Courts further curtail the powers of Argentina’s antitrust regulators to issue injunctions

Through a battery of rulings issued during the past year, different courts of appeals have finished to overturn a long-standing court interpretation regarding the powers of theComisión Nacional de Defensa de la Competencia (CNDC) to take certain decisions in general and specially to issue injunctions. Although these powers remained undisputed by the courts until 2008, since then different courts started to question the CNDC’s powers, and this trend has been consolidated in at least 12 cases within the past year against no known case of a court ruling ratifying a CNDC injunction.

The 1999 antitrust Law created an independent antitrust court to enforce the law. Notwithstanding the legal mandate, more than 13 years after the enactment of the antitrust law such court has not been set up yet. The antitrust law provided that until such court was established, all antitrust cases were to be decided by the enforcement authority of the former law consisting of both the CNDC as an investigative body and the Secretary of Domestic Trade (SDT) with decision-making powers.

During the first decade after the enactment of the antitrust law, the CNDC issued many injunctions in its anticompetitive behavior investigations and the different courts upheld its decisions. This trend started to change in July 2008 when a Court of Appeals upheld an injunction issued by a first instance judge ordering both the SDT and the CNDC to refrain from issuing an injunction in a merger case[1]. Since then, at least three different courts of appeals have revoked or nullified injunctions issued by the CNDC but the case law was not unanimously held by all the courts since some rulings went further saying that not even the SDT could issue injunctions.

Following this new trend in the courts, in November 2012, the Court of Appeals in Criminal and Economic matters[2] held that an injunction issued by the CNDC was null and void since the latter agency lacks of powers to issue such type of decisions. The court of appeals decided the case on the basis of the 2011 Supreme Court precedent Moda S.R.L, which ruled that the CNDC has no decision-making powers and that such powers solely rest on the SDT.

Recently, the Court of Appeals in Civil and Commercial matters has gone even further in curtailing the powers of the antitrust regulators. In ShellYPF and Esso[3], all of them decided in August 2012, it held that the injunction issued by the SDT was null since neither the CNDC nor the SDT have the power to issue injunctions. Therefore, the Court of Appeals in Civil and Commercial matters concluded that should the CNDC or the SDT want to issue an injunction in an antitrust case, the Antitrust Law allows them to request such a measure to a judge.

These cases have been appealed by the Government and now the Supreme Court will have to decide whether the SDT has powers to issue injunctions under the antitrust law. However, considering previous Supreme Court decisions, most likely this new trend will be completely settled.

[1] Multicanal, Federal Administrative Court of Appeals, Chamber No 5, 18 July 2008.

[2] Falabella, Court of Appeals in Criminal and Economic matters, Chamber B, 7 November 2012.

[3] ShellYPFEsso; Court of Appeals in Civil and Commercial matters, Chamber No 3, 21 August 2012.

For further information on this topic please contact Julián Peña