Objective Territorial Principle or Effects Doctrine? Jurisdiction and ...

In.Law | 6 (2006) | 289
territory. In this regard, the theoretical difference between the effects doctrine
and the objective territorial principle was not negligible. 22 The objective territorial
principle was capable of demonstrating meaningful limits of extraterritorial
jurisdiction: when there is no intra-territorial act, the exercise of extraterritorial
jurisdiction is not permitted. The effects doctrine theoretically removed this limit,
by justifying the exercise of jurisdiction even when there was no intra-territorial
act, and the alternative limit it offered was unclear.
The reactions to the 1989 Wood Pulp case 23 heard by the European Court
of Justice stressed this theoretical difference between the effects doctrine and
the objective territorial principle. 24 The case involved a cartel of manufacturers
located outside the European market. The cartel agreement included price-fixing
for customers in the European Community, but the manufacturers involved had
no base within the Community territory. Thus, they challenged jurisdiction of
the Community, arguing that the alleged offence had taken place outside the
Community. The court, however, avoided discussing the effects of this offence as
a basis of jurisdiction. Instead, it “concentrate[d] on the place of implementation
of the agreement” 25 as something that actually occurred in the European market.
In other words, the court used a “fiction that there was some quasi-territorial
basis for jurisdiction.” 26 It meant that the court preferred the objective territorial
principle to the effects doctrine, and was therefore a relief to those who were
skeptical about the effects doctrine: the basis of jurisdiction in the Wood Pulp case
was “significantly narrower than the ‘effects’ doctrine in its most extreme form”. 27
While the Gencor case 28 a decade later does indicate a certain degree of acceptance
22 D. W. Bowett, Jurisdiction: Changing Patterns of Authority over Activities and Resources, 53
Brit. Y.B. Int’l L. (1982), p. 7; Roger O’Keefe, Universal Jurisdiction: Clarifying the Basic Concept, 2
J. Int’l Crim. Just. (2004) p. 739; Lowe, supra note 4, p. 339.
23 Ahlstrom and Others v. Commission of European Communities [1988] ECR 5193 [hereinafter
referred to as the Wood Pulp case].
24 Malcolm N. Shaw, International Law (5th ed. 2003), pp. 618-20; Antonio F. Bavasso, Boeing/McDonnell
Douglas: Did the Commission Fly Too High, 19 Eur. Competition L. Rev. (1998), pp.
244-45.
25 Stephen Weatherill & Paul Beaumont, EU Law (1999), p. 812 (emphasis in the original).
26 Dieter G. F. Lange & John Byron Sandage, The Wood Pulp Decision and its Implications for
the Scope of EC Competition Law, 26 Comm. Market L. Rev. (1989), p. 157. See also Dupuy, supra
note 4, p. 85.
27 Vaughan Lowe, International Law and the Effects Doctrine in the European Court of Justice, 48
Cambridge L.J. (1989), p. 11.
28 Gencor Ltd v. Commission of the European Communities (T102/96, Court of First Instance,
25 March 1999).