WOLTERS KLUWER LAWYERS' AWARD: PUBLIC PROCUREMENT CARTEL NOVAWUM

OUR PUBLIC PROCUREMENT CARTEL NOVAWUM APPLICATION HAS BEEN SHORTLISTED FOR THE 2023 WOLTERS KLUWER LAW AWARD IN THE COMPETITION CATEGORY, MAKING US THE ONLY TEAM TO BE SHORTLISTED FOR THE COMPETITION WITH TWO APPLICATIONS IN ONE CATEGORY.

In the case presented in our submission, the Curia ruled in a precedent-setting judgment that a request for review can only be based on a question of law and that the fact that there can be two approaches to a question cannot in itself be a basis for a reopening of the case, thus rejecting the request of the Competition Authority.

The Court thus ruled in favour of the applicant, represented by Bitai Law Firm, and upheld the judgment of the Municipal Court of Budapest, in which the Court annulled the fine imposed by the GVH in a retrial. In addition to the waiver of the fine, our client was also exempted from paying HUF 300 million in damages.

In December 2019, the Competition Authority fined several waste management companies a total of more than HUF 860 million after the Competition Authority's proceedings revealed that the companies had colluded in several tendering procedures for the procurement of waste collection containers, vehicles and equipment, typically under EU-funded tenders.

In the case of a tender in Budapest, the GVH based its findings on a series of e-mails showing that the companies colluded to ensure that the applicant won the tender and that the applicant was involved in a collusive arrangement between competitors.          

In March last year, the Curia partially upheld the General Court's order dismissing the companies' action against the GVH's decision, but annulled the previous order against one of the applicants and ordered the General Court to conduct a new procedure.

The reopened proceedings of the General Court revealed that none of the e-mails on which the GVH's decision was based showed that the applicant had reached an agreement with the other companies involved in the proceedings before submitting the bid, and therefore could not be used as admissions.

While it is possible to establish an infringement on the basis of circumstantial evidence alone, in this case the evidence must form a closed chain of logic from which it could reasonably be inferred that the applicant had designed its conduct to eliminate or reduce the uncertainty in the public procurement procedures.

The General Court concluded that the latter was not the case. It was not possible to prove that the company had behaved in such a way as to eliminate the uncertainty in the tender procedure.

The Court of First Instance also had to decide whether the company could be held liable on the basis of the settlement statement, in addition to the evidence previously taken into account by the GVH. This is because a settlement statement can only be taken into account against a company if the other evidence supports its participation in the infringement.

However, the General Court found that the content of the emails taken into account by the GVH was contrary to that finding and that the evidence found by the GVH did not therefore establish the applicant's participation in the infringing conduct.

In its judgment, however, the Curia refused to grant the GVH's request for review, pointing out that a request for review can only be directed to a point of law. A review is only possible if it is justified by an infringement of the law, such as an irregular finding of facts or a manifestly serious lack of discretion.

According to the Curia, the General Court examined the merits of the GVH's decision, its lawfulness and assessed the evidence found in the GVH's proceedings in accordance with the guidelines of the Curia.

The Curia ruled that the GVH had not identified any specific breach of law and that the mere fact that it disagreed with the assessment of the evidence and, in its request for a reassessment of the evidence, essentially requested the adoption of its own position, did not in itself constitute grounds for the admissibility of its application for review.

A review cannot be an appeal in disguise, and the mere fact that two approaches to an issue are possible cannot form the basis for a retrial of the case, the Curia ruled.

The Lawyers' Awards gala will take place on 24 November 2023 and will be attended by our team.