Irish Judiciary Supports Effective Enforcement Of Competition Law

The Supreme Court decision of 28 July 2011 in Hegarty resolved a number of complex legal issues, but at the heart of the case is the continuing trend of Irish judges to interpret legislation in a manner which ensures the effective enforcement of competition law. It is this aspect of the case which will be examined in more detail below following a brief summary of the case. The principal issue was the interpretation of a provision of Irish competition law which provides that an individual who is a key decision maker in an "undertaking" can be prosecuted and convicted of a cartel offence as well as the undertaking itself. The principal issue in this case was that, for technical reasons, the undertaking was not first prosecuted for a cartel offence and the question arose as to whether the individual, Mr Pat Hegarty, could be prosecuted as the offence relating to the individual provided that it must first be established that an offence had been committed by the undertaking. At a difference to EU competition law, on which Irish competition law and most other national competition laws of the Member States of the EU are based, infringements of competition law in Ireland, in particular cartel infringements such as price fixing - the infringement in this case, can be prosecuted as a criminal offence as well as constituting a civil infringement. The judgment of the Supreme Court dealt with two questions posed by a Galway Circuit Criminal Court in a process similar to an Article 267 TFEU reference, namely:

Whether for the purposes of charges standing against Mr Hegarty a jury can lawfully find that the undertaking has committed an offence in circumstances where that undertaking has not been prosecuted for such offence; and Whether a conviction formally secured and recorded against that undertaking is a necessary pre-condition for the successful prosecution of the accused individual. In response to the questions posed, the Supreme Court answered as follows:

Question 1: Yes; and

Question 2: No.

Background Facts

On 21 May 2008, Mr Hegarty, the accused, attended at Galway Circuit Criminal Court to answer charges against him of being a "Manager" or "Officer" of an undertaking which entered into an agreement having as its object the prevention, restriction or distortion of competition in the trade of gas oil in Galway city and county by directly or indirectly fixing the selling price of gas oil and authorising or consenting to the doing of the acts constituting an offence contrary to s.4(1) of the Competition Act 1991 ("the 1991 Act"), the national equivalent of Article 101(1) TFEU.

The key issue in this case is that the undertaking concerned had not been prosecuted, let alone convicted, for its alleged role in the price fixing and, consequently, Mr Hegarty argued that the indictment against him should be quashed. Upon the resistance of the DPP to this application, in May 2008 the Galway Circuit Criminal Court agreed to the prosecution's request to refer the matter as a "case stated" to...