Cookies on Pinsent Masons website

Our website uses cookies and similar technologies to allow us to promote our services and enhance your browsing experience. If you continue to use our website you agree to our use of cookies.

To understand more about how we use cookies, or for information on how to change your cookie settings, please see our Cookie Policy.

Comments on Credit Agricole amount to 'maladministration' in Euribor probe

Public statements by former EU competition commissioner Joaquín Almunia about an ongoing cartel investigation involving Crédit Agricole created a public impression of bias, and amount to maladministration, European ombudsman Emily O'Reilly has said. 16 Mar 2015

Crédit Agricole complained about eight public statements made by Almunia that suggested the former commissioner had already reached a conclusion or assumed wrongdoing in the investigation, which was looking into a possible cartel set up to manipulate the Euribor interest rate benchmark, O'Reilly said in a statement.

Deutsche Bank, Société Générale and the Royal Bank of Scotland all admitted to jointly manipulating Euribor in 2013, and were fined around €1 billion (US$1.06 billion). HSBC, JP Morgan and Crédit Agricole held out against a settlement at the time, but were formally charged in May 2014, the Financial Times said.

Among other statements, Almunia had described the evidence as "quite telling" and said that the investigation was "not the most difficult in the world", the ombudsman said.

O'Reilly stressed in her draft recommendation that the principles of good administration require EU institutions not only to take impartial decisions, but also to be perceived to be impartial throughout the procedure.  They must therefore avoid actions that could lead to the impartiality being called into question.

The ombudsman clearly considered that Almunia's statements went beyond what could be justified and created the impression Almunia had already made up his mind about Crédit Agricole's alleged participation in the cartel before the investigation was complete, competition law expert Robert Eriksson of Pinsent Masons, the law firm behind, said.

Crédit Agricole was subject to a dawn raid by the Commission in October 2011, in relation to the Euribor case, Eriksson said. "But following such an inspection, the Commission is always careful to stress that the inspection does not mean that the raided entity has necessarily breached competition law. The Commission did not open its formal investigation until March 2013, yet Almunia made some of these public statements in 2012."

The Commission argued that Almunia felt a need to be transparent, and only made general comments. But to comment on the quality of evidence and even on sanction levels before the Commission had even opened its formal investigation is unusual, Eriksson said.

"It's not clear whether this was a deliberate attempt to encourage parties to settle, but it's worth noting that there is an increasing trend for the Commission to settle cartel cases as this accelerates proceedings and frees up its finite resources for other cases. However, it's important to ensure that this does not reduce the quality of its proceedings. Also, because settled cases present less detail on the Commission's assessments, the insight into its developing case law might be reduced," he said.

The ombudsman has now made the draft recommendation to the Commission to acknowledge the maladministration that occurred, apologise and take steps to avoid similar problems in the future.

She also urged the Commission to issue guidelines on statements by commissioners about ongoing investigations, and invited it to reply by 30 June. 

Almunia has been succeeded by Margrethe Vestager. O'Reilly said that because proceedings are still pending, and because a new commissioner is now in charge, it is unlikely that the maladministration will affect further handling of the case.