Document 24
Ref. Ares(2020)3092549 - 15/06/2020
EUROPEAN COMMISSION
Brussels, 1.2.2019
C(2019) 871 final
OUT OF SCOPE
France
DECISION OF THE SECRETARY GENERAL ON BEHALF OF THE COMMISSION PURSUANT
TO ARTICLE 4 OF THE IMPLEMENTING RULES TO REGULATION (EC) NO 1049/20011
Subject:
Your confirmatory application for access to documents under
Regulation (EC) No 1049/2001 - GESTDEM 2018/5758
Dear
,
I refer to your letter of 14 December 2018, registered on the same day, in which you
requested, pursuant to Regulation (EC) No 1049/2001 regarding public access to
European Parliament, Council and Commission documents2 (hereafter, ‘Regulation (EC)
No 1049/2001’), a review of the position taken by the Directorate-General for
Competition in reply to your initial application of 5 November 2018.
1.
SCOPE OF YOUR REQUEST
In your initial application of 5 November 2018, you requested access to the following
documents in the European Commission’s administrative file concerning State aid
procedure SA.38945 – Alleged aid to McDonald’s Luxembourg:
‘any written answer(s) given by Luxembourg to the letter sent by the European
Commission on 3 December 2015 [C(2015) 8343 final];
1
Official Journal L 345 of 29.12.2001, p. 94.
2
Official Journal L 145 of 31.05.2001, p. 43.
Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel. +32 22991111
any written document sent by the European Commission to Luxembourg other
than the letter sent dated 3 December 2015 [C(2015) 8343 final] that is already
public;
any written document sent by the European Commission to McDonald’s
Corporation or any McDonald’s subsidiaries including McD Europe Franchising
Sarl;
any written document sent by the European Commission to third parties in
relation with the case (other than Luxembourg and McDonald’s Corporation or
subsidiaries including McD Europe Franchising Sarl);
any observation(s) or written answer(s) filed by Luxembourg, including without
limitation any observations made in response to EPSU, EFFAT and SEIU’s
observations dated 5 August 2016;
any observation(s) or written answer(s) filed by McDonald’s Corporation or any
McDonald’s subsidiaries including McD Europe Franchising Sarl;
any observation(s) or written answer(s) filed by any third parties (other than
EPSU/EFFAT/SEIU) in relation with the case’.
In its initial reply of 23 November 2018, the Directorate-General for Competition refused
access to the documents in question, based on the exceptions of Article 4(2), first indent
(protection of the commercial interests of a natural or legal person) and third indent
(protection of the purpose of inspections, investigations and audits), and Article 4(3)
(protection of the decision-making process) of Regulation (EC) No 1049/2001.
In your confirmatory application, you requested a review of the position of the
Directorate-General for Competition. You put forward detailed arguments, which I
address below. You also requested access to the non-confidential version of the decision
of the European Commission of 19 September 2018 on tax rulings granted to
McDonald’s Europe by Luxembourg.
2.
ASSESSMENT AND CONCLUSIONS UNDER REGULATION (EC) NO 1049/2001
When assessing a confirmatory application for access to documents submitted pursuant
to Regulation (EC) No 1049/2001, the Secretariat-General conducts a fresh review of the
reply given by the Directorate-General concerned at the initial stage.
Following this review, I wish to inform you that I confirm the initial decision of
Directorate-General for Competition to refuse access, based on the exceptions of Article
4(2), first indent (protection of commercial interests), Article 4(2), third indent
(protection of the purpose of inspections, investigations and audits), and Article 4(3), first
subparagraph (protection of the decision-making process), for the reasons set out below.
2.1. Protection of the purpose of investigations and of commercial interests
In accordance with the case law of the Court of Justice, the European Commission,
‘when assessing a request for access to documents held by it, may take into account more
than one of the grounds for refusal provided for in Article 4 of Regulation (EC) No
2
1049/2001 and two different exceptions can, as in the present case, be closely
connected’.3
Article 4(2), first indent of Regulation (EC) No 1049/2001 provides that ‘[t]he
institutions shall refuse access to a document where disclosure would undermine the
protection of commercial interests of a natural or legal person, including intellectual
property, […], unless there is an overriding public interest in disclosure’.
Article 4(2), third indent of Regulation (EC) No 1049/2001 provides that the
‘[i]nstitutions shall refuse access to a document where disclosure would undermine the
protection of […] the purpose of inspections, investigations and audits’.
As a preliminary remark, please note that the European Commission’s decision of 19
September 2018 on tax rulings granted to McDonald’s Europe (SA.38945) was published
on 17 December 2018 and is available at the following address:
http://ec.europa.eu/competition/state aid/cases/261647/261647 2033697 264 2.pdf
In your confirmatory application, you argued that your request ‘does not aim at accessing
internal notes, briefings or memoranda from the Commission but essentially at analysing
the legal and technical arguments raised by Luxembourg and McDonald’s to support
their interpretation and application of the US-Luxembourg Double tax treaty and their
conclusion that Luxembourg did not provide state aid to McDonald’s in breach of EU
rules […]’.
Please note that the non-confidential version of the above-mentioned European
Commission decision, which was published on 17 December 2018, already provides a
comprehensive and sufficiently understandable summary of all arguments raised by
Luxembourg and McDonald’s and their reasoning. Furthermore, the latter decision
provides information about the European Commission’s own reasoning in reaching its
conclusion that no state aid has been granted to McDonald’s Europe by Luxembourg.
Regarding the remaining documents forming part of your request, I would like to point
out that in its judgment in
Commission v TGI4, which concerned a request for documents
in two state aid cases, the Court of Justice held that there exists, with regard to the
exception related to the protection of the purpose of investigations, a general presumption
that the disclosure of documents in the file would undermine the purpose of state aid
investigations.5 The Court reasoned that such disclosure would call into question the state
aid procedural system.6 This reasoning was further confirmed in the
Sea Handling
3
Judgment of 13 September 2013,
Netherlands v European Commission, T-380/08, EU:T:2013:480,
paragraph 34.
4
Judgment of 29 June 2010,
Commission v Technische Glaswerke Ilmenau, C-139/07, EU:C:2010:376,
paragraphs 52 to 61.
5
See also judgment of 14 July 2016,
Sea Handling v Commission, C-271/15 P, EU:C:2016:557,
paragraphs 36 to 47.
6
See also judgment of 21 September 2010,
Sweden and Others v API and Commission, C-514/07 P,
EU:C:2010:376, paragraphs 99 and 100, as well as judgment of 28 June 2012,
Commission v Odile
Jacob, C-404/10 P, EU:C:2012:393, paragraphs 108-126, where the Court of Justice applied
Commission v TGI by analogy to merger proceedings.
3
judgment.7 Recently, in the
Arca Capital Bohemia judgment, the General Court held that
the general presumption also applies to state aid procedures that are already closed.8
Please be informed that the state aid review procedure is strictly bilateral between the
European Commission and the Member State. This often involves a lengthy dialogue in
which very sensitive information is exchanged, under the understanding that it will
remain confidential. The disclosure of the documents pertaining to the state aid
investigation file would thus jeopardise the willingness of Member States to cooperate in
future state aid investigations. Therefore, confidentiality must be guaranteed at all times
to create and maintain a climate of mutual trust between the European Commission and
the Member States.
Furthermore, the Court of Justice pointed out that interested parties other than the
Member State concerned do not have the right to consult the documents in the European
Commission’s administrative file. The Court held that ‘the interested parties, except for
the Member State responsible for granting the aid, do not have a right under the
procedure for reviewing state aid to consult the documents on the European
Commission’s administrative file. If those interested parties were able to obtain access,
on the basis of Regulation (EC) No 1049/2001, to the documents in the European
Commission’s administrative file, the system for the review of state aid would be called
into question. From a practical point of view, whatever the legal basis on which it is
granted, access to the file enables the interested parties to obtain all the observations and
documents submitted to the European Commission, and, where appropriate, adopt a
position on those matters in their own observations, which is likely to modify the nature
of such a procedure’.9
As the Directorate-General for Competition has rightly pointed out, the time limit to
bring proceedings before the General Court has not yet expired. Contrary to what you
argue in your confirmatory application, the fact that the factual situation in the
TGI10 and
Odile Jacob11 judgments relied upon by the Directorate-General for Competition might
have been different than the present one is irrelevant for the current analysis.
Indeed, the general presumption continues to apply even if the European Commission has
already rendered its decision about the alleged state aid to McDonald’s Europe in the
present case for the reasons explained above.
Furthermore, in your confirmatory application you requested access to ‘any written
document sent by the European Commission to Luxembourg other than the letter sent
dated 3 December 2015 [C(2015) 8343 final] that is already public’, ‘any written
documents sent by the European Commission to McDonald’s Corporation or any
7
Judgment of 14 July 2016,
Sea Handling v Commission, C-271/15 P, EU:C:2016:557, paragraphs 36
to 47.
8
Judgment of the General Court of 11 December 2018 in Case T-440/17,
Arca Capital Bohemia v
Commission, paragraphs 56-58.
9
Judgment in
Commission v Technische Glaswerke Ilmenau, cited above, paragraphs 58, 59 and 61.
10
Judgment of 29 June 2010,
Commission v Technische Glaswerke Ilmenau, cited above.
11
Judgment of 28 November 2013
Commission v Odile Jacob, cited above.
4
McDonald’s subsidiaries including McD Europe Franchising Sarl’ and ‘any written
documents sent by the European Commission to third parties in relation with the case
(other than Luxembourg and McDonald’s Corporation or subsidiaries including McD
Europe Franchising Sarl)’.
Please be informed that all these documents, to the extent that they exist and are in the
possession of the European Commission, would not only provide information about the
legal and technical arguments raised by Luxembourg and McDonald’s, but would also
undoubtedly reveal the European Commission’s strategy and its preliminary assessment
of the case.
Furthermore, in its initial reply, the Directorate-General for Competition also referred to
Article 4(2) first indent, which provides that ‘[t]he institutions shall refuse access to a
document where disclosure would undermine the protection of commercial interests of a
natural or legal person, including intellectual property, […], unless there is an overriding
public interest in disclosure’.
However, in your confirmatory application, you argued that your request ‘[…] does not
aim at accessing sensitive information relating to undertakings but at having full
knowledge mainly of Luxembourg and McDonald’s legal and technical arguments […]’.
Furthermore, you argued that the Directorate-General for Competition ‘[…] does not
state the type of “commercial and market-sensitive information regarding the activities of
the potential beneficiaries whose public disclosure would undermine the latter’s
commercial interests” ’ and ‘[…] does not provide information about how it assesses that
information is “commercial and market-sensitive”
’.
I am unable to agree with these statements.
As a preliminary point, please be informed that, for the specific cases where a general
presumption of non-accessibility applies, all documents in the file are covered by that
presumption. Contrary to what you state in your confirmatory application, the institution
is, therefore, not required to carry out a specific and individual assessment of the content
of each requested document. Consequently, there is no obligation to explain what type of
commercially and market-sensitive information is contained in the requested documents.
Furthermore, I note that natural and legal persons submitting information to the European
Commission have a legitimate right to expect that the information they supply on an
obligatory or voluntary basis will not be disclosed to the public. This legitimate right
arises from the specific provisions concerning the professional secrecy obligation, which
provides for documents to be used only for the purposes for which they have been
gathered, and the special conditions governing access to the European Commission's file.
In the
Odile Jacob12 judgment, the Court of Justice held that the publication of sensitive
information concerning the economic activities of undertakings subject to a control
procedure by the European Commission is likely to harm their commercial interests even
12
Judgment in
Commission v Editions Odile Jacob, cited above, paragraphs 123 and 124.
5
after the control procedure has been concluded. Therefore, the Court of Justice held that a
general presumption of non-disclosure of the documents in the European Commission's
case file applies, irrespective of whether a request for access concerns proceedings that
have already been closed or proceedings that are pending. The Court specifically
recognised that granting access to such documents would undermine the protection of the
objectives of the investigation activities and also of the commercial interests of the
undertakings involved.13 Although the
Odile Jacob judgment concerned a merger control
investigation, this reasoning applies by analogy to state aid proceedings.
The documents in question, which are part of a state aid investigation file, have not been
made available to the public and contain business and market-sensitive information
regarding the undertakings involved, the public disclosure of which would significantly
harm the commercial interests of these companies. In this respect, please note that the
European Commission is largely reliant on the cooperation of third parties in order to
collect the necessary evidence and to issue a final decision. Careful respect by the
European Commission of its obligations regarding professional secrecy has so far created
a climate of mutual confidence between the European Commission and undertakings,
under which the latter have cooperated by providing the former with the information
necessary for its investigations. Indeed, if this kind of sensitive information were
disclosed to the public, this would lead to a situation where undertakings subject to
investigations and potential informants and complainants would lose their trust in the
European Commission’s reliability and would become reluctant to cooperate with the
institution. Moreover, the European Commission relies on Member States’ contributions,
which typically also contain commercially sensitive information relating to companies,
and access to such documents would thus also, as already mentioned, undermine the
Member States’ willingness to cooperate.
This, in turn, would jeopardise the European Commission’s authority and lead to a
situation where the latter would be unable to carry out properly its task of enforcing EU
competition law.
2.2. Protection of the decision-making process
Article 4(3), first subparagraph of Regulation (EC) No 1049/2001 provides that ‘access
to a document drawn up by an institution for internal use or received by an institution,
which relates to a matter where the decision has not been taken by the institution, shall be
refused if disclosure of the document would seriously undermine the institution’s
decision-making process, unless there is an overriding public interest in disclosure’.
In its initial reply, the Directorate-General for Competition informed you that the
documents to which you request access, to the extent that they exist, form part of the case
file in a state aid investigation under Article 107 of the Treaty on the Functioning of the
EU in which the procedure may not be considered finalised yet, as long as the European
Commission’s decision of 19 September 2018 on tax rulings granted to McDonald’s
Europe is still subject to appeal.
13
Ibid.
6
As already mentioned, revealing the European Commission’s strategy and its preliminary
assessment of the case by disclosing the requested documents to the extent that they exist
would undermine the protection of the purpose of the investigation. Please note that it
would also seriously undermine the European Commission’s decision-making process,
especially in case an appeal is filed and a decision of the Court is adopted that would
prompt the European Commission to resume the investigation. As the Directorate-
General for Competition has righty pointed out, the European Commission’s services
must be free to explore all possible options in the preparation of a decision free from
external pressure, in case the investigation is reopened. The disclosure to the public of
the documents in question would thus seriously undermine the effective enforcement of
Article 107 of the Treaty on the Functioning of the European Union.
Against this background, I confirm that the documents falling under the scope of your
application with the reference number Gestdem 2018/5758 need to be protected against
the risks associated with their public disclosure under the exceptions provided for in the
first and third indents of Article 4(2) and Article 4(3) first subparagraph of Regulation
(EC) No 1049/2001.
3.
NO PARTIAL ACCESS
I have also examined the possibility of granting partial access to the documents
concerned, in accordance with Article 4(6) of Regulation (EC) No 1049/2001.
However, it follows from the assessment made above that the documents that fall within
the scope of your request are manifestly and entirely covered by the exceptions laid down
in Article 4(2), first and third indents of Regulation (EC) No 1049/2001.
It must also be underlined that the Court of Justice confirmed that a presumption of non-
disclosure excludes the possibility to grant partial access to the file.14
4.
NO OVERRIDING PUBLIC INTEREST IN DISCLOSURE
The exceptions laid down in Article 4(2) and Article 4(3), second subparagraph must be
waived if there is an overriding public interest in disclosure. Such an interest must,
firstly, be public and, secondly, outweigh the harm caused by disclosure.
14
Judgment of 25 March 2015,
Sea Handling v Commission, cited above, paragraph 93.
7
As a preliminary remark, it must be noted that the General Court recently confirmed
again that the right of access to documents does not depend on the nature of the particular
interest that the applicant for access may or may not have in obtaining the information
requested.15
In your confirmatory application, you argued that McDonald’s is not like any other
company as ‘[i]ts business practices touch every corner of the world and reverberate
throughout the global economy’ and ‘[it] has a track record of low-wage jobs, tax
avoidance and conflicts with its workers […]’. You provide a series of reports to support
your claim.
Irrespective of the question of whether these allegations are correct (which is not the
subject matter of this decision), I consider that these arguments are not relevant for the
current assessment.
As already mentioned, in its decision of 19 September 2018, the European Commission
held that the tax rulings granted to McDonald’s Europe by the Luxembourgish authorities
did not result in state aid. I consider that the release of the non-confidential version of the
above-mentioned decision has brought the requested transparency and availability of
information to the public required to ‘enhance the quality of the public debate on tax
planning practices’ and also to ‘contribute to the public debate about the relationship and
actions that companies apply with tax authorities’. It also brings clarity on the
interpretation and application of the US-Luxembourg Double Tax Treaty.
Finally, please be informed that the draft bill that will amend the relevant provisions in
Luxembourg’s tax legislation to which you referred to in your confirmatory application
has now been adopted by the Luxembourgish parliament. The non-confidential version of
the European Commission’s decision of 19 September 2018, which is now published,
will in my view allow you to assess whether the bill ‘close[s] the loophole in
Luxembourg’s legislation’.
Therefore, following this analysis, I have not been able to establish the existence of any
overriding public interest in the disclosure of the document in question.
Consequently, I
consider that in this case there is no overriding public interest that would outweigh the
public interest in safeguarding the protection of the purpose of investigations,
commercial interests and the decision-making process protected by the first and third
indents of Article 4(2) as well as by Article 4(3), second subparagraph, of Regulation
(EC) No 1049/2001.
15
Judgment of 27 November 2018,
VG v Commission, joined Cases T-314/16 and T-435/16,
EU:T:2018:841, paragraph 55
.
8
5.
MEANS OF REDRESS
Finally, I would like to draw your attention to the means of redress that are available
against this decision, that is, judicial proceedings and complaints to the Ombudsman
under the conditions specified respectively in Articles 263 and 228 of the Treaty on the
Functioning of the European Union.
Yours sincerely,
For the European Commission
Martin SELMAYR
Secretary-General
9