When, or if, you hear the hurdy-gurdy sound of an ice-cream van this summer, it is unlikely, unless you are a particular type of lawyer, that you will begin to reflect on Ireland's relationship with the European Union.
But if you were a competition lawyer, you'd think instantly, as lawyers do, of the seven-year dispute between Unilever and Mars over the way ice-cream freezer compartments are placed in shops. You'd think of the ruling last week by the European Court of First Instance suspending the implementation of the European Commission's ruling against Unilever.
The immediate issue is whether the supply of freezers to retailers by Unilever's Van den Bergh subsidiary, which sells HB ice-cream in Ireland, is anti-competitive, because of a condition of the supply that only HB products can be kept in the freezer. The Irish High Court permitted the exclusivity provisions, but the European Commission had earlier this year ruled against the practice as being contrary to EU competition law. This newspaper reported the reaction to the Court of First Instance's ruling by both sides, Unilever (pleased) and Mars (disappointed), with both couching their respective stances as being in consumers' interests, as giant consumer goods manufacturers will do. This dispute is about a lot more than what consumers want, and even about a lot more than profits on ice-cream sales in Ireland. It illustrates, once again, the practical reach of the EU and the power of the Commission in competition law.
The Financial Times carried a piece by Brick Court Chambers in Brussels which stated that the Court had noted "an apparent contradiction" between the views of the Irish courts and the Commission on the legality of the exclusivity provisions. The Court said: "Enforcement of competition rules was a shared competence between the Commission and the national courts. This conflict jeopardised legal certainty. Adverse consequences `of the uncertainty' should be limited as much as possible."
I wonder how often officials in the Commission reminded themselves that enforcement of competition rules was a shared competence with national courts. In the complex area of competition law, the European Commission has always had special powers. It is no coincidence that the Euro-enthusiast par excellence, Peter Sutherland, was commissioner for competition. His successor, Karel Van Miert, has turned the screw on the International Financial Services Centre, by bringing forward to 1999 the deadline by which new IFSC projects can secure the 10 per cent tax rate. As "good Europeans", we are supposed to reflect that we consciously voted for each and every provision of the Treaty of Rome and all its successors. Indeed we did. But as good democrats, we might well question whether the way competition law, as but one example, is judged and enforced is sufficiently democratic. Just because some area of policy has become part of the "acquis communautaire" does not mean that it is operated democratically or even effectively.
The ice-cream decision came amid the higher profile comments about our inflationary dangers by the new head of the European Central Bank. Charlie McCreevy brushed off the comment by Wim Duisenberg, but Garret FitzGerald showed how, procedurally, the Commission's view on Irish budgets could end up with a recommendation which might, he said, unsettle the markets' rating of Irish government debt. You could quibble that it is unlikely that markets will wait for the long procedure and a Commission warning to take a view on Irish fiscal policy. But the point is clear. The Commission is watching our budget policy, while the European Central Bank will control our monetary policy.
Irish inflation will always be a very minor factor in decisions on Euro interest rates. Euro interest-rate policy can only suit us to the extent that we become integrated with and indistinguishable from the major Euro-zone economies. The question now is not whether we should pull out, but how will we know if we are being looked after by the Commission and the ECB, and not just being looked at?
The EU executive must be challenged and held to account with the same alacrity that the Commission wields its powers. So, well done to the European Court of First Instance. Well done, Unilever. When will we say in this context, well done, Ireland?
