the plea does raise an arguable case against D1 and D5. It was also submitted by the Claimants that if the cartel had not been implemented in Europe then it would have collapsed and would have not had effect, or would have ceased to have effect, elsewhere in the world."
". . . Although the monitors were bought by Corporation or C6 [Mouse] outside the EU, the price paid was said to have been influenced by the fact that there was a worldwide cartel increasing prices throughout the world, including the EU. If the prices in the EU had not been increased by reason of the cartel, then the Claimants say that they would have been able to buy in the EU without paying the overcharge and that on the balance of probabilities they would have done so. Accordingly, they suffered loss and damage by buying outside the EU at a price greater than the price that would have been available in the EU if the cartel had not been implemented in the EU. Further, if the cartel had not been implemented in the EU, then it may very well not have succeeded elsewhere so that Corporation or C6 [Mouse] could have bought in Asia without paying the overcharge."
"The above findings show that the Claimants have at least an arguable case for the following propositions:
(1) D1 and others were parties to the relevant cartel;(2) D4 was a wholly owned subsidiary of D1;(3) D4 was under the control of D1;(4) D1 directed D4 as to the prices to be charged by D4 on its sales of LCD monitors and D4 complied with that direction;(5) the prices charged by D4 were cartel prices.
The law is not wholly settled as to what a claimant needs to allege and prove to establish liability under Article 101 on the part of a subsidiary company such as D4. If D1 is a party to the relevant cartel and causes the cartel to be implemented by directing its wholly-owned subsidiary, D4, to charge cartel prices, it seems fairly clear that D1 is liable for that implementation: see KME Yorkshire Ltd v Toshiba Carrier UK Ltd  EWCA Civ 1190 at  and Sainsbury's Supermarkets Ltd v Mastercard Inc  CAT 11 at [363(7)]. The Sainsbury's case contains a full review of the relevant authorities both European and domestic. What is perhaps not established is what is needed to establish liability on the part of D4. Are the facts stated above sufficient to render D4 liable for infringement of Article 101 or must it be shown in addition that D4 charged cartel prices with knowledge of the existence of the cartel? However, what is not in doubt is the proposition that D4 will be liable if it does charge cartel prices under the direction of its parent, a member of the cartel, and D4 knows of the existence of the cartel: see KME Yorkshire Ltd v Toshiba Carrier UK Ltd  EWCA Civ 1190 at .
In the present case, the Claimants contend that, in law even if not in fact, D4 did know of the existence of the cartel at the time that it charged cartel prices. It is said that D4 had the requisite knowledge as a matter of law because the knowledge of D1 as to the existence of the cartel is to be attributed to D4 under the ordinary English law principles as to attribution of knowledge. In particular, it is said that D4 wholly delegated to D1 the decision which D4 would otherwise have to make for itself as to the prices it charged for the relevant goods. Accordingly, the knowledge of the person to whom the decision was delegated is to be attributed to the person who delegated the decision. I consider that as a matter of English law, that proposition is at least arguable.
It follows that the Claimants have an arguable case that D4 is liable for its participation in the infringement of Article 101. Therefore, it is not appropriate to strike out the claim against D4 nor to give D4 summary judgment dismissing the claim against it.
I take the same view in relation to the claims against D2 and D3. I have already drawn attention to the unclear position on the evidence as to whether D2 and D3 did sell products incorporating LCD panels. However, the case was argued before me on the assumption that D2 and D3 did sell such products. As to the relationship between D1 on the one hand and D2 and/or D3 on the other and the way in which D2 and D3 set their prices for such products, the evidence at present is not as clear as in the case of D1 and D4. However, on the material at present available, it is inherently likely that the position in relation to D2 and D3 was much the same as in relation to D4. Accordingly, as I have indicated, I will treat D2 and D3 in the same way as I have treated D4. The claims against D2 and D3 will not be struck out and I will not give D2 and D3 summary judgment dismissing the claims against them."
Grounds of appeal
The LCD and CRT Decisions in more detail
"For present purposes it is sufficient to give a highly abbreviated summary of the recitals in the decision. In what follows, numbers in square brackets are the paragraph numbers of the recitals. The decision includes the following findings:
(1) the suppliers of LCDs and their major customers are global actors; LCD panels are sold world-wide and prices are set on a world-wide basis: ;
(2) from October 2001 to January 2006, LCD panels were sold directly by the addressees of the decision to customers in the EEA (Direct EEA Sales): ;
(3) a number of panels were incorporated and transformed in the final IT and TV products for sale in the EEA by the addressees and/or their subsidiaries (Direct Sales through Transformed Products); this was particularly the case in relation to Samsung which owned and supplied factories in the EEA which later distributed the final products mostly within the EEA: ;
(4) in addition, LCD panels produced by the addressees could also be purchased by customers in the EEA as part of IT and TV final products sold in the EEA by third parties (Indirect Sales): ;
(5) the parties to the infringement engaged in bilateral and multilateral meetings and other contacts in relation to LCD panels for IT and TV applications from 5 October 2001 until at least 1 February 2006: ;
(6) anti-competitive practices included price-fixing at world-wide and EEA level, directly or indirectly, and were not restricted to specific geographic or shipment destinations: ;
(7) the agreement between the cartelists did not target any specific geographic area; participants were aware of and sought effects on the European market: ;
(8) the arrangements applied at world-wide level and therefore covered the entire EEA territory and were therefore liable to affect competition in the whole of the internal market and the territory covered by the EEA agreement: ;
(9) the application by the EU of its competition rules is governed by the territoriality principle as a universally recognised principle of international law: ;
(10) in determining the territorial scope of Article 101, the decision of the Court of Justice in Ahlström Osakeyhtiö v Commission, ("Woodpulp I")  ECR I-5913 established that the decisive factor was whether the relevant arrangement or practice was implemented within the territory of the EU: ;
(11) the test in Woodpulp I was supplemented by the decision of the General Court in Gencor Ltd v Commission ("Gencor")  ECR II - 753, a decision on the first Merger Regulation on the control of concentrations between undertakings, which established that those rules applied if the conduct at issue had immediate, foreseeable and substantial effect in the EU: ;
(12) the relevant agreements related to the world-wide sales of LCD panels, without geographical limitations, affecting prices globally; the agreement related to direct sales of LCD panels to undertakings seated in the EEA and Europe was also targeted by substantial indirect sales in which the parties had a very high joint market share: ;
(13) applying the test in Woodpulp I, the agreements and practices were implemented in the EEA by direct sales into the EEA: ;
(14) the participants in the cartel sought to implement their agreement and to have effect within the EEA, even if the negotiation of the price took place outside the EEA: ;
(15) further, the test in Gencor was satisfied in that the Direct EEA Sales and the Direct EEA Sales through Transformed Products had foreseeable, immediate and substantial effect with the EEA: ;
(16) the Commission had jurisdiction to apply both Article 101 of the TFEU and Article 53 of the Agreement on the EEA: ;
(17) Article 101 of the TFEU and Article 53 of the Agreement on the EEA had been infringed: ;
(18) the arrangements had an appreciable effect on trade between Member States and between contracting parties to the EEA Agreement: ;
(19) D1 was fully aware and regularly involved in the everyday conduct of its subsidiaries: ; [the Claimants have obtained an unredacted version of this paragraph and the unredacted version refers to D1 setting the prices for its subsidiaries];
(20) the Samsung subsidiaries were dependent on their headquarters in relation to the prices charged and the Samsung group as a whole must be considered as a single economic undertaking for the purposes of Article 101: ; [again, the Claimants have obtained an unredacted version which provides more detail in this respect];
(21) it was appropriate to set the starting date for the arrangements as 5 October 2001: ;
(22) the end date of the infringement should be taken (in respect of D1 and D5) as 1 February 2006: ;
(23) given the secrecy with which the cartel arrangements were carried out, it was not possible to declare with absolute certainty that the infringement had ceased so that it was necessary to require the addressees to bring the infringement to an end, if they had not already done so: ;
(24) in determining the basic amount of the fine to be imposed, the Commission started with the value of the undertaking's sales of the goods or services to which the infringement directly or indirectly related in the EEA: ;
(25) the sales of LCD panels directly or indirectly concerned by the infringement in the EEA were Direct EEA Sales, Direct EEA Sales Through Transformed Products and Indirect Sales (in the latter case, the value of the LCD panels sold by one of the addressees of the decision to another undertaking outside the EEA, which would then incorporate the panels into final IT or TV products and sell them in the EEA): ;
(26) for the purpose of establishing the value of sales in this case, the relevant EEA turnover consisted of those sales where the first real sale of the LCD panel, as such or in a final IT or TV product, was made into the EEA by one of the addressees of the decision; although the Indirect Sales referred to above could have been included, this was not to be done in this case as sufficient deterrence was achieved without including them: ;
(27) the value of the LCD panels delivered into the EEA should be taken into account: ;
(28) D1 was granted immunity from the fines otherwise appropriate: ;
(29) D5's fine was reduced by 50%: ."
(1) During the cartel period the participants sold CRTs produced in Germany, the United Kingdom, Austria, Spain, France, Poland, the Czech Republic, Hungary, as well as in Korea, Taiwan, China, Japan and elsewhere to customers established in numerous Member States and in the Contracting Parties to the EEA Agreement: ;
(2) Wider activities were also engaged in by CDT producers which participated in meetings and other contacts with the aim of fixing prices worldwide, allocating market shares and customers and restricting output at least in the period from 24 October 1996 to 14 March 2006 during which period they also exchanged commercially sensitive information: ; and agreed on target prices, on what to tell customers about the reason for the price increase and, in addition, on which producer would communicate the price increase to which customer: ;
(3) Price fixing arrangements also concerned customers within vertically integrated groups, such as Philips, and evidence suggests that the price increases in CDTs were, at times, passed on to the downstream market of production of computer monitor tubes; ;
(4) arrangements applied at worldwide level or at least EEA wide level and were liable to affect competition in the whole of the common market and the territory covered by the EEA Agreement: ;
(5) the Commission was the competent authority to apply Article 101/Article 53 because the cartel had an appreciable effect on trade between Member States: ;
(6) the fact that some of the undertakings concerned, at the time of the infringement, were based outside the EU/EEA did not rule out the applicability of both Article 101 and Article 53 as for these provisions to be applicable it suffices that the anti-competitive conduct in question affects trade within the Community and the EEA: ;
(7) the decisive factor in the applicability of Article 101/Article 53 where participants in the cartel are situated outside the EU, is whether the agreement, decision or concerted practice is implemented within the EU: Woodpulp: ;
(8) EU competition law is also applicable if the conduct in issue has immediate, foreseeable and substantial effect in the EU: ;
(9) The CDT cartel related to sales without geographical limitations: ;
(10) In line with the criteria set by the Court of Justice in the Woodpulp case, the Commission had jurisdiction to establish an infringement in this case where CRT suppliers established in third countries concerted on the prices and sales volumes (via market share, capacity and sales coordination) impacting their customers in the EEA and put that concertation into effect in their sales to those customers. Even when the cartel arrangements were formed outside the EEA, the cartel participants, through their sales into the EEA or measures impacting their sales to the EEA (specifically market sharing and capacity and sales limitation), implemented their agreements and concerted practices relating to the EEA: ;
(11) the CPT cartel whilst being worldwide was implemented in Europe by direct sales by the cartelists of transformed products: ;
(12) the cartel contacts had immediate, foreseeable and substantial effect in the EU in the sense of the Gencor case and those effects were also present in the case of integrated suppliers such as Philips: ;
(13) for the purpose of establishing jurisdiction, all that matters is whether the cartel as a whole was implemented and had immediate, foreseeable and substantial effects in the EEA. It is irrelevant whether those effects were limited for a given party, in a given period of time, as compared to the world-wide effects of the cartel. In any event, the parties had significant Direct EEA Sales and Direct EEA Sales Through Transformed Products and the Commission had jurisdiction under Article 101 and Article 53:  and ;
(14) the conduct of the cartelists was capable of having an appreciable effect upon trade between Member States and between Contracting Parties to the EEA Agreement and worldwide arrangements to fix prices, allocate regional market shares and customers, restrict the capacity of entities across the world must have resulted or were likely to result in the diversion of trade patterns from the course they would otherwise have followed in the EEA:  and ;
(15) although a large part of the cartel arrangements took place at world-wide level, CDTs and CPTs were delivered and/or billed directly to customers in Europe, including various producers of downstream equipment, and to European entities connected to the undertakings that participated in the infringement. The existence of agreements and concerted practices in the present case resulted, or was likely to result, in the automatic diversion of trade patterns from the course they would otherwise have followed. The cartel arrangements were implemented in the EEA and their impact in the EEA unavoidably affected price levels, production and consumption within the EEA and thus had an effect on trade between Member States: ;
(16) the cartel arrangements produced effects within the EEA not only through the direct sales of CDTs and CPTs but also indirectly through inter-state trade of incorporated CDTs and CPTs: ;
(17) based on those circumstances, it could be established that the cartel arrangements could and did have a substantial impact on the patterns of trade between Member States and on the EEA market through direct EEA sales and direct EEA sales through transformed products in which CDTs and CPTs were incorporated: ;
(18) insofar as the activities of the cartel related to sales in countries that are not Member States or Contracting Parties to the EEA Agreement, they lie outside the scope of the Decision: ;
(19) the Commission may impose fines where undertakings have either intentionally or negligently infringed Article 101 and/or Article 53 and for each undertaking the fine shall not exceed 10% of its total turnover in the preceding business year: ;
(20) in fixing the amount of the fine, regard is had both to the gravity and to the duration of the infringement: ;
(21) the basic amount of the fine to be imposed is set by reference to the value of sales of goods or services to which the infringement directly or indirectly related in the relevant geographic area in the EEA: ;
(22) the sales directly or indirectly concerned by the infringement in the EEA were: (a) Direct EEA Sales (that is CDT or CPT sold directly to customers in the EEA by one of the addressees of the Decision); (b) Direct EEA Sales Through Transformed Products (that is CDT or CPT incorporated intra-group into a final computer monitor or colour television and subsequently sold to customers in the EEA by one of the addressees of the Decision); and (c) Indirect Sales (that is the value of the CDT or CPT sold by one of the addressees of the Decision to customers outside the EEA, which would then incorporate the CDT or CPT into final computer monitor or colour television products and sell them in the EEA): ;
(23) for the purpose of establishing the value of sales for (a) and (b) in , the relevant EEA turnover consists of those sales where the first "real" sale of CDT or CPT as such or integrated in a final computer or colour television product was made into the EEA by one of the addressees of the Decision: ;
(24) although the value of all indirect sales referred to in (c) of  could have been included in the relevant value of sales, it was not necessary to do so: ;
(25) "Recitals (1014) and (1020) explain the sales that the Commission may use under the 2006 Guidelines on fines, which could normally include indirect sales, which means both Direct EEA Sales Through Transformed Products and Indirect Sales (points (b) and (c) of Recital (1020)). On this issue, it has to be recalled that the Statement of Objections already pointed out that indirect sales could eventually be taken into account in the setting of fines. However, it has to be stressed that, as already stated in Recital (1021) above, the Commission does not, in this case, take into account Indirect Sales as defined in point (c) of Recital (1020). By focusing on the value of Direct EEA Sales as well as the value of Direct EEA Sales Through Transformed Products, the purpose is to consistently include in the 'value of sales' the cartelised products only when they are sold for the first time to a customer which is external to the cartelists' undertakings and is located in the EEA. . . When the first sale of the cartelised product is made to an independent customer in the EEA, a direct link with the EEA Territory is established.": ;
(26) " . . . Being participants in a world-wide cartel and colluding on volumes and prices in general, including production volumes, the suppliers' knowledge on the final shipment destination or centre of interest of the customer has no bearing on the geographical coverage of the anti-competitive objective. Similarly, implementation of the cartels necessarily produced immediate and foreseeable effects in the EEA as a whole irrespectively of whether the parties had any knowledge of the actual place of delivery or billing of the specific CDTs or CPTs. Moreover, the approach suggested by Samsung would result in a situation in which sales for which the place of delivery and the place of billing is not the same, would end up not being taken into account in any competition proceedings, thereby allowing general impunity for the cartelists concerned. It follows from Recital (1034) that by using the delivery criterion for the establishment of the value of sales a strong nexus to the EEA is assured.": ;
(27) Samsung SDI was fined 69,418,000 Eur for the infringement of Article 101 and Article 53 in respect of CDTs, Philips NV was fined 73,185,000 Eur and LG Inc was fined 116,536,000 Eur.
The relevant supply chains in more detail
"The basic supply chain up to 30 April 2006, somewhat simplified, was as follows:
(1) D1 and D5 [SECL and LGD] and other suppliers of LCDs sold LCDs to OEMs [original equipment manufacturers] based in Asia ("Step 1");(2) Step 1 took place outside the EU;(3) The OEMs sold monitors incorporating LCDs to Corporation ("Step 2");(4) Step 2 took place outside the EU;(5) Corporation sold monitors to C1 to C5 [the iiyama claimants other than Mouse] ("Step 3");(6) Step 3 took place (presumably) in the EU;(7) C1 to C5 [the iiyama claimants other than Mouse] sold monitors to dealers ("Step 4");(8) Step 4 took place inside the EU."
"There was a variation ("the first variation") on the basic supply chain in operation up to 30 April 2006. This variation is said to have involved some 39,136 LCDs/monitors. This variation involved the elimination of the step of sales to OEMs. Instead, Corporation acquired LCDs and used them for the purpose of its own manufacture of monitors at its factory in Japan. As before, there is the point, which may later be relevant, that D1 [SECL] did not make direct supplies of LCDs to Corporation but made indirect supplies to its Japanese subsidiary which then supplied independent distributors and they then supplied Corporation. Corporation then sold the monitors, incorporating LCD panels, to C1 to C5 [the iiyama claimants but for Mouse]. As before there may have been more than one transaction between C1 to C5 [the iiyama claimants]."
"There was also said to be a variation ("the second variation") to the basic supply chain on and after 1 May 2006. This variation accounted for 15% of the purchases from all OEMs during that period. This 15% was bought from OEMs in Europe. The Claimants say that C3 [iiyama Benelux BV] (not C6 [Mouse]) bought monitors incorporating LCDs from three OEMs operating in Europe. These were BenQ operating in the Czech Republic (which joined the EU in 2004), TPV operating in Poland and Novatech Technology operating in Germany. It seems to be alleged that C3 [iiyama Benelux BV] then sold such monitors to dealers in the EU. The Claimants do not plead that the LCDs for these monitors came from D1 or D5 [SECL or LGD] but assert that the prices for the LCDs were affected by the worldwide cartel. The parties made submissions as to where the LCDs were sold and whether the sales were inside or outside the EU. In particular, the Defendants submitted that BenQ, TPV and Novatech Technology were European subsidiaries of Asian parent companies and that I should infer that the LCDs were bought by the parent companies in Asia and then provided by the parents to their subsidiaries, rather than the LCDs being sold within the EU to the three European subsidiaries."
"The basic supply chain on and from 1 May 2006 (accounting for 85% of the purchases of monitors from all OEMs in that period), somewhat simplified (i.e. subject to similar comments to those made in paragraph 35 above), was as follows:
(1) D1 and D5 [SECL and LGD] and other suppliers of LCDs sold LCDs to OEMs based in Asia ("Step 1");
(2) Step 1 took place outside the EU;
(3) The OEMs sold monitors incorporating LCDs to C6 [Mouse] ("Step 2");
(4) Step 2 took place outside the EU;
(5) C6 [Mouse] sold monitors to C1 to C5 [the iiyama claimants other than Mouse] ("Step 3");
(6) Step 3 took place (presumably) in the EU;
(7) C1 to C5 [the iiyama claimants other than Mouse] sold monitors to dealers ("Step 4");
(8) Step 4 took place inside the EU."
"(i) CRT glass was made in Asia (or otherwise outside the EEA).
(ii) It was supplied to CRT manufacturers outside the EEA (in Asia) who turned it into tubes (CRTs).
(iii) The tubes were then sold to a monitor manufacturer or in some cases to dealers who sold on to monitor manufacturers. This step was generally in Asia (but in any event outside the EEA), save that in one chain the manufacturer was a UK subsidiary of a Japanese group (Mitsubishi).
(iv) The completed monitors were then sold to iiyama Corporation, a Japanese company (and therefore in Asia).
(v) iiyama Corporation then sold the monitors to one of the claimant companies. At this point the monitors entered the EEA.
(iv) The claimants then sold the monitors within the EEA."
The relevant tests
"It was accepted that the most relevant authority was Easyair Ltd v Opal Telecom Ltd  EWHC 339 Ch, where Lewison J said:
"15. As Ms Anderson QC rightly reminded me, the court must be careful before giving summary judgment on a claim. The correct approach on applications by defendants is, in my judgment, as follows:
i) The court must consider whether the claimant has a "realistic" as opposed to a "fanciful" prospect of success: Swain v Hillman  1 All ER 91;ii) A "realistic" claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel  EWCA Civ 472 at iii) In reaching its conclusion the court must not conduct a "mini-trial": Swain v Hillmaniv) This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel at v) However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5)  EWCA Civ 550;vi) Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd  FSR 3;vii) On the other hand it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent's case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant's case is bad in law, the sooner that is determined, the better. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd  EWCA Civ 725."
To that summary Mr Beard QC for the sixth and seventh defendants added the following from Lord Woolf in Swain v Hillman  1 All ER 91 at 94:
"It is important to note that a judge in appropriate cases should make use of the powers contained in Part 24. In doing so he or she gives effect to the overriding objective as contained in Part 1. It saves expense; it achieves expedition; it avoids the court's resources being used up on cases where this serves no purpose, and I would add, generally, that it is in the interests of justice. If the claimant has a case which is bound to fail, then it is in the claimant's interest to know as soon as possible that that is the position.""
"(3) A claim is made against a person ("the defendant") on whom the claim form has been or will be served (otherwise than in reliance on this paragraph) and –
(a) there is between the claimant and the defendant a real issue which it is reasonable for the court to try; and
(b) the claimant wishes to serve the claim form on another person who is a necessary or proper party to that claim.
. . . "
"There was no dispute between the parties on the general principles to be applied when deciding whether permission should be granted to serve proceedings on a defendant who is out of the jurisdiction, under the terms of paragraph 3.1 of Practice Direction 6B of the CPR. The three basic principles were recently restated by Lord Collins of Mapesbury in giving the advice of the Privy Council in AK Investment CJSC v Kyrgyz Mobile Tel Ltd  UKPC 7, 1 CLC 205 at paragraphs 71, 81 and 88. They can be summarised as follows: first, the claimant must satisfy the court that, in relation to the foreign defendant to be served with the proceedings, there is a serious issue to be tried on the merits of the claim, i.e. a substantial question of fact or law or both. This means that there has to be a real, as opposed to a fanciful, prospect of success on the claim. Secondly, the claimant must satisfy the court that there is a good arguable case that the claim against the foreign defendant falls within one or more of the classes of case for which leave to serve out of the jurisdiction may be given. These are now set out in paragraph 3.1 of Practice Direction 6B. "Good arguable case" in this context means that the claimant has a much better argument than the foreign defendant. Further, where a question of law arises in connection with a dispute about service out of the jurisdiction and that question of law goes to the existence of the jurisdiction (e.g. whether a claim falls within one of the classes set out in paragraph 3.1 of Practice Direction 6B), then the court will normally decide the question of law, as opposed to seeing whether there is a good arguable case on that issue of law."
Our consideration of the issues
(a) choice of law: are the claims governed by EU law?
(b) jurisdiction: the territorial scope of Article 101 and indirect effects;
(c) the application of the CRT claimants to amend their particulars of claim;
(d) causation and joint and several liability; and
(e) service out of the jurisdiction and related matters.
Choice of law: Are the claims governed by EU law?
"11. Choice of applicable law: the general rule.
(1) The general rule is that the applicable law is the law of the country in which the events constituting the tort…in question occur.
(2) Where elements of those events occur in different countries, the applicable law under the general rule is to be taken as being-
(c) in any other case, the law of the country in which the most significant element or elements of those events occurred.
12. Choice of applicable law: displacement of general rule.
(1) If it appears, in all the circumstances, from a comparison of-
(a) the significance of the factors which connect a tort… with the country whose law would be the applicable law under the general rule; and
(b) the significance of any factors connecting the tort…with another country,
that it is substantially more appropriate for the applicable law for determining the issues arising in the case, or any of those issues, to be the law of the other country, the general rule is displaced and the applicable law for determining those issues or that issue (as the case may be) is the law of that other country.
(2) The factors that may be taken into account as connecting a tort…with a country for the purposes of this section include, in particular, factors relating to the parties, to any of the events which constitute the tort…in question or to any of the circumstances or consequences of those events."
"(l) Section 11 of the 1995 Act sets out the general rule for ascertaining the applicable law of a tort. It adopts a geographical approach to that question. (2) Where the elements of the events constituting the tort or delict occur in different countries and the cause of action relates to something other than personal injury or damage to property, then section 11(2)(c) requires an analysis of all the elements of the events constituting the tort in question. (3) In carrying out that exercise, it is the English law constituents of the tort that matter. (4) The analysis requires examination of the 'intrinsic nature' of the elements of the events constituting the tort. It does not, at this stage, involve an examination of the nature or closeness of any tie between the element and the country where that element was involved or took place. This latter exercise is only relevant if section 12 is invoked. (5) Once the different elements of the events and the country in which they occurred have been identified, the court has to make a 'value judgment' regarding the 'significance' of each of those 'elements'. 'Significance' means the significance of the element in relation to the tort in question, rather than trying to judge which involves the most elaborate factual investigation. (6) Under section 11(2)(c), (ie in relation to causes of action other than in respect of personal injury or damage to property where the elements of the events constituting the tort occur in different countries) the applicable law of the tort in question will be that of the country where the significance of one element or several elements of events outweighs or outweigh the significance of any element or elements found in any other country."
"The first was that, if, as here, the exercise is being carried out at an interlocutory stage as part of an overall exercise to determine whether the English court should have jurisdiction to determine the claim in tort in question, the court cannot finally determine the applicable law of the tort. The second was that it is "quintessentially" for the judge to make an assessment of the significance of the elements of the events constituting the tort for the purposes of section 11(2)(c) and that the Court of Appeal would not interfere with that assessment unless it was satisfied that the judge made such an error in his assessment as to require the Court of Appeal to make its own assessment."
(a) The formation of the anti-competitive cartel agreement, which occurred in Taiwan.
(b) The overcharge for the LCD panels incorporated into the goods which the claimants ultimately bought, which occurred when the panels were first sold by cartel members to the OEMs in Asia.
(c) The onward sale of the finished products by the OEMs to Corporation (or, after May 2006, to Mouse), which occurred principally in Japan.
(d) The further onward sale of the finished products, within the iiyama group, to the claimants, whose financial resources may reasonably be assumed to have been depleted where each of them was based and operated (and thus, for each of the first to fifth claimants, within the EU).
"I would apply those provisions to this case in the following way. The tort of infringement of Article 101 occurred in the EU, when the worldwide cartel was implemented in the EU. The damage resulting from that tort, which is a necessary part of the cause of action arising under Article 101, was suffered by the Claimants in their respective countries of incorporation. In relation to C1, a company incorporated in England and Wales, its cause of action will be based on Article 101 having direct effect in England and Wales and the legal principles as to causation of loss will be English law principles (although overlaid by EU law as to the principles of effectiveness and equivalence). I provisionally conclude, not having been addressed on this point, in relation to the other Claimants, that the legal principles as to causation of loss will be the law of their countries of incorporation."
To the extent that Morgan J here reached a conclusion on the applicable law, Mr Calver submitted that we should not depart from it unless satisfied that it was clearly wrong.
Jurisdiction: the territorial scope of Article 101 and indirect effects
"At this stage, the Claimants' claim to recover an alleged loss caused by the implementation of the LCD cartel in the EU/EEA will not be struck out."
"1. The following shall be prohibited as incompatible with the internal market: all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market, and in particular those which:-
(a) directly or indirectly fix purchase or selling prices or any other trading conditions;
(b) limit or control production, markets, technical development, or investment;
(c) share markets or sources of supply;
(d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;
(e) make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.
2. Any agreements or decisions prohibited pursuant to this Article shall be automatically void.
The focus of the Article is therefore on the internal market, and the effect on trade between Member States of anti-competitive agreements or concerted practices "which have as their object or effect the prevention, restriction or distortion of competition within the internal market."
"Any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States."
"The question of substantive, or subject-matter, jurisdiction under EU competition law arises not only as regards Article 101 but also in connection with the application of Article 102 and the Merger Regulation. When a non–EU undertaking engages in conduct directly within the EU, such conduct is clearly subject to EU law on the basis of territorial jurisdiction. It is the application of EU competition law to activity carried on outside the EU (and the European Economic Area), especially by non-EU undertakings, that gives rise to a potential problem. How far a State may properly apply its laws to conduct carried out beyond its territory is a controversial issue under public international law. On the one hand, the application by one State, or a group of States, of their law to conduct on the territory of another State can be regarded as an infringement of the latter State's sovereignty. On the other hand, in an increasingly interdependent world, competition law that is based primarily on economic consequences becomes stunted and artificial if it cannot reach any conduct engaged in beyond the legislating State's territorial boundaries."
"12. It should be noted that the main sources of supply of wood pulp are outside the Community, in Canada, the United States, Sweden and Finland and that the market therefore has global dimensions. Where wood pulp producers established in those countries sell directly to purchasers established in the Community and engage in price competition in order to win orders from those customers, that constitutes competition within the Common Market.
13. It follows that where those producers concert on the prices to be charged to their customers in the Community and put that concertation into effect by selling at prices which are actually co-ordinated, they are taking part in concertation which has the object and effect of restricting competition within the Common Market within the meaning of Article 85 of the Treaty.
14. Accordingly, it must be concluded that by applying the competition rules in the Treaty in the circumstances of this case to undertakings whose registered offices are situated outside the Community, the Commission has not made an incorrect assessment of the territorial scope of Article 85.
15. The applicants have submitted that the decision is incompatible with public international law on the grounds that the application of the competition rules in this case was founded exclusively on the economic repercussions within the Common Market of conduct restricting competition which was adopted outside the Community.
16. It should be observed that an infringement of Article 85, such as the conclusion of an agreement which has had the effect of restricting competition within the Common Market, consists of conduct made up of two elements, the formation of the agreement, decision or concerted practice and the implementation thereof. If the applicability of prohibitions laid down under competition law were made to depend on the place where the agreement, decision or concerted practice was formed, the result would obviously be to give undertakings an easy means of evading those prohibitions. The decisive factor is therefore the place where it is implemented.
17. The producers in this case implemented their pricing agreement within the Common Market. It is immaterial in that respect whether or not they had recourse to subsidiaries, agents, sub-agents, or branches within the Community in order to make their contacts with purchasers within the Community.
18. Accordingly the Community's jurisdiction to apply its competition rules to such conduct is covered by the territoriality principle as universally recognised in public international law. "
"In the light of that provision, the vast majority of academic writers take the view that it is neither the nationality nor the geographical location of the undertaking but the location of the anti-competitive effect which constitutes the criterion for the application of Community competition law."
( 4 CMLR 901 at 918). He also referred, at 919, to a suggestion made by Advocate General Mayras in the so-called "Dyestuffs" cases (including Case 48/69, Imperial Chemical Industries v Commission  ECR 619), that the Court should adopt the criterion of "qualified effects" in order to establish the extra-territorial jurisdiction of the EU. As Advocate General Darmon noted, the Court had not adopted that suggestion, but had preferred to base such jurisdiction in the Dyestuffs cases on the unity of the undertaking, adding:
"But that certainly does not mean that the location of the effects would not constitute a sufficient basis for jurisdiction."
"(a) I think that the first condition lies in the fact that the agreement or the concerted practice must create a direct and immediate restriction on competition on the national market or, as here, on the Community market. In other words, an agreement only having effects at one stage removed by way of economic mechanisms themselves taking place abroad could not justify jurisdiction over participating undertakings whose registered offices are also situated abroad.
I would suggest that the American Restatement of Foreign Relations Law should be interpreted in this way insofar as it states that jurisdiction over conduct occurring abroad may be admitted when the effect occurs as a direct result of that conduct.
(b) Secondly, the effect of the conduct must be reasonably foreseeable, although there is no need to show that the effect was intended.
(c) Thirdly and lastly, the effect produced on the territory must be substantial."
We find here what appears to be the first description in the EU jurisprudence of the doctrine of "qualified effects", that is to say the principle that extra-territorial jurisdiction may properly be asserted where it is reasonably foreseeable that a foreign cartel will have effects in the EU which are both immediate and substantial. It may also be necessary for those effects to be, at least in some sense, direct.
"90. Application of the Regulation is justified under public international law when it is foreseeable that a proposed concentration will have an immediate and substantial effect in the Community.
91. In that regard, the concentration would, according to the contested Decision, have led to the creation of a dominant duopoly on the part of Amplats and Implats/LPD in the platinum and rhodium markets as a result of which effective competition would have been significantly impeded in the Common Market within the meaning of Article 2(3) of the Regulation.
92. It is therefore necessary to verify the three criteria of immediate, substantial and foreseeable effect are satisfied in this case."
It can thus be seen that paragraph 90 contains a clear and unqualified statement of the qualified effects principle, albeit without any discussion of its pedigree.
"It is true that the concentration would not necessarily lead to abuses immediately, since that depends on decisions which the parties to the duopoly may or may not take in the future. However, the concentration would have had the direct and immediate effect of creating the conditions in which abuses were not only possible but economically rational, given that the concentration would have significantly impeded effective competition in the market by giving rise to a lasting alteration to the structure of the markets concerned."
And in relation to the criterion of foreseeability, they said at paragraph 100:-
"As for the criterion of foreseeable effect, it follows from all the foregoing that it was in fact foreseeable that the effect of creating a dominant duopoly position in a world market would also be to impede competition significantly in the Community, an integral part of that market."
"In the present case, however, the Commission was entitled to define the category of "direct EEA sales through transformed products" by restricting that category solely to sales of cartelised LCD panels which were incorporated in finished products sold in the EEA. Indeed, if that first sale of the cartelised products to a third party had not taken place in the EEA, the link between the internal market and the infringement would have been too weak."
The implication of this comment, submits Mr Beard, is that if the first sale of a cartelised product to a third party takes place outside the EEA, the link between the internal market and the infringement of Article 101 would be too weak to satisfy the qualified effects test. We observe, however, that the comment was made in the context of an argument about discrimination in the fixing of fines, not an argument about the territorial scope of Article 101.
"The foregoing demonstrates that, in the present case too, a broad interpretation of the territorial scope of EU competition law would entail the risk of conflicts of jurisdiction with foreign competition authorities and of double penalties for undertakings."
He also said, at paragraph 44:-
"It seems to me that, unless further evidence can be furnished that the cartel creates qualified effects in the EEA, the Commission goes too far if it fines cartels relating to products manufactured and sold outside the EEA for the sole reason that those products are subsequently "transformed" or incorporated into other products which (either wholly or in part) arrive in the EEA."
"277. Intel's conduct was intended to produce an immediate effect in the EEA and was capable of doing so.
278. That conduct was intended to induce Acer and was capable of inducing it to delay the launch of an AMD-based notebook worldwide, including in the EEA. The delay in the launch means that, during a certain period, a certain AMD-based computer model is not available, including in the EEA. It is a direct effect and not merely a knock-on effect.
280. Moreover, the single and continuous infringement committed by the applicant, viewed as a whole, was capable of having the immediate effect of weakening the applicant's sole significant competitor by foreclosing it from the most important sales channels and therefore of changing the effective competition structure in the common market."
"The wording of Articles 101 and 102 TFEU does not justify the application of EU rules by the Commission with respect to conduct that has no "qualified" effect in the territory of the European Union. To hold the contrary would also be problematic under the rules of public international law. An over-reach of EU competition rules would risk encroaching upon the sovereign interests of other States and be legally and practically difficult to enforce. It would also considerably increase the overlaps in the jurisdictions of different States or polities and thereby create great uncertainty for undertakings and increased risks of conflicting rules (or judgments) applying to the same conduct. Lastly, but no less importantly, it may raise questions under the principle of good administration: what would be the interest in enforcing EU rules with respect to conduct that has no significant effect in the European Union? Would that be a valid and effective use of the European Union's limited resources?"
a) the conduct in question was not implemented in the EU, and Intel did not sell products to Lenovo in the EU;
b) the General Court erred in law by accepting the qualified effects test in order to determine the Commission's jurisdiction, because the implementation test "is the only test allowed by the case-law";
c) even if the qualified effects test were applicable, it could not be satisfied on the facts because the link between the internal market and the infringement was too weak (see the judgment of the CFI in InnoLux at paragraph 87), and it was not foreseeable that the agreements with Lenovo regarding CPUs for delivery in China "would have an immediate and substantial effect within the EEA";
d) even if indirect effects could be sufficient to establish jurisdiction, the 2006 and 2007 agreements with Lenovo could not have had a substantial effect within the EEA; and
e) the Commission's approach "would give rise to jurisdictional conflict with other competition authorities and create a real risk of double jeopardy."
(See paragraphs 33 to 37 of the judgment).
"45. The qualified effects test pursues the same objective, namely preventing conduct which, while not adopted within the EU, has anti-competitive effects liable to have an impact on the EU market.
46. The argument put forward by Intel, supported by ACT, that the qualified effects test cannot serve as a basis for the Commission's jurisdiction is therefore incorrect.
47. Accordingly, that argument must be rejected as unfounded."
The Grand Chamber has accordingly now made it clear, beyond argument, that the qualified effects test provides an alternative basis for grounding the territorial jurisdiction of the Commission.
"48. In the second place, it is necessary to examine the argument put forward in the alternative by Intel, according to which, even if the qualified effects test were applicable in the present case, the General Court wrongly considered that the agreements concluded with Lenovo in 2006 and 2007 would have foreseeable, immediate and substantial effects in the EEA. Intel emphasises, in that respect, the allegedly limited number of products affected.
49. It must be noted, first of all, that, as the General Court held, in paragraphs 233 and 258 of the judgment under appeal, the qualified effects test allows the application of EU competition law to be justified under public international law when it is foreseeable that the conduct in question will have an immediate and substantial effect in the European Union.
50. It must be pointed out, as the General Court did in paragraphs 268 and 280 of the judgment under appeal, that it is necessary to examine the conduct of the undertaking or undertakings in question, viewed as a whole, in order to determine whether the Commission has the necessary jurisdiction to apply, in each case, EU competition law.
51. Next, in so far as Intel criticises the General Court for considering that it was foreseeable that the agreements concluded with Lenovo concerning CPUs for delivery in China would have an immediate effect in the EEA, it must be pointed out, first, that the General Court rightly held, in paragraphs 251, 252 and 257 of the judgment under appeal, that it is sufficient to take account of the probable effects of conduct on competition in order for the foreseeability criterion to be satisfied.
52. Secondly, since in paragraph 255 of the judgment under appeal, the General Court found, in essence, that Intel's conduct vis-à-vis Lenovo formed part of an overall strategy intended to ensure that no Lenovo notebook equipped with an AMD CPU would be available on the market, including in the EEA, the General Court did not err in considering, in paragraph 277 of the judgment under appeal, that Intel's conduct was capable of producing an immediate effect in the EEA.
53. That argument must therefore be rejected as unfounded.
54. Lastly, Intel submits that the General Court wrongly considered that the agreements concluded with Lenovo concerning CPUs for delivery in China could have a substantial effect on the EEA market even though the effects of those agreements were negligible.
55. It suffices, in that respect, to note that the General Court held that Intel's conduct vis-à-vis Lenovo formed part of an overall strategy aimed at foreclosing AMD's access to the most important sales channels, which, moreover, Intel does not dispute in its appeal.
56. Accordingly, in view of the considerations set out in paragraph 50 above, the General Court did not err in law in holding that, faced with a strategy such as that adopted by Intel, it was appropriate to take into consideration the conduct of the undertaking viewed as a whole in order to assess the substantial nature of its effects on the market of the EU and of the EEA.
57. As the Commission emphasises, to do otherwise would lead to an artificial fragmentation of comprehensive anti-competitive conduct, capable of affecting the market structure within the EEA, into a collection of separate forms of conduct which might escape the European Union's jurisdiction.
58. Consequently, the argument mentioned in paragraph 54 of the present judgment must be rejected as unfounded."
a) the recognition that conduct intended to delay the launch of a competing product worldwide could constitute a direct effect in the EU, "and not merely a knock-on effect";
b) the absence of sales by Intel of CPUs to Acer in the EU did not mean that the effect in the EU of Intel's conduct could only have been indirect; and
c) viewed as a whole, the infringement was capable of "changing the effective competition structure in the common market".
The decision of Mann J on territoriality
"148. My decision on immediacy is that the claimants have not made out a sufficiently arguable case. Immediacy is a concept which is capable of flexible application, depending on the facts, but it is clear to me that it cannot be made out in this case. The consequences of the non- EU cartels fixing their prices for glass and CRTs will have been felt in the market into which they were sold, which is not the EU market. Even if the effect of those sales is ultimately felt in the EU in the manner which the claimants would like to rely on, that is not an immediate effect. If a label is required, it is a "knock-on effect", and it is apparent from Intel that that is not sufficient."
The judge then quoted paragraph 278 from the judgment of the General Court, which drew the distinction between "a direct effect" and "merely a knock-on effect": see  above.
The US authorities
"The position for which Motorola contends would if adopted enormously increase the global reach of the Sherman Act, creating friction with many foreign countries and "resentment at the apparent effort of the United States to act as the world's competition police officer", a primary concern motivating the Foreign Trade Antitrust Improvements Act."
Conclusion on jurisdiction
The application of the CRT claimants to amend their particulars of claim
"In particular, but without prejudice to the generality of the foregoing:
(a) The cartel in Europe was essential to sustain the cartel price in Asia. If there had been no cartel in the EEA, the cartel price in Asia would have collapsed.
(b) The Claimants would have bought in the EEA if there had been CRTs/transformed products available at a non-cartelised price which they could have purchased."
These further amendments, it is said, would permit the CRT claimants to advance essentially the same arguments as persuaded Morgan J not to strike out the LCD claims.
"From discussions I have had with Jeffry Pettinga, I understand that the manufacture of iiyama CRT monitors in the EEA, containing CRTs manufactured in the EEA, for sale by the Claimants would have had potential advantages compared to CRTs manufactured in Asia. It would probably have meant that the lead time was shortened between placing orders and the Claimants receiving delivery of the monitors in Europe. It is also likely that there would have been transport cost advantages for the Claimants. CRTs are larger than replacement technologies such as LCD panels and the transport costs were relatively high. A 40 foot-long shipping container travelling from Asia could typically contain only 300 to 400 CRTs, whereas it can contain 1600 to 1700 LCD panels. Had the Claimants been able to source CRTs from a country in the EEA at a lower price than the price fixed by the cartelists, and been able to make suitable manufacturing arrangements with an OEM in the EEA, in principle the Claimants would have sourced CRTs which were manufactured in the EEA, including England and Wales."
Causation and joint and several liability
Service out of the jurisdiction and related matters
"(a) A failure to disclose the cartels relied on were external to the EU and not within the EU.
(b) A failure to point out that the cartel sales relied on by the claimants were not in fact in or into the EU but took place elsewhere.
(c) (Having seen how the matter is now put by the claimants) that the claims are not the follow-on claims that they purported to be, but were standalone claims of a different nature."
For the reasons which he then gave at  to , Mann J found these complaints to be established.
"169… He accepted that the application proceeded on the basis of the purchase of some monitors from OEMs in the EU, and that that turned out to be incorrect. The correct position did not become apparent until further instructions were taken after Part 18 requests were made, whereupon the 15% point was withdrawn from the Particulars of Claim. He accepted that the description of the claim as a "follow-on" claim put the matter too narrowly, and that it required further explanation. That admits non-disclosure - something that requires further explanation does not make a complete disclosure.
170. I therefore find this aspect of non-disclosure made out. The non-disclosure is serious – it is a mis-statement of important facts about European purchases (the 15% point), a misdescription of the intended nature of the action, and a non-disclosure of facts which go to jurisdiction even if the claimants claim to have an answer to the point (I got the strong impression throughout that they were not actually live to it, though that is no answer). All these go to the heart of the case.
171. Mr Robertson submitted, and Ms Ford did not gainsay, that non-disclosure did not necessarily require setting aside of the permission. He pointed out that proportionality had a part to play. Alternative remedies were available, such as disallowing the costs of the service out application (see Masri). I accept all that, but lesser remedies would only be appropriate for lesser transgressions. In my view the non-disclosures in this case were so serious, going as they did to the heart of jurisdiction, that the familiar sanction of setting aside the service out order would be justified by these transgressions alone. I would so order."
The appropriate forum
(a) the claimants' appeal against the second declaration contained in paragraph 1(ii) of Morgan J's Order should be allowed on all grounds;
(b) both declarations in paragraph 1 of Morgan J's Order should be set aside; and
(c) the cross-appeals of the Samsung defendants and LGD should be dismissed.