On 26 November 2013, the European Union’s top court, the European Court of Justice, gave a seminal ruling establishing the principle that a claim for damages for losses incurred as a result of excessively long judicial review proceedings before the General Court must be brought in a separate action before the General Court itself.

Introduction

On 26 November 2013, the European Union’s top court, the European Court of Justice (ECJ), gave a seminal ruling establishing the principle that a claim for damages for losses incurred as a result of excessively long judicial review proceedings before the European Union’s court of first instance (the General Court) must be brought in a separate action before the General Court itself. Allowing the General Court to decide on whether it acted too dilatorily, may raise eyebrows in practitioner circles and amongst potential damages claimants alike.

The ECJ decided to distance itself from the stance it had taken in a previous judgment, Baustahlgewebe v Commission (Case C-185/95 P), where it took it upon itself to simply reduce the fine to reflect the excessive length of proceedings before the lower instance court. The ECJ’s 26 November ruling instead implies that parties seeking compensation for losses incurred as a result of excessively long proceedings will have to invest more money and time in preparing a separate action before the General Court.

Background

In 2005, the European Commission (Commission) levied fines exceeding €290 million on 16 firms for operating a cartel in the industrial bags sector (Industrial Bags Case COMP/38354). The majority of the addressees of the Commission decision lodged an appeal before the General Court seeking to have the Commission’s decision annulled or to have their respective fines annulled or reduced. Nearly six years later, in judgments handed down on 16 November 2011, the General Court ruled on the actions, dismissing those brought by Kendrion NV (Case T-54/06), Groupe Gascogne SA (Case T-72/06) and Sachsa Verpackung GmbH (now Gascogne Sack Deutschland GmbH) (Case T-79/06).

The General Court took five years and nine months to decide to uphold the Commission’s findings, considerably longer than the average 24.8 months currently required for the General Court to examine and rule on a Commission decision. In Case T-54/06, during the course of the proceedings, Kendrion NV raised the slow nature of the General Court’s proceedings before the General Court itself. The General Court stated simply “The legality of [the] decision may be considered only in the light of the facts and circumstances at the disposal of the Commission at the date of the adoption”. The General Court therefore rejected as ineffective the ground of appeal which alleged that the Court had failed to observe the principle that it must adjudicate within a reasonable time, on the ground that only the legality of the decision fell within its review jurisdiction.

Not satisfied with this response, Kedrion NV, along with Groupe Gascogne SA and Gascogne Sack Deutschland GmbH complained to the ECJ that the General Court had taken far too long to [...]

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