CELEX: 62011TJ0090
Competition
Agreements, decisions and concerted practices
French market for clinical laboratory tests
Decision finding an infringement of Article 101 TFEU
Association of undertakings
Professional association
Subject-matter of the inspection and the investigation
Conditions for the application of Article 101 TFEU
Infringement by object
Minimum price and barriers to the development of groups of laboratories
Single and continuous infringement
Proof
Errors of assessment of fact and errors of law
Point 37 of the 2006 Guidelines on the method of setting fines
Unlimited jurisdiction

Background to the dispute
By Decision C(2010) 8952 final of 8 December 2010 relating to a proceeding pursuant to Article 101 [TFEU] (Case 39.150 — Labco/ONP) (‘the contested decision’), the European Commission found that the applicants, the Ordre national des pharmaciens (National Association of Pharmacists) (ONP) and its decision-making organs, the Conseil national de l’Ordre des pharmaciens (National Council of the Association of Pharmacists) (CNOP) and the Conseil central de la Section G de l’Ordre national des pharmaciens (Central Council of Section G of the Association of Pharmacists) (CCG) (together ‘the Association’), infringed Article 101 TFEU by taking, first, decisions having the object of imposing minimum prices on the French market for clinical laboratory tests and, second, decisions aimed at imposing restrictions on the development of groups of laboratories on that market (Article 1 of the contested decision) and ordered them, jointly and severally, to pay a fine of EUR 5 million (Article 3 of the contested decision).
As described at recitals 44 and 45 to the contested decision, the ONP is a French professional association to which the French State has delegated four main functions which define its public service remit. The ONP and its councils are governed by the French Code de la santé (Public Health Code) (‘the CSP’), which provides as follows in Article L 4231-1:
‘The [ONP] shall have as its objects:
1.
to ensure compliance with professional duties;
2.
to ensure the defence of the honour and independence of the profession;
3.
to supervise the competence of pharmacists;
4.
to contribute to promoting public health and the quality of healthcare, and in particular the reliability safety of professional procedures.
The [ONP] shall comprise all pharmacists practising their profession in France.’
The activities and tasks of the ONP, the pharmacists’ Code of Ethics and the organisation of ONP are described at recitals 44 to 62 to the contested decision. It is apparent, in particular, that the ONP draws up and maintains the national register of pharmacists (‘the register’), inclusion on the register being a statutory precondition to the exercise of an activity related to the profession of pharmacist (Articles L 4221-1, L 4232-3 and L 4232-16 of the CSP).
The relevant market is the market for clinical laboratory tests in France. It is described at recitals 5 to 38 to the contested decision. As regards the market players, the contested decision states that, in France, clinical biochemistry is mainly practised by pharmacists, which explains the predominant role played by the ONP, while the Ordre des médecins (Medical Association) has an identical role vis-à-vis biochemist-physicians (recital 11). Clinical laboratory tests can be carried out only in clinical test laboratories (also referred to hereinafter as ‘laboratories’) under the responsibility of their directors and deputy directors (recital 12). The laboratories are often small (50% have a turnover below EUR 1.5 million and 30% operate as one-person firms), although several groups of laboratories operate in France (recitals 13 and 14).
The main group of laboratories, namely the intervener, Labco, a European group of laboratories active in particular in France and Spain, and also in a number of other European countries, is described at recitals 14 to 17 to the contested decision. Other significant groups of laboratories active in France are Unilabs SA, which is also active in a number of countries inside and outside the European Union, and the financial holding company Générale de santé (recitals 18 and 19). There are also two groups of specialised laboratories, Pasteur Cerba and Biomnis, which offer a different range of services from the other laboratories, specialising in highly technical services (recitals 20 to 22).
The French legal framework within which the laboratories have developed is described at recitals 63 to 109 to the contested decision.
The procedure was initiated following a complaint lodged on 12 October 2007 by Labco, relating to decisions taken by the Association aimed at slowing down Labco’s development and limiting its capacity to compete with other laboratories on the market for clinical biology tests, whose owners elect the officers of the Association (contested decision, recitals 110 and 111).
An inspection took place on 12 and 13 November 2008 at the premises of the Association and those of the Champagnat-Desmoulins-Philippakis laboratory, in accordance with Article 20(4) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 [EC] and 82 [EC] (
OJ 2003 L 1, p. 1
). The two decisions forming the basis of those inspections, including Commission Decision C(2008) 6494 of 29 October 2008 in Case COMP/39.150, ordering the Association to submit to an inspection (‘the inspection decision’), were challenged before this Court (Case T-23/09
CNOP and CCG
v
Commission
[2010] ECR II-5291, and order of 16 June 2010 in Case T‑24/09
Biocaps
v
Commission
, not published in the ECR).
During 2009 the Commission sent requests for information to the Association and also to five professional partnerships (
sociétés d’exercice libéral
; ‘SEL’), to which they replied. The statement of objections was adopted on 19 October 2009. The Association replied on 11 January 2010. The hearing took place on 10 February 2010. The Commission sent a request for further information to the Association on 26 February 2010, to which it replied.
In the contested decision, the Commission finds, in essence, that decisions adopted by the Association were decisions by an association of undertakings amounting to restrictions of competition by object and constituting a single and continuous infringement of Article 101 TFEU which had begun at least in October 2003 and had not apparently come to an end, even after notification of the statement of objections. The conduct in question concerned all decisions of the Association, taken in the economic interest of the majority of its members and not in the general interest, with the complementary and inseparable objects, first, of preventing groups of laboratories from developing and, second, of attempting to impose a minimum price on the French market for clinical laboratory tests.
As regards the calculation of the amount of the fine, the Commission states that, since this is the first case since the entry into force of Regulation No 1/2003 in which the financial liability of the members of an association of undertakings could be invoked in order to guarantee payment of part of the fine imposed on the association, since the members might not have been fully aware of the scope of the legal provisions at issue and since the conduct complained of was not secret, it applied point 37 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003 (
OJ 2006 C 210, p. 2
; ‘the Guidelines’). It therefore disregarded the general method set out in those Guidelines and set the amount of the fine imposed jointly an severally on the ONP, the CNOP and the CCG at EUR 5 million, a sum not exceeding 10% of the sum of the total turnover attained by each member active on the affected market.
Procedure and forms of order sought
By application lodged at the Court Registry on 21 February 2011, the Association brought the present action.
By documents lodged at the Court Registry on 22 July 2011, Labco and Unilabs sought leave to intervene in support of the form of order sought by the Commission. By order of the President of the Third Chamber of the Court of 8 November 2011, those two companies were granted leave to intervene. Unilabs informed the Court, by letter lodged on 19 December 2011, that it was withdrawing its application to intervene and was removed from the case by order of the President of the Third Chamber of the Court of 15 February 2012.
Following a change in the composition of the Chambers of the Court, the Judge-Rapporteur was assigned to the Ninth Chamber, to which the present case was therefore assigned.
Upon hearing the Report of the Judge-Rapporteur, the Court (Ninth Chamber) decided to open the oral procedure and, in the context of the measures of organisation of procedure provided for in Article 64 of the Rules of Procedure of the General Court, put a number of written questions to the parties, which answered them within the period prescribed.
The parties presented oral argument and answered the oral questions put to them by the Court at the hearing on 6 February 2014.
The Association submits, in essence, that the Court should:
—
annul the contested decision;
—
in the alternative, reduce the amount of the fine imposed on it, taking into account certain mitigating circumstances and its special characteristic as an association of undertakings;
—
order the Commission to pay the costs.
The Commission, supported by Labco, contends that the Court should:
—
dismiss the action;
—
order the Association to pay the costs.
Law
The Association submits, first, a claim for annulment, which is supported by nine pleas in law, and, second, an alternative claim for a reduction of the amount of the fine, which is supported by a single plea, alleging an error of assessment and of interpretation in the application of Article 23(2) and (4) of Regulation No 1/2003 and point 37 of the Guidelines.
1.
The claim for annulment
In support of its claim for annulment, the Association puts forward, in essence, nine pleas.
The first plea alleges an error of interpretation and application of Article 101 TFEU in the light of Case
C-309/99
Wouters and Others
[2002] ECR I-1577
(‘the judgment in
Wouters
’).
The second, third, fourth, fifth and sixth pleas concern the conduct aimed at the development of groups of laboratories.
More specifically, the second and third pleas concern the SELs’ obligations to communicate certain information during their lifetime. The second plea concerns, in essence, an error of assessment resulting from the misinterpretation of the French legislation as regards the respective roles of the prefect and the CCG with regard to changes taking place during the lifetime of an SEL. The third plea alleges, in essence, failure to take account of the scope of the obligation to communicate information laid down in the French legislation and of the role of the CCG in the context of its
a posteriori
verification of company documents.
The fourth and fifth pleas concern the regime relating to the composition and modification of the capital of SELs. The fourth plea relates, in essence, to failure to take account of the role of the CCG as guarantor of the professional independence of partners as regards their minimum shareholding in the capital of SELs. The fifth plea alleges, in essence, an error of assessment of the legislature’s intention as regards the dismemberment of shares in SELs above a ceiling of 25% and failure to take account of the legal framework applicable to the dismemberment of shares in SELs.
The sixth plea alleges, in essence, an error in the interpretation and application of Article 101 TFEU in so far as the disciplinary measures imposed are found to exacerbate the potential or actual effects of the decisions in question.
The seventh, eighth and ninth pleas concern the conduct involving intervention in market prices.
The seventh plea, which is raised as a main plea, alleges, in essence, a misuse of powers owing to failure to observe the limits of the terms of reference of the inspection order. The eighth and ninth pleas, which are raised in the alternative, concern, respectively, in essence, an error of assessment of the scope of the applicable legal framework and of the legislature’s intention as regards the definition and practice of discounts and an error of assessment of the facts, giving rise to an error of law.
Last, in the reply, the Association appears also to call into question the Commission’s findings relating to the existence of a single and continuous infringement; the Commission disputes the admissibility of this plea.
First plea, alleging an error of interpretation and application of Article 101 TFEU in the light of the judgment in
Wouters
The Association claims that its remit is to protect the independence of the profession and to contributing to promoting public health and the quality of care, in particular the safety of professional procedures, as was confirmed in Case
C-89/09
Commission
v
France
[2010] ECR I-12941
. In the Association’s submission, the Commission ought to have considered that its actions were those of a public authority falling outside the scope of Article 101 TFEU and, moreover, that even on the assumption that it did take decisions in its capacity as an association of undertakings, its actions were justified by the protection of public health.
As regards the specific practices in respect of which it is criticised, the Association observes that the purpose of the obligation placed on laboratories to communicate documents relating to the transfer of shares, the dismemberment of the usufruct and the bare ownership and any changes in the statutes was to ensure that the parties concerned complied with the French legislation.
As regards the changes to the statutes of an SEL and changes of directors during its lifetime, the powers of the CCG are circumscribed, as the final decision with respect to such changes is a matter for the prefect and the Association therefor acts as a public authority, as envisaged in the judgment in
Wouters
, paragraph 21 above. The same applies to the obligation to communicate information in that regard laid down by the CSP, as the CCG’s task of undertaking
a posteriori
verification of the agreements concluded by SELs and the laboratories is defined by law and the information obtained is forwarded to the prefect, who takes the final decision. The Association further submits in the reply that, since, as the Commission claims before the Court, the contested decision is aimed, as regards the respective roles of the prefect and the CCG during changes occurring during the lifetime of SELs, only at decisions relating to entries on the register, the management of that register depends on the approvals.
As for the criticisms of the applicant in the contested decision concerning disciplinary proceedings, the Association maintains that the exercise of disciplinary power comes within the powers of a public authority.
Last, the Association maintains that the Commission does not comment in the contested decision on the application of the judgment in
Wouters
, paragraph 21 above, to its action in relation to the prohibition of excessive discounts. It observes that that conduct is also justified by the protection of public health.
The Commission, supported by Labco, contends that the Association adopted decisions which are decisions by an association of undertakings falling within the scope of Article 101 TFEU in all the circumstances mentioned, as it did not act as a public authority in any of those cases.
In that regard, its should be observed that in the judgment in
Wouters
, paragraph 21 above, the Court recalled a number of principles according to which it could be established in what circumstances the action of a professional body could be described as a decision by an association of undertakings in restriction of competition, contrary to Article 101(1) TFEU.
In the first place, the rules on competition laid down in the FEU Treaty do not apply to activity which, by its nature, its aim and the rules to which it is subject does not belong to the sphere of economic activity, or which is connected with the exercise of the powers of a public authority (judgments in
Wouters
, paragraph 21 above, paragraph 57, and Case C‑1/12
Ordem dos Técnicos Oficiais de Contas
[2013] ECR, paragraph 40).
In the second place, not every decision of an association of undertakings which restricts the freedom of action of the parties or of one of them necessarily falls within the prohibition laid down in Article 101(1) TFEU. For the purposes of application of that provision to a particular case, account must first of all be taken of the overall context in which a decision of the association of undertakings was taken or produces its effects. More particularly, account must be taken of its objectives, which in the present case consist in ensuring that the ultimate consumers of the services in question are provided with the necessary guarantees. It has then to be considered whether the consequential effects restrictive of competition are inherent in the pursuit of those objectives (judgments in
Wouters
, paragraph 21 above, paragraph 97, and in Case C‑136/12
Consiglio nazionale dei geologi et Autorità garante della concorrenza e del mercato
[2013] ECR, paragraph 53).
It follows from that case-law that reasons of general interest, in particular the interest in the proper exercise of a profession, may justify the non-application of Article 101 TFEU to certain restrictions of competition when they are necessary.
In the present case, the Commission considered the applicability of the judgment in
Wouters
, paragraph 21 above, at recitals 684 to 691 to the contested decision. In particular, it rejects the Association’s argument, put forward in its reply to the statement of objections, that the restrictions identified are justified by the protection of public health, a reason in the general interest that removes its conduct from the scope of Article 101 TFEU. According to the Commission, in essence, the Association relies on the principle of the independence of biologists as a means of attaining the objective of protecting public health by giving that principle a broad and debatable interpretation which is systematically unfavourable to contributions of capital from outside the profession even when they do not affect the biologists’ freedom to take decisions and, moreover, imposes restrictions of competition in addition to those imposed by the French legislature, although the Association has no regulatory powers. The Commission also refers to the Association’s practices in relation to pricing, which are not intended to protect the general interest or the independence of the profession, but to protect the economic interests of pharmacist-biologists on the market for clinical laboratory tests, to the detriment of competition and of patients. As the restrictions identified are not necessary for the pursuit of the general interest, the Commission concludes that the exception established in the judgment in
Wouters
does not apply to the present case.
In that regard, it is established that, unlike the professional body concerned in the judgment in
Wouters
, paragraph 21 above, the Association does not have regulatory powers.
It must also be made clear that, unlike the situation in the case giving rise to the judgment in
CNOP and CCG
v
Commission
, paragraph 8 above, it is now no longer disputed that the Association is a professional association of pharmacists, at least some of whom exercise an economic activity and may be regarded as undertakings (paragraphs 70 to 72 of that judgment).
The Association maintains, in essence, that the acts in respect of which it is criticised in the contested decision, summarised at paragraph 10 above, were either adopted in the exercise of its public-authority powers, and therefore fall outside the economic sphere and cannot be regarded as decisions by an association of undertakings for the purposes of Article 101 TFEU, or are decisions by an association of undertakings within the meaning of that provision but, while being restrictive and not meeting the conditions laid down in Article 101(3) TFEU, they are inherent in or necessary to the implementation of a legitimate objective related to guarantees provided to consumers.
In spite of a certain amount of confusion created by the Association in its written submissions and identified by the Commission, it is apparent from the file that the Association considers that, in so far as its practices are not State measures, but, as decisions by associations of undertakings, fall within the scope of Article 101 TFEU, they must not, however, be prohibited. In fact, their restrictive effects are necessary for the pursuit of a legitimate objective, in this instance the protection of public health, where necessary through compliance with the principle of the independence of pharmacist-biologists. The only exception is in the practice relating to changes to the statutes of SELs, when the Association claims to have acted as a public authority in a subordinate role to the prefect, who takes the final decision.
For the majority of the practices in question, the central question for the purpose of determining whether the principles identified in the judgment in
Wouters
, paragraph 21 above, are applicable is therefore whether, as it claims, the Association acted within the limits of the French legal framework. In such a case, its action is covered by an application of the legal provisions and serves to attain the objective intended by the law. That applies as much to its action relating to the development of groups of laboratories as to its action relating to discounts.
However, as regards the specific application of the principles identified in the judgment in
Wouters
, paragraph 21 above, to the conduct in question, even though the Association defines the present plea as being preliminary to the other pleas, the Court considers it appropriate to answer this plea after it has examined the complaints put forward by the Association in the context of the other pleas concerning the interpretation of the applicable legal provisions and the Association’s actual practices. The applicability of the principles identified in the judgment in
Wouters
, paragraph 21 above, to the present case will therefore be addressed after the Court has examined the pleas relating to the claim for annulment.
None the less, it is appropriate to examine at this stage the argument which the Association derives from the judgment in
Commission
v
France
, paragraph 29 above. As stated at recitals 695 and 696 to the contested decision, that judgment concerns the question whether the French rules on biomedical analysis laboratories containing restrictions on the holding of capital by non-biologists is compatible with Article 49 TFEU on freedom of establishment.
In that judgment, the Court considered that the rule that the shareholding of shareholders not pursuing the profession of biologist in the capital of laboratories could not exceed 25%, now laid down in Article R 6212-82 of the CSP, did not go beyond what was necessary for attaining the public-health objective relied on (paragraphs 80 to 89). At paragraph 82 of the judgment, the Court observed that the discretion of the Member State, which may take the view that there is a risk that rules designed to ensure the professional independence of biologists would not be observed in practice, given that the interest of a non-biologist in making a profit would not be tempered in the same way as that of self-employed biologists and that, if biologists, as employees, were in a subordinate position with respect to an SEL with limited liability operating clinical test laboratories in which non-biologists held the majority of shares, they could make it difficult for them to oppose instructions given by those non-biologists. The Court added, in the same paragraph, that it cannot be excluded, inter alia, that such non-biologists would be tempted to refuse to carry out tests that were less profitable or more complicated to perform, or to cut down on the advice given with regard to patients at the pre-analysis and post-analysis stages, the existence of which is a feature of the organisation of medical biology in France.
Although the rules whose application the Association claims to ensure in the context of the conduct penalised in the contested decision are of the same type, the Commission maintains, at recital 102 to the contested decision, that none of the complaints against the Association relates to decisions adopted by the Association with the aim of ensuring compliance with Article R 6212-82 of the CSP. That question will also be examined further in the context of the pleas relating to the conduct aimed at the development of groups of laboratories.
In any event, the Commission correctly maintains that that case-law is not decisive for the purpose of determining whether the Association’s conduct constitutes an infringement of Article 101(1) TFEU. As the Commission asserts at recital 696 to the contested decision, recognition of the power of the Member States to restrict freedom of movement by invoking the protection of public health does not authorise private players or their representative bodies to ignore the Treaty rules on competition law by imposing restrictions on competition for which the State itself does not make provision.
The question whether the Commission correctly applied the judgment in
Wouters
, paragraph 21 above, and therefore the final answer to the first plea, will therefore be addressed after the Court has examined the pleas for annulment of the contested decision.
The pleas concerning the conduct aimed at the development of groups of laboratories
Before examining the specific complaints put forward by the Association in relation to the conduct at issue, it is appropriate to recall, by way of preliminary observation, the broad outlines of the content of the contested decision relating to that conduct, the principles relating to the standard of proof and the extent of judicial review, and also to examine the scope of the complaints put forward by the Association.
The Association’s conduct aimed at the development of groups of laboratories consists of four types of decision, identified at recital 127 to the contested decision: first, decisions aimed at prohibiting the dismemberment of shares in SELs; second, decisions aimed at requiring that share movements be immediately notified to the ONP; third, decisions aimed at requiring that pharmacist-biologists hold a minimum shareholding; and, fourth, decisions aimed at requiring that any change in the statutes or appointment of a director be conditional on the prior approval of the Association. That conduct is examined in detail in Chapter 5.2 of the contested decision (recitals 222 to 494). Recitals 667 to 676 summarise the consequences, as follows:
‘…
(667)
As described in Chapter 5.2 … the evidence shows that decisions were aimed at laboratories having links with groups with the objective of slowing down, and if possible putting a stop to, the development of such groups, and thus limiting or controlling production, technical development and investments.
(668)
This objective is illustrated, in particular, by the minutes of a meeting of an ONP body held on 27 March 2003[:] “From a strictly legal perspective, it does not seem possible to oppose the dismemberment of interests or shares in an SEL … the Council decides that a detailed opinion should be drawn up showing that dismemberment in favour of Stés Unilabs should be rejected for ethical reasons”. It is also illustrated by the Section G management team’s draft electoral programme in 2005[,] which refers to financial groups. stating: “There can be no doubt, we have hit the target, it must be knocked down.”
(669)
The decisions in question can be seen from March 2003, when a policy emerged within the ONP according to which “a new doctrine” was to be developed, according to which “the dismemberment of shares in favour of Stés Labco should be rejected”, and at the latest as from October 2003, and thereafter in 2004, in the form of letters sent by the ONP to the laboratories having links with groups. As far as the Commission is aware, the ONP continues to behave in this way.
(670)
A number of factors make it possible to discern the economic objective of restricting competition in the market pursued by the ONP through this second type of behaviour. The risk to competition posed for the many small laboratories active in the market was quickly identified by the ONP, which focused its actions on one factor, namely control of the capital. The ONP thus penalised failures to comply with supposed obligations in respect of ownership of the capital and the communication of documents relating to developments in the SELs, with the aim of impeding or slowing down the development of these groups of laboratories.
(671)
As shown in numerous documents in the case file which are described in Chapter 5.2, such as “Clinical biochemistry and its financiers”, or “List of Labco complaints by SEL”, the ONP organised for those purposes a systematic hunt for laboratories having links with groups. At the same time, the ONP, just as systematically, initiated disciplinary action against the laboratories in question and the pharmacists practising in them (see Chapter 5). The factor common to all the laboratories and pharmacists referred to in the documents and decisions mentioned in Chapter 5.2 above is that they belong to groups of laboratories (in particular Labco, Unilabs and Confindex) which in the ONP’s view represent a danger of competition with the majority of its members.
(672)
The groups’ shareholdings in the laboratories enable the latter to invest in high-performance equipment in order to achieve economies of scale, to develop the range of tests on offer, and deliver the results more quickly, as explained in Chapter 2.2.2.2. The ONP and, in particular, the managing bodies of Section G cannot be unaware of the increases in quality, speed and productivity that the most recent laboratory equipment has made possible, particularly given that two hospital biologists sit on the Central Council of Section G.
(673)
Moreover, even if the view were to be taken that the disciplinary penalties imposed by the ONP on laboratories belonging to one of the groups targeted by its decisions are legally justified, the sanctions are objectively disproportionate, especially when set alongside the penalties imposed for non-compliance with a quality standard (obligatory since 1994) by approximately one third of the laboratories active in the market, and those generally imposed by the ONP on SELs or pharmacist-biologists for serious public health reasons, as explained in Chapter 5.4.
(674)
Last, as shown in Chapter 5.2, the ONP’s justifications for the decisions designed to restrict development in the market by groups of laboratories are in conflict with the arguments it has put forward in support of the positions it has adopted in relation to the so-called reference laboratories, which are not in direct competition with the large majority of laboratories active in the market.
(675)
Thus, the defence of “the independence of practising professionals” may, according to the ONP, be based on other criteria when the laboratories in which such professionals practise are not in competition with those whose economic interests the ONP champions. What is more, the legal mechanisms disputed by the ONP have had their legality clearly affirmed by the French State on numerous occasions. Moreover, the ONP cannot claim to be championing professionals when the French State did not consider it necessary to impose restrictions on transactions exclusively between professionals (natural or legal persons (SELs)) on grounds of undermining professional independence. In this case, the ONP, which does not have regulatory powers, cannot substitute itself for the [legislature] to impose these restrictions.
(676)
By impeding the economic activities of professionals active in the market or preventing external capital from being invested in the market, the ONP is aiming to limit or control production, technical development and investment.’
As regards the rules on evidence, it has consistently been held that the Commission must prove the infringements which it has found and adduce evidence capable of demonstrating to the requisite legal standard the existence of the facts constituting an infringement (Case
C-185/95 P
Baustahlgewebe
v
Commission
[1998] ECR I-8417
, paragraph 58, and Joined Cases T‑44/02 OP, T‑54/02 OP, T‑56/02 OP, T‑60/02 OP and
T-61/02 OP
Dresdner Bank and Others
v
Commission
[2006] ECR II-3567
, paragraph 59).
Thus, the Commission must adduce precise and consistent evidence to justify its view that the infringement took place (Joined Cases
29/83 and 30/83
Compagnie royale asturienne des mines and Rheinzink
v
Commission
[1984] ECR 1679
, paragraph 20, and judgment of 8 July 2008 in Case T‑54/03
Lafarge
v
Commission
, not published in the ECR, paragraph 55). The evidence adduced by the Commission must therefore permit the conclusion beyond all reasonable doubt that there was an infringement (
Dresdner Bank and Others
v
Commission
, paragraph 53 above, paragraphs 137 and 144).
As regards the evidence which may be invoked in order to establish the infringement of Article 101 TFEU, the prevailing principle in EU law is the unfettered evaluation of evidence (Case
T-50/00
Dalmine
v
Commission
[2004] ECR II-2395
, paragraph 72, and Case
T-112/07
Hitachi and Others
v
Commission
[2011] ECR II-3871
, paragraph 64).
The items of evidence on which the Commission relies in the contested decision in order to prove the existence of an infringement of Article 101(1) TFEU must not be assessed separately, but as a whole (Case
48/69
ICI
v
Commission
[1972] ECR 619
, paragraph 68, and Case
T-53/03
BPB
v
Commission
[2008] ECR II-1333
, paragraph 185). Different pieces of evidence may reinforce each other (
T-67/00, T-68/00, T-71/00 and T-78/00
JFE Engineering and Others
v
Commission
[2004] ECR II-2501
, paragraph 275).
As regards judicial review of a decision applying Article 101 TFEU, it is settled case-law that, where the Court hears an action for the annulment of such a decision, it must undertake a comprehensive review in order to ascertain whether or not the conditions for applying that article are met (Case
42/84
Remia and Others
v
Commission
[1985] ECR 2545
, paragraph 34, and Case
T-41/96
Bayer
v
Commission
[2000] ECR II-3383
, paragraph 62). Not only must the Courts of the European Union establish, among other things, whether the evidence relied on is factually accurate, reliable and consistent but also whether that evidence contains all the information which must be taken into account in order to assess a complex situation and whether it is capable of substantiating the conclusions drawn from it (see Case
C-386/10 P
Chalkor
v
Commission
[2011] ECR I-13085
, paragraph 54 and the case-law cited).
In the present case, it follows from Chapter 5.2 of the contested decision and from the extract from Chapter 7 cited at paragraph 52 above that the Commission relies on documentary evidence in order to substantiate its finding that there was an infringement relating to the decisions designed to prevent groups of laboratories from developing which must be characterised as barriers to production, technical development and investment on the relevant market in such a way as to constitute a manifest infringement of European competition law (recital 755, concerning the gravity of the infringement).
The important documentary evidence adduced in support of that finding is that discussed in Chapter 5.2.1 of the contested decision (recitals 222 to 237). In that part of the contested decision, the Commission describes what in its view is a ‘deliberate strategy’ of the Association intended to hinder groups of laboratories, which the Commission infers from a number of documents and from certain practices.
The Association puts forward no specific arguments in relation to this part of the contested decision, but claims, in essence, in particular in the second, third, fourth and fifth pleas examined below, that the Commission misinterpreted the French law and the intention of the legislature, of which its actions are merely a reflection. Nor, moreover, does it not forward any arguments in relation to Chapter 5.3 of the contested decision, where the Commission considers that the Association afforded favourable treatment to the groups of specialised laboratories which act as sub-contractors of other laboratories and are therefore not in direct competition with them. In particular, the Association did not take issue with the fact that the pharmacist-biologists practising in those structures held only 15% of the capital, whereas it required a shareholding of at least 50% for groups of laboratories competing in the market. Nor, last, in the context of the present action, does the Association put forward any specific arguments in relation to Chapter 5.5.2 of the contested decision (recitals 537 to 547), where the Commission considers that those running the Association set out its anti-competitive objectives in the context of elections of its regulatory bodies, in particular in the context of their election programmes or in publications in its bulletin. By way of example, recital 527 to the contested decision refers to the desire expressed by the President of the CCG to ‘upset the capitalistic ambitions of financial groups and the wealth strategies of certain biochemists’. The Commission also describes there the economic objectives announced by the bodies of the Association.
However, the fact that the Commission outlined, by means of that evidence, the existence of certain premeditated conduct, or indeed of a strategy towards groups of laboratories on the part of the managing bodies of the Association, is relevant when assessing the particular context of which its actions consisting in championing and strictly applying an interpretation of the law form part in circumstances in which, if necessary, several interpretations could be argued, which in the Commission’s view proves that the law was being interpreted for economic purposes. Although intention is not a necessary factor in determining whether the acts in question are restrictive (see, to that effect, Case C‑32/11
Allianz Hungária Biztosító and Others
[2013] ECR, paragraph 54 and the case-law cited), it may play a not insignificant role in the present case, in view of the remit entrusted to the Association by the legislature in the context of which its action is supposed to take place.
It is by taking those considerations into account that the Court must consider whether, as the Association asserts, the Commission erred in its interpretation of the applicable legislative framework, and that it must ultimately conclude (paragraphs 343 to 348 below) whether the Association can claim that its conduct should not be penalised under Article 101 TFEU, in the light of the judgment in
Wouters
, paragraph 21 above).
The Court considers it appropriate to examine the pleas relating to the composition of and change in the capital of the SELs (fourth and fifth pleas) before the pleas relating to the SELs’ duty to communicate certain information during their lifetime (second and third pleas), while the sixth plea will be examined last.
The pleas relating to the composition of and change in the capital of the SELs
The fourth and fifth pleas relate to the consequences for the structure of the SELs of the development of the legislative framework governing them towards the opening up of their capital to external shareholders. The legal framework the interpretation of which is at issue is described at recitals 91 to 102 and 431 et seq. to the contested decision.
Article 1 of Law No 90-1258 of 31 December 1990 on the exercise, in the form of a company or partnership, of liberal professions governed by particular legislation or regulations or whose professional title is protected and on holding companies for liberal professions (JORF, 5 January 1991, p. 216), provides that ‘For the purposes of practising a liberal profession governed by particular legislation or regulations or whose professional title is protected, private limited companies, public limited companies or limited partnerships with shares governed by [the Commercial Code] may be formed, subject to the provisions of Title I of the present law.’ It follows that SELs may be formed to operate laboratories and that, as stated at recital 91 to the contested decision, they may take any of the usual forms of commercial company, in particular that of private SEL (SELARL) or public SEL (SELAFA). It is also possible to form an SEL with shares (SELCA). The possibility of using the simplified public SEL (SELAS) was introduced later.
The first paragraph of Article 5 of Law No 90-1258 states that ‘[m]ore than half of the share capital and the voting rights must be held … by professionals practising in the partnership’.
Mention should also be made of the terms of Article R 6212-82 of the CSP, introduced by Decree No 92-545 of 17 June 1992 on professional partnerships of directors and deputy directors of clinical test laboratories (JORF, 21 June 1992, p. 8106), a decree implementing Law No 90-1258. That provision was at issue in the judgment in
Commission
v
France
, paragraph 29 above. It provides as follows:
‘A maximum of 25% of the capital of [an SEL] of directors and deputy directors of clinical test laboratories may be held by one or more persons who do not meet the conditions laid down in the first paragraph … of Article 5 of Law No 90-1258 …
However, if the [SEL] is formed as a limited partnership, the percentage of the capital that may be held by persons other than those referred to in Article 5 of the abovementioned Law of 31 December 1990 may be greater than that laid down in the first paragraph but may not, however, be so high as to represent 50% of the capital.’
By Law No 2001-1168 of 11 December 2001 introducing urgent economic and financial reforms (JORF, 12 December 2001, p. 19703; ‘the Murcef Law’), the capital of SELs was further opened up to external partners by the possibility of separating ownership rights and voting rights. Thus, Article 5-1 was inserted into Law No 90-1258 and took effect on 12 December 2001. The first paragraph of Article 5-1 provides that, ‘by way of exception to the first paragraph of Article 5, more than half of the capital of [an SEL] may also be held by natural or legal persons practising the profession specified in the objects of [the partnership]’.
Article 5-1 was supplemented by Law No 2005-882 of 2 August 2005 in favour of small and medium enterprises (JORF, 3 August 2005, p. 12639). A second paragraph which was then added to Article 5-1 provides that the decrees of the French Conseil d’État may provide, taking into account the needs specific to each profession other than the legal and judicial professions, that the first paragraph is not to apply when that exception is likely to harm the practice of the profession concerned, respect for the independence of its members or its own ethical rules.
A number of ministerial circulars are also relevant for the interpretation of those provisions.
First, Circular DCIS No 970019 of 29 January 1997 (‘Circular No 970019’) states that, ‘[a]s the legislation currently stands, the laboratory director may have a minimum shareholding in the [SEL]’.
Second, Circular DGS/SQ 3 No 98/585 of 22 September 1998 (‘Circular No 998/585’) provides as follows: ‘[a] member of another health profession may not hold shares in [an SEL] as usufructuary. The usufruct relating to securities involves a certain number of rights (dividend rights, right to substitute for the bare owner in default in the event of a distribution of reserves or an increase in capital) and participatory powers (attendance at ordinary general meetings, bringing of certain legal proceedings).’
Third, Circular DHOS/05 No 2005/506 of 14 November 2005 (‘Circular No 2005-506’) states that ‘Article 5(1) of … [Law No 90-1258] provides for a derogation from this principle’, that ‘this provision shall apply to SELAFAs, SELCAs and SELASs, as, in these companies, it is possible to alter the relationship between voting rights and share capital’ and that ‘[t]his provision shall also apply to SELARLs, by means of shares allocated in return for a contribution in kind.’
It follows that the following basic principles were applicable during the relevant period: first, no more than 25% of the capital of an SEL operating a laboratory could be held by persons not in the profession (Article R 6212-82 of the CSP) and, second, professionals practising the same profession, but external to the laboratories, could hold more than 50% of the capital of an SEL operating a laboratory (first paragraph of Article 5-1 of Law No 90-1258), on condition that the professionals practising in the laboratory held more than 50% of the voting rights (first paragraph of Article 5 of Law No 90-1258).
It is apparent from the contested decision that the groups of laboratories made use of the openings offered in the first paragraph of Article 5-1 of Law No 90/1258, introduced by the Murcef Law, by using, in essence, two techniques.
The first technique consists in splitting the voting rights from the financial interest by the allocation, through dual or multiple voting rights, of a number of voting rights which do not correspond to the number of capital shares held by the various partners in the SEL. It is dealt with in the fourth plea.
The second technique involves the ‘dismemberment’ of shares, which consists, in essence, in splitting the ownership of shares in the SEL between the usufruct, which gives the right to vote on the allocation of profits and to receive dividends, and the bare ownership (recital 239 to the contested decision). This technique is discussed in the fifth plea.
– Fourth plea, alleging, in essence, failure to have regard to the role of the CCG as guarantor of the professional independence of the partner as regards his minimum shareholding in the capital of SELs
The fourth plea is aimed at Chapter 5.2.2.3 of the contested decision (recitals 373 to 449), entitled ‘Pharmacists’ minimum shareholdings in SELs’, where the Commission considers that the Association tried, within the context of groupings of SELs having links with groups of laboratories, to require pharmacists practising within the SELs in question to hold a minimum percentage of their capital, this decision being intended to slow down the formation of such groupings and to curb the development of groups of clinical laboratories. Two types of action by the Association are referred to in the contested decision. First, according to the Commission, the Association maintained that it was not possible to grant professional partners external to an SELA or an SELARL a number of voting rights lower than the number of shares which they held, for ethical reasons, while all the cases found by the Commission were concerned with transactions between professionals, with the consequence that professional independence was not involved (recitals 374 and 375). Second, the Association took the stance that if the proportion of the share capital held by pharmacists was too low that would also compromise the ethical rules and, in particular, the professional independence of pharmacists, whereas, according to the Commission, professional independence is guaranteed by the existing legal provisions (recital 377). The Commission provides a number of actual examples in which the Association had adopted that stance (recitals 378 to 430).
The Association contends, in essence, that its role in supervising the minimum shareholding by professional partners in the SELs falls within its statutory remit of ensuring compliance with the professional independence of practising biologists. In its submission, it was in that context that it objected to mechanisms such as those adopted by Labco, which were intended to enable professionals practising in a laboratory to retain the majority of voting rights, but only a symbolic share of the capital, therefore depriving them of the profits and of effective participation in the governance of the laboratory. Without any dividends, the director of the laboratory would be subject to the requirements of the controlling shareholder and remunerated on terms determined by that shareholder, equivalent to a salary, and therefore according to the performance of the laboratory, which would undermine his financial independence. The Commission’s analysis has the effect of diverting the law from its objective. In that regard, the Association also refers to the parliamentary debates preceding the adoption of Law No 2005-882, which introduced the second paragraph of Article 5-1 of Law No 90-1258, showing the existence of a certain latitude. The Association also claims that the judgment in
Commission
v
France
, paragraph 29 above, confirms its analysis and also the position adopted by the Ordre des médecins in certain cases.
Furthermore, in the Association’s submission, it is not possible, within an SELARL, to split the shareholding from the voting rights, except where there is a contribution in kind.
The Commission, supported by Labco, disputes the Association’s arguments. It claims, in essence, that the possibility of splitting ownership of the capital from the ownership of voting rights is provided for in Article 5-1 of Law No 90-1258 and confirmed by ministerial circular. The law thus also provides for the control by professionals of the functioning of the SELs. According to the Commission, the Association could not, by a decision of an association of undertakings, neutralise the application of the law, as its powers must be exercised within the legal framework in force.
Labco maintains, moreover, that its structure is perfectly legal.
This plea concerns, in essence, the Association’s opposition to legal mechanisms, such as that used by Labco, in which a holding company takes a minority shareholding of no more than 25% in SELs operating laboratories, which in turn take majority shareholdings in other SELs, always ensuring, however, that the intermediary SELs do not hold the majority of the voting rights in the other SELs. A biologist practising in these SELs therefore holds the majority of the voting rights, but potentially benefits from only a minimum share in the capital, an arrangement to which the Association is opposed.
Contrary to the Association’s submission, the first paragraph of Article 5-1 of Law No 90-1258, introduced at the end of 2001 by the Murcef Law, is unambiguous as to the legality of such a construction during the infringement period (that is to say, between 14 October 2003 and 21 October 2009).
It is clear from the first paragraph of Article 5-1 of that law that natural or legal persons outside an SEL may hold the majority of its capital, but not of the voting rights, provided that those persons are engaged in the profession referred to in the objects of the SEL in question. The splitting of capital and voting rights is therefore possible, for example, in favour of third party pharmacist-biologists or SELs operating a laboratory, provided that they do not hold a majority of the voting rights.
That development, moreover, had previously been envisaged by Circular No 970019, according to which the shareholding of the director of the laboratory in the capital of the SEL may be minimal, and is supported by Circular No 2005-506, where it provides that it is possible to alter the relationship between voting rights and capital in an SELAFA, SELCA and SELAS. As is apparent from its wording, the latter circular was issued by the French Ministry of Health specifically in order to explain to prefects the essential principles governing, in particular, the application of Article 5-1 of Law No 90-1258.
In that regard, the Commission correctly maintains that the argument based on the defence of professional independence, on which the Association relies, cannot be decisive in that debate.
Indeed, the financial independence of the pharmacist-biologist is specifically mentioned in Article R 4235-18 of the CSP, which provides that ‘the pharmacist must not be subject to any financial, commercial, technical or moral constraint of any kind whatsoever that would be capable of undermining his independence in the exercise of his profession, in particular when concluding contracts, agreements or supplementary clauses having a professional object’. It is not disputed that the application of that provision is within the Association’s remit.
However, that provision cannot allow the Association to object to structures which are in accordance with the law, in particular when they relate to the holding of capital by pharmacist-biologists or companies operating a laboratory, which are also subject to the ethical rules, and not by non-professional third parties, referred to by the rule in Article R 6212-82 of the CSP which limits to a maximum of 25% of the capital of a laboratory that may be held by non-professionals. The judgment in
Commission
v
France
, paragraph 29 above, which concerns the validity of that provision in the light of freedom of establishment, is therefore not decisive in that regard either.
It is true that certain passages in the Opinion of Advocate General Mengozzi in
Commission
v
France
, paragraph 29 above (ECR I‑12944), and in the judgment itself refer to the possibility, raised by the Commission, that a more flexible rule from the viewpoint of freedom of establishment than the rule relating to the maximum shareholding of 25% of the capital of an SEL operating a laboratory that can be held by non-biologists, which would in splitting the voting rights from the financial rights. However, it is clear that such a regime, which, where appropriate, would allow non-professionals to hold more than 25% of the capital provided that professionals retain the majority of the voting rights, is not what the French legislature had in mind when the more flexible Murcef Law was adopted and the first paragraph of Article 5-1 of Law No 90-1258 was introduced. This latter provision, under which the majority of the capital may be owned by professionals external to the SEL, was not examined in the case giving rise to the judgment in
Commission
v
France
, paragraph 29 above. The fact that that judgment (paragraph 85), like the Opinion of Advocate General Mengozzi (points 212 and 213), refers to the pressure that a third party majority shareholder might exert on the biologists practising in laboratories serves only to justify the existence of the rule prohibiting a 25% shareholding by non-biologists by comparison with more flexible arrangements in regard to them.
It follows from the above analysis that the French legislature considered, by the amendment of the regime introduced by the Murcef Law, that the independence of the biologist could be adequately guaranteed if two safeguards were applied simultaneously: the shareholding in an SEL by persons outside the profession must be limited to a maximum of 25% and the majority of the voting rights must be held by persons practising within the SEL. It was therefore within the framework of those limits that the Association had to act, since the principle of professional independence, a concept defined broadly in Article R 4235-18 of the CSP, cannot be a pretext for restricting access to the capital of SELs in structures that are in accordance with the law.
Furthermore, as stated at recital 377 to the contested decision, control of the operation of the SEL by professionals and, therefore, their professional independence are guaranteed not only by the fact that they hold the majority of voting rights, in application of Article 5 in conjunction with Article 5-1 of Law No 90-1258, but also by other provisions of that law which provide, in particular, for the minimum presence of partners practising in the company in the decision-making bodies and provide that only they can take part in the deliberations concerning certain agreements on the conditions in which they practise.
Nor can the Association rely in that regard on the parliamentary proceedings relating to Law No 2005/882. The Commission examines that argument at recitals 440 and 441 to the contested decision. It relates, in particular, to the view expressed by Mr Lang, a French deputy, when a draft law aimed at prohibiting the dismemberment of shares was being discussed, although that prohibition was not included in the law eventually adopted. The view, expressed by a deputy, that the Labco mechanism enables that undertaking to take all the profits and to fix the biologists’ remuneration, contrary to the CSP, cannot justify the Association’s intervention with respect to structures that are in accordance with the law. The same applies to the Minister of Health’s answer to a parliamentary question, referred to at recital 441 to the contested decision. Nor, likewise, is the fact that the second paragraph of Article 5-1 of Law No 90-1258 provides for the possibility of legislation by decree in the event of abuse decisive, since no decree aimed at such cases has in fact been adopted.
As regards, moreover, the parties’ discussion of the specific question whether at the material time the capital rights and voting rights in an SELARL could be split, the Association relies in that regard on the general scope of Article L 223-28 of the French Commercial Code (‘the CDC’) on limited companies. That article provides that each partner is entitled to take part in decisions and has a number of votes equal to the number of shares which he owns.
In the Association’s submission, that provision applies to SELARLs and therefore precludes the possibility of capital rights and voting rights being split.
In that regard, in its answer to the written questions put by the Court and at the hearing, the Commission no longer disputes that, by Circular No 2005/506, the French authorities states that SELARLs were excluded from the benefit of Article 5-1 of Law No 90-1258, except for cases of a contribution in kind. However, the scenario of a contribution in kind, which refers to a situation in which a partner makes his technical knowledge, his labour or his services available to the company, does not need to be examined in greater detail in the context of the present case.
However, independently of the argument put forward by the Association at the hearing that Circular No 2005-506 merely reflects the law as it stands, or the question whether, on the contrary, that circular contains an interpretation contra legem on that point, it cannot be denied that, until that circular was adopted in 2005, companies were indisputably entitled to consider that Article 5-1 of Law No 90-1258 took precedence, as a lex specialis, over the general provisions of the commercial code.
As stated at recital 388 to the contested decision, Article 1 of Law No 90-1258 specifies that SELs are to be governed by Book II of the Commercial Code, ‘subject to the provisions of Title I of the present law’. In fact, Article 5-1 is part of Title I.
Nor is there any reason to conclude that when the legislature introduced a new regime within the framework of the Murcef Law it wished to discriminate between different types of SEL, as the wording of Article 501 refers to the capital of SELs without further defining them and therefore to all forms of SELs.
In those circumstances, the Commission did not err in finding that, until 2005, different interpretations of the legal framework affecting SELARLs were possible and that the Association systematically chose to apply the interpretation least favourable to the opening of the market to groups of laboratories. That is so even though recital 435 to the contested decision does not properly reflect the wording of Circular No 2005-506 when it states that it follows from that circular that Article 5-1 of Law No 98-1258 applies to SELARLs without distinction. In any event, the actual cases in which the Association has intervened with respect to SELARLs, in particular in the case of the SELs Laboratoire d’Isle (recital 378 et seq. to the contested decision) and Norden (recital 391 to the contested decision) date from before 2005 and the Commission’s analysis pointing to the excessive nature of the Association’s intervention with regard to those companies is not called into question.
Furthermore, several other examples of intervention, which do not relate to SELARLs, are cited by the Commission.
In that respect, the Commission’s analysis calling into question, in particular, the Association’s intervention regarding the SELAS Laboratoire Central and Groupe biologic Lam, both having links with Labco, or the SELAS JPBS, the SELAS Exsel Bio and the SELAS Labocentre, is not rendered invalid by the Association’s argument that, owing to the small proportion of shares held by practising partners by comparison with the total number of shares, it was necessary to ensure the financial independence of practising pharmacist-biologists vis-à-vis external partners having economic control of the structure. The law had expressly provided for the option that partners practising in the laboratory could keep only a small, even a very small, part of the capital, provided that they retained the majority of the voting rights. Nor does the fact that practising partners benefit, where appropriate, from remuneration which is not indexed to the profits alter that conclusion. Likewise, as the Commission correctly submits, the fact that the Ordre des médecins was opposed to situations in which a physician practising in an SELAS held the majority of the voting rights but a symbolic share of the capital does not prove that the Association’s practices are lawful.
For the sake of completeness, as regards the Association’s argument, discussed at the hearing, that it was necessary to ensure that, in an SELAS, external partners were not granted a number of voting rights lower than the number of shares, which would not be possible for that type of company, it must be held that, apart from the fact that it lacks clarity, it must be rejected, in any event, for the reasons set out at paragraphs 98 and 99 above.
Last, it must be borne in mind that the contested decision mentions a number of documents from which it is apparent that the Association was aware that it was legally possible that investors practising the profession should hold the majority of the capital, provided that the majority of the voting rights were held by professionals practising within the SEL, which is demonstrated, in particular, by the fact that it worked in order to obtain a legislative amendment providing that a minimum share of the capital must be held by partners practising within the company (see the evidence cited at footnote 523 and recitals 442 to 449 to the contested decision). That evidence, linked to the evidence set out, in particular, in Chapter 5.5 of the contested decision concerning the stated objectives of the opposition to the introduction of financial groups in the profession, supports the Commission’s position that the Association’s intervention relates to its own particular interpretation of the law, which is systematically unfavourable to group structures. In that regard, reference may also be made to the fact that the Association’s letters to the SELARLs Laboratoire d’Isle and Norden refer to the Association’s position of principle against the dismemberment of shares (although, technically, those particular cases did not involve dismemberment in the strict sense), which is examined below in the context of the fifth plea.
It follows from the foregoing that the fourth plea must be rejected.
– Fifth plea, alleging, in essence, an error of assessment of the legislature’s intention as regards the dismemberment of the shareholding in SELs above a maximum holding of 25% and failure to have regard to the legal framework applicable to the dismemberment of shareholdings in SELs
This plea concerns Chapter 5.2.2.1 of the contested decision (recitals 239 to 295), entitled ‘Dismemberment of shares in SELs’, where the Commission takes issue with the Association for having prohibited the dismemberment of shares in SELs. The decisions of the Association at issue relate, first, to the formal notice given to SELs or partner/pharmacists practising in those SELs to remove any reference to dismemberment from their statutes or to reverse any dismemberment carried out and, second, the disciplinary proceedings brought against pharmacist-biologists on the pretext that they had infringed the rules governing the profession of pharmacist (recitals 242 to 244), of which the Commission describes the examples of the SELAFA Schaffner Jean Bart Mathieu Wallon (recitals 248 to 253) and the SELARL Labco Artois (recitals 256 to 258).
The Association claims, in essence, that the maximum amount of 25% of shareholding fixed by Article R 6212-82 of the CSP for non-professional third parties applies both to shares owned outright and to dismembered shares. It maintains that it was opposed to dismemberment only where there was no guarantee, first, that 50% of the voting rights were owned by professionals practising in the structure and, second, that non-professional third parties owned less than 25% of the shares. The cases of Unilabs, the SELAFA Schaffner Jean Bart Mathieu Wallon and the company Biolabs Centre Labo relate to mechanisms refused for that reason. The CCG was also called upon to determine the cases of companies in which the shares were dismembered but which were approved within the limit of 25% imposed by law.
In the reply, the Association submits that the Commission is confusing the technique of dismemberment of the right of ownership and the technique provided for in the first paragraph of Article 5-1 of Law No 90-1258. It also refers to a judgment of the cour administrative d’appel Paris (Paris Administrative Court of Appeal) (France) of 31 March 2011, upholding a judgment of the tribunal administratif de Paris (Paris Administrative Court) of 12 May 2009 and to the illegality of the mechanism used by Unilabs.
The Commission contends that the Association adopted a position of principle with respect to dismemberment which prompted it to intervene in cases where dismemberment was perfectly lawful and, in particular, in accordance with Article R 6212-82 of the CSP.
As observed at paragraph 77 above, the technique of dismemberment consists in splitting the ownership of shares in an SEL between the usufruct, which gives the right to vote on the allocation of profits and to receive dividends, and the bare ownership (recital 239 to the contested decision).
It should be observed at the outset that the Association is not incorrect to claim that the Commission’s written pleadings reveal a certain amalgamation between the technique involve the splitting of voting rights from financial participation and the technique of dismemberment when, in the defence and the rejoinder, it refers to the splitting of voting rights and capital rights provided for in Article 5-1 of Law No 90-1258 for SELARLs and the cases of the Laboratoires d’Isle and Norden, for which a problem of dismemberment in the strict sense does not appear to be at issue. Those questions, moreover, were examined in the context of the fourth plea. In that regard, however, it cannot be denied that the Association may have contributed to that alleged confusion, since it referred to its opposition as a matter of principle to the technique of dismemberment in correspondence with those laboratories, although the changes which they had made to their statutes concerned the practice of splitting the rights (recitals 380 and 392 to the contested decision).
That discussion is not decisive for the outcome of the present plea, however. As the Commission stated at the hearing, both techniques could be used in order to implement the possibility offered by Article 5-1 of Law No 90-1258 to allow more outside capital to be invested in SELs.
It must be pointed out that, before the Court, the Association does not deny that that technique could be used for SELs, but it maintains that it must comply with all the applicable provisions. Its action was limited to ensure compliance with the rules arising under those provisions, including, in particular, the rule that, first, the majority of the voting rights must be owned by partners practising in the SEL and, second, the rule that non-professionals cannot hold more than 25% of the capital (save in the specific case of limited partnerships with shares, which is not at issue here).
The Commission does not dispute that the use of the technique of dismemberment cannot result in those legal limits, whose interpretation is not in doubt, being called into question, but contends that in reality the Association’s action went further by advocating, in particular, a general prohibition of that technique.
That Association’s objective of opposing any dismemberment is documented at recitals 277 to 287 to the contested decision. By way of example, it is apparent that, although the CCG concluded on 27 March 2003 that, ‘from a strictly legal perspective, it does not seem possible to oppose the dismemberment of interests or shares in an SEL’, it decides that ‘a detailed opinion should be drawn up showing that dismemberment in favour of Stés Unilabs should be rejected for ethical reasons’ (recital 282). Likewise, an internal memo of October 2003 refers to the fact that the bodies of the Association adopted a position of principle of opposing ‘any dismemberment of shares in companies formed for the purpose of operating a dispensing pharmacy or a clinical test laboratory’ (recital 284).
It also follows that the Association consents to the dismemberment of shares only in the special and transitional case of a person who has retired from an SEL or that of the heirs of a professional who practised within an SEL. At the hearing, the Association explained that, in such cases, the situation was temporary and the usufruct will be reunited with the bare ownership and those shares will again be owned outright by the director of the laboratory.
It must be stated that the Commission is correct to take the view that the legislative framework applicable at the material time does not impose such restrictions. In the reply, the Association maintains, moreover, that it is the need to ensure compliance with the rule limiting the shareholding of non-professionals to 25% that constitutes the reason for its intervention.
Indeed, as stated at recitals 275 and 291 to 295 to the contested decision, and as the Association submitted before the Court, parliamentary debates in 2005 concerning a proposal for an amendment to the applicable law refer to the fact that dismemberment should be prohibited as it provided a means of circumventing the law. However, the proposed amendment, supported by the Association, aimed at requiring that shares in SELs be owned outright except in the case of retirement or inheritance, was never adopted and, as already observed in the context of the fourth plea (see paragraph 93 above), the argument cannot be properly invoked by the Association. It merely confirms that the law did not provide for such limitations, a situation which the Association attempted to change by lobbying, which, incidentally, is perfectly lawful.
However, the Association pertinently claims that it follows from the judgment of the tribunal administratif de Paris of 12 May 2009, as upheld by the judgment of the cour administrative d’appel of 31 March 2011, invoked by the Association and discussed at recitals 269 and 270 to the contested decision, that the structure used by Unilabs was condemned in an action brought against a decision of the Association aimed at the SEL Biolab Centre Labo. The French administrative courts considered, in particular, that the fact that Unilabs France held 25% of the capital of that SEL and that Unilabs owned 75% of that capital in usufruct, while both companies were outside the profession, constituted a breach of the prohibition on shareholding by non-professional partners of the SEL beyond a maximum of 25%, a maximum amount which applied both to shares owned outright and to dismembered shares.
However, although those judgments confirm the interpretation advocated by the Association with respect to the structure of Unilabs, they do not call into question the Commission’s reasoning in the contested decision. First, the case of the SEL Biolab Centre Labo is not used as a specific example of the Association’s intervention at 242 et seq. to the contested decision, as the Commission no longer disputes that that case highlighted the problem of breach of the rule laying down a maximum shareholding of 25% by non-professionals. Second, in so far as the Commission does indeed rely on documentary evidence referring to the positions of principle adopted within the Association concerning dismemberment that were aimed at the Unilabs model, that evidence is used to demonstrate not the desire to comply with the 25% rule but a principled stance generally prohibiting the technique of dismemberment, other than in the limited exceptions referred to above. It is precisely in respect of its defence of that position of principle with regard to the technique of dismemberment, even when its application did not call into question the 25% limit on shareholdings in SELs by non-professionals, that the Association is criticised.
The Commission’s argument is supported by the position adopted by the Association with respect to the SELARL Labco Artois (recitals 256 to 258 to the contested decision), which the Association required to submit statutes containing no reference to dismemberment after the SELARL in question had been approved by the prefect and without there having been any reference to a risk of a breach of the 25% rule. Nor does the Association put forward any argument concerning the Commission’s analysis relating to that structure in the context of the present plea.
Next, it is still necessary to examine the Association’s intervention in respect of the SELAFA Schaffner Jean Bart Matthieu Wallon, which is also referred to in the contested decision.
As regards the SELAFA Schaffner Jean Bart Matthieu Wallon, the Association claims that its opposition to the dismemberment effected in the statutes of that SEL was lawful even though, as stated at recital 248 to the contested decision, it applied to only 5% of the share capital, since the SARL in whose favour the dismemberment operated already fully owned 25% of the shares.
In that regard, it should be observed that it is not clear from a reading of the minutes of the extraordinary general meeting of the SEL in question, submitted by the Association, that the SARL in question was not active in the laboratory sector, as the Association claims. That seems to be capable of being inferred from the fact that it is referred to as a simple SARL and not as an SELARL. However, the Commission claims that it was a company owned by biologist-physicians. Labco maintained at the hearing that the company in question was managed by a biologist, which is also apparent from the minutes referred to above, although that does not really contradict the Association’s analysis that the company in question was a commercial company.
However, there is no need to adopt a definitive position on the status of the company in question, since it is apparent from the letters cited that the Association defended a position of principle requiring that there be no reference in the statutes to any dismemberment, independently of the size of the shareholding.
Accordingly, it follows from the foregoing that the Commission was entitled to take the view, without committing an error, that the Association adopted a position of principle with respect to dismemberment that was not consistent with the legal framework applicable at the material time and resulted in its being opposed to constructions that were in accordance with the law.
The fifth plea must therefore be rejected.
The pleas relating to the SELs’ duties to communicate certain information during their lifetime
– Second plea, alleging, in essence, an error of assessment resulting from a misinterpretation of the French legislation as regards the respective roles of the prefect and the CCG when changes occur during the lifetime of an SEL
The relevant part of the contested decision for the purposes of the examination of this plea is Chapter 5.2.2.4 (in particular recital 450 et seq.), entitled ‘Effective date of changes to statutes and contracts for SELs’.
The legal framework the interpretation of which is at issue is described at recitals 63 to 92 and 460 to 467 to the contested decision. It relates to two types of obligation for SELs, which are, first, of an administrative nature and concern authorisations which must be obtained from the French authorities and, second, of an ethical nature, namely entry on the register. Those obligations arise at two different stages: when an SEL is formed and when its statutes are amended during its lifetime.
It has already been explained above that, since Law No 90-1258 entered into force, SELs may be formed in order to operate one or more laboratories.
As regards the administrative aspect of the obligations borne by new SELs, the parties are agreed that new SELs are formed subject to the suspensory condition of being approved by the public authorities, that is to say, the prefect of the
département
in which their registered office is situated, as is apparent from Article R 6212-75 of the CSP, inserted into the regulatory part of the CSP concerning SELs that operate laboratories. Article R 6212-77 of the CSP specifies the information to be submitted in that context, including the statutes and a declaration as to the nature of contributions and to the allocation of the share capital.
It should also be observed that it follows from Article L 210-6 of the CDC, applicable to SELs, that a normal change in the form of a company does not entail the creation of a new legal person.
Furthermore, Article L 6211-2 of the CSP, in the version in force until 15 January 2010, inserted in the legislative part of the CSP concerning laboratories, states in the first paragraph that no laboratory may operate without administrative authorisation. Article R 3112-88 of the CSP states that the application for administrative authorisation must necessarily include documentation showing that the partners have been entered on the register of the Association or have applied for registration, and also the observations of the professional association, which is to check that the documentation in question complies with the ethical rules.
In the regulatory part of the CSP concerning SELs that operate laboratories, it is stated in Article R 6212-78 that the application for approval and the application for authorisation of the laboratory are to be determined at the same time.
From the ethical aspect, an SEL operating one or more laboratories is subject to the obligation to be entered on the register of the Association, as is apparent from Article R 6212-88 of the CSP.
As for changes that occur during the lifetime of the SEL, the fourth paragraph of Article L 6211-2 of the CSP provides that ‘[a]ny change subsequent to the authorisation decision, either in the person of a director or deputy director, or in the operating conditions, must be declared’. It follows from the fifth paragraph of that article that authorisation is to be withdrawn when the legal or regulatory conditions are no longer fulfilled.
In that regard, in the contested decision the Association is alleged to have wished to slow down the taking effect of changes to statutes and contracts for SELs, stating that those changes would take effect only after amending prefectoral orders had been obtained and an entry subsequently made in the registers, and to have required that express clauses to that effect be included in the documents relating to the conversion of SELs (recital 450 et seq. to the contested decision). The Commission maintains that the formulation of such requirements artificially increases the economic risk associated with the implementation of those conversions. It provides several examples of such conduct, in particular at recitals 453 to 459 to the contested decision. In addition, at recitals 492 to 494 to the contested decision, the Commission describes the case of the SELAFA Aubert H, where the Association’s action led to the laboratory’s operations being suspended. As explained at recital 460 to the contested decision, the Commission considers that it is only when an SEL is formed that it is subject to an administrative authorisation, and the formation is suspended until the approval of the prefect has been obtained, while subsequent changes (for example, where an SELARL is changed to an SELAFA), which do not involve the creation of a new SEL, are subject only to an obligation to declare the changes in question, without any suspension of their implementation.
The Association contends that the Commission made a first error of interpretation of the legal framework when it considered that the obligation to communicate any changes occurring during the lifetime of an SEL was declaratory. In its submission, the regime in question is subject to the approval of the prefect and the declaratory regime relates only to the authorisation of the laboratory and not to its approval.
A second error of assessment concerns the respective roles of the prefect and the CCG when changes are made to the statutes during the lifetime of an SEL, which gave rise to an error of law. According to the Association, since an SEL must first of all apply for the approval of the prefect for such changes during its lifetime, the intervention of the CCG in regard to a change in the entry on the register of a director and/or an SEL depends directly on changes of authorisations and approvals issued by the prefect, and the Association’s powers in that respect are therefore limited.
In support of its argument, the Association relies on Circular No 98-585, which was in force during the period covered by the investigation, but which the Commission mentions only in footnote 562 to the contested decision and which was not repealed by Circular No 2005-506, on which the Commission relies in that respect. In addition, the Association submits a table illustrating the correspondence between the dates of approval and the dates of entry on the register of SELs, either for their entry or following a change in their structure. It emphasises that, in application of Circular No 98/585, prefects have almost systematically adopted orders amending the approval. The Association’s intervention consists in reminding SELs of the approval procedure does not therefore increase the economic risk but, on the contrary, serves to make the SELs aware of the risk that approval may be withdrawn in the event of irregularities in the proposed changes.
Last, the Association observes that the entire approval procedure and its amendment are strictly intended to protect public health and that it must be considered that, in that sphere, the Association acts as a public authority outside the scope of Article 101 TFEU, as its remit is defined by law and the ultimate power to take decisions rests with the State. In the Association’s submission, in any event, even where a professional body acts as an association of undertakings, its decisions in restriction of competition may be justified by a higher interest like public health.
The Commission, supported by Labco, disputes those arguments. It emphasises that the communication of changes during the lifetime of an SEL is declaratory in nature. In addition, the Commission and Labco claim that Chapter 5.2.2.4 of the contested decision is not aimed at the role of the Association in the administrative approval procedure, in which it has an advisory role, but at the decisions taken by the Association itself, in complete independence, to enter changes in an SEL’s statutes in the register. Last, the Commission denies that the Association’s conduct in question falls outside the scope of Article 101 TFEU.
The Court notes that the Association’s argument relates, first, to whether the communication of changes during the lifetime of an SEL, as provided for in Article L 6211-2 of the CSP, forms part of a simple declaratory regime and, second, to whether the Association plays a subordinate role to that played by the prefect in the case of such changes or may act autonomously.
As regards the first of these questions, it must be stated that the wording of Article L 6211-2 of the CSP, cited at paragraph 136 above, refers to the declaratory nature of any change in the person of a director or in the operating conditions that arises after the decision authorising the laboratory. It follows that there is no suspensory effect for changes in an SEL during its lifetime.
That interpretation is confirmed by Circular No 2005-506, which specifically explains the general conditions for the application of Article 5-1 of Law No 90-1258. As for the compatibility of the statutes of the companies with the legislative and regulatory provisions relating to SELs, that circular informs the prefects what action should be taken in a case of incompatibility. As regards a change to the statutes during the lifetime of an SEL, the circular states the following:
‘You should be informed of such changes by the declaration provided for in Article L 6211-2 of the [CSP].
In accordance with the second paragraph of Article R 6212-79 of that code, after giving the company the opportunity to submit its observations …, if the irregular changes have not been deleted, you should withdraw the approval of the company and also the authorisation of the laboratories …’
The Association disagrees with that analysis and maintains that the declaratory nature of the communication concerns only the application for authorisation of the laboratory, while the altered SEL is still required to obtain fresh approval. The association refers, in that regard, in particular to Circular No 98-585.
Circular No 98-585 does in fact contain references to the obligation to seek fresh approval in the case of changes during the operation of the SEL. Thus, as regards the entry of the company on the French Trade and Companies Register, Circular No 98-585 states that, ‘for subsequent changes to the statutes of the company …, [the company] must first of all apply for approval on account of the changes, then file the new statutes [with the French Trade and Companies Register] after receiving approval’.
The Association also refers in that context to Article R 6212-76 of the CSP, which states that the application for approval of an SEL formed in order to operate a laboratory must be lodged with the prefect of the
département
either at the same time as the application for authorisation to operate a laboratory, provided for in the first paragraph of Article L 6211-2 of the CSP (see paragraph 133 above), where a laboratory is being set up, or at the same time as the declaration of the change, within the meaning of the fourth paragraph of Article L 6211-2 of the CSP (see paragraph 136 above), where the laboratory or laboratories to be operated is or are already in existence.
Questioned by the Court, both in writing and at the hearing, as to the interpretation of the two circulars and the fact that they both existed at the same time, the two parties continued to differ on that question.
The conclusions set out below can none the less be drawn.
First, Circular No 2005/206, adopted on 14 November 2005 and immediately applicable, confirms that changes in an SEL associated with the application of Article 5-1 of Law No 90-1258 are to be subject to the declaratory regime both for approval of the SEL and for the aspect relating to authorisation of the laboratory, the circular referring expressly to both aspects, as is clear from the citation at paragraph 145 above. It is only in so far as changes contrary to the law are found that the administration, after requesting observations from the SEL in question, may withdraw the approval if the irregular changes are not deleted.
Second, that interpretation is not contradicted by any legal provision. Article R 6212-76 of the CSP refers to cases of newly-formed SELs and not to their alteration. The reference to an amending declaration in that provision (see paragraph 148 above) concerns the case in which initial approval is obtained when an SEL is formed in order to operate a laboratory where the laboratory already exists. Accordingly, the provision in question does not relate to the change in the structure of an SEL and it cannot therefore be inferred that after initial approval has been obtained by the SEL in question fresh approval would have to be obtained for subsequent structural changes.
Third, as regards the fact that, even after the adoption of Circular No 2005/206, prefects continued to adopt amending approval decrees under a practice based on Circular No 98-585, the Commission correctly contends, in answer to a written question put by the Court, that such a practice does not call into question the existence of a declaratory regime for changes in SELs during their lifetime: it is not provided for by law, but may be explained by the interest in bringing certain changes to the knowledge of the public. Furthermore, as is apparent from the evidence adduced by the Commission, a number of those decrees make express reference to the declaratory nature of the regime governing the changes and do not rely, or in any event do not specifically rely, on Article R 6212-75 of the CSP, which concerns the obligation for a new SEL to obtain approval, as a suspensory condition.
Accordingly, the Association’s complaint that the Commission erred in taking a declaratory regime into account in the case of changes in an SEL must in any event be rejected for the period after 14 November 2005 — the date of adoption of Circular No 2005/206, which was immediately applicable –, during which most of the examples of intervention on the part of the bodies of the Association towards SELs cited at recitals 450 to 494 to the contested decision occurred.
As regards the period before the adoption of Circular No 2005/206, therefore between 14 October 2003 and 14 November 2005, although it is regrettable that the contested decision is virtually silent as to the impact of Circular No 98-585 in that context, apart from the reference in footnote 562 to the fact that it contains a different interpretation of the regime applicable when its states that ‘[t]he company must first request approval on the basis of the changes’, it does not follow that the Commission misinterpreted the French legislation in the present case.
As Circular No 98-585 establishes an approval procedure, while the law establishes a declaratory regime, the Commission rightly raises the question whether that circular contains a correct transposition of the legal framework. In that regard, the Commission refers at recitals 467 and 468 to the contested decision to documents dating from before 2005 that may contradict the analysis that emerges from the circular. They are a letter of July 2004 from the Director for Health and Social Affairs of the
département
of Essonne (France) to a law firm, referring to the obligation to make a simple declaration in the case of a ‘subsequent change in the staff operating [a laboratory]’ and internal documents of the Association, of October 2003 and June 2004, cited at recital 468 to the contested decision, referring to
a posteriori
supervision and to a declaratory regime resulting from Article L 6211-2 of the CSP. In addition, the Association referred, in a letter of 27 May 2004 to the Laboratoire d’Isle, cited in footnote 555 to the contested decision, to the fact that, as regards ‘the supervisory conditions, we would point out to the interested parties that, without being obligatory in the case in question, they merely constitute a protective measure for biologists, with regard to the changes that they envisage implementing’.
Accordingly, it has not been established that the Commission erred in interpreting the applicable legal framework as regards the taking effect of changes in the statutes and contracts for SELs.
In those circumstances, the Association’s complaint relating to a misinterpretation of the French legislation by the Commission in Chapter 5.2.2.4 of the contested decision must be rejected.
As regards the second question raised by the Association, concerning what it claims to be its subordinate role to that played by the prefect, the Commission does not deny that the Association plays an advisory role in approval procedures before the prefect and that certain matters are communicated to it in that context in order to enable it to perform that role.
For the remainder, the question whether, as the Association claims, it plays a subordinate role to that played by the prefect and has only limited powers as regards entry on the register, as illustrated by a table of correspondence between the dates of amending decrees and changes to entries on the register for a series of SELs submitted in the application, is not decisive as regards the criticisms made of the Association in Chapter 5.2.2.4 of the contested decision. Nor is it decisive in that regard whether the action taken by the Association in relation to entries on the register is confined to taking note of the decisions of the prefect and does not slow down the implementation of the changes, and indeed has not led to refusals to make entries, as the Association attempts to establish. Furthermore, that argument is disputed by the Commission, which refers, in particular, to the case of the SELAFA Aubert H in the contested decision (recitals 492 and 493) and before the Court.
In fact, it is apparent on reading the contested decision that although it refers on several occasions very positively to ‘decisions’ designed to impose the ‘prior approval’ of the Association for changes to an SEL, the Commission takes issue with the Association in Chapter 5.2.2.4, first, for having mentioned the possibility that changes within an SEL could be implemented only after an amending prefectoral decree had been obtained and a subsequent entry made on the register and, second, for having referred to the need to amend the documents relating to the changes in the SEL to that effect, whether in written documents addressed directly to the SELs or indirectly by means of observations to the prefect, of which the parties receive a copy (Article R 6212-77 of the CSP).
However, irrespective of whether the changes were ‘approved’, and by whom, it follows from the foregoing analysis that the approach thus taken by the Association is not consistent with the legislative framework as interpreted by Circular No 2005/206 and in any event goes beyond the purely advisory role which the Association claims to have. Nor can the Association rely on the principles in the judgment in
Wouters
, paragraph 21 above, in that respect.
Consequently, the second plea must be rejected.
– Third plea, alleging, in essence, failure to have regard to the scope of the obligation to communicate certain information provided for in the French legislation and the CCG’s role in the context of its remit of
a posteriori
verification of the company documents
This plea relates to Chapter 5.2.2.2 (recital 296 et seq.) of the contested decision, entitled ‘Communication of documents concerning sales of shares’.
It concerns the interpretation of Article L 4221-19 of the CSP, introduced in 2005 in the legislative part of the CSP, concerning the rules associated with the practice of the profession of pharmacist. That article provides, in the first paragraph, that ‘pharmacists practising in the form of a company must communicate to the council of the association to which they belong, in addition to the company’s statutes and any amendments thereto, the agreements and amendments thereto relating to its operation, or to relations between partners’. The second paragraph states that those documents ‘must be communicated within one month following the conclusion of the agreement or amendment’.
Also relevant are Articles L 6221-4 and L 6221-5 of the CSP, inserted in the legislative part of the CSP, concerning, specifically, the conditions governing the exercise of their functions by directors of laboratories.
Article L 6221-4 of the CSP states, in the first paragraph, that directors of laboratories must communicate to the council of the association with which they are registered the contracts and amendments thereto relating to the practice of their profession and, if they do not own their equipment or the premises in which they practise their profession, the contracts which guarantee them use of the equipment and premises and any amendments to those contracts. The fourth paragraph of that provision states that such contracts or amendments must be communicated within one the month following their conclusion.
Article L 6221-5 of the CSP states, in the first paragraph, that the statutes of companies formed for the purpose of operating a laboratory and any amendments made to those statutes during the lifetime of those companies must be communicated, at the initiative of the director or directors, within one month of being signed, to the councils of the associations within whose jurisdiction the laboratory is situated and with which the directors and deputy directors are registered.
Article L 6221-8 of the CSP provides that failure to communicate the contracts, any amendments thereto or the statutes referred to in Articles L 6221-4 and L 6221-5 of the CSP, or any untruthful communication thereof, is to constitute a disciplinary penalty which may entail penalties.
In Chapter 5.2.2.2 of the contested decision, the Commission considers, in essence, that the Association, with the aim of hindering the development of groups of laboratories, and in particular of Labco, required on many occasions, in reliance on a resolution of 18 January 2006 (‘the resolution of 18 January 2006’) and its own particular interpretation of the law, that movements in shares in the SELs in the group be communicated to it (recital 296). Furthermore, in the event of a refusal, or where the movements in question had taken place several months before they were communicated, the Association lodged a complaint and at the same time initiated disciplinary proceedings against the SELs concerned (recital 297). The Commission also takes issue with the Association for using a registration form in which information is requested about an SEL’s shareholding in other SELs operating laboratories, which has no basis in any legal text (recitals 355 to 358).
In that regard, the Association claims, in essence, that the Commission misinterpreted the scope of the obligation for SELs to communicate movements in shares and also the Association’s role in that respect. Its complaints may be divided into two parts.
In the first part, the Association claims that the requirement that SELs communicate to it all agreements relating to the method of financing and the ownership of their shares, formulated in the resolution of 18 January 2006, was imposed in accordance with a strict application of Article L 4221-19 of the CSP, confirmed by Circular No 98-558. It also refers to Articles L 6221-4 and L 6221-5 of the CSP. According to the Association, the legislature did not intend to distinguish between different types of SEL, and the obligation to communicate as thus defined should also apply to the forms of SEL (SELAFA and SELAS) which do not define the allocation of capital in their statutes. The Commission cannot therefore conclude on that basis that there was any strategy of harassment on the Association’s part.
In the second part, the Association maintains that the Commission failed to understand the CCG’s role in the context of its remit of
a posteriori
verification of the documents relating to the SELs and laboratories and also its obligation to submit observations to the prefect in the context of the approval procedure. It also denies having created new obligations by means of a registration form. Last, the Association observes that its action in relation to the communication of documents comes within the scope of the powers which it exercises as a public authority.
The Commission, supported by Labco, maintains, as regards the first part, that by the resolution of 18 January 2006, the Association went beyond the limits of the powers conferred on it or, at least, applied an exaggeratedly restrictive interpretation of the legal framework. Furthermore, no problem of professional independence is at issue and that resolution led to measures of intimidation. As regards the second part, the resolution of 18 January 2006, the creation of a declaration of conformity and the use of a registration form are part of a strategy of harassment aimed at identifying SELs belonging to groups and impeding their development. Last, the Commission denies that the requirements imposed by the Association come within the scope of the powers which it exercises as a public authority.
The Court considers that the two parts should be dealt with together.
In the first place, it should be observed at the outset that the Commission does not dispute that it is for the Association, and in particular for the CCG, in the context of its remit of managing the register, to check certain information relating to the operation of the pharmacists and SELs on the register. Nor is it disputed that it is within the Association’s remit to guarantee the application of Article R 6212-82 of the CSP, which concerns the rule that no more than 25% of the capital of an SEL operating laboratories may be owned by non-professionals and, moreover, the rule that a practising biologist must hold the majority of the voting rights, as laid down in Articles 5 and 5-1 of Law No 90-1258.
That control is carried out
a posteriori
, as is apparent from the applicable provisions, which refer each time to a period, generally one month, within which certain information is to be communicated to the Association. The importance of the duty to communicate such information is underlined, however, by the fact that non-compliance may give rise to disciplinary penalties, as provided for, in particular, in Article L 6221-8 of the CSP.
In the second place, as regards the information to be communicated by SELs operating laboratories, Article L 4221-19 of the CSP is the most relevant reference, as Articles L 6221-4 and L 6221-5 of the CSP were drawn up, as the Association explains, at a time when SELs operating laboratories did not exist. Furthermore, it is the principal provision to which the Association refers in its interventions with SELs listed by the Commission in that context. It is therefore appropriate to examine the resolution of 18 January 2006, adopted by the Association after that legal provision had been introduced. After setting out the content of the first paragraph of Article L 4221-19 of the CSP (see paragraph 165 above), the resolution states the following:
‘Thus, with effect from 1 March 2006, all documents relating to the partnership, whether connected with the statutes, the operation of the partnership and relations between partners, must be communicated to the [CCG]. This means, in particular, agreements relating to the methods of financing the partnership and to the way in which the capital is held, and also to partnership agreements.
Whenever there is a change within a professional partnership operating [laboratories], pharmacist-biologists practising in the laboratories must certify in writing that they have complied with Article L 4221-19 of the [CSP].’
As to whether that resolution contains a broad interpretation of the expression ‘agreements and amendments thereto relating to the operation of the partnership or to relations between partners’, which appears in Article L 4221-19 of the CSP, it is stated at recital 368 to the contested decision that agreements concerning relations between partners are related to shareholder agreements or partnership agreements which supplement the statutes and are intended to guarantee rights to the signatories and to define their commitments in terms of management of the partnership or protection of minority shareholders, but not to contracts for the sale of shares.
The interpretation thus put forward by the Commission is logical. The methods of financing the SEL and the way in which its capital is held, to which reference is made in the resolution of 18 January 2006, constitute information of a different type, going beyond the conditions for the operation of the SEL or relations between partners.
Nor are the documents relating to movements of capital by reference to SELs necessarily covered by the expression ‘contracts and amendments thereto relating to the practice of their profession’ in Article L 6221-4 of the CSP, unless that expression is to be interpreted so broadly that it covers any legal document relating to directors of laboratories.
Nor does Article L 6221-5 of the CSP provide clear support for the Association’s argument that the duties to communicate certain information should be extended movements in shares. That provision concerns the directors’ duty to communicate to the Council of the Association the statutes of the SEL and any amendments made thereto during the lifetime of the SEL, within one month of signature. In that regard, the Commission observes, in particular, without being contradicted on that point by the Association, that the allocation of shares is not recorded in the statutes of an SELAFA or an SELAS, which are concerned by the requests to submit information referred to by the Commission.
The Association claims, however, that it was not the legislature’s intention to distinguish between different types of SEL. It must be stated, however, that that is not necessarily sufficient reason for the Association to impose obligations on SELs where the law does not do so.
A duty to communicate movements in shares in SELs does not therefore follow from the provisions on which the Association relies in that regard.
In the third place, it cannot be denied that the broad obligation to certify placed on SELs, defined in the second paragraph of the extract from the resolution of 18 January 2006, cited at paragraph 178 above, is imposed in addition to the relevant legislative and regulatory framework that makes the SEL’s obligation to communicate more onerous. The same applies to the registration form which the Association has sent with effect from 2008 to all SELs registered with the Ordre des médecins in which pharmacist-biologists practised in the light of the new obligation for such SELs to be included on two registers, which had to be complied with from February 2008. As the Commission observes at recital 356 to the contested decision, that form asks for information about the SEL’s shareholding in other SELs operating laboratories. In that regard, in spite of the possible existence of other earlier forms, to which the Association refers, the Commission correctly submits that the latter requirement for information in the form referred to in the contested decision, which has no basis in any legal text, is very broad in scope and that it could be used to identify laboratories having links with groups through cross shareholdings.
In the fourth place, it is important to bear in mind that the Commission’s criticisms about the Association’s conduct must be read in the light of the intentions which it ascribes to the Association. The Commission does not deny that the legal framework may give rise to interpretation. However, it is appropriate to take into account the documents referred to in Chapter 5.5 of the contested decision, which reveal a strategy consisting in attempting to hinder market penetration by groups of laboratories and also clearly identifying Labco and the SELs affiliated to that group in that context. For example, the letter from the President of the Association to the President of the Ordre des médecins of December 2004, cited at recital 556 to the contested decision, illustrates that point. The attention of the President of the Ordre des médecins is drawn to the fact that he has agreed to register the structures of the Labco group without expressing any reservations about the documents submitted and that ‘this situation cannot be allowed to continue’. Furthermore, the Commission has many examples, described at recitals 305 to 351 et seq. to the contested decision, showing, first, that repeated requests were made for information about movements in the shareholdings of the SELs, including many belonging to the Labco group, with reference, in particular, to Article L 4221-19 of the CSP, which could be interpreted as a threat of the use of disciplinary penalties, and, second, that such penalties were actually used on several occasions (see, to give only one example, that of the SELAS Laboratoire du Littoral at recitals 310 to 316 to the contested decision).
In the fifth place, as regards the fact that Article L 4221-19 of the CSP must, according to the Association, be read in the light of Circular No 98-558, which refers to the fact that an application for approval must clearly state the distribution of capital between professional partners, external professionals, former partners, those entitled to claim under them and external partners, and which does not distinguish between the documents to be forwarded to the professional association, which must give its opinion, and those to be forwarded to the prefect, the Commission correctly maintains that that argument cannot justify certain interventions on the part of the Association vis-à-vis the SELs in the Labco group. First, those interventions concern changes made to the structure of existing SELs after Circular No 2005-506 was adopted, which, as explained in the context of the second plea, confirms only an obligation to declare such changes. Second, and in any event, the Association intervened on many occasions with requests for information and, where appropriate, disciplinary proceedings against SELs outside the context of approval procedures, or even after approval had been granted.
In the sixth place, it is necessary to question whether certain requests for information are none the less justified in the context of the Association’s remit of
a posteriori
verification, referred to at paragraphs 176 and 177 above.
For example, with respect to the SEL Littoral/Charrière Levy (recital 362 to the contested decision), belonging to the Labco group, and whose new partner was a legal person, the Association requested a list containing the names of the partners of that legal person and their statutes.
In that regard, as concerns the fact that it is necessary to ensure compliance with the 25% limit on shareholding by non-professionals, the Commission correctly observes that the Association also insisted on the communication of information concerning the shareholding of the SEL when it was clear that relations between professionals were involved. In addition, it is apparent that the interpretation of the legislative and regulatory framework advocated by the Association, according to which it is necessary to guarantee the independence of biologists practising within the SELs vis-à-vis third party professionals, may have formed the basis of requests for information seeking to ascertain the shareholding of SELs operating laboratories which were shareholders in the SEL to which the changes applied. It has already been held, in the context of the fourth plea, that that interpretation is contrary to the openness intended by the amendments introduced by the Murcef Law (see paragraph 91 above).
Nor, likewise, can the remit consisting in checking that the practising pharmacist-biologist holds a majority of voting rights within the SEL justify any request for information about the share ownership and the holding of SEL shareholders, as compliance with that rule can be checked by means of information on the voting relationships between shareholders and their identity, which is more limited than the information concerned by a broad duty to communicate with regard to share movements, under the threat of disciplinary penalties.
It follows from the foregoing that the Commission’s analysis, according to which, faced by a legal framework which is indisputably open to interpretation, the Association failed to observe the limits of its legal powers and assumed a certain regulatory power and made more onerous the obligations of SELs wishing to avail themselves of the legal possibilities of opening up their capital, is not incorrect, particularly when certain approaches are read in the light of the strategy documented in the contested decision, in particular towards Labco.
The third plea must therefore be rejected.
Sixth plea, alleging, in essence, an error in the interpretation and application of Article 101 TFEU in so far as the disciplinary penalties imposed reinforce the potential or actual effects of the decisions in question
The Association maintains that, although the Commission states that it does not include the disciplinary penalties among its objections, it none the less considers that the initiation of disciplinary proceedings and the penalties imposed are liable to reinforce the potential or actual effects of the impugned decisions, with the consequence that the measures complained of also concern the initiation of disciplinary proceedings and the penalties imposed. The Association recalls, in that regard, that the exercise of disciplinary power is one of its powers as a public authority which falls outside the scope of competition law, which, moreover, in the Association’s submission, the Commission does not dispute. However, in taking the view that the initiation of proceedings and the extent of the penalties imposed reinforce the anti-competitive nature of the applicant’s conduct, the Commission contradicts itself and errs in the interpretation of Article 101 TFEU, in disregard of the judgment in
Wouters
, paragraph 21 above.
The Commission claims that the plea is ineffective, as the imposition of disciplinary penalties was not an objection against the Association. It states, however, that the imposition of penalties must not be confused with the threat of penalties (or a reminder of the Association’s powers in that respect) and the lodging of complaints, which formed part of the overall plan and guaranteed the effectiveness of the Association’s plan. The Commission maintains that, without passing judgment on the disciplinary decisions, it was entitled to reveal in the contested decision all the aspects of the plan put in place.
Labco also maintains that the Association used the possibility of imposing disciplinary penalties as a means of exerting pressure and of ensuring the effectiveness of the overall plan.
In that regard, it should be borne in mind that, as stated at paragraph 57 of the judgment in
Wouters
, paragraph 21 above, the Treaty rules on competition do not apply to an activity which, by its nature, its aim and the rules to which it is subject does not belong to the sphere of economic activity (see, to that effect, Joined Cases
C-159/91 and C-160/91
Poucet and Pistre
[1993] ECR I-637
, paragraphs 18 and 19, concerning the management of the public social security system), or which is connected with the exercise of the powers of a public authority (see, to that effect, Case
C-364/92
SAT Fluggesellschaft
[1994] ECR I-43
, paragraph 30, concerning the control and supervision of air space, and Case
C-343/95
Diego Calì & Figli
[1997] ECR I-1547
, paragraphs 22 and 23, concerning anti-pollution surveillance of the maritime environment).
The Association submits that the activities of its disciplinary boards panels involve the exercise of the powers of a public authority within the meaning of that case-law and therefore fall outside the scope of Article 101 TFEU, with the consequence that the Commission was not entitled to consider that the Association’s exercise of its disciplinary powers reinforced the potential or actual effects of the decisions in question.
At recital 514 to the contested decision, the Commission concludes that ‘[t]he conduct under consideration comprises all the decisions of the Association aimed at requiring market players to adopt specified market behaviour, including in particular, the lodging of complaints against pharmacists or SELs by managers of the Association’. At recital 515, however, the Commission goes on to state that, ‘[t]hat being said, the activities of the bodies of the Association that consist in preparing disciplinary proceedings that might lead to disciplinary penalties are not included in the objections’. None the less, at recital 516, the Commission states that the disciplinary powers of the Association, which are delegated by the State, are such as to reinforce the potential or actual effects of its decisions, even though they do not alter the components that make up the infringement. It observes, in the alternative (recitals 517 to 520), that in every case involving the dismemberment of shares or ownership of capital or changes in the statutes of companies, the disciplinary board of Section G of the Association systematically imposes a ban of greater or lesser duration on practising as a pharmacist.
The Commission returns to the disciplinary decisions in Chapter 6 of the contested decision (recitals 579 to 584), reiterating that the initiation of disciplinary proceedings by the bodies of the Association was not included in the behaviour complained of, but that it merely stated, as a subsidiary point, that those disciplinary penalties were liable to reinforce the potential or actual effects of the anti-competitive conduct in question, following which it gave certain examples.
Furthermore, it is apparent from recital 583 to the contested decision that the Association has already maintained during the administrative procedure that the decisions of its disciplinary boards were outside the scope of Article 101 TFEU. The Commission responded at recital 584, asserting that the issue of the nature of the Association’s disciplinary boards could be left open, because the disciplinary decisions had not been included among the objections.
Last, the Commission refers to the conduct of the bodies of the Association at recital 761 to the contested decision, when it analyses the gravity of the infringement, observing that the systematic initiation of disciplinary proceedings by lodging complaints against the undertakings having links with groups of laboratories with the aim of reinforcing the effects of its anti-competitive decisions is a factor that increases the gravity of the conduct in question.
In spite of certain quite detailed argument in the contested decision concerning the Association’s exercise of its disciplinary power, which the Association rightly claims to be sometimes ambiguous, it none the less follows from Chapter 5 of that decision, concerning ‘[t]he behaviour under investigation’, that the Commission did not regard the exercise of the Association’s disciplinary power as forming part of the practices in restriction of competition in which it was found to have engaged (see, in particular, recital 515 to the contested decision, the content of which is set out at paragraph 199 above). That is also reiterated in Chapter 6, in particular at recitals 579 to 584 to the contested decision (see paragraph 200 above).
Contrary to the Association’s contention, the Commission’s approach is not inconsistent with the principle established in
Wouters
and is not the consequence of an incorrect application of Article 101 TFEU.
That would be the case if the Commission had found an infringement of competition law in connection with conduct falling outside the scope of Article 101 TFEU. However, the fact that the Commission relied on certain practices as evidence in order to characterise the conduct that does fall within the scope of that provision does not constitute an incorrect application of the judgment in
Wouters
, paragraph 21 above, or of Article 101 TFEU, since the Association’s exercise of its disciplinary power, that is to say, the decisions adopted in that respect, is not regarded as being restrictive of competition for the purposes of Article 101 TFEU.
More precisely, it follows from the contested decision that the Commission distinguished the exercise of that disciplinary power from the implicit or explicit threat that it would be exercised or from the lodging of complaints, referred to, in particular, at recital 761 to the contested decision, concerning the gravity of the infringement, as having been capable of reinforcing the implementation of the overall plan which the Commission identified. As regards the lodging of complaints, the Commission correctly maintains that it follows from Article R 4234-1 of the CSP that a complaint may be lodged by several categories of persons. According to paragraph 1 of that provision, disciplinary proceedings against a pharmacist may be initiated by certain ministers and members of the administration whose powers are connected with the pharmaceutical sector and also by the prefect, certain members of the Association at director level, another pharmacist or an individual. It cannot therefore be accepted that, as the Association maintains, the lodging of complaints involves the exercise of its disciplinary power.
Be that as it may, although, in those circumstances, there is no need to adopt a definitive position on the extent to which the Association’s exercise of its disciplinary power forms part of the exercise of a power of a public authority, and thus falls outside the scope of Article 101 TFEU, it must be made clear that the exercise of such a power cannot afford absolute protection against any allegation of conduct in restriction of competition, since the manifestly inappropriate exercise of such a power would in any event constitute a misuse of that power.
The sixth plea must therefore be rejected.
The pleas relating to the objections concerning prices
Seventh plea, raised by way of principal plea, alleging, in essence, misuse of powers owing to failure to observe the limits of the inspection remit
The Association maintains that the Labco complaint that prompted the investigation did not refer to the question of a minimum price policy, but only to the Association’s alleged intention to prevent the development of Labco and to limit its capacity to compete with other laboratories on the market for clinical laboratory tests. Likewise, the inspection decision, the Commission’s letter of 19 November 2008 and the request for information of 3 February 2009 do not refer to pricing practices, nor does the request for information mention any extension of the framework of the investigation in that respect. The request for information of 18 June 2009 contained requests for communication of letters dealing with problems related to discounts, but without providing any particular explanation. The Association claims that it was therefore only at the stage of the statement of objections that it became aware that the investigation had been extended at the time of the inspection to conduct relating to prices and discounts. In its submission, although the Commission is not required to set out a strict classification of the alleged infringements forming the subject-matter of the investigation in the inspection decision, the case-law on Article 20(4) of Regulation No 1/2003 requires it to indicate clearly the situations which it intends to check, which it did not do in the present case with respect to prices.
The Association adds that it seems to be precluded that the reference in the inspection decision to a very broad subject-matter such as ‘looking for infringements in the area of clinical biology’ may be consistent with the case-law. Nor is the use of the adverb ‘
notamment
’ (including) in Article 1 of the inspection decision compatible with the required precision.
The Association acknowledges that the Commission may open an investigation procedure in order to verify or supplement information which it happened to obtain during an inspection and recognises that there is nothing to prevent the Commission from initiating a new investigation on the basis of that new information. However, the Association claims that the Commission breached its rights of defence in the present case by using information gathered during an inspection for purposes other than those stated in the inspection decision. In the Association’s submission, none of the documents obtained during the inspection seeking to prove an agreement on prices can serve as evidence and the contested decision should be annulled on that point.
The Association further maintains that the judgment in
CNOP and CCG
v
Commission
, paragraph 8 above, did not resolve that question, as the plea which had been raised in that respect in the context of that procedure was rejected as inadmissible on the ground that it was out of time.
The Commission denies having exceeded its powers and contends that all the evidence gathered during the inspection and also the replies to the requests for information must be taken into account.
This plea concerns the question whether the Commission was entitled to conclude, in the contested decision, on the basis of the documents in the file, that there was an infringement relating to the imposition of a minimum price by means of the prohibition of the granting of discounts when the relevant evidence was obtained following a complaint and an inspection decision which, according to the Association, related only to the restrictive practices aimed at the development of groups of laboratories. It therefore relates to the conditions in which the Commission conducted the preliminary investigation stage following Labco’s complaint of 12 October 2007 and the initiation of the investigation on 22 October 2007. The important steps in that preliminary stage are, in particular, the inspection carried out on 12 and 13 November 2008 on the basis of the inspection decision and also the requests for information subsequently sent to the Association.
The plea consists, in essence, of two complaints. The first complaint relates to the question whether the subject-matter and the purpose of the inspection, which the Commission is required to state in the inspection decision, in accordance with Article 20(4) of Regulation No 1/2003, were defined too broadly in the light of the evidence in the Commission’s possession at that stage, derived from Labco’s complaint. The second plea concerns, first, the question whether the documents seized during the inspections relating to the conduct in respect of discounts were obtained in breach of the Association’s rights of defence, since they allegedly did not come within the subject-matter or the purpose of the inspections, as defined in the inspection decision, and, second, the conditions in which the Commission may extend the scope of an investigation which is already in progress or must initiate a new investigation.
– First complaint
As regards the alleged irregularity of the way in which the evidence relating to discounts was obtained, on the ground that there was no reference to the matter in the complaint, the complaint concerns, in reality, the question whether, in the light of the obligations arising under Article 20(4) of Regulation No 1/2003, which provides that the subject-matter and purpose of the inspection are to be stated in the inspection decision, that decision was unfair, since the Commission did not have sufficiently serious indicia to adopt it as regards the conduct relating to discounts.
It must be borne in mind that the Court has already been required to examine the legality of the inspection decision in the context of the judgment in
CNOP and CCG
v
Commission
, paragraph 8 above. The complaint at issue is based on factual matters which were, at the stage of that decision, available to the applicants. Thus, as Labco’s complaint was communicated to the Association on 10 March 2008 and the Association replied on 15 April 2008, that is to say, well before the inspection carried out on 12 and 13 November 2008, there was nothing to prevent the Association from raising the complaint alleging inconsistency between the inspection decision and the indicia emerging from the complaint at the time of the action in Case T‑23/09. In any event, to the extent to which the complaint does not concern a question relating to the legality of the inspection decision which has already been examined by the Court and is now
res judicata
vis-à-vis the applicants concerned, it can still no longer be raised at this stage without disregarding the procedural time-limits laid down in Article 263 TFEU.
The complaint is therefore inadmissible.
– Second complaint
First, it should be observed that this complaint is linked to the application of the case-law on the duty to state reasons arising under Article 20(4) of Regulation No 1/2003, which provides that the inspection decision is to state ‘the subject-matter and purpose of the inspection’ in order to protect the rights of defence of the undertakings concerned at that stage of the investigation.
In that regard, it should be borne in mind that, in the judgment in
CNOP and CCG
v
Commission
, paragraph 8 above, the Court considered that the inspection decision was sufficiently reasoned. At paragraph 34 of that judgment, the Court considered that the reasons stated made it possible, in particular, to identify the subject-matter and purpose of the inspection. In any event, as already stated with respect to the complaint relating to the alleged unfairness of the inspection decision at paragraph 217 above, to the extent to which the complaint alleging failure to state reasons in the inspection decision is not
res judicata
, it can still no longer be raised at this stage without disregarding the procedural time-limits laid down in Article 263 TFEU.
It must therefore be considered for the present case that, in the contested decision, the Commission, in accordance with the case-law, stated, as precisely as possible, the presumptions which it intended to verify, namely what it was looking for and the matters to which the inspection must relate (see, to that effect, concerning Regulation No 17, Case
85/87
Dow Benelux
v
Commission
[1989] ECR 3137
, paragraph 10; Joined Cases
46/87 and 227/88
Hoechst
v Commission [1989] ECR 2859
, paragraph 41; and Case
C-94/00
Roquette Frères
[2002] ECR I-9011
, paragraph 48).
Second, it is appropriate to examine the Association’s argument that, in essence, as the evidence obtained concerning its practice in relation to discounts was outside the scope of the subject-matter of the inspection, it was gathered unlawfully and could therefore not be used as proof. Nor could the Commission rely on that evidence in order to send the Association the request for information of 18 June 2009; it ought instead to have initiated a new investigation concerning the practices in relation to discounts.
In that regard, the Commission’s argument that the Association did not claim in its reply to the request for information of 18 June 2009, or in its reply to the statement of objections, that the question of discounts was new and therefore outside the scope of the inspection must be rejected. Although an undertaking’s express or implicit acknowledgement of matters of fact or of law during the administrative procedure before the Commission may constitute additional evidence when determining whether an action before the Court is well founded, it cannot restrict the actual exercise of a natural or legal person’s right to bring proceedings before the Court under the fourth paragraph of Article 263 TFEU (see, to that effect, Case
C-407/08 P
Knauf Gips
v
Commission
[2010] ECR I-6375
, paragraph 90).
As regards the substance, it must be borne in mind that the Commission obtained evidence relating to discounts at different stages of the preliminary investigation procedure. Without being contradicted on that point by the Association, the Commission observes that five letters relating to discounts were seized during the inspection. In addition, the Commission requested information about the Association’s policy in the second request for information, dated 18 June 2009, some of the questions in which addressed the issue of discounts, notably by asking the Association to submit copies of certain letters sent by the CCG containing requests for information about price discounts granted by laboratories. Furthermore, the part of the contested decision relating to the establishment of the infringement in so far as it concerned discounts (recital 133 et seq.) is also based on the minutes of the administrative meetings of the CCG, copies of which were obtained, in particular, following the request for information sent to the Association on 3 February 2009 and also following requests for information addressed to the laboratories.
The main question to arise in the context of the present complaint, however, is whether the subject-matter of the inspection, as defined in the inspection decision, could reasonably be understood to encompass the Association’s conduct in relation to discounts.
In that regard, the first recital to the inspection decision states that ‘[t]he Commission has information that agreements and/or concerted practices between pharmacists in France assembled within the [ONP] and/or decisions by the [ONP] and/or the [CNOP] and/or the [CCG] having as their object and/or effect the prevention, restriction or distortion of competition within the common market, notably in the market for clinical laboratory tests have existed at least since 2003’ and that ‘[t]his conduct took the form, inter alia, of decisions intended to prevent pharmacists and/or legal persons from having access to the market for clinical laboratory tests, to restrict their activity on the market or to exclude them from that market’.
Likewise, the first paragraph of Article 1 of the inspection decision states that ‘[t]he [ONP], the [CNOP] and the [CCG] shall submit to an inspection relating to their participation in and/or possible implementation of agreements and/or concerted practices between pharmacists in France assembled within the [ONP] and in the manifestations of those agreements and/or concerted practices in the form of decisions contrary to the provisions of Article 81 [EC] and/or Article 82 [EC] inter alia in the market for clinical laboratory tests’ and that ‘[t]hat conduct is alleged inter alia to have manifested itself in the form of decisions designed to prevent pharmacists and/or legal persons from gaining access to the market for clinical laboratory tests, to restrict their activity on that market or to exclude them from that market’.
Contrary to the Association’s contention, that description does not relate solely to the Association’s conduct aimed specifically at the development of groups of laboratories from the point of view of their structure. Admittedly, it may be inferred that the investigation was particularly concerned with such practices. That is so if account is taken of the fourth recital, which states that ‘[t] he Commission has information that agreements and/or concerted practices between the pharmacists in France assembled within the [ONP] have manifested themselves with regard to pharmacists and/or legal persons wishing to provide clinical laboratory tests in the form of decisions not to register them on the list of Section G, not to update their registration on the list and/or to prohibit them from pursuing their activity with the object and/or effect of restricting competition on the market for clinical laboratory tests’, as the Association’s practices in connection with registration were closely linked to the problem of the structure of the groups of LABM, as may be seen from the examination of the second to sixth pleas above.
None the less, the reference in the first recital to, and in Article 1 of the operative part of, the inspection decision to decisions by the Association and its bodies intended to restrict the activity of pharmacists and/or legal persons in the market for clinical laboratory tests may logically include a wider range of practices having that effect than only those relating to registration. As the Commission pertinently claims, in view of the heavy regulation of the sector, price was undeniably an essential element on which market players could be differentiated.
The Association’s argument that that subject-matter is ‘wholly unconnected with the complaint relating to discounts’ must therefore be rejected.
As for the Association’s argument that the use of the expression ‘inter alia’ in the first recital to the inspection decision and in Article 1 of the operative part of that decision cannot satisfy the requirements of precision laid down in the case-law, it concerns the issue of the sufficiency of the reasoning on which the inspection decision is based, which the Court has already determined in the judgment in
CNOP and CCG
v
Commission
, paragraph 8 above, as observed at paragraphs 220 and 221 above. It may however be reiterated, for the sake of completeness, that, as the Association acknowledges, although the Commission must state as precisely as possible the presumptions which it intends to verify, it is not required to provide a precise legal classification of the infringements concerned. The Commission is required only to give a description of the essential features of the suspected infringement, since it does not yet have precise information to issue a specific legal opinion, but must first of all verify the substance of its suspicions and also the extent of the facts that have taken place (see, to that effect, judgment in
Roquette Frères
, paragraph 221 above, paragraph 55 and the case-law cited).
In that regard, the Commission pertinently observes that, at the stage of the adoption of the inspection decision, it did not have the necessary information to distinguish the different aspects of the Association’s anti-competitive conduct on the market for clinical biology test services. Thus, although it is the case that the Commission did not expressly mention the Association’s opposition to discounts, nor did it focus on the Association’s opposition to the dismemberment of shares in the SELs or on the matter of the minimum shareholding of the biologist in the capital of the SELs. Admittedly, those types of conduct are clearly more closely related to the problem of registration, to which specific reference is made in the inspection decision, than the conduct relating to discounts, but that does not suffice to exclude from the subject-matter of the inspection other types of conduct on the part of the Association designed to restrict the activity of pharmacists and/or legal persons on that market.
In addition, the Commission correctly claims that, although the Association’s actions in relation to discounts also concern laboratories or SELs not forming part of a group of laboratories, they were also aimed at such groups, which undoubtedly had the greatest capacity to make economies of scale and, where appropriate, to offer discounts.
It follows from the foregoing analysis that the subject-matter of the inspection decision could reasonably extend to the Association’s conduct in relation to discounts and, accordingly, the evidence obtained in that respect is legally constituted. The same applies to the evidence obtained following the requests for information of 3 February and 16 June 2009, in so far as those requests were directly or indirectly based on that evidence gathered during the inspection.
Third, and consequently, there is no need to examine further the conditions in which the Commission is required to initiate a new investigation in order to examine a certain type of infringement or may widen the scope of an investigation already in progress. That question concerns the application of the case-law to the effect that although, as a matter of principle, the information gathered in the course of inspections must not be used for purposes other than those indicated in the inspection decision, the Commission is not barred from initiating an inquiry in order to verify or supplement information which it happened to obtain during a previous investigation if that information indicates the existence of conduct contrary to the competition rules in the Treaty (see, to that effect, judgment in
Dow Benelux
v
Commission
, paragraph 221 above, paragraphs 18 and 19).
Since the Court considers that the information gathered during inspections relating to the Association’s pricing practices is consistent with the subject-matter of the investigation as defined in the inspection decision, the Commission was not required to initiate a new investigation with regard to that information, contrary to the Association’s contention.
Last, for the remainder, it should be observed that, as the Commission claimed at the hearing, it is apparent from the application that the Association considers that it understood at the time of the second request for information, on 18 June 2009, and certainly when the statement of objections was issued, that the investigation included its practices in relation to discounts. It cannot therefore be accepted that the Association was not given the opportunity to put forward during the inter partes administrative procedure its point of view on the reality and the relevance of facts and circumstances alleged by the Commission in that respect.
The second complaint must therefore be rejected, as must, accordingly, the seventh plea in its entirety.
Eighth plea, raised in the alternative, alleging, in essence, an error of assessment of the scope of the applicable legal framework and the intention of the legislature
This plea is aimed, in particular, at Chapter 5.1 of the contested decision, ‘Intervention on market prices’, where the Commission describes the Association’s unlawful conduct as a series of decisions having as their object the imposition of a minimum market price by means of the positions which it adopts and its intervention with respect to cooperation contracts or agreements concluded between laboratories and including discounts (recitals 133 to 221).
It concerns, more specifically, the interpretation of Article L 6211-6 of the CSP and, in particular, the interpretation of the concept of ‘discount’ in that provision.
Article L 6211-6 of the CSP reads as follows:
‘Subject to any agreements that may be concluded with health insurance schemes or organisations or public or private health establishments and to the [cooperation contracts between laboratories] referred to in Article L 6211-5, natural persons and the companies and bodies that operate a clinical test laboratory may not grant third parties discounts of any kind for the tests or examinations entrusted to them.
They may not conclude a contract or agreement granting a third party all or part of the revenue from the activity of the clinical test laboratory.’
As stated at recital 106 to the contested decision, Order No 2010-49 of 13 January 2010, which entered into force on 16 January 2010, prohibited the grant of discounts by laboratories, without exception. In fact, the first paragraph of Article L 6211-6 of the CSP was then replaced by a provision which stated that ‘[a] clinical laboratory shall invoice the clinical laboratory tests which it performs at the price set out in the nomenclature of clinical tests’.
The Association maintains that the Commission misreads Article L 6211-6 of the CSP when it considers that, before the entry into force of Order No 2010-49, under that provision laboratories were free to grant reductions in prices for clinical biology test services which qualify for reimbursement provided that they were defined in agreements or cooperation contracts between laboratories or with hospitals. According to the Association, that provision contained a strict prohibition of such price reductions, which is confirmed by the parliamentary proceedings leading to the enactment of Law No 75-626 of 11 July 1975 on clinical test laboratories and their directors and deputy directors, which introduced Article L 6211-6 of the CSP, in particular by the report drawn up on behalf of the Cultural, Family and Social Affairs Committee on the draft law (No 750) relating to clinical test laboratories by Mr Bichat, a deputy, annexed to the minutes of the sitting of 10 April 1975 of the French National Assembly (‘the Bichat report’).
Furthermore, the Association takes issue with the Commission for not defining in the contested decision what is meant by the word ‘discount’, but merely asserting peremptorily that discounts are ‘undeniably a commercial gesture’, at recital 207. In the Association’s submission, a discount cannot in any event be a commercial gesture. The exceptions to the prohibition of discounts refer either to the sharing of fees between laboratories or to charges for services supplied by a contracting partner.
The Commission disputes the Association’s arguments.
In that regard, it is apparent, in particular, from recital 136 to the contested decision that the Commission considers that it follows from Article L 6211-6 of the CSP, and in particular from the first paragraph of that provision, that the body with which the laboratory signs a contract or an agreement, whether that body is a health insurance scheme, a public or private hospital or another laboratory, may choose the better price between two proposals from laboratories offering an equivalent quality of service and, accordingly, pay a price for those services that is less than the legal maximum price, namely the official reimbursement rate, also called the ‘nomenclature’. The Commission therefore considers that, in the limited circumstances provided for in the first paragraph of Article L 6211-6 of the CSP, the content of which is set out at paragraph 241 above, namely in the context of cooperation contracts between laboratories and that of agreements concluded between laboratories and health insurance schemes or public or private health establishments, a discount in the sense of a gesture of a commercial nature of a reduction of the reimbursement price provided for in the nomenclature may exist.
It must be stated that a reading of the provision in question does not call that interpretation into question.
The Association contends, however, that in reality only two situations are permitted under Article L 6211-6 of the CSP: first, the sharing of fees between laboratories which share the tasks when providing clinical biology test services or, second, charges in contracts between laboratories and health establishments, corresponding to compensation for services supplied by those establishments. Any gesture of a commercial nature is precluded.
The first interpretation put forward by the Association, namely that the word ‘discount’ in the first paragraph of Article L 6211-6 of the CSP can mean only the sharing of fees in the context of cooperation contracts between laboratories, is based on the parliamentary proceedings leading to the introduction of that article as set out in the Bichat report. However, it must be stated that, as the Commission maintains, first, the wording of the first paragraph of Article L 6211-6 of the CSP is clear and, second, the Bichat report puts forward an interpretation of the wording that does not correspond to the version of that provision that was adopted. While that report states, inter alia, that ‘discounts granted to third parties are strictly prohibited, except … in the case of fees charged by a dispensing pharmacist or another laboratory’, Article L 6221-6 of the CSP as adopted is not drafted in those terms.
Contrary to the Association’s contention, it cannot therefore be inferred from the Bichat report that in cooperation contracts between laboratories, an exceptional situation expressly referred to in the first paragraph of L 6211-6 of the CSP, a gesture of a commercial nature between the laboratories in question, going beyond a strict sharing of the remuneration provided for in the nomenclature, is precluded.
In any event, the Commission does not dispute that the first paragraph of Article L 6211-6 of the CSP refers, as regards cooperation contracts between laboratories, to arrangements as to the way in which they share the final price as invoiced to the customer, and therefore the way in which they share the fees. What it does is to object to the way in which the Association also intervened in that context, which is the subject-matter of the examination of the ninth plea. Likewise, as regards the assertion that the Commission fails to take into consideration the fact that the Association eventually issued an opinion in favour of the contracts in question, the argument is not relevant to the outcome of the present plea, which concerns the question whether the Commission’s interpretation of the law is correct.
It has therefore not been established that the Commission misinterpreted Article L 6211-6 of the CSP with regard to the cooperation contracts between laboratories.
As regards the second interpretation put forward by the Association, namely that, in contracts concluded between laboratories and health establishments, the word ‘discount’ necessarily refers to a reduction granted by the laboratory by comparison to the price in the nomenclature by way of consideration for a service provided in exchange by the health establishment concerned, the Commission examined and rejected that argument at recitals 199 to 212 to the contested decision.
Nor do the arguments put forward by the Association in that respect before the Court show that the Commission misinterpreted the applicable legal framework.
First, the Association relies on French case-law relating to the interpretation of legislative texts concerning the profession of physician.
The judgments of the French Cour de cassation cited before the Court concern the application of Article L 4113-5 of the CSP, which provides that ‘a person who does not satisfy the requirements to practise the profession shall not receive, under an agreement, all or a proportion of the fees or benefits arising from the professional activity of a member of one of the professions governed by this Book’. As the Association observes, that case-law, and in particular the judgment of the French Cour de cassation of 21 November 2006, states that payment of a fee is subject to the twofold condition, first, that it is consideration for services provided by the establishment corresponding by their nature and their cost to a service supplied to practitioners and, second, that the cost of all or some of those services is not borne by a social security scheme. The judgments of the Cour de cassation and the other decisions on which the Association relies prohibit, in proceedings relating to fees on the basis of Article L 4113-5 of the CSP, any fee not corresponding to the actual consideration for a service provided for the physicians, because it follows from that provision, which is designed to protect the remuneration of medical activities, that a sum levied on that remuneration must correspond exclusively, by its nature and its cost, to a service supplied to the practitioner.
Article L 4113-5 of the CSP is in Book I of Part 4, entitled ‘Health professions’, of the legislative part of the CSP, concerning the medical professions, and it follows in particular from Article L 4113-1 that those professions include physicians, dentists and midwives, while pharmacists are governed by Book II of the CSP, entitled ‘Pharmaceutical professions’.
Admittedly, as the Association observed in an answer to a written question put by the Court, the wording of Article L 4113-5 of the CSP is similar to that of the second paragraph of Article L 6211-6 of the CSP, which the Commission does not appear to take into account in the contested decision when it disregards the case-law in question. However, that second paragraph is clearly aimed at the particular problem of the financial independence of operators of laboratories, as Article L 4113-5 of the CSP is aimed at the financial independence of physicians. However, it has not been established that that problem necessarily coincides with the problem of the possibility of granting discounts in the context of specific contracts, particularly in the light of the fact that the first paragraph, referring to discounts, and the second paragraph of Article L 6211-6 of the CSP coexist, so that, according to the legislature, discounts do not necessarily threaten that financial independence. It must be observed, moreover, that the Association does not generally refer to the problem of the financial independence of operators of laboratories when it formulates observations on the level of discounts (see paragraph 261 et seq. below).
In those circumstances, it cannot be accepted that the conditions in which Article L 4113-5 of the CSP permits discounts must also apply for the purpose of determining in what circumstances Article L 6211-6 of the CSP permits discounts.
Furthermore, the Commission rightly points to certain inconsistencies in the Association’s argument in that respect. First, if the sums levied for a service provided must be the exact counterpart of the value of that service, the Association should no longer advocate a standard reduction of 10% (see also paragraph 263 below). Second, that interpretation does not take account of the fact that price competition is permitted in the context of occupational medicine, for which there is no reimbursement by social security schemes, as observed at recital 155 to the contested decision, which is not disputed by the Association. Last, the case referred to at recital 151 to the contested decision concerns a discount granted in a contract between a laboratory and a public hospital, which the Association accepted although it clearly did not relate to compensation for services provided.
Second, the first paragraph of Article R 4235-75 of the CSP, inserted in the part dealing with ethical rules applicable to pharmacist-biologists, states that ‘[a] pharmacist-biologist must not reduce his fees with the intention of competing unfairly or to the detriment of the quality of the services which he provides’ and that, ‘[i]n the case of a cooperation contract between laboratories, fees for samples transferred must be set with tact and moderation’.
That provision therefore takes into account the possibility that prices may be set at a different level from the price stated in the nomenclature, provided that there is no unfair competition and the quality of care is observed, and, moreover, as regards cooperation contracts between laboratories, ‘with tact and moderation’.
As the Commission observes, in particular, at recital 141 to the contested decision, before January 2010 the Association adopted a position of principle, imposing a minimum price by means of its policy of maximum discounts of 10%, without any mention of looking for evidence of unfair competition or a possible detrimental effect on the quality of care. In that regard, recital 141 to the contested decision refers, in particular, to a decision adopted at an administrative meeting of the CCG on 14 September 2005, according to which, ‘[t]he Council confirms the observations set out in its previous correspondence, [that is to say] that any discount must be set with tact and moderation, and a discount of more than 10% does not reflect well on our profession’ and that ‘[d]iscounts should not become common practice’.
Admittedly, a reference to a maximum amount of 10% may be found in the provisions governing the profession of physicians, as Article R 6141-35 of the CSP, repealed on 31 March 2011, authorised fees to be paid to a hospital by way of consideration for services provided for general practitioners. However, when asked by the Court specifically about that matter in the written questions and at the hearing, the Association was unable to cite any legislative or regulatory provision specifically governing pharmacists, or indeed pharmacist-biologists, at the material time that mentioned such a maximum amount of 10%.
In those circumstances, the Commission cannot be criticised for taking the view that the reference to a discount or a maximum discount of 10% for pharmacist-biologists is the consequence of a broad application of the legislative and regulatory provisions applicable to biological pharmacists.
Third, Opinion No 10-A-01 of the French Competition Authority of 5 January 2010 relating to a draft order on the organisation of medical biology, commenting on the reason why the French legislature prohibited the possibility of granting discounts by means of Order No 2010-49, indicates the following at paragraphs 156 to 158:
‘156
[The proposed provision] prohibits any discount by reference to the tariff in the nomenclature of medical biology procedures, other than in the particular case of cooperation contracts.
That provision will restrict the part of freedom to set prices that exists today. Article L 6211-6 [of the CSP] prohibits discounts, but “subject to contracts or agreements that may be concluded with health insurance schemes or organisations or public or private health establishments”.
Thus, the financial relations between clinical test laboratories and public or private health establishments are not predefined by the nomenclatures and tariffs relating to the reimbursement of persons covered by social insurance, which constitute a maximum price and, within the limit of that maximum amount, come under the arrangements governed by ordinary law on freedom to set prices currently laid down in the first paragraph of Article L 410-2 of the Commercial Code.’
Those observations of the French Competition Authority therefore also support the interpretation according to which at the material time laboratories had a margin of negotiation in order to grant discounts in the circumstances referred to in Article L 6211-6 of the CSP.
Fourth, the adoption of Order No 2010-49 and the ensuing prohibition of any reduction in price by reference to the price stated in the nomenclature for clinical examinations permit the inference that such a general prohibition did not exist under Article L 6211-6 of the CSP.
Last, the fact that certain documents in the Commission’s file refer to fees by way of consideration for services provided does not prove that this is one of the only interpretations of that word in the context of Article L 6211-6 of the CSP, or that it must be inferred from that provision that the value of the reduction offered must necessarily correspond to the value of a service provided.
Consequently, it must be concluded that the Association advocates a biased interpretation of Article L 6211-6 of the CSP in force until 2010, in so far as that provision allowed a certain amount of price competition in situations not limited to cases of sharing of fees or fees necessarily corresponding to the value of a service provided in return.
Last, in any event, it should be stated that, even if the Commission must be considered to have made an error of interpretation with regard to the examples referred to in Article L 6211-6 of the CSP, that would still not necessarily provide justification for the Association’s interventions as regards the level of the percentages specified in that regard by laboratories in specific agreements. The other arguments which in the Association’s submission justify such interventions are examined in the context of the ninth plea, and in particular of the second part of that plea, at paragraph 279 et seq. below.
It follows from the foregoing that the eighth plea must be rejected.
Ninth plea, raised in the alternative, alleging, in essence, an error in the assessment of the facts, leading to an error of law
Like the eighth plea (see paragraph 239 above), this plea concerns Chapter 5.1 of the contested decision, ‘Intervention on market prices’, where the Association’s conduct designed to impose a maximum level of discounts on prices set by the State is examined in detail at recitals 133 to 221. In essence, however, it is directed at the question whether the Commission proved this aspect of the infringement to the requisite legal standard.
Recitals 662 to 666 to the contested decision draw the conclusions from the findings made in Chapter 5. They are worded as follows:
‘…
(662)
It has been shown in Chapter 5.1 that the decisions aimed at imposing a minimum market price took shape as from December 2003, when the ONP decided to draw up “certain rules concerning the financial conditions to feature in cooperation contracts”.
(663)
The documents in the file also enable it to be established that the ONP was increasingly insistent in attempting between September 2004 and September 2007 to impose a minimum market price on the ground that any departure from that minimum “does not reflect well on our profession and could indicate behaviour detrimental to colleagues” …
(664)
With a view to imposing a minimum market price, the ONP sent letters to a very large number of laboratories which, as the law obliged them to do, had given notice of contracts for cooperation with other laboratories or hospitals, where the contracts involved discounts deemed by the ONP to be too large. In all the letters, the ONP referred explicitly to the Code of Ethics and, therefore, indirectly to its powers to impose disciplinary penalties. In several cases, the ONP copied its letters to the decentralised departments of the State.
(665)
In its observations on the statement of objections, the ONP correctly pointed out that it had not instituted any disciplinary proceedings in relation to the discounts on the basis of a disciplinary breach of Article R 4235-75 of the CSP. It is settled case-law, however, that the implementation of retaliatory measures is not a condition that must be met before there is behaviour designed to fix market prices. Article 101(1) TFEU expressly refers to decisions by associations of undertakings designed to “directly or indirectly fix prices” as being restrictive of competition.
(666)
As a result, there is no doubting the anti-competitive object of this type of manifestation of the infringement, especially since this object was formalised on 14 September 2005 by a decision of the ONP to the effect that “a discount of more than 10% does not reflect well on our profession. Discounts should not become common practice”.’
The arguments put forward by the Association with respect to the analysis set out in the contested decision may be divided into two parts.
In the first part, the Association claims that the Commission was wrong to take the view that it had systematically attempted, in order to protect the interests of small laboratories, to impose a minimum price in the market for clinical biology test services.
In the second part, the Association maintains that the Commission cannot find that its conduct in relation to discounts does not fall within the scope of its legal remit but reflects anti-competitive objectives.
It is appropriate to begin by examining the second part.
– The second part
The Association maintains that the Commission cannot find that its conduct in relation to discounts does not fall within the scope of its legal remit, but reflects anti-competitive objectives. It submits that, in all the cases to which the Commission refers, its conduct was designed to ensure that the ethical rules were observed and to ensure respect for the principle of professional independence in order to preserve the quality of the procedures carried out by pharmacist-biologists in the context of an
a posteriori
control coming within its legal supervisory remit. The Association is not against the principle of discounts as such, but formulated observations when the discounts were liable to harm public funds, the quality of healthcare or the independence of health professionals. It refers to its legal remit as defined in Article L 4231-1 CSP (ensuring compliance with professional duties and the independence of the profession, contributing to promoting public health and the quality of healthcare) and in Article R 4235-75 of the CSP (ensuring that pharmacist-biologists do not reduce their fees with the intention of engaging in unfair competition or to the detriment of the quality of their services). The Association also refers to the Bichat report and to Article L 162-13-2 of the French Social Security Code.
The Association maintains, moreover, that the price fixed in the nomenclature is a balanced price negotiated by the State which takes into account the real costs of the analysis, remuneration for the provision of care and the protection of public funds, and not a market price. In its submission, it is generally accepted that there is a definite relationship between the quality of services received by the sick and the nature and method of remuneration. It relies, in that regard, on Joined Cases
C-94/04 and C-202/04
Cipolla and Others
[2006] ECR I-11421
, paragraph 67). Accordingly, having been entrusted by the legislature with ensuring compliance with the ethical rules, including, in particular, Article R 4235-75 of the CSP, which is specific to biological pharmacists, it could not, in its submission, fail to be concerned about certain large discounts (mainly over 30% and up to 50%) on the ground that they tend to indicate dumping.
The Commission disputes the Association’s arguments.
It must be pointed out that the Association’s argument that its action was none other than an application of the law overlaps with the argument put forward in the context of the eighth plea, but in this part of the present plea the Association makes specific reference to its duty to ensure compliance with Articles L 4231-1 and R 4235-75 of the CSP.
As a preliminary point, the argument which the Association bases on the Bichat report must be rejected, for the reason stated at paragraphs 249 and 250 above.
The content of Article L 4231-1 of the CSP is set out at paragraph 2 above. It follows that the tasks entrusted to the Association include, inter alia, the obligation to ensure compliance with professional duties, defending the honour and independence of the profession, ensuring the competence of pharmacists and contributing to promoting public health and quality of healthcare, including the safety of professional procedures.
The content of Article R 4235-75 of the CSP has already been mentioned in the context of the examination of the eighth plea. As a reminder, the first paragraph of that provision states that ‘[a] pharmacist-biologist must not reduce his fees with the intention of competing unfairly or to the detriment of the quality of the services which he provides’ and that, ‘[i]n the case of a cooperation contract between laboratories, fees for samples transferred must be set with tact and moderation’.
According to the Association, in essence, in the context of the alleged conduct relating to discounts, it merely applies the law by pointing out the exorbitant or unusual nature of certain discounts, since a systematic practice of offering high discounts would undermine the quality of healthcare and the independence of health professionals and would entail the risk of misuse of public funds. The Association observes that it must also ensure that the pharmacist-biologists’ fees are not reduced with the intention of engaging in unfair competition. Its conduct therefore falls outside the scope of Article 101 TFEU.
In that regard, it cannot be denied that the Association’s conduct in relation to prices as described in the contested decision is not unconnected to its remit as guardian of the ethical duties of biological pharmacists, which the Commission also recognises when its states, at recital 174 to the contested decision, that the monitoring of compliance with the code of ethics concerning the prices charged by pharmacists falls within the Association’s legal remit.
Furthermore, the interventions by the Association referred to in the contested decision often relate to the grant of significant discounts, of as much as 30, or even 50%, of the price stated in the nomenclature for a clinical biological test. Those interventions concern contracts submitted to the Association in accordance with Article L 6221-5 of the CSP, which provided that SELs operating laboratories were required to notify to the Association ‘contracts and amendments thereto concluded by those companies and intended to ensure the use of the equipment or the premises serving for the activities of the laboratory’, those provisions being reinforced since August 2005 by Article L 4221-19 of the CSP, under which such contracts and amendments thereto are to be notified within one month of their conclusion.
However, the Commission explains in detail at recitals 175 to 221 to the contested decision why in its view the action taken by the Association in that sphere is the result of an interpretation of the law for economic ends rather than a strict interpretation of the law.
It must be stated that none of the arguments put forward by the Association calls into question the Commission’s finding that the conduct in question does not result from a simple application of the law. The Association on a number of occasions exceeded the limits of its legal remit in order to impose its own economic interpretation of the law.
First, as the Commission correctly asserts, it does not follow from the citations of the letters or minutes set out at recitals 142 to 164 to the contested decision that, in its interventions in relation to the contracts concluded by the laboratories, the Association made any reference to the quality of healthcare, the independence of health professions or the risk of misuse of public funds. Nor does the Association submit any specific document in support of its argument to that effect.
As regards the link between the grant of discounts and the quality of healthcare, the Commission claims, without being contradicted on that point by the Association, that the Association has not at any time established that the discounts granted would affect the quality of the services provided by the laboratory concerned. Furthermore, as stated at recital 218 to the contested decision, the Association itself makes clear that the monitoring of quality is exclusively a matter for the French Ministry of Health.
As regards the judgment in
Cipolla and Others
, paragraph 280 above, the Court of Justice observes at paragraph 67 of that judgment that it is conceivable that a scale imposing minimum fees on lawyers does serve to prevent them, in the specific context of the very competitive Italian market, from being encouraged to offer discounts, with the risk of deterioration in the quality of services provided. Apart from the fact that that judgment concerns the problem of freedom to provide services, the services at issue in that judgment were generally delivered in a context of an asymmetry of information between client-consumers and the provider of the services, unlike the situations envisaged in the contested decision, which concern relations between professionals in the sector. The judgment cannot therefore be decisive for the purpose of supporting the Association’s argument.
As regards the possible harm to public funds, the Association refers in particular to Article L 162-13-2 of the French Social Security Code, which provides that the directors of laboratories are required to carry out analyses and tests while observing the strictest economy compatible with precise compliance with the instructions. However, it must be stated that there is never any reference to possible harm to public funds in the Association’s letters. Furthermore, the Commission correctly claims, first, that the discounts granted to public hospitals or hospitals controlled by the sickness insurance scheme cannot but benefit public funds. Second, the Commission is also correct to assert that, if there were instances of abuse in agreements between laboratories and private hospitals, in so far as the latter might be granted discounts while being reimbursed at the price set in the nomenclature, that constituted an anomaly in the regulations that should be regulated otherwise than by the intervention of the Association in cases where the law permitted discounts. Furthermore, it should be observed that, as the Commission has remarked in essence (recital 197 to the contested decision), if the Association considered that the discounts in themselves gave rise to fraud, it ought also to have reacted with respect to discounts of up to 10%.
As regards an alleged link between the grant of discounts that are too high and the professional independence of pharmacist-biologists, which the Association is also responsible for ensuring, its arguments are confined to mere assertions which are not based on any evidence that would explain the link between those two aspects, which is not readily apparent.
Second, the extracts from letters cited by the Commission in the contested decision systematically refer to the fact that discounts must be set ‘with tact and moderation’ and that a discount of a certain percentage, admittedly quite high (often between 30 and 50%), ‘does not reflect well on the profession’ or ‘may indicate behaviour detrimental to colleagues’.
However, as the Commission states at recital 179 to the contested decision, the reference to Article R 4235-75 of the CSP, which provides that the fees must be set with ‘tact and moderation’, applies only to contracts between laboratories, in particular ‘fees for samples transferred’, and not to contracts between a laboratory and another organisation, although the Association refers to it in that context on several occasions.
Furthermore, the Commission sets out at recitals 175 to 179 to the contested decision the argument that the concept of ‘tact and moderation’ refers to the risk of fees that are too high by comparing the legislation applicable to biological pharmacists with the articles of the law relating to other health professionals, an analysis which is not specifically contradicted by the Association.
Third, as regards the fact that the Association’s remit also includes preventing the risk of unfair competition, the Commission correctly observes that it is not sufficient for the Association to refer to that remit in the abstract. Such a risk cannot result only from the amount of the discount, especially in a context where the reports on which the Association itself relies, namely, first, the report for a proposal to reform biological medicine submitted to the French Minister for Health, Youth, Sports and Community Life by Mr Ballereau on 23 September 2008 and, second, Report No 2006 045 of April 2006, submitted by Ms Lalande, Ms Yeni and Ms Laconde, members of the French Inspectorate-General for Social Affairs (IGAS), point out that the prices charged in France are higher than in the other Member States. That assertion remains valid even though the Association correctly observes that the findings of the second report are more nuanced and accept that the price of medical biology measures in France, which consist of various stages and are therefore more complex, cannot be compared with the prices generally charged in the other countries of the European Union. In fact, the Commission’s finding that there is a margin for laboratories that enables them to grant discounts before they could be accused of working at a loss is also based, as observed at recital 186 to the contested decision, on the responses provided by several pharmacists to the Commission’s questionnaires, in which they stated that they easily covered their costs.
It follows from the foregoing that the second part of the ninth plea must be rejected.
– First part
First, in the Association’s submission, the interventions identified by the Commission in regard to discounts were only marginal, since for the investigation period, from December 2003 until the end of 2008, thus more than five years, the Commission identified only 18 letters, which in reality concerned 14 contracts and 3 requests for information. Out of 4270 laboratories in France, that represents 0.3% of laboratories concerned over five years.
Second, the Commission is wrong to find, at recital 185 to the contested decision, that the Association’s objective in relation to discounts is to protect small laboratories by systematically taking action against groups of laboratories, as the laboratories concerned were small structures in 11 cases among the 18 letters, while only 3 of them were addressed to SELs forming part of a regional network, 1 was addressed to a specialised laboratory and 3 to groups of laboratories. The Association’s objective in relation to discounts was therefore clearly not to take action systematically against groups of laboratories, but to protect public health by ensuring compliance with the principle of the professional independence of pharmacist-biologists in order to maintain the quality of clinical laboratory procedures.
Third, the analysis of the Association’s conduct with respect to the contracts in question does not confirm the Commission’s findings. At recitals 161 and 162 to the contested decision, the Commission relies as against the Association on agreements between two laboratories concerning the sharing of fees, in respect of which the CCG issued a favourable opinion. Next, at recitals 159, 163 and 164 to the contested, the Commission relies on three agreements between laboratories and private health establishments which were exclusivity contracts or practitioner contracts, where discounts are allowed, but the price cannot be set freely, as it is subject to the nomenclature of clinical biology procedures. In challenging discounts of between 15 and 48% of the price set in the nomenclature, the CCG acted within the framework of its legal remit in order to ensure compliance with the ethical rules, because there was a risk of harm to public funds. The other agreements mentioned by the Commission in relation to agreements with public health establishments (recitals 147 to 151 and 153 to the contested decision) and with sickness insurance schemes (recitals 144, 145 and 152 to the contested decision) contained discounts which did not benefit the patient and were not apt to ensure an optimum quality of care, but potentially showed acts of unfair competition. It was in the context of its
a posteriori
supervision that the CCG formulated observations on those agreements, referring to the principles set out in Article R 4235-75 of the CSP, but it did not send reminders and never made use of its disciplinary power.
The Commission disputes the Association’s arguments and observes, in essence, that the infringement committed by the Association in relation to discounts is an infringement by object.
In that regard, it should be borne in mind that it follows from the case-law that the concepts of ‘agreement’, ‘decisions by associations of undertakings’ and ‘concerted practice’ in Article 101(1) TFEU are intended, from a subjective point of view, to catch forms of collusion having the same nature which are distinguishable from each other only by their intensity and the forms in which they manifest themselves (see Case
C-8/08
T-Mobile Netherlands and Others
[2009] ECR I-4529
, paragraph 23 and the case-law cited).
Furthermore, with regard to the assessment as to whether particular practices are anti-competitive, close regard must be paid in particular to the objectives which they are intended to attain and to their economic and legal context (see, to that effect, judgment in
T-Mobile Netherlands and Others
, paragraph 305 above, paragraph 27 and the case-law cited).
Next, the case-law makes clear that the distinction between ‘infringements by object’ and ‘infringements by effect’ arises from the fact that certain forms of collusion between undertakings can be regarded, by their very nature, as being injurious to the proper functioning of normal competition (judgments in
T-Mobile Netherlands and Others
, paragraph 305 above, paragraph 29, and
Allianz Hungária Biztosító and Others
, paragraph 61 above, paragraph 35).
Thus, it is settled that certain collusive conduct, such as that leading to horizontal price-fixing by cartels, may be regarded as so likely to have negative effects on, in particular, the price, quantity or quality of goods and services that there is no need, for the purposes of the application of Article 101(1) TFEU, to demonstrate that it has actual effects on the market (see, to that effect, Case
123/83
Clair
[1985] ECR 391
, paragraph 22).
Where the analysis of a type of collusion between undertakings does not present a sufficient degree of harm for competition, it is necessary, on the contrary, to examine the effects of the collusive action and, in order to prohibit it, to find that factors are present which show that competition has in fact been prevented or restricted or distorted to an appreciable extent (judgment in
Allianz Hungária Biztosító and Others
, paragraph 61 above, paragraph 34 and the case-law cited).
In order to determine whether an agreement between undertakings or a decision by an association of undertakings is sufficiently harmful to be regarded as a restriction of competition ‘by object’ for the purposes of Article 101(1) TFEU, it is necessary to have regard to the content of its provisions, its objectives and the economic and legal context of which it forms part. When determining that context, it is also appropriate to take into consideration the nature of the goods or services affected, as well as the real conditions of the functioning and structure of the market or markets in question (see, to that effect, judgment in
Allianz Hungária Biztosító and Others
, paragraph 61 above, paragraph 36 and the case-law cited).
In the present case, it should first of all be recalled that it follows from the examination of the eighth plea that the Commission did not err in finding that the Association’s conduct in relation to discounts was the consequence of a broad interpretation of the applicable legislative framework and the Commission was therefore entitled to evaluate it from the aspect of Article 101(1) TFEU.
Next, it follows, in particular, from Chapter 5.1 of the contested decision and from the passage from Chapter 7 cited at paragraph 274 above that the Commission relies on documentary evidence as the basis for its conclusion that there was an infringement by object consisting in a horizontal agreement on prices, although, at recital 754, concerning the gravity of the infringement, it concedes that this is not a typical case.
Thus, the infringement began, according to the Commission, with the decision taken at the administrative meeting of the CCG on 11 December 2003, referred to in particular at recitals 139 and 662 to the contested decision, to ‘define certain rules concerning the financial conditions to feature in cooperation contracts concluded between laboratories’. In that regard, the Commission correctly maintains that the public service remit entrusted to the Association by the French State does not cover decisions adopted in that sphere.
The Commission also mentions the minutes of an administrative meeting of the CCG on 15 April 2004, from which it is apparent that the CCG decided to seek information from certain specialised bodies about the overall average profitability of clinical laboratories ‘before taking a position on those various contracts and agreements’.
Another crucial document is the minutes of the administrative meeting of the CCG held on 14 September 2005, referred to at recitals 141 and 666 and already mentioned in the context of the eighth plea (see paragraph 263 above). According to the Commission, on that occasion the Association put its policy on a formal footing. As stated in the contested decision, those minutes state, in relation to a contract between a laboratory and a university hospital, that ‘[t]he Council confirms the observations set out in its previous correspondence, namely that any discount must be set with tact and moderation, and a discount of more than 10% does not reflect well on our profession’ and that ‘[d]iscounts should not become a common practice’.
It must be stated that, apart from the general argument that its conduct constitutes an application of the law, the Association puts forward no arguments in relation to the minutes in question and the fact that they reveal its decision to intervene with respect to the terms of cooperation contracts or discounts granted to clients of the laboratories. However, those minutes are important documents in the chain of evidence established by the Commission, in particular because the decisions of the bodies of the Association to oppose discounts of a certain level can be inferred from those minutes.
In addition, the Commission relies on a series of letters between 2004 and 2008 in support of its finding that a practice of imposing minimum prices (or a maximum level of discounts) existed. Following a request from the Court, the Commission submitted copies of several of those letters sent to laboratories and of minutes of meetings internal to the Association in which it is stated each time that a discount, generally called a ‘reduction’, of a certain level above 10%, does not reflect well on the profession and might indicate behaviour detrimental to colleagues.
At recital 146 to the contested decision, moreover, the Commission refers to correspondence between the Association and SEL Eimer, in which the Association expressed its concern at the level of discounts granted and concerning which the French Directorate General for Competition, Consumption and the Repression of Fraud (DGCCRF), which had been approached by the Association, stated in 2009 that the sending of the letters in question could be analysed ‘as having as its object or potential effect the restriction of commercial freedom of undertakings, by encouraging them to adopt pricing behaviour without taking their actual costs into consideration’.
Other letters referred to in the contested decision also confirm the Commission’s analysis, in so far as they relate to situations, such as those mentioned at recitals 150 and 160 to the contested decision, in which the Association did not react to discounts fixed at a rate of below 10%.
Nor does the Association put forward any arguments concerning the exchange of letters between it and laboratories discussed at recitals 155 to 158 to the contested decision concerning its intervention in relation to contracts for clinical laboratory tests carried out in connection with occupational medicine. As the Commission observes at recital 155 to the contested decision, without being challenged on that point by the Association, such tests are not reimbursed by sickness insurance schemes and their price is therefore freely fixed and negotiation of the price is covered by the provisions of ordinary law governing freedom to set prices laid down in the Commercial Code.
The Court considers that the evidence referred to at paragraphs 313 to 320 above show that there was a decision by an association of undertakings taking the form of an indirect horizontal price-fixing agreement by means of the fixing of a maximum authorised level of discounts for market players, in particular a level of 10% by reference to the agreed reimbursement price in a context in which, until 2010, the law allowed laboratories to charge lower prices.
Therefore, in the light of the economic and legal context described in the contested decision, namely that of a regulated and protected market for clinical laboratory tests leaving only a small possibility of competing on prices by means of discounts for tests carried out in the context of occupational medicine, between laboratories and with hospitals or social security schemes, the Commission was correct to conclude that the decisions and practices in which the Association is found to have engaged and which are documented in the contested decision were aimed at price-fixing on the market, the anti-competitive object of which could not be called into question. Accordingly, in accordance with the case-law cited at paragraph 308 above, the Commission was entitled to classify them as contrary to Article 101(1) TFEU without demonstrating their actual effects on the market.
In addition, it must be further stated that the Commission found, at recitals 703 to 706 to the contested decision, that the exceptions provided for in Article 101(3) TFEU did not apply, as since the administrative procedure the Association had supplied no evidence on which it might be concluded that those exceptions applied. Furthermore, the Commission observes, as a subsidiary point, that ‘hardcore’ restrictions do not give rise to objective economic advantages and that in any event in the present case there was nothing to suggest that the conditions of Article 101(3) were met. The Commission’s analysis in relation to that provision in the contested decision is not called into question in the context of the present action.
In the light of those considerations, the argument which the Association bases on what it claims to be the insufficient number of letters referred to in the contested decision is not decisive for the purpose of challenging the finding that it engaged in conduct that was particularly harmful for the remaining competition allowed by what was otherwise restrictive legislation.
Admittedly, only 18 letters were found, over a period of five years. However, the Commission correctly states at recital 221 to the contested decision that the small number of letters might equally be explained by the fact that the Association ensured that discipline prevailed.
Likewise, in that context, it is not decisive whether, as the Association claims, the letters in question were also, indeed principally (that is to say, according to the Association, in the case of 11 out of 18 letters), addressed to small laboratories. Even if the Commission’s response to that argument, namely that that merely demonstrates the inconsistency of the Association’s policy, is not really convincing, it must be observed that the actual steps taken by the Association against laboratories in an attempt to establish a policy that was restrictive of competition on prices is no less unlawful if it is aimed at small laboratories or at large laboratories.
For the remainder, the Association’s argument that its objective in relation to discounts was rather to protect public health by ensuring compliance with the principle of the professional independence of biological pharmacists instead of protecting small laboratories, it follows from the examination of the eighth plea and the second part of the ninth plea above that the Association’s action in relation to discounts is based on a broad interpretation of the legal framework. In the absence of a regulatory power in that sphere, the Association ought to have acted within the strict framework of the law. In any event, the fact that the Association may have pursued a legitimate objective does not mean that its action in relation to discounts cannot be considered to have an object restrictive of competition (see, to that effect, Case
C-209/07
Beef Industry Development Society and Barry Brothers
[2008] ECR I-8637
, paragraphs 19 to 21), provided that that object is proven, which is undeniably the case in this instance.
Furthermore, the fact that the Association eventually issued an opinion in favour of the sharing of fees in certain cases does not call into question the unlawful nature of its initial intervention, which constitutes the implementation of a decision restrictive of competition.
Likewise, as to whether the Commission uses too strong a term when it refers to the sending of ‘reminders’, it is apparent from the examples given in the contested decision that in at least two cases the Association, after receiving explanations from the laboratory concerned about certain approved discounts, reiterated its position (see the examples cited at recitals 150 and 159 to the contested decision). Nor, moreover, is the question of the sending of reminders or not, or indeed the express requirement for contractual amendments, decisive for the purpose of determining whether there is an infringement of Article 101 TFEU by object.
That also applies to the question of the extent to which the Association threatened to use its disciplinary power in reaction to what it regarded as unorthodox behaviour. It must be stated, however, that, in the light of the evidence examined above, it cannot be denied that the Association made explicit reference to the use of its power when it referred to the existence of practices that were potentially detrimental to colleagues.
Last, as regards the fact that certain of the Association’s interventions were aimed at agreements potentially containing acts of unfair competition, the argument has already been examined in the context of the second part of this plea. In that regard, it was observed that that argument was used by the Association only in the abstract, as no specific evidence of unfair competition had been given in the letters in question.
It follows from the foregoing that the first part of the ninth plea must be rejected as must, consequently, the ninth plea in its entirety.
The assertion that there was not a single and continuous infringement
In the Commission’s submission, the Association appears to dispute for the first time in the reply the single and continuous nature of the infringement and thus raises a new, and inadmissible, plea. Furthermore, according to the Commission, the Association submits no argument in support of that alleged plea, which is therefore inadmissible for that reason too.
In that regard, it should be borne in mind that it follows from Article 44(1)(c) in conjunction with Article 48(2) of the Rules of Procedure that the original application must contain the subject-matter of the proceedings and a summary of the pleas in law relied on, and that new pleas in law may not be introduced in the course of the proceedings unless they are based on matters of law or of fact which come to light in the course of the procedure. However, a plea which amplifies a plea put forward previously, whether directly or by implication, in the application initiating the proceedings, and which is closely connected therewith, must be declared admissible (see Case
T-94/98
Alferink and Others
v
Commission
[2008] ECR II-1125
, paragraph 38 and the case-law cited).
In the present case, in the reply, the Association challenges the existence of a so-called overall plan which ‘constitutes a single and continuous infringement’. In its submission, this amounts to an artificial construction which does not stand up to an analysis of the facts.
The Court must consider whether, in so far as it is possible to infer from that argument a challenge to the single and continuous infringement, it constitutes a new plea.
In that regard, two passages in the application refer indirectly to the overall plan, a key element in the Commission’s analysis of the existence of a single and continuous infringement.
First, in the seventh plea, as set out in the application, the Association submits that the Commission exceeded the terms of reference of the inspection by seizing certain documents relating to prices in the course of the inspection, which in its view entailed a breach of its rights of defence. The Association adds in the reply that the Commission attempted, artificially and
a posteriori
, to establish a link between the problem relating to the development of groups of laboratories and the problem associated with discounts, in order to justify the use of evidence gathered during the inspection in an overall plan.
Second, the Association disputes, in the context of the first part of the ninth plea presented in the application, the Commission’s view that its principal objective in relation to discounts was to target groups of laboratories, given the large number of small laboratories to which the letters in question related.
The ninth plea raised in the application concerns whether the Commission proved to the requisite legal standard that there had been an infringement of Article 101 TFEU in respect of the Association’s policy on discounts. It is solely in order to claim, in the context of the first part, that the Commission was wrong to consider that, in order to protect the interests of small laboratories, the Association had systematically attempted to impose a minimum price in the market for clinical biology test services, that the Association refers to the large number of small laboratories concerned by its letters relating to discounts.
It must be stated that in the application the Association did not raise, either in the context of the argument raised in support of the seventh plea, or in the context of the first part of the ninth plea, even indirectly, any challenge to the single and continuous nature of the infringement.
In those circumstances, the plea challenging the single and continuous nature of the infringement, raised for the first time in the plea, cannot be regarded as amplifying a plea put forward previously. It must therefore be declared inadmissible on the ground that it is out of time.
Conclusion on the application of the
Wouters
case-law and the pleas in support of the claim for annulment
At this stage of the examination, it is still necessary to determine whether the
Wouters
case-law is applicable to the present case.
It follows from the examination of the second and third pleas above that the Association’s behaviour concerning the SELs’ duty to communicate certain information to it relates, first, to an unwarranted insistence on the part of the Association that the effects of changes during the lifetime of an SEL were subject to a suspensory condition and that the documents of certain companies must be amended in that sense and, second, requests for the communication of information not required by the law, under threat of penalties, in particular, towards SELs in the Labco group, which were identified by the managing bodies of the Association as constituting a threat.
Those acts in any event go beyond the advisory role played by the Association in procedures relating to approval by the prefect, nor are they justified by the fact that the Association takes account of prefectoral decrees when managing the register, which is based on specific provisions. The Association cannot therefore claim to act as a mere extension of the power of the prefect in that regard. Furthermore, as the Commission correctly observes, the Association has no regulatory power.
In addition, it follows from the examination of the third plea that the strict interpretation of the rules applied by the Association in its requests for information concerning movements in shares within the SELs cannot be justified by its remit of
a posteriori
verification of the legal provisions. In order to preclude the application of Article 101(1) TFEU, a party cannot therefore rely with regard to the behaviour at issue on the argument that any effects restrictive of competition are necessary for the proper practice of the profession as organised by the law, as was accepted for certain rules of the Ordre des avocats at paragraphs 109 and 110 of the judgment in
Wouters
, paragraph 21 above.
Furthermore, the Association’s behaviour with respect to the development of groups of laboratories, at issue in the fourth and fifth pleas, or in relation to discounts, may be analysed in the same way. Admittedly, the Association must ensure compliance with the ethical rules in the context of its legal remit, including the defence of the independence of pharmacist-biologists and the promotion of public health. However, its action must remain within the legal framework set up by the legislature and the administrative authorities, as the Association itself has no regulatory power. Accordingly, when it acts on the basis of an interpretation that is contrary to the literal meaning of the relevant provisions, and indeed adopts the most restrictive interpretation in the context of a particular strategy, its conduct cannot fall outside the scope of Article 101(1) TFEU on the basis of the argument that it is inherent in the pursuit of a legitimate objective. The Commission rightly finds in that regard that it is not for a body representing private persons to extend the scope of protection of the law with the desire of protecting the interest of a group when the legislature had defined the limits of the protection offered and left the possibility for a certain amount of competition.
The principles that emerge from the judgment in
Wouters
, paragraph 21 above, therefore do not permit the general view that the Association’s restrictive conduct referred to in the contested decision is not caught by the prohibition in Article 101(1) TFEU.
It follows that the first plea must be rejected.
Consequently, the claim for annulment must be rejected.
2.
The alternative claim, seeking a reduction of the amount of the fine
It should be borne in mind that review of the lawfulness of decisions adopted by the Commission is supplemented by the unlimited jurisdiction conferred on the Courts of the European Union by Article 31 of Regulation No 1/2003, in accordance with Article 261 TFEU. That jurisdiction empowers the Courts, in addition to carrying out a mere review of the lawfulness of the penalty, to substitute their own appraisal for the Commission’s and, consequently, to cancel, reduce or increase the fine or penalty payment imposed.
It is therefore for the Court, in the exercise of its unlimited jurisdiction, to assess, on the date on which it adopts its decision, whether the applicants received a fine the amount of which correctly reflects the gravity and duration of the infringement in question (see, to that effect, Case T‑343/06
Shell Petroleum and Others
v
Commission
[2012] ECR, paragraph 117 and the case-law cited).
It must be pointed out, however, that the exercise of unlimited jurisdiction does not amount to a review of the Court’s own motion, and that proceedings before the Courts of the European Union are inter partes (judgment in
Chalkor
v
Commission
, paragraph 57 above, paragraph 64).
In the present case, as explained at paragraph 11 above, the Commission applied point 37 of the Guidelines when determining the amount of the fine. That provision reads as follows:
‘Although these Guidelines present the general methodology for the setting of fines, the particularities of a given case or the need to achieve deterrence in a particular case may justify departing from such methodology or from the limits specified in point 21.’
It follows that the Commission fixes the amount of the fine at recital 769 to the contested decision at EUR 5 million in an abstract fashion, although it refers there to the factors which it must take into account when setting the fine. The determination of the amount of the fine is discussed at recitals 746 to 772 to the contested decision. It follows from those recitals that when setting the fine the Commission took into account the very serious nature of the infringement, the fact that it affected an important market, the fact that this is the first case in which Article 23(4) of Regulation No 1/2003 could be applied and also the fact that the members of the Association might not have been fully aware of the scope of the applicable provisions. It also took account of the fact that the conduct at issue was not carried out in secret. As regards the duration of the single and continuous infringement, the Commission found the total duration was 6 years, including a period of 2 years and 11 months during which the 2 manifestations of the unlawful conduct were established. Last, the Commission rejected the mitigating circumstances put forward by the Association.
The Court observes, as a preliminary point, that the Association does not dispute the fact that the amount of the fine was set in an abstract fashion. In that regard, although it might have been desirable for the Commission to set out in the contested decision reasons including figures, to enable the various parameters taken into account when determining the amount of the fine to be weighed up, the fact is that the contested decision is not vitiated by a failure to state reasons, since the Commission specified the factors which enabled it to determine the gravity of the infringement and its duration (see Joined Cases
C-238/99 P, C-244/99 P, C-245/99 P, C-247/99 P, C-250/99 P to C-252/99 P and C-254/99 P
Limburgse Vinyl Maatschappij and Others
v
Commission
[2002] ECR I-8375
, paragraphs 463 and 464 and the case-law cited).
However, while it does not dispute the use of point 37 of the Guidelines in its case, the Association asks that the amount of the fine be reduced, on a number of grounds.
In the first place, the Association submits that it ought to have been contemplated in this case that no fine would be imposed, in accordance with Article 23(2) of Regulation No 1/2003. At most, if a fine had to be imposed, it ought to have been symbolic, because that would have been a sufficiently deterrent and proportionate measure in the case of a professional association entrusted with a public service remit that does not seek to make a profit. The Association also points out that the deterrent effect of any fine has been neutralised since the adoption of Order No 2010-49 on discounts. Last, it maintains that the Commission ought to have treated it in the same way as it treated the Ordre des architectes belge (Belgian Architects’ Association) in its decision of 24 June 2004 (Case COMP/A.38549 — Belgian Architects’ Association), which had been ordered to pay a fine of only EUR 100 000 for a horizontal agreement on prices.
In that regard, although Article 23(2) of Regulation No 1/2003, which provides that the imposition of a fine is a possibility offered to the Commission and in no case the logical and automatic consequence of the finding of an infringement, leaves to the Commission’s discretion the decision whether or not to impose a fine when it finds an infringement of Article 101 TFEU, a symbolic fine, or even no fine at all, was not appropriate in the present case.
As for the fine of EUR 100 000 imposed on the Belgian Architects’ Association for having forced its members to use a minimum price, it should be borne in mind that the Commission’s practice in previous decisions cannot itself serve as a legal framework for the imposition of fines in competition matters and that decisions in other cases can give only an indication for the purpose of determining whether there might be discrimination, since the facts of those cases, such as markets, products, the undertakings and the periods concerned, are not likely to be the same (see Case
T-73/04
Carbone-Lorraine
v
Commission
[2008] ECR II-2661
, paragraph 92 and the case-law cited).
Furthermore, in that decision the Commission had first of all set the basic amount of the fine at EUR 4 500 000, which, however, was reduced to EUR 100 000, taking into account the fact that that fine was imposed in 2004, at a time when the Commission was beginning to reflect on competition in professional services. At the date of the infringements committed by the Association, however, the Commission had already published a report on competition in professional services, containing recommendations to the Member States in that respect. Another circumstance that distinguishes the two cases is the fact that the Belgian Architects’ Association, unlike the Association, immediately changed its practices when the procedure was initiated by the Commission.
As for the fact that the deterrence of a fine imposed in the present case is neutralised by the legislative amendment introduced in 2010, namely by the adoption of Order No 2010-49, which prohibited discounts without exception (see paragraph 242 above), it should be observed that deterrence is aimed at any future infringements of competition law, which need not necessarily relate to the same type of infringement as the conduct at issue in the contested decision. Furthermore, the Association’s conduct in relation to discounts concerns only one aspect of the single and continuous infringement penalised in the contested decision. The argument is therefore ineffective.
Likewise, the fact that the Association does not seek to make a profit and carries out a public service remit does not mean that it cannot, when carrying out that remit, confer advantages on certain private interests; therefore that argument, too, cannot justify the imposition of no fine at all or of a symbolic fine. The fact that, according to the Association, it is unimaginable that a professional association created by law should not comply with an order made by a European institution is also a purely speculative argument which, too, cannot be decisive in that respect.
In the second place, the Association observes in the reply that it is apparent from the defence that the Commission wrongly failed to take account of two factors that would enable the fine to be reduced, namely, first, the Association’s spontaneous cooperation with regard to pricing in its reply to the request for information based on Article 18(2) of Regulation No 1/2003 and, second, the fact that the Commission exceeded the terms of reference of the inspection, which constitutes a breach of the Association’s rights of defence. It submits that the Court ought to take the latter procedural irregularity into account, even if it should take the view that the irregularity should not lead to annulment of the contested decision.
Without there being any need to rule on the Commission’s argument that those arguments are inadmissible, on the ground that they are out of time, in application of the first subparagraph of Article 48(2) of the Rules of Procedure, they must be rejected. It follows from the examination undertaken above of the pleas in support of the claim for annulment that the Commission did not exceed the terms of reference of the inspection and did not breach the Association’s rights of defence. As for the argument based on what the Association claims to have been its spontaneous cooperation with the Commission in its reply of 10 February 2009 to the Commission’s request for information of 3 February 2009, the Commission correctly maintains that the pricing aspect of the infringement does not arise from an admission or disclosure made spontaneously by the Association, since it was on the basis of information already in its possession, in particular the minutes of meetings of the Association’s bodies, that the Commission requested further information concerning the practices in relation to discounts.
In the third place, the Association relies on certain circumstances specific to the case that would justify a reduction of the amount of the fine.
In its submission, mitigating circumstances ought to have been applied in its case, owing to the fact that its conduct in relation to discounts had only marginal effects, that it was not its intention to favour small laboratories, that its practice concerning the development of laboratories was aimed at protecting the independence of pharmacists and was in accordance with the law, that the conduct in question was public in nature and that membership was compulsory.
First, as regards the public nature of the conduct in question, it should be pointed out that the Commission states at recital 756 to the contested decision that it took that into account, noting that the conduct in question was not conduct that should be regarded as particularly serious.
Likewise, as regards the compulsory nature of membership of the Association, the Commission states at recital 757 to the contested decision that it took that into account, in the exercise of its discretion, when determining the amount of the fine, because undertakings might be held liable for the consequences of the Association’s acts, irrespective of their actual degree of involvement. In fact, it is clear that that degree of involvement could vary and that, as observed at recital 754 to the contested decision, some decisions may have been imposed on the members of the Association against their will.
However, those factors must be weighed up against other features of the infringement. Thus, the conduct relating to discounts is a form of horizontal agreement on prices, which is among the most serious restrictions of competition. As for the decisions aimed at preventing the development of groups of laboratories, these constitute barriers to production, technical development and investment on the market that may reasonably have had the effect of slowing down action on the French market by international groups and compartmentalising the internal market, as the Commission observes at recital 755 to the contested decision. Also taking into account the duration of the infringement (see paragraph 355 above), as well as the size of the relevant market, with an estimated value of EUR 4.4 billion in 2008 (recital 759 to the contested decision) and also the fact that the impact of the Association’s action was considerable, since the pharmacist-biologists on the Association’s register have a combined market share of 95% for clinical biology test services, the Commission was entitled to consider that the circumstances invoked had not altered the gravity of the infringement.
Second, as regards the fact that the infringement relating to discounts did not have a great effect and that, in particular, the conduct relating to discounts was not designed to protect small laboratories, it should be borne in mind that the effect of an anti-competitive practice is not a conclusive criterion for assessing whether the fine is appropriate and that other factors, such as intent, may be of greater importance than those relating to the effects in that context, especially in the case of infringements which are intrinsically serious, such as price-fixing and market-sharing (see, to that effect, Case
T-138/07
Schindler Holding and Others
v
Commission
[2011] ECR II-4819
, paragraph 222 and the case-law cited).
It is clear from the examination of the claims for annulment above that the Commission has documentary evidence illustrating, first, the intention of the managing bodies of the Association to impede the development of certain structures of groups of laboratories and, second, to oppose discounts in excess of 10%, an objective which has no legal basis and cannot therefore be justified by the reference to the protection of the independence of pharmacist-biologists, or indeed of public health.
Furthermore, the Commission’s conclusion, set out at recital 761 to the contested decision, that the practices relating to discounts were implemented has not been successfully challenged by the Association, as is apparent, in particular, from the examination of the first part of the ninth plea above.
The Commission therefore did not err by not according weight to those factors when determining the amount of the fine.
Third, as regards the argument that it was merely interpreting the law, the Association has not put forward any arguments that would permit a conclusion different from that reached by the Commission, namely that the Association’s interpretation of the law ran counter to the provisions themselves and formed part of a logic restrictive of competition in the case of the great majority of the aspects of the single and continuous infringement it was found to have committed. The Commission did not err in not recognising, at recital 768 to the contested decision, the existence of a mitigating circumstance in respect of the Association’s argument that its conduct was authorised, indeed encouraged, by the public authorities or by the regulations.
However, that conclusion must be qualified with regard to the objections set out in the contested decision (recital 450 et seq.) concerning the taking effect of the amendments to the statutes and contracts for SELs.
Although it follows from the examination of the second plea at paragraphs 128 to 157 above that the Commission did not make an error of assessment because of a misinterpretation of the French legislation as regards the immediate effect of changes to the statutes and contracts for SELs during their lifetime, the Court none the less considered at paragraph 155 above that it was regrettable that the decision was virtually silent on the impact of Circular No 98-585 in that context, apart from the reference in footnote 562 to the fact that that circular contains a different interpretation of the applicable regime when it states that ‘[t]he company must first request approvable on the basis of the changes’.
Although that circular, and the prefects’ ensuing practice of adopting decrees amending approvals, do not call into question the legality of the Commission’s analysis, those circumstances may have influenced the positions adopted by the Association, in respect of which it is criticised. Independently of the question of the legality, on that specific point, of Circular No 98-585 and the prefects’ practice, they may explain the analysis advocated by the Association of a dual system: alteration of the authorisation of the laboratory subject to a declaratory regime, but the need for new approval for the SEL, of a suspensory nature. Yet the hypothesis of that dual system is not addressed in the contested decision.
Therefore, also taking into account the fact that it follows from recital 453 et seq. to the contested decision that a number of positions which the Association is alleged to have adopted towards the SELs predated Circular No 2005/206, it must be considered in the present case that the Commission erred in not recognising the existence of a mitigating circumstance for that specific aspect of the infringement during part of the period in question, namely before Circular No 2005/206 entered into force on 14 November 2005.
In the light of the foregoing, the complaint that certain mitigating circumstances were not taken into account by the Commission when it determined the amount of the fine must be upheld. The consequences that must follow for the determination of the amount of the fine will be examined below.
It must be pointed out that the mitigating circumstance identified at paragraphs 376 to 379 above relates to only one of the four types of decision which the Association is found to have adopted as regards the aspect of its conduct designed to prevent the development of groups of laboratories. Furthermore, it relates to only a part of the period during which acts of that type were adopted (the period between the end of 2003 and 2005). The Commission has evidence of other decisions adopted in respect of the development of groups of laboratories which related to the period before 2005.
In the light of those circumstances, the error in question can reasonably lead to only a small reduction in the amount of the fine. The Court therefore considers that a reduction of EUR 250 000 is appropriate in order to take that error into account, and the fine imposed on the Association must therefore be set at EUR 4 750 000.
Last, it is still necessary to examine the Association’s arguments relating to the disproportionate or inappropriate nature of the fine, given the weak financial capacity of the Association, which is such that its proper functioning might be jeopardised. That examination must be carried out by reference to the fine as thus recalculated.
As the Commission states at recital 743 to the contested decision, the fact that the method of setting the fine does not take the Association’s weak financial capacity into account is not conclusive, since under Article 23(2) of Regulation No 1/2003 the turnover of each member active on the market affected by the infringement may be taken into account.
It follows, in particular, from recital 744 to the contested decision that the Commission imposed the fine by reference to Article 23(2) of Regulation No 1/2003. The third subparagraph of Article 23(2) provides that where the infringement of an association of undertakings relates to the activities of its members, the fine is not to exceed 10% of the sum of the total turnover of each member active on the market affected by the infringement of the association. It will be necessary to undertake the verification provided for in the third subparagraph of Article 23(2) by reference to the amount as recalculated in order to ensure that it is not excessive.
Furthermore, the first subparagraph of Article 23(4) of Regulation No 1/2003 states that ‘[w]hen a fine is imposed on an association of undertakings taking account of the turnover of its members and the association is not solvent, the association is obliged to call for contributions from its members to cover the amount of the fine’.
It must be held that the reasoning which the Commission sets out in the contested decision specifically incorporates consideration of the ability of the members of the Association to pay the fine. At recitals 746 to 751, the Commission refers to the novel nature of that provision, introduced by Regulation No 1/2003, and also to the possibility that the Association must actually call for contributions from its members, who may however have exercised varying degrees of supervision over the decisions adopted by the managing bodies, in order to be able to pay the fine. The Commission thus justifies the fact that it distances itself in the present case from the method of setting fines provided for in the Guidelines and the Association does not dispute that the application of point 37 of the Guidelines is more favourable to make contributions, to it than the application of the general method laid down in those Guidelines, as the Commission observes at recital 751 to the contested decision.
As regards the verification of the financial impact of the fine, the Association does not dispute the financial data used by the Commission. It may be inferred from recital 771 to the contested decision that 95% of the value of the fees invoiced by clinical laboratories in France in 2008 represented EUR 4.2 billion (and not ‘EUR 4 205 033 million’, as mentioned on what may be the basis of a typographical error), more recent figures not being available at the time. Furthermore, it also follows from recital 771 that the figure of 95% of the value of total fees is taken into account by the Commission in order to exclude the turnover of laboratories whose only partners are biologist-physicians, and which represent around 5% of all private laboratories. Those figures are confirmed at recitals 23 and 759 to the contested decision, which refer to a turnover of EUR 4.4 billion achieved by private laboratories in 2008 when describing the size of the market.
The Court does not have a different turnover achieved by clinical laboratories on the relevant market than that presented in the contested decision. It should be emphasised, however, that there has been no suggestion that that figure might no longer be representative today. In any event, it may reasonably be considered that that figure does not overestimate the value of the relevant market on the date of the judgment.
The amount of the fine imposed, as reduced by the Court, corresponds to only a little over 1% of that figure. It is therefore not excessive.
Furthermore, in the light of the evidence in the file, it does not appear that the amount as recalculated might reasonably affect the viability of the members of section G active on the relevant market in the event that they should be called upon to make their contribution in the future.
In the light of the foregoing, Article 3 of the contested decision should be annulled and the fine reduced to an amount of EUR 4.75 million, which the Court, in the exercise of its unlimited jurisdiction, considers appropriate, having regard to the circumstances of the case, in particular those relating to the gravity and the duration of the infringement found by the Commission and also to the resources on which the Association can call, and the action should be dismissed as to the remainder.
Costs
Under Article 87(3) of the Rules of Procedure, where each party succeeds on some and fails on other heads, the Court may order that the costs be shared or that each party bear its own costs.
Under Article 87(4) of the Rules of Procedure, the Court may order an intervener to bear its own costs.
In the present case, only one complaint in support of the alternative claim for a reduction of the amount of the fine was upheld in part and the amount of the fine imposed on the Association was reduced accordingly. Therefore, on an equitable assessment of the facts of the case, the Court decides that the Commission should bear its own costs and pay one tenth of those incurred by the Association, which shall bear nine tenths of its own costs.
Labco shall bear its own costs.

On those grounds,
THE GENERAL COURT (Ninth Chamber)
hereby:

1.
Sets the amount of the fine imposed jointly and severally on the Ordre national des pharmaciens (ONP), the Conseil national de l’Ordre des pharmaciens (CNOP) and the Conseil central de la section G de l’Ordre national des pharmaciens (CCG) in Article 3 of Commission Decision C(2010) 8952 final of 8 December 2010 relating to a proceeding pursuant to Article 101 [TFEU] (Case 39510 — Labco/ONP) at EUR 4.75 million;

2.
Dismisses the action as to the remainder;

3.
Orders the European Commission to bear its own costs and to pay one tenth of those incurred by the ONP, the CNOP and the CCG;

4.
Orders the ONP, the CNOP and the CCG to bear nine tenths of their own costs;

5.
Orders Labco to bear its own costs.

Berardis
Czúcz
Popescu
Delivered in open court in Luxembourg on 10 December 2014.
[Signatures]
Table of contents

Background to the dispute

Procedure and forms of order sought

Law

1. The claim for annulment

First plea, alleging an error of interpretation and application of Article 101 TFEU in the light of the judgment in Wouters

The pleas concerning the conduct aimed at the development of groups of laboratories

The pleas relating to the composition of and change in the capital of the SELs

– Fourth plea, alleging, in essence, failure to have regard to the role of the CCG as guarantor of the professional independence of the partner as regards his minimum shareholding in the capital of SELs

– Fifth plea, alleging, in essence, an error of assessment of the legislature’s intention as regards the dismemberment of the shareholding in SELs above a maximum holding of 25% and failure to have regard to the legal framework applicable to the dismemberment of shareholdings in SELs

The pleas relating to the SELs’ duties to communicate certain information during their lifetime

– Second plea, alleging, in essence, an error of assessment resulting from a misinterpretation of the French legislation as regards the respective roles of the prefect and the CCG when changes occur during the lifetime of an SEL

– Third plea, alleging, in essence, failure to have regard to the scope of the obligation to communicate certain information provided for in the French legislation and the CCG’s role in the context of its remit of a posteriori verification of the company documents

Sixth plea, alleging, in essence, an error in the interpretation and application of Article 101 TFEU in so far as the disciplinary penalties imposed reinforce the potential or actual effects of the decisions in question

The pleas relating to the objections concerning prices

Seventh plea, raised by way of principal plea, alleging, in essence, misuse of powers owing to failure to observe the limits of the inspection remit

– First complaint

– Second complaint

Eighth plea, raised in the alternative, alleging, in essence, an error of assessment of the scope of the applicable legal framework and the intention of the legislature

Ninth plea, raised in the alternative, alleging, in essence, an error in the assessment of the facts, leading to an error of law

– The second part

– First part

The assertion that there was not a single and continuous infringement

Conclusion on the application of the Wouters case-law and the pleas in support of the claim for annulment

2. The alternative claim, seeking a reduction of the amount of the fine

Costs
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)	Language of the case: French.