On December 2, 2020, the Regional Court of Bonn dismissed BayWa AG’s (“BayWa”) action for state liability against the Republic of Germany and the FCO for a breach of the constitutional prohibition of discrimination in the context of the FCO’s leniency program.
BayWa claimed damages of around €73 million— consisting of the fine the FCO imposed against BayWa for participating in the plant protection products cartel as well as its counsels’ fees. The action was based on the FCO’s unfair treatment of BayWa and other wholesalers of plant protection products during its antitrust proceeding from 2014 to 2020. In 2014, the FCO received an anonymous complaint, claiming that BayWa and all its competitors in the wholesale of plant protection products had agreed on a method to calculate list prices. Upon receipt of that complaint, an official of the FCO called three of BayWa’s main competitors, informing them about the anonymous complaint and advised them to apply for immunity under the FCO’s leniency program. As a result, two competitors immediately applied for immunity, with the first one receiving full immunity.
BayWa argued that the selective tip to three out of the 12 potential cartelists infringed the constitutional principle of equal treatment as well as the leniency program itself. According to BayWa, it is not for the FCO to decide, by way of selective tips, which company wins the race for immunity under the leniency program. If BayWa had also received the same tip, it would have won the immunity race and avoided the claimed damages (fine and counsels’ fees).
The Regional Court of Bonn dismissed BayWa’s action, mainly arguing that:
The selection of the three competitors was not arbitrary and within the FCO’s general discretionary and investigatory powers. The FCO’s leniency program does not impose a duty on the FCO to conduct its investigation in a certain manner. Specifically, the court dismissed a violation of the equality principle. First, the court emphasized that there is no right of equal treatment between wrongdoers. Second, the court noted that BayWa was the only firm explicitly mentioned in the anonymous complaint, which justified the FCO to not to contact BayWa.
The principle of fair trial as laid down in Article 6 ECHR is not applicable, as it only ensures equality of arms vis-à-vis the opponents in proceedings, not between the defendants themselves.
BayWa could not establish causality between the FCO’s tips to competitors and the imposed fines—in particular, the cartel could have been uncovered without the allegedly illegal selective tip at a later point in time.
BayWa could have appealed the FCO’s fining decision to the DCA and raised its constitutional claims in that context. As a result, there is no basis for raising those claims later in a state liability action.
On December 12, 2020, BayWa appealed the Regional Court of Bonn’s judgment. The Court of Appeal will thus be called to decide the questions concerning the interplay between the FCO’s investigatory powers and its duties under the leniency program.