# C_2012375EN.01000401.xml

| 5.12.2012 | EN | Official Journal of the European Union | C 375/4 |
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5.12.2012

EN

Official Journal of the European Union

C 375/4

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Final report of the Hearing Officer (1)

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COMP/39.462 — Freight forwarding

2012/C 375/04

I.   BACKGROUND

BACKGROUND

| (1) | The draft decision in this case concerns four separate cartels in the sector of freight forwarding services by air. |
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(1)

The draft decision in this case concerns four separate cartels in the sector of freight forwarding services by air.

| (2) | The procedure was initiated subsequent to an application for immunity by Deutsche Post AG (including DHL Global Freight Forwarding and Exel Ltd as well as several other subsidiaries and affiliates). In October 2007, the Commission conducted inspections pursuant to Article 20 of Regulation (EC) No 1/2003 at the premises of certain freight forwarders. |
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(2)

The procedure was initiated subsequent to an application for immunity by Deutsche Post AG (including DHL Global Freight Forwarding and Exel Ltd as well as several other subsidiaries and affiliates). In October 2007, the Commission conducted inspections pursuant to Article 20 of Regulation (EC) No 1/2003 at the premises of certain freight forwarders.

| (3) | Following the inspections, seven freight forwarders made applications under the Leniency Notice: Deutsche Bahn AG and its subsidiaries, in particular Schenker AG; Public Warehousing Company KSC; ABX; CEVA Group Plc. and Eagle Inc; Nippon Express Co. Ltd; [*]; and Yusen Air & Sea Service (Europe) BV. |
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(3)

Following the inspections, seven freight forwarders made applications under the Leniency Notice: Deutsche Bahn AG and its subsidiaries, in particular Schenker AG; Public Warehousing Company KSC; ABX; CEVA Group Plc. and Eagle Inc; Nippon Express Co. Ltd; [*]; and Yusen Air & Sea Service (Europe) BV.

II.   WRITTEN PROCEDURE

WRITTEN PROCEDURE

| (4) | On 5 February 2010, the Commission addressed a statement of objections (‘SO’) to 47 legal entities belonging to 15 groups of undertakings (‘the parties’) concerning alleged infringements of Article 101 TFEU and Article 53 of the EEA Agreement in the freight forwarding sector (2). The SO covered four separate alleged infringements: the new export system (NES), the advanced manifest system (AMS), the currency adjustment factor (CAF), and the peak season surcharge (PSS) infringements. |
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(4)

On 5 February 2010, the Commission addressed a statement of objections (‘SO’) to 47 legal entities belonging to 15 groups of undertakings (‘the parties’) concerning alleged infringements of Article 101 TFEU and Article 53 of the EEA Agreement in the freight forwarding sector (2). The SO covered four separate alleged infringements: the new export system (NES), the advanced manifest system (AMS), the currency adjustment factor (CAF), and the peak season surcharge (PSS) infringements.

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| (5) | The parties were granted access to the file between 11 and 18 February 2010. The parties also received access to oral and written leniency statements at the Commission's premises. I did not receive any request for further access to the file. |
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(5)

The parties were granted access to the file between 11 and 18 February 2010. The parties also received access to oral and written leniency statements at the Commission's premises. I did not receive any request for further access to the file.

| (6) | The addressees of the SO were originally granted a deadline to reply to the SO within eight weeks from the day after access to the file was granted, i.e. between 9 and 16 April 2010. 13 parties (all except Deutsche Post AG and ABX) requested extensions, most of them on grounds that I found justified, at least in part. I granted extensions up to two weeks. All parties replied within the given deadlines. Almost all parties but one requested an oral hearing in their written replies. |
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(6)

The addressees of the SO were originally granted a deadline to reply to the SO within eight weeks from the day after access to the file was granted, i.e. between 9 and 16 April 2010. 13 parties (all except Deutsche Post AG and ABX) requested extensions, most of them on grounds that I found justified, at least in part. I granted extensions up to two weeks. All parties replied within the given deadlines. Almost all parties but one requested an oral hearing in their written replies.

III.   ORAL PROCEDURE

ORAL PROCEDURE

| (7) | The oral hearing was held on 6-9 July 2010. It was attended by representatives of all parties, except for the one party that did not request a hearing. |
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(7)

The oral hearing was held on 6-9 July 2010. It was attended by representatives of all parties, except for the one party that did not request a hearing.

| (8) | Prior to the oral hearing, three parties requested to be heard partly in camera. I rejected two of the requests and granted one. At the oral hearing, however, I found, that the request to be heard in camera was not justified in many respects, as it contained little confidential information. Thus, I ordered the party concerned to orally present a summary of its in camera presentation to the other parties, and to submit a non-confidential version of their statement, which was received and circulated to all parties after the oral hearing. |
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(8)

Prior to the oral hearing, three parties requested to be heard partly in camera. I rejected two of the requests and granted one. At the oral hearing, however, I found, that the request to be heard in camera was not justified in many respects, as it contained little confidential information. Thus, I ordered the party concerned to orally present a summary of its in camera presentation to the other parties, and to submit a non-confidential version of their statement, which was received and circulated to all parties after the oral hearing.

in camera

in camera

in camera

| (9) | At the oral hearing, some parties contested the validity of the immunity application of Deutsche Post AG on the basis that the external legal advisers that represented Deutsche Post AG in the proceedings allegedly acted in contradiction with the applicable Brussels bar rules and contract law. Since this issue acquired a certain importance during the hearing, I considered that it was appropriate and efficient to give all parties the possibility to submit comments after the oral hearing, which four parties did. The draft decision dismisses the claims brought against Deutsche Post AG's immunity application as unfounded. |
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(9)

At the oral hearing, some parties contested the validity of the immunity application of Deutsche Post AG on the basis that the external legal advisers that represented Deutsche Post AG in the proceedings allegedly acted in contradiction with the applicable Brussels bar rules and contract law. Since this issue acquired a certain importance during the hearing, I considered that it was appropriate and efficient to give all parties the possibility to submit comments after the oral hearing, which four parties did. The draft decision dismisses the claims brought against Deutsche Post AG's immunity application as unfounded.

IV.   PROCEDURE AFTER THE ORAL HEARING

PROCEDURE AFTER THE ORAL HEARING

1.   Letter of facts

Letter of facts

| (10) | In view of the arguments submitted by the parties in relation to the NES infringement concerning the establishment of effect on trade between Member States, the Commission carried out further fact-finding following the oral hearing. As a result, the Commission received supplementary information from the parties concerned. Since it intended to make use in the decision of some of this information to establish effect on trade in relation to the NES infringement, the Commission decided that it was appropriate to bring such information to the attention of the parties concerned by way of a letter (the ‘letter of facts’), sent on 20 September 2011, giving them two weeks to submit their views on the subject. |
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(10)

In view of the arguments submitted by the parties in relation to the NES infringement concerning the establishment of effect on trade between Member States, the Commission carried out further fact-finding following the oral hearing. As a result, the Commission received supplementary information from the parties concerned. Since it intended to make use in the decision of some of this information to establish effect on trade in relation to the NES infringement, the Commission decided that it was appropriate to bring such information to the attention of the parties concerned by way of a letter (the ‘letter of facts’), sent on 20 September 2011, giving them two weeks to submit their views on the subject.

| (11) | All parties concerned submitted written comments on the letter of facts. |
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(11)

All parties concerned submitted written comments on the letter of facts.

| (12) | On a procedural level, one party, CEVA, complained that, first, it had been denied the opportunity of submitting its observations on the new evidence in the oral hearing and, moreover, that the nature of the conclusions that the Commission drew from the new evidence was so unclear that it had been hampered in its ability to make its view known on those conclusions. CEVA considered that its rights of defence had thereby been compromised. Second, CEVA claims that certain new evidence referred to in the letter of facts was requested at a late stage after the oral hearing (May 2011), and therefore that CEVA could reasonably have assumed that it would be used for the purpose of fines calculation, and not to support the objections set out in the SO. CEVA contends that this constitutes unfair behaviour on the part of the Commission, which compromised CEVA's rights of defence. Third, CEVA claims that, in breach of the principle of equal treatment, some of the evidence referred to in the letter of facts was obtained by the Commission from the immunity applicant in response to questions that were not asked to other parties. |
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(12)

On a procedural level, one party, CEVA, complained that, first, it had been denied the opportunity of submitting its observations on the new evidence in the oral hearing and, moreover, that the nature of the conclusions that the Commission drew from the new evidence was so unclear that it had been hampered in its ability to make its view known on those conclusions. CEVA considered that its rights of defence had thereby been compromised. Second, CEVA claims that certain new evidence referred to in the letter of facts was requested at a late stage after the oral hearing (May 2011), and therefore that CEVA could reasonably have assumed that it would be used for the purpose of fines calculation, and not to support the objections set out in the SO. CEVA contends that this constitutes unfair behaviour on the part of the Commission, which compromised CEVA's rights of defence. Third, CEVA claims that, in breach of the principle of equal treatment, some of the evidence referred to in the letter of facts was obtained by the Commission from the immunity applicant in response to questions that were not asked to other parties.

| (13) | In light of my duty to ensure the effective exercise of the parties' procedural rights (3), I have reviewed the claims put forward by CEVA. I conclude that CEVA has been able to effectively exercise its rights of defence in connection with the issues covered by the letter of facts, for the reasons set out below:






  — | First, as regards the claim that the company has not been able to comment on the evidence referred to in the letter of facts at the oral hearing, I note the Commission is entitled to send to the parties after the statement of objections fresh documents which it considers support its argument, subject to giving the undertakings the necessary time to submit their views on the subject (4). In the present case, CEVA was given the opportunity to comment on the issues covered by the letter of facts, and made use of this possibility. As regards the claim that the conclusions in the letter of facts were so unclear that CEVA was hampered in its ability to make its view known on those conclusions, I note that no specific elements are provided in support of this contention. Further, CEVA was able to submit a 31 pages' response, which addresses each ‘possible inference’ set out in the letter of facts, and discusses extensively the evidence on which the Commission said it intends to rely. Finally, none of the other addressees claimed that the conclusions set out in the letter of facts were unclear. I therefore consider that CEVA's claim is without merit. |
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(13)

In light of my duty to ensure the effective exercise of the parties' procedural rights (3), I have reviewed the claims put forward by CEVA. I conclude that CEVA has been able to effectively exercise its rights of defence in connection with the issues covered by the letter of facts, for the reasons set out below:

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First, as regards the claim that the company has not been able to comment on the evidence referred to in the letter of facts at the oral hearing, I note the Commission is entitled to send to the parties after the statement of objections fresh documents which it considers support its argument, subject to giving the undertakings the necessary time to submit their views on the subject (4). In the present case, CEVA was given the opportunity to comment on the issues covered by the letter of facts, and made use of this possibility. As regards the claim that the conclusions in the letter of facts were so unclear that CEVA was hampered in its ability to make its view known on those conclusions, I note that no specific elements are provided in support of this contention. Further, CEVA was able to submit a 31 pages' response, which addresses each ‘possible inference’ set out in the letter of facts, and discusses extensively the evidence on which the Commission said it intends to rely. Finally, none of the other addressees claimed that the conclusions set out in the letter of facts were unclear. I therefore consider that CEVA's claim is without merit.

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| — | Second, as regards the allegedly unfair behaviour of the Commission, I find that there was no indication in the request for information of the Commission of May 2011 that the requested information was to be used for the purpose of fines calculation, and not for any other purpose, such as investigating the issue of effect on trade in the NES infringement. CEVA was wrong to assume that the Commission was requesting the information exclusively for fining purposes, and cannot therefore claim that the Commission acted in an unfair manner on this basis. It is indeed legitimate for the Commission to institute fresh inquiries during the administrative procedure if it appears from the course of that procedure that additional investigations are necessary (5). |
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Second, as regards the allegedly unfair behaviour of the Commission, I find that there was no indication in the request for information of the Commission of May 2011 that the requested information was to be used for the purpose of fines calculation, and not for any other purpose, such as investigating the issue of effect on trade in the NES infringement. CEVA was wrong to assume that the Commission was requesting the information exclusively for fining purposes, and cannot therefore claim that the Commission acted in an unfair manner on this basis. It is indeed legitimate for the Commission to institute fresh inquiries during the administrative procedure if it appears from the course of that procedure that additional investigations are necessary (5).

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| — | Third, as regards the alleged breach of the principle of equal treatment, it is settled case law that the Commission enjoys a freedom of action in the conduct of its investigations and is under no obligation to put the same questions, during an investigation, to all the undertakings which it suspects of participating in an infringement (6). |
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Third, as regards the alleged breach of the principle of equal treatment, it is settled case law that the Commission enjoys a freedom of action in the conduct of its investigations and is under no obligation to put the same questions, during an investigation, to all the undertakings which it suspects of participating in an infringement (6).

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2.   Letter from DG Competition concerning the fine calculation

Letter from DG Competition concerning the fine calculation

| (14) | On 25 October 2011, DG Competition addressed a letter to the parties in which it indicated that the Commission may use certain sales data as the basis for the ‘value of sales’ calculation and thus, pursuant to the 2006 Guidelines on Fines (7), as the basis for any fine that may be imposed. The parties were given two weeks to submit observations on this issue. Some parties submitted observations to DG Competition. |
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(14)

On 25 October 2011, DG Competition addressed a letter to the parties in which it indicated that the Commission may use certain sales data as the basis for the ‘value of sales’ calculation and thus, pursuant to the 2006 Guidelines on Fines (7), as the basis for any fine that may be imposed. The parties were given two weeks to submit observations on this issue. Some parties submitted observations to DG Competition.

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| (15) | In its observations, Deutsche Bahn AG (8) requested to be granted access to the file of Case COMP/39.258 — Air freight (9) on the basis that it was necessary for it to be able to assess and comment on the Commission's basis for calculating the fines in the present case. The Commission has not responded directly to the request (10). However, at the time of drafting of this report, more than three months have lapsed since the request, and, although Deutsche Bahn could have assumed from such timing that its request was being rejected, it has not brought the matter to my attention for independent review pursuant to Article 3(7) of Decision 2011/695/EU. |
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(15)

In its observations, Deutsche Bahn AG (8) requested to be granted access to the file of Case COMP/39.258 — Air freight (9) on the basis that it was necessary for it to be able to assess and comment on the Commission's basis for calculating the fines in the present case. The Commission has not responded directly to the request (10). However, at the time of drafting of this report, more than three months have lapsed since the request, and, although Deutsche Bahn could have assumed from such timing that its request was being rejected, it has not brought the matter to my attention for independent review pursuant to Article 3(7) of Decision 2011/695/EU.

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V.   THE DRAFT COMMISSION DECISION

THE DRAFT COMMISSION DECISION

| (16) | Pursuant to Article 16 of Decision 2011/695/EU, I have examined whether the draft decision deals only with objections in respect of which the parties have been afforded the opportunity of making known their views. I have come to a positive conclusion. |
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(16)

Pursuant to Article 16 of Decision 2011/695/EU, I have examined whether the draft decision deals only with objections in respect of which the parties have been afforded the opportunity of making known their views. I have come to a positive conclusion.

| (17) | I also note that the Commission has decided not to pursue objections against three companies which were addressees of the statement of objections, including two companies which had previously been held jointly and severally liable with their respective subsidiaries and one company held directly liable for the infringement but excluded from the decision in light of evidence justifying the imputation of liability to another company of the same undertaking. Further, compared to the statement of objections, a shorter duration has been retained in the draft decision against certain undertakings as regards the AMS, CAF and PSS infringements. |
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(17)

I also note that the Commission has decided not to pursue objections against three companies which were addressees of the statement of objections, including two companies which had previously been held jointly and severally liable with their respective subsidiaries and one company held directly liable for the infringement but excluded from the decision in light of evidence justifying the imputation of liability to another company of the same undertaking. Further, compared to the statement of objections, a shorter duration has been retained in the draft decision against certain undertakings as regards the AMS, CAF and PSS infringements.

VI.   CONCLUDING REMARKS

CONCLUDING REMARKS

| (18) | I conclude that the parties have been able to effectively exercise their procedural rights in this case. |
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(18)

I conclude that the parties have been able to effectively exercise their procedural rights in this case.

Brussels, 26 March 2012.

Michael ALBERS

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(1)  Pursuant to Articles 16 and 17 of Decision 2011/695/EU of the President of the European Commission of 13 October 2011 on the function and terms of reference of the hearing officer in certain competition proceedings (OJ L 275, 20.10.2011, p. 29).

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(2)  Freight forwarding services are defined by the Commission in the decision as ‘the organisation of transportation of items (possibly including activities such as customs clearance, warehousing, ground services etc.) on behalf of customers according to their needs. Freight forwarding services have been segmented into domestic and international freight forwarding and freight forwarding by air, land and sea’ (decision, recital 3). The infringements described in the decision all relate to the provision of freight forwarding services by air.

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(3)  Article 1(2) of Decision 2011/695/EU.

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(4)  Case T-23/99, LR AF 1998 A/S, formerly Løgstør Rør A/S v Commission of the European Communities, [2002] ECR, p. II-1705, paragraph 190.

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LR AF 1998 A/S, formerly Løgstør Rør A/S

Commission of the European Communities

(5)  See, for example, Case C-52/69, J.R. Geigy AG v Commission, [1972] ECR, p. 787, paragraph 14.

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J.R. Geigy AG

Commission

(6)  Case T-48/00, Corus UK v Commission, [2004] ECR II-2331, paragraph 212.

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Corus UK

Commission

(7)  Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation (EC) No 1/2003 (OJ C 210, 1.9.2006, p. 2).

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(8)  And related companies, Schenker AG, Schenker Limited, Schenker China Ltd. and Schenker International (H.K.) Ltd.

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(9)  Information on this case can be found on here: http://ec.europa.eu/competition/index_en.html

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(10)  Instead, the request is rejected by the Commission in the draft decision.

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