Cyprus Competition Authority Chairman removed by Supreme Court
THE SUPREME Court has unanimously overturned a decision by the Competition Commission (CPC) to fine four fuel companies close to €43 million for collusion, after finding that the CPC’s chairman had been appointed illegally. In September 2009, the CPC fined Petrolina, Lukoil, Exxon Mobile and Hellenic Petroleum (EKO) €42.9 million for “concerted practice,” a term meaning the informal and tacit understanding between firms to influence the conduct of the market. A report on the decisions of the CPC can be found here.
The Supreme Court decision is expected to affect other CPC cases in which Christoforou was involved. The companies had appealed the CPC decision claiming it was illegal.
Before adjudicating on the merits of the appeals, the plaintiffs filed a motion asking the Supreme Court Plenum – all 13 judges – to examine four legal points whose outcome could have affected the continuation of the procedure. One of the points was that the CPC’s composition was illegal when the case was examined. The companies argued that the chairman had been appointed in violation of the relevant law and did not possess the necessary qualifications for the position.
The cabinet had not carried the necessary research before appointing Christoforou as head of the CPC, or if it did, it had not been adequate, the companies said.
The companies argued that both the trade minister’s proposal to appoint Christoforou and the cabinet decision to put him at the helm of the CPC made “no reference whatsoever to his education, experience, career or knowledge.” There was nothing to lead to the conclusion that he has specialised knowledge and experience in legal affairs and is capable of contributing to the implementation of the law’s objectives, the companies said. The Republic on the other hand suggested there were no grounds to appeal the legitimacy of the appointment since it had not been contested the first time.
The Court disagreed with both arguments. It noted that the new law demands different qualifications and pointed out that the provision cited by the state could only apply in cases in which the chairman of the CPC had not participated. “In the present case however, he apparently took part in the decision-making; thus, since his appointment was illegal, the administrative decision in question is also illegal,” the Supreme Court said.
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