**Joined Cases T-456/05 and T-457/05**

**Gütermann AG and**

**Zwicky & Co. AG**

**v**

**European Commission**

(Competition – Agreements, decisions and concerted practices – European market in industrial thread – Decision finding an infringement of Article 81 EC and Article 53 of the EEA Agreement – Fines – Gravity of the infringement – Actual impact on the market – Duration of the infringement – Mitigating circumstances – Cooperation during the administrative procedure – Proportionality – Guidelines on the method of setting fines)

Summary of the Judgment

1.      *Community law – Interpretation – Acts of the institutions – Statement of reasons*

2.      *Competition – Agreements, decisions and concerted practices – Prohibition – Infringements – Agreements and concerted practices
capable of being treated as constituting a single infringement – Imputation of liability to an undertaking by reason of its
participation in an infringement considered as a whole – Lawfulness*

*(Art. 81(1) EC)*

3.      *Competition – Agreements, decisions and concerted practices – Imputation to an undertaking – Responsibility for conduct of
other undertakings in the context of the same infringement – Lawfulness – Criteria*

*(Art. 81(1) EC)*

4.      *Competition – Administrative procedure – Bringing infringements to an end – Commission's powers – Injunctions to undertakings*

*(Council Regulation No 1/2003, Art. 7(1))*

5.      *Competition – Fines – Amount – Determination – Maximum amount*

*(Council Regulations Nos 17, Art. 15(2), and 1/2003, Art. 23(2))*

6.      *Competition – Fines – Amount – Determination – Criteria – Gravity and duration of the infringement – Possibility of raising
the level of fines in order to increase their deterrent effect*

*(Council Regulations Nos 17, Art. 15(2), and 1/2003, Art. 23(2))*

7.      *Competition – Fines – Amount – Whether appropriate – Judicial review*

*(Arts 229 EC and 253 EC; Council Regulations Nos 17, Art. 17, and 1/2003, Art. 31)*

8.      *Actions for annulment – Judicial review – Limits on jurisdiction*

*(Art. 233 EC)*

9.      *Competition – Fines – Amount – Determination – Criteria – Actual impact on the market – Criteria for assessment*

*(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03)*

10.    *Competition – Fines – Amount – Determination – Criteria – Duration of the infringement – Infringements of long duration*

*(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03, Section 1B, first para.)*

11.    *Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Mitigating circumstances – Agreement
not implemented in practice – Assessment at the level of the individual conduct of each undertaking*

*(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03, Sections 1A, first para., and 3)*

12.    *Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Mitigating circumstances – Passive
or ‘follow-my-leader’ role of the undertaking*

*(Art. 81 EC; Council Regulation No 17, Art. 15; Commission Notice 98/C 9/03, Sections 2 and 3)*

13.    *Procedure – Introduction of new pleas during the proceedings – Conditions – New plea – Concept*

*(Rules of Procedure of the General Court, Art. 48(2))*

14.    *Competition – Fines – Amount – Determination – Criteria – Reduction of the fine for cooperation of the fined undertaking –
Conditions – Discretion of the Commission*

*(Council Regulation No 17; Commission Notice 96/C 207/04, Title D, Section 2)*

15.    *Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Determination of the fine in proportion
to the factors for assessment of the gravity of the infringement*

*(Council Regulation No 17, Art. 15(2))*

1.      The enacting terms of an act are indissociably linked to the statement of reasons for those provisions, so that, when they
have to be interpreted, account must be taken, if necessary, of the reasons which led to their adoption.

(see para. 41)

2.      An infringement of Article 81(1) EC may result not only from an isolated act but also from a series of acts or from continuous
conduct. That interpretation cannot be challenged on the ground that one or more elements of that series of acts or continuous
conduct could also constitute, in themselves and in isolation, an infringement of that provision.

A single and continuous infringement frequently consists of a series of acts which follow each other in time and which, in
themselves, at the time when they occur, can also constitute an infringement of the competition rules. The distinctive feature
of those acts is that they form part of an overall strategy.

(see paras 45-46)

3.      An undertaking which has participated in a single complex infringement through its own conduct – conduct which meets the definition
of an agreement or concerted practice with an anti-competitive object for the purposes of Article 81(1) EC, and which was
intended to help bring about the infringement as a whole – may also be liable for the conduct of other undertakings in the
context of the same infringement throughout the period of its participation in the infringement, where it is proved that the
undertaking in question was aware of the unlawful conduct of the other participants, or could reasonably have foreseen such
conduct, and was prepared to accept the risk.

An undertaking can infringe the prohibition laid down in Article 81(1) EC where the purpose of its conduct, as coordinated
with that of other undertakings, is to restrict competition on a specific relevant market within the common market, and that
does not mean that the undertaking has itself to be active on that relevant market.

(see paras 50, 53)

4.      The Commission’s power to issue injunctions is to be applied according to the nature of the infringement found.

In so far as an undertaking has ceased to trade in the sector in question, it is no longer concerned by the injunction to
bring the infringements to an end. There cannot therefore be a breach of the principle of proportionality in that regard.

The application of Article 7(1) of Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles
81 [EC] and 82 [EC] may involve a prohibition on continuing certain activities, practices or situations which have been found
to be unlawful, but also a prohibition on adopting similar future conduct or any measure having the same or equivalent object
or effect.

Where the undertaking concerned has given an undertaking to refrain from repeating its anti-competitive conduct, the Commission
is justified in including that injunction in the enacting terms of the contested decision even if that undertaking has ceased
to trade in the sector concerned by the cartel.

Such obligations on undertakings must not, however, exceed the limits of what is appropriate and necessary to achieve the
aim pursued.

(see paras 61, 63, 65, 67)

5.      In determining the ‘preceding business year’, the Commission must assess, in each specific case and having regard both to
the context and to the objectives pursued by the scheme of penalties created by Regulation No 17 and Regulation No 1/2003
on the implementation of the rules on competition laid down in Articles 81 [EC] and 82 [EC], the intended impact on the undertaking
in question, taking into account in particular a turnover which reflects the undertaking’s true economic situation in the
period during which the infringement was committed.

It is clear, however, both from the objectives of the system of which Article 15(2) of Regulation No 17 and the second subparagraph
of Article 23(3) of Regulation No 1/2003 form part and from the case-law, that the application of the 10% upper limit of turnover
presupposes, first, that the Commission has at its disposal the turnover figure for the last business year preceding the date
of adoption of the decision and, second, that those data represent a full year of normal economic activity over a period of
12 months.

Thus, if the business year had ended before the adoption of the decision but the annual accounts of the undertaking in question
had not yet been drawn up or had not been disclosed to the Commission, the latter would have the right, indeed the obligation,
to use the turnover achieved in an earlier business year in order to apply Article 15(2) of Regulation No 17 and the second
subparagraph of Article 23(2) of Regulation No 1/2003. Similarly, if, as a result of a reorganisation or a change in accounting
practices, an undertaking has, for the preceding business year, produced accounts which relate to a period shorter than 12
months, the Commission is entitled to rely on the turnover achieved in an earlier complete year in order to apply those provisions.
The same is true if an undertaking has not carried on any economic activity during the preceding business year and, accordingly,
the Commission does not have at its disposal a figure for the undertaking’s turnover, representing economic activity carried
on by it during that year. Contrary to the requirements of the case-law, the turnover for that period gives no indication
of the size of the undertaking and, in consequence, cannot serve as a basis for determining the maximum amount permissible
under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003.

Even in a year of normal business activity, the turnover of an undertaking may fall significantly, or indeed substantially,
as compared with previous years, for various reasons, such as a difficult economic context, a crisis in the sector concerned,
an accident or a strike. However, as long as an undertaking has in fact achieved a turnover during a complete year in which
economic activities, albeit on a reduced scale, have been carried on, the Commission must take account of that turnover for
the purposes of determining the maximum amount permissible under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation
No 1/2003. Accordingly, at least in situations where there is no indication that an undertaking has ceased its commercial
activities or has diverted its turnover in order to avoid the imposition of a heavy fine, it is appropriate to regard the
Commission as obliged to fix the maximum limit of the fine by reference to the most recent turnover corresponding to a complete
year of economic activity.

(see paras 89-90, 94-97)

6.      The power of the Commission to impose fines pursuant to Article 15(2) of Regulation No 17 and Article 23(2) of Regulation
No 1/2003 on the implementation of the rules on competition laid down in Articles 81 [EC] and 82 [EC] is one of the means
given to the Commission so as to enable it to carry out the task of supervision entrusted to it by Community law.

That task includes the duty to investigate and punish individual infringements, but it also encompasses the duty to pursue
a general policy designed to apply, in competition matters, the principles laid down by the Treaty and to guide the conduct
of undertakings in the light of those principles. That task thus also includes the curbing of illegal activities and the prevention
of repeat offences.

It follows that the Commission must ensure that fines have a deterrent effect.

(see paras 79, 91)

7.      The Community judicature has, in regard to actions contesting Commission decisions imposing fines on undertakings for infringement
of the competition rules, power to assess, in the context of the unlimited jurisdiction accorded to it by Article 229 EC,
Article 17 of Regulation No 17 and Article 31 of Regulation No 1/2003 on the implementation of the rules on competition laid
down in Articles 81 [EC] and 82 [EC], the appropriateness of the amounts of fines. That assessment may justify the production
and taking into account of additional information which is not as such required, by virtue of the duty under Article 253 EC
to state reasons, to be set out in the decision imposing the fine.

(see paras 105-106)

8.      If an addressee of a decision decides to bring an action for annulment, the matter to be adjudicated by the Community judicature
relates only to those aspects of the decision which concern that addressee. Unchallenged aspects concerning other addressees,
on the other hand, do not form part of the matter to be adjudicated by the Community judicature.

(see para. 112)

9.      In order to assess the actual impact of an infringement on the market, the Commission must take as a reference the competition
which would normally have existed if there had been no infringement. In order to conclude that there has been an impact on
the market, it is sufficient that the agreed prices have served as a basis for determining individual transaction prices,
thereby limiting customers’ room for negotiation.

On the other hand, the Commission cannot be required, where the implementation of a cartel has been established, systematically
to demonstrate that the agreements in fact enabled the undertakings concerned to achieve a higher level of transaction prices
than that which would have prevailed in the absence of a cartel. It would be disproportionate to require such proof, which
would absorb considerable resources, given that it would necessitate making hypothetical calculations based on economic models
whose accuracy it would be difficult for the Court to verify and whose infallibility has in no way been demonstrated. In order
to assess the gravity of the infringement, the decisive point is whether the cartel members did all they could to give practical
effect to their intentions. What then happened at the level of the market prices actually obtained is liable to have been
influenced by other factors outside the control of the members of the cartel. The cartel members cannot therefore benefit
from external factors which counteracted their own efforts by turning them into factors justifying a reduction of the fine.

The actual conduct which an undertaking claims to have adopted is irrelevant for the purposes of assessing the impact of a
cartel on the market. Only the effects resulting from the whole of the infringement are to be taken into account. Thus, consideration
of the unlawful conduct of an undertaking concerned with regard to competition sheds light on the individual situation of
the undertaking, but can have no bearing whatsoever on the categorisation of the infringement as ‘very serious’.

With an infringement of long duration, it is unlikely that the producers regarded the practices complained of at the time
as wholly ineffective and pointless.

The nature of the infringement plays a major role, in particular, in distinguishing ‘very serious’ infringements. It is clear
from the description of very serious infringements given in the Guidelines on the method of setting fines imposed pursuant
to Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty that agreements or concerted practices which are
designed, inter alia, to fix prices may, on the basis of their nature alone, be categorised as ‘very serious’, without there
being any need to distinguish such conduct by reference to a particular impact or geographic area. The description of very
serious infringements makes no mention of any requirement as to actual market impact or effects produced in a particular geographic
area.

(see paras 126, 128-130, 133-134, 136-137)

10.    The duration of the infringement is one of the factors to which regard is to be had in fixing the amount of the fine to be
imposed on undertakings which have infringed the competition rules. In relation to infringements of long duration, the Commission
may automatically apply the maximum increase of 10% of the amount used to calculate the gravity of the infringement for each
year thereof. Even though the third indent of the first paragraph of Section 1B of the Guidelines on the method of setting
fines imposed pursuant to Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty does not provide for an automatic
increase of 10% per year for long-term infringements, it leaves the Commission a measure of discretion in that regard

There is nothing in the Guidelines to prevent the actual duration of the infringement from being taken into account in the
calculation of the amount of the fine. Such an approach is entirely logical and reasonable and falls, in any event, within
the Commission’s discretion.

Where it is established that an undertaking was aware of the offending conduct of the other participants or that it could
reasonably have foreseen it and that it was prepared to take the risk, it is also regarded as responsible, throughout the
entire period of its participation in that infringement, for conduct put into effect by other undertakings in the context
of the same infringement The Commission is right to consider, implicitly, that the duration of the infringement could not
be divided on the basis of the intensity of the participation of the applicant undertaking in the markets concerned. If the
role played in a cartel by an undertaking has been correctly taken into account in determining the starting amount for the
fine, the fact that the undertaking did not take part in all the conduct by which the cartel is identified cannot once again
be taken into account in determining the duration of the infringement.

The increase in the amount of the fine in relation to the duration of the infringement is calculated by the application of
a certain percentage to the starting amount which is determined according to the gravity of the infringement as a whole, thus
already reflecting the varying levels of intensity of the infringement. Thus, it would not be logical to take into account,
for the increase of that amount on the basis of the duration of the infringement, a variation in the intensity of the infringement
during the period concerned. A distinction should always be made between the duration of the actual operation of the cartel
and the gravity thereof as resulting from its particular nature.

(see paras 147-148, 150, 152, 156-157, 159-160)

11.    The mitigating circumstances provided for in Section 3 of the Guidelines on the method of setting fines imposed pursuant to
Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty are all based on the individual conduct of each undertaking.
In order to assess any mitigating circumstances, including those relating to the non-implementation of agreements, it is necessary
to take into account not the effects arising from the infringement as a whole, which must be taken into consideration in assessing
the actual impact of an infringement on the market for the purposes of determining its gravity, but the individual conduct
of each undertaking, for the purposes of examining the relative gravity of the participation of each undertaking in the infringement.

Undertakings must therefore put forward other arguments which are capable of showing that, during the period in which they
were party to the unlawful agreements, they actually avoided implementing those agreements by adopting competitive conduct
on the market or, at the very least, that they clearly and substantially breached the obligations relating to the implementation
of the cartel to the point of disrupting its operation.

(see paras 178, 180)

12.    A passive role implies that the undertaking adopted a ‘low profile’, that is to say, that it did not actively participate
in the creation of any anti-competitive agreements. Amongst the circumstances that may indicate the adoption by an undertaking
of a passive role within a cartel is the situation where the undertaking’s participation in cartel meetings is significantly
more sporadic than that of the ‘ordinary’ members of the cartel, and likewise its belated entry to the market where the infringement
occurred, regardless of the duration of its participation in the infringement, or again the existence of express statements
to that effect emanating from representatives of other undertakings which participated in the infringement.

It is only in certain specific circumstances that the small size of an undertaking is an important factor to take into consideration.
When the managers of the undertaking chair and organise several meetings, the Commission is entitled to conclude that it is
not playing a passive role. It is settled law that convening meetings, proposing an agenda and distributing preparatory documents
for such meetings are incompatible with a low-profile since such initiatives show the positive and active attitude of the
undertaking concerned to the founding, continuation and control of the cartel.

The Commission is not bound by a decision-making practice: because, in previous cases, it took account of the economic situation
in the sector as a mitigating circumstance does not mean that it must necessarily continue to do so. The Commission is required
to carry out an individual appraisal of the circumstances of each case, without being bound by previous decisions concerning
other undertakings, other product and service markets or other geographical markets at different times.

(see paras 184-185, 189, 193-195)

13.    Under Article 48(2) of the Rules of Procedure of the General Court, no new plea in law may be introduced in the course of
proceedings unless that plea is based on matters of law or of fact which have come to light in the course of the procedure.

However, a plea which may be regarded as amplifying a plea put forward previously, whether directly or by implication, in
the original application, and which is closely connected therewith, will be declared admissible.

(see paras 198-199)

14.    The Commission has a broad discretion as regards the method of calculating fines and may, in that regard, take account of
numerous factors, including the cooperation provided by the undertakings concerned during the investigation conducted by its
departments. An undertaking's cooperation with the Commission can justify a reduction of the fine pursuant to the Commission
Notice on the non-imposition or reduction of fines in cartel cases solely if it has made it easier for the Commission to establish
an infringement and to put an end to it.

The Commission is not bound by a previous decision-making practice when it grants a certain rate of reduction for a particular
kind of conduct; it is not required to grant a reduction of the same proportion when assessing similar conduct in the course
of a later administrative procedure.

The Commission enjoys a broad discretion in assessing the quality and usefulness of the cooperation provided by an undertaking,
especially in comparison with the contributions made by other undertakings. In that context, the Commission is required to
make complex assessments of fact, such as those relating to the cooperation provided by the individual undertakings concerned.
The list of circumstances which may give rise to a reduction of the fine, set out in Section D2 of the Leniency Notice, is
merely illustrative.

The Commission cannot disregard the usefulness of the information provided, which inevitably depends on the evidence already
in its possession. Where an undertaking providing cooperation does no more than confirm, in a less precise and explicit manner,
certain information that has already been provided by another undertaking, that does not facilitate the Commission’s task
significantly and does not justify a reduction in the fine for cooperation.

Leniency is a reward granted by the Commission in return for facilitating establishment of the infringement, whatever the
stage at which the undertaking provided assistance and regardless of whether the assistance consisted in the provision of
new information and evidence, or in the admission of facts or of the legal characterisation of the facts.

A reduction in the fine in recognition of cooperation depends principally on the quality and usefulness of the cooperation
provided, which is a matter for the Commission to assess in the exercise of its broad discretion, of which only a manifest
abuse of that discretion can be censured.

When assessing the cooperation provided by undertakings, the Commission cannot ignore the principle of equal treatment, which
is infringed where comparable situations are treated differently or different situations are treated in the same way, unless
such treatment is objectively justified.

The assessment of the usefulness of cooperation is in no way based on an arithmetical formula automatically indicating a reduction
of at least 20% if the two indents of Section D of the Leniency Notice are found to apply.

(see paras 219-225, 238, 246, 248)

15.    The principle of proportionality requires that measures adopted by Community institutions must not exceed the limits of what
is appropriate and necessary for attaining the objective pursued.

When it comes to the calculation of fines, the gravity of infringements has to be determined by reference to numerous factors
and it is important not to confer on one or other of those factors an importance which is disproportionate in relation to
other factors.

In this context, the principle of proportionality requires the Commission to set the fine proportionately to the factors taken
into account for the purposes of assessing the gravity of the infringement and also to apply those factors in a way which
is consistent and objectively justified.

Thus, the Commission is not required, when determining the amount of the fine, to take into account the poor financial situation
of an undertaking, since recognition of such an obligation would be tantamount to conferring an unfair competitive advantage
on the undertakings least well adapted to market conditions. In any event, even if a measure taken by a Community authority
were to lead to the liquidation of an undertaking, such a liquidation of the undertaking in its existing legal form – although
it may adversely affect the financial interests of the owners, investors or shareholders – does not mean that the personal,
tangible and intangible elements represented by the undertaking would also lose their value.

Thus, neither Regulation No 17, nor Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles
81 [EC] and 82 [EC], nor the Guidelines on the method of setting fines imposed pursuant to Article 15(2) of Regulation No
17 and Article 65(5) of the ECSC Treaty provide that the amount of fines must be determined in direct relation to the size
of the affected market, that being only one relevant factor among others.

Although the Guidelines do not state that fines should be calculated according to the overall turnover of the undertakings
concerned or their turnover on the relevant market, nor do they preclude the Commission from taking either figure into account
in determining the amount of the fine, in order to ensure compliance with the general principles of Community law and where
circumstances so require. The turnover derived from the goods in respect of which the infringement was committed is likely
to give a fair indication of the scale of the infringement and the liability of each cartel member on the relevant markets.
That turnover figure constitutes an objective criterion which gives a proper measure of the harm which the offending conduct
in question represents for normal competition and it is therefore a good indicator of the capacity of each undertaking to
cause damage. However, there is no general principle that the penalty be proportionate to the turnover which the undertaking
made from the sale of the product in respect of which the infringement was committed.

The Commission is under no obligation, where fines are imposed on a number of undertakings involved in the same infringement,
to ensure that the final amounts calculated for the fines reflect every difference between the undertakings concerned in terms
of their overall turnover or their turnover on the market for the product in question. The Commission is not required to take
account of the size of the undertakings concerned when it determines the amount of the fine; there is no reason to treat small
and medium-sized undertakings differently from other undertakings since that does not exempt them from their duty to comply
with the competition rules.

(see paras 260-261, 264, 266-267, 275, 277-283)

JUDGMENT OF THE GENERAL COURT (Fifth Chamber)

28 April 2010 (*)

(Competition – Agreements, decisions and concerted practices – European market in industrial thread – Decision finding an infringement of Article 81 EC and Article 53 of the EEA Agreement – Fines – Gravity of the infringement – Actual impact on the market – Duration of the infringement – Mitigating circumstances – Cooperation during the administrative procedure – Proportionality – Guidelines on the method of setting fines)

In Joined Cases T‐456/05 and T‐457/05,

**Gütermann AG,** established in Gutach-Breisgau (Germany), represented by J. Burrichter, B. Kasten and S. Orlikowski-Wolf, lawyers,

applicant in Case T‐456/05,

**Zwicky & Co. AG,** established in Wallisellen (Switzerland), represented by J. Burrichter, B. Kasten and S. Orlikowski-Wolf, lawyers,

applicant in Case T-457/05,

v

**European Commission,** represented initially by F. Castillo de la Torre, M. Schneider and K. Mojzesowicz, and subsequently by F. Castillo de la
Torre and K. Mojzesowicz, acting as Agents,

defendant,

APPLICATIONS for annulment of Commission Decision C(2005) 3452 of 14 September 2005 relating to a proceeding under Article
81 [EC] and Article 53 of the EEA Agreement (Case COMP/38.337 – PO/Thread), as amended by Commission Decision C(2005) 3765
of 13 October 2005, and, in the alternative, for reduction of the fine imposed on the applicants by that decision,

THE GENERAL COURT (Fifth Chamber),

composed of M. Vilaras, President, M. Prek (Rapporteur) and V.M. Ciucǎ, Judges,

Registrar: T. Weiler, Administrator,

having regard to the written procedure and further to the hearing on 17 December 2008,

gives the following

**Judgment**

**Background to the dispute**

1.     *Subject-matter of the dispute*

1        By Decision C(2005) 3452 of 14 September 2005 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement
(Case COMP/38.337 – PO/Thread) (‘the contested decision’), as amended by Commission Decision C(2005) 3765 of 13 October 2005
and a summary of which was published in the *Official Journal of the European Union* of 26 January 2008 (OJ 2008 C 21, p. 10), the Commission of the European Communities found that the applicants – Gütermann
AG (‘Gütermann’) and Zwicky & Co. AG (‘Zwicky’) – had participated in a set of agreements and concerted practices on the market
in thread for industrial customers in Benelux and the Nordic countries during the period from January 1990 to September 2001,
in the case of Gütermann, and during the period from January 1990 to November 2000, in the case of Zwicky.

2        The Commission imposed a fine of EUR 4.021 million on Gütermann and a fine of EUR 0.174 million on Zwicky for their participation
in the industrial thread cartel in Benelux and the Nordic countries.

2.     *Administrative procedure*

3        On 7 and 8 November 2001, the Commission carried out inspections pursuant to Article 14(3) of Council Regulation No 17 of
6 February 1962: First Regulation implementing Articles [81 EC] and [82 EC] (OJ, English Special Edition 1959‐1962, p. 87)
at the premises of a number of sewing thread manufacturers. Those inspections were carried out as a result of information
supplied in August 2000 by The English Needle & Tackle Company.

4        On 26 November 2001, Coats Viyella plc (‘Coats’) filed an application for leniency under the Commission Notice on the non-imposition
or reduction of fines in cartel cases (OJ 1996 C 207, p. 4; ‘the Leniency Notice’), together with documents intended to show
the existence of the following cartels: (i) a cartel on the market in thread for automotive customers in the European Economic
Area (EEA); (ii) a cartel on the market in thread for industrial customers in the United Kingdom; and (iii) a cartel on the
market in thread for industrial customers in Benelux, as well as in Denmark, Finland, Norway and Sweden (collectively, ‘the
Nordic countries’).

5        In March and August 2003, on the basis of the documents taken in the course of the inspections and those provided by Coats,
the Commission sent the undertakings concerned requests for information pursuant to Article 11 of Regulation No 17.

6        On 15 March 2004, the Commission issued a statement of objections regarding a number of undertakings on account of their participation
in one or more of the cartels referred to in paragraph 4 above, including the cartel on the market in thread for industrial
customers in Benelux and the Nordic countries.

7        All the undertakings to which the statement of objections was addressed submitted written observations. Gütermann replied
in its own name and in the name of Zwicky.

8        A hearing took place on 19 and 20 July 2004.

9        On 24 September 2004, the parties were granted access to the non-confidential version of the responses to the statement of
objections, as well as to the comments made by the parties at the hearing, and were given a deadline by which to submit further
comments.

10      On 14 September 2005, the Commission adopted the contested decision.

3.     *The contested decision*

*Definition of the relevant markets*

Product market

11      In the contested decision, the Commission states that the thread sector can be divided into two categories: (i) the thread
used in industry to sew or embroider various kinds of apparel or other items such as leather goods, textile coatings for motor
vehicles and mattresses and (ii) domestic thread used by individuals for sewing or mending and for leisure activities.

12      The industrial thread business can be divided into three categories according to the use to which the thread is put: (i) sewing
thread for the clothing industry, which is used for various types of garment; (ii) embroidery thread, which is used in computerised,
industrial embroidery machines to embellish clothing, sports shoes and household textiles; and (iii) special thread, which
is used in various sectors such as footwear, leather goods and the motor industry.

13      According to the Commission, industrial thread may be regarded, from the point of view of supply, as a single product market
since there is no strict correspondence between the end-use and the type of fibre and/or the structure of the thread.

14      Nevertheless, the Commission draws a distinction in the contested decision between thread intended for the motor industry
and thread intended for industries other than the motor industry. It considers that, although the production processes for
the two types of thread are similar or easily interchangeable, the demand in the motor industry comes from large customers
which impose higher specification standards for certain products which they use – such as the thread used for seat belts –
and which require product uniformity in the various countries in which they have need of those products for their industry.

15      In the present cases, the product market by reference to which the infringement complained of was investigated is the market
for industrial thread other than for the motor industry (‘industrial thread’).

Geographic markets

16      In the contested decision, the Commission notes that, according to the information provided by the parties, the relevant geographic
market for industrial thread is regional. It adds that, according to the case, the region can cover a number of EEA countries,
such as Benelux or the Nordic countries, or a single country, such as the United Kingdom.

17      In the present case, the geographic market relevant to the alleged infringement on the part of the applicants is Benelux and
the Nordic countries.

*Size and structure of the relevant markets*

18      It can be seen from the contested decision that the sales of industrial thread in Benelux and the Nordic countries was approximately
EUR 50 million in 2000 and approximately EUR 40 million in 2004.

19      It also emerges from the contested decision that, at the end of the 1990s, the main suppliers of industrial thread in Benelux
and the Nordic countries included Gütermann, Zwicky, Amann und Söhne GmbH & Co. KG (‘Amann’), Barbour Threads Ltd, before
it was acquired by Coats, Belgian Sewing Thread NV (‘BST’) and Coats.

*Description of the unlawful conduct*

20      The Commission states in the contested decision that the events relating to the cartel on the market for industrial thread
in Benelux and the Nordic countries took place between 1990 and 2001.

21      According to the Commission, the undertakings concerned met at least once a year and those meetings were split into two sessions,
one dealing with the Benelux market and the other dealing with the market in the Nordic countries. The primary objective of
the meetings was the maintenance of high prices on both markets.

22      The participants exchanged price lists, as well as information on rebates, the application of increases in list prices, reductions
in rebates and increases in the special prices applied to certain customers. They also concluded agreements on future price
lists, maximum rebates, reductions in rebates and increases in the special prices applied to certain customers, as well as
agreements to avoid undercutting, to the advantage of the incumbent supplier and with a view to arranging customer allocation
(contested decision, recitals 99 to 125).

*Enacting terms of the contested decision*

23      By Article 1(1) of the contested decision, the Commission found that eight undertakings, including Gütermann and Zwicky, had
infringed Article 81 EC and Article 53 of the EEA Agreement by participating in agreements and concerted practices affecting
the markets of thread for industrial customers in Benelux and the Nordic countries, during the period between January 1990
and September 2001 in the case of Gütermann and during the period between January 1990 and November 2000 in the case of Zwicky.

24      Under the first paragraph of Article 2 of the contested decision, the following fines were imposed in respect of the cartel
on the market for industrial thread in Benelux and the Nordic countries on the following undertakings, among others:

–        Coats: EUR 15.05 million;

–        Amann: EUR 13.09 million;

–        BST: EUR 0.979 million;

–        Gütermann: EUR 4.021 million;

–        Zwicky: EUR 0.174 million.

25      By Article 3 of the contested decision, the Commission ordered the undertakings covered by that decision to bring to an end
immediately, if they had not already done so, the infringements which had been found to exist. It also ordered them to refrain
from repeating any act or conduct referred to in Article 1 of the contested decision and from adopting any act or conduct
having equivalent object or effect.

**Procedure and forms of order sought**

26      By applications lodged at the Registry of the General Court on 30 December 2005, the applicants brought the present actions.

27      In Case T‐456/05, Gütermann claims that the General Court should:

–        annul Article 1 of the contested decision in so far as it declares that Gütermann infringed Article 81 EC and Article 53 of
the EEA Agreement as regards the market in Finland, Norway and Sweden in the period from January 1990 to September 2001 or,
in the alternative, in the period from January 1990 up to and including December 1993;

–        annul Article 2 of the contested decision in so far as it imposes on Gütermann a fine of EUR 4.021 million or, in the alternative,
reduce that fine to an appropriate amount;

–        order the Commission to pay the costs.

28      The Commission contends that the General Court should:

–        dismiss the action;

–        order Gütermann to pay the costs.

29      In Case T‐457/05, Zwicky claims that the General Court should:

–        annul Article 1 of the contested decision in so far as it declares that Zwicky infringed Article 81 EC and Article 53 of the
EEA Agreement as regards the market in Finland, Norway and Sweden in the period from January 1990 to November 2000 or, in
the alternative, in the period from January 1990 up to and including December 1993;

–        annul Article 2 of the contested decision in so far as it imposes on Zwicky a fine of EUR 0.174 million or, in the alternative,
reduce that fine to an appropriate amount;

–        annul Article 3 of the contested decision in so far as it concerns Zwicky;

–        order the Commission to pay the costs.

30      The Commission contends that the General Court should:

–        dismiss the action;

–        order Zwicky to pay the costs.

31      By order of 9 December 2008, the President of the Fifth Chamber of the General Court decided, after hearing the parties, to
join Cases T‐456/05 and T‐457/05 for the purposes of the oral procedure and the judgment, in accordance with Article 50 of
the Rules of Procedure of the General Court.

**Law**

32      First of all, the applicants have put forward two pleas in law concerning the alleged unlawful conduct. By their first plea,
the applicants allege infringement of Article 7(1) 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). Zwicky has also put forward a plea
alleging that the injunctions to bring the infringement to an end and to refrain from repeating such conduct were unjustified.

33      Secondly, the applicants have put forward a series of pleas with a view to having the fine cancelled or reduced. On the one
hand, Zwicky complains that the Commission imposed on it a fine which exceeded the upper limit of 10% of turnover. On the
other hand, the applicants have put forward five pleas alleging, respectively: (i) incorrect assessment of the gravity of
the infringement as regards its effects; (ii) incorrect assessment of the duration of the infringement; (iii) failure to take
account of certain mitigating circumstances; (iv) misapplication of the Leniency Notice; and (v) imposition of fines which
are disproportionate.

1.     *The pleas challenging the finding that an infringement has occurred and the injunctions to bring that infringement to an end
and to refrain from repeating it*

*The plea, put forward by Gütermann and Zwicky, alleging infringement of Article 7(1) of Regulation No 1/2003*

Arguments of the parties

34      According to the applicants, the Commission infringed Article 7(1) of Regulation No 1/2003, which provides that ‘[w]here the
Commission, acting on a complaint or on its own initiative, finds that there is an infringement of Article 81 [EC] or of Article
82 [EC], it may by decision require the undertakings and associations of undertakings concerned to bring such infringement
to an end’. When it accused the applicants of infringing Article 81 EC and Article 53 of the EEA Agreement by reason of their
participation in agreements and concerted practices on the markets for industrial thread in Benelux and the Nordic countries,
during the period from January 1990 to September 2001 in the case of Gütermann and from January 1990 to November 2000 in the
case of Zwicky, the Commission failed to take account of the fact that the EEA Agreement did not enter into force until 1 January
1994 and, consequently, before that date, did not apply to Finland, Norway or Sweden. Similarly, since Finland and Sweden
did not accede to the European Community until 1 January 1995, Article 81 EC did not become directly applicable there until
that date.

35      The applicants also maintain that the Commission was correct in considering that an infringement in the legal sense of the
term – that is to say, an infringement of Article 81 EC and Article 53 of the EEA Agreement by reason of their conduct – can
exist in relation to Finland, Norway and Sweden only from 1 January 1994. The Commission therefore erred by taking as its
starting point, from a legal point of view, the existence of a single infringement which simply grew in intensity. The Commission
made no distinction between the factual assessment of the applicants’ conduct as a single and continuous collusive agreement,
from January 1990 to September 2001 in the case of Gütermann and from January 1990 to November 2000 in the case of Zwicky,
and the legal assessment of that conduct as an infringement of the competition rules during those two periods.

36      Furthermore, the applicants maintain that their plea alleging infringement of Article 7(1) of Regulation No 1/2003 is admissible.
The Commission has argued, incorrectly, that it is inadmissible on the ground that they have not established the existence
of a manifest error of assessment in the categorisation of their conduct as a single and continuous collusive agreement. In
the applicants’ view, the Commission categorised their conduct as a single and continuous collusive agreement from the point
of view of the facts, which the applicants do not challenge in the context of the present plea. On the other hand, the legal
assessment set out in Article 1(1) of the contested decision is erroneous, since Zwicky was not present on the market for
industrial thread in the Nordic countries and, in relation to Finland, Norway and Sweden, there could not have been any infringement
of the competition rules between January 1990 and December 1993.

37      The Commission relies principally on the inadmissibility of the applicants’ present plea and, in the alternative, contends
that that plea is not well founded.

Findings of the Court

38      The Court considers that the merits of the plea alleging infringement of Article 7(1) of Regulation No 1/2003 should be assessed,
without there being any need to examine the admissibility of that plea.

39      It should first be noted that, in points (g) and (h) of Article 1(1) of the contested decision, the Commission finds that
the applicants infringed Article 81 EC and Article 53 of the EEA Agreement by reason of their participation, from January
1990 to September 2001 in the case of Gütermann and from January 1990 to November 2000 in the case of Zwicky, in concerted
practices on the market for industrial thread in Benelux and the Nordic countries.

40      It must be stated that, taken in isolation, those provisions could suggest that the Commission concluded that the applicants
had committed an infringement by participating in concerted practices on the market for industrial thread in Finland, Norway
and Sweden between January 1990 and December 1993, that is to say, before the EEA Agreement entered into force. However, it
is common ground that, during that period, there was no legal basis for a finding by the Commission that the applicants had
committed such an infringement.

41      As it is, it is clear from the case-law that the enacting terms of an act are indissociably linked to the statement of reasons
for those provisions, so that, when they have to be interpreted, account must be taken, if necessary, of the reasons which
led to their adoption (Case C‐355/95 P *TWD* v *Commission* [1997] ECR I‐2549, paragraph 21, and Joined Cases T‐204/97 and T‐270/97 *EPAC* v *Commission* [2000] ECR II‐2267, paragraph 39).

42      It is clear from recitals 246, 295 to 298 and 331 of the contested decision that, in so far as the cartel covered Finland,
Norway and Sweden, it constituted an infringement of the Community competition rules and the EEA competition rules only from
1 January 1994, the date on which the EEA Agreement entered into force. Accordingly, points (g) and (h) of Article 1(1) of
the contested decision must be read in the light of that statement of reasons, which is clear and entirely unambiguous. It
follows that the enacting terms of the contested decision are to be read as meaning that the elements of the single and continuous
infringement existed, in relation to Finland, Norway and Sweden, only from 1 January 1994.

43      Secondly, it is to no avail that the applicants rely, essentially, on a distinction supposedly made by the Commission in the
contested decision between, on the one hand, the legal assessment of an infringement of Article 81 EC and Article 53 of the
EEA Agreement and, on the other, a factual assessment – in recitals 264 to 277 of that decision – of their conduct as a single
and continuous infringement. They conclude from that, also wrongly, that since an infringement ‘in the legal sense of the
term’ could exist in relation to Finland, Norway and Sweden only from 1 January 1994, the Commission erred in finding that
there was a single infringement which had simply grown in intensity.

44      First, it is important to point out that the applicants in no way deny the single and continuous nature of the infringement
on the market for industrial thread in Benelux and the Nordic countries.

45      Also, it should be borne in mind that an infringement of Article 81(1) EC may result not only from an isolated act but also
from a series of acts or from continuous conduct. That interpretation cannot be challenged on the ground that one or more
elements of that series of acts or continuous conduct could also constitute, in themselves and in isolation, an infringement
of that provision (Case C‐49/92 P *Commission* v *Anic Partecipazioni* [1999] ECR I‐4125, paragraph 81, and Case T‐279/02 *Degussa* v *Commission* [2006] ECR II‐897, paragraph 155).

46      Thus, a single and continuous infringement frequently consists of a series of acts which follow each other in time and which,
in themselves, at the time when they occur, can also constitute an infringement of the competition rules. The distinctive
feature of those acts lies in the fact that they form part of an overall strategy. That is essentially what the Commission
concluded in recitals 264 to 277 of the contested decision with regard to the cartel on the market for industrial thread in
Benelux and the Nordic countries.

47      Contrary to the applicants’ claim, the considerations set out in the abovementioned recitals of the contested decision do
not simply rehearse the facts, but set out the objective reasons which require the Commission to conclude that the infringement
on the market for industrial thread in the Nordic countries constituted, together with that on the market for industrial thread
in Benelux, a single and continuous infringement.

48      The fact that the legal basis on which the Commission relied in finding that there had been an infringement on the markets
for industrial thread in Finland, Norway and Sweden did not exist until after the infringement had begun is irrelevant in
that regard since, as is clear from the statement of reasons in the contested decision, the applicants’ conduct on the market
was taken into account only as from 1 January 1994.

49      Secondly, the complaint raised by Zwicky that it was not present on the market in the Nordic countries must be rejected. As
was pointed out in paragraph 44 above, Zwicky confirmed that it did not challenge the single and continuous nature of the
infringement on the market for industrial thread in Benelux and the Nordic countries.

50      However, it can be seen from the case-law that an undertaking which has participated in a single complex infringement through
its own conduct – conduct which meets the definition of an agreement or concerted practice with an anti-competitive object
for the purposes of Article 81 EC, and which was intended to help bring about the infringement as a whole – may also be liable
for the conduct of other undertakings in the context of the same infringement throughout the period of its participation in
the infringement, where it is proved that the undertaking in question was aware of the unlawful conduct of the other participants,
or could reasonably have foreseen such conduct, and was prepared to accept the risk (*Commission* v *Anic Partecipazioni*, paragraph 45 above, paragraph 203, and Case T‐15/99 *Brugg Rohrsysteme* v *Commission* [2002] ECR II‐1613, paragraph 73).

51      In the present case, Zwicky does not deny that it participated regularly in the meetings concerning industrial thread on the
market in the Nordic countries; it does not challenge the Commission’s statement that it was active on the market for industrial
thread in the Nordic countries before the beginning of the single infringement; it has not denied participating in the acts
which constitute the infringement on the market for industrial thread in Benelux; nor does it deny that those acts formed
part of an overall strategy and, in consequence, were merely some of the constituent parts of a single and continuous infringement
on the market for industrial thread in Benelux and the Nordic countries.

52      It follows that the mere fact that Zwicky was not present on the market for industrial thread in the Nordic countries in the
period during which the single and continuous infringement was committed does not relieve it of liability for the conduct
engaged in on that geographic market by other undertakings in the context of that infringement.

53      Moreover, in so far as Zwicky’s complaint is to be understood as meaning that only undertakings which are active on the geographic
market in the Nordic countries as competitors, or on the side of supply or demand, are capable of coordinating their conduct
as undertakings which are the (co-)perpetrators of an infringement, it must be pointed out that an undertaking can infringe
the prohibition laid down in Article 81(1) EC where the purpose of its conduct, as coordinated with that of other undertakings,
is to restrict competition on a specific relevant market within the common market, and that does not mean that the undertaking
has itself to be active on that relevant market (see, by analogy, Case T‐99/04 *AC-Treuhand* v *Commission* [2008] ECR II‐1501, paragraph 122).

54      In the light of the findings set out in paragraph 51 above, Zwicky cannot validly deny that it is also liable, as co-perpetrator,
for the infringement of the competition rules as regards the cartel concerning industrial thread on the market in the Nordic
countries.

55      The plea alleging infringement of Article 7(1) of Regulation No 1/2003 must therefore be rejected.

*The plea, put forward by Zwicky, alleging that the injunctions to bring the infringement to an end and to refrain from repeating
such conduct were unjustified*

Arguments of the parties

56      Zwicky states that, in Article 3 of the contested decision, the Commission ordered the undertakings concerned to bring to
an end immediately the infringements which had been found to exist in so far as they had not already done so and to refrain
in future from any act relating to those infringements or any conduct having an equivalent object.

57      Zwicky argues that, not only has it no longer been present on the markets concerned by the contested decision since November
2000, but also it has abandoned all its commercial activities and now merely manages real estate. It maintains that the abovementioned
injunctions are in breach of the principle of proportionality and that Article 3 of the contested decision is unlawful. In
its view, in so far as the Commission could have determined, without carrying out any further investigations, that Zwicky
had brought the infringements to an end and that there was no risk of further infringements being committed, it had no legitimate
interest in issuing an injunction. Zwicky relies in that regard on Case 7/82 *GVL* v *Commission* [1983] ECR 483, paragraph 24 et seq.

58      The Commission contends that this plea should be rejected.

Findings of the Court

59      It should be pointed out that, by the present plea, Zwicky is seeking annulment of Article 3 of the contested decision in
so far as it relates to Zwicky.

60      It should be noted that Article 3 of the contested decision contains, in fact, two injunctions.

61      First of all, that provision requires the undertakings concerned to bring to an end immediately the infringements referred
to in Article 1 of the contested decision, in so far as they have not already done so. In so far as Zwicky had ceased to trade
in the industrial thread sector at the time when the contested decision was adopted, the argument raised against that provision
is manifestly devoid of all foundation. Even though Zwicky is one of the undertakings listed in Article 1 of the contested
decision, it had, by virtue of the fact that it had ceased to trade, already brought the infringement to an end and was therefore
no longer concerned by the injunction at issue (see, to that effect, Joined Cases T‐305/94 to T‐307/94, T‐313/94 to T‐316/94,
T‐318/94, T‐325/94, T‐328/94, T‐329/94 and T‐335/94 *Limburgse Vinyl Maatschappij and Others* v *Commission* [1999] ECR II‐931, paragraph 1247). That circumstance also frustrates Zwicky’s argument concerning the breach of the principle
of proportionality in that regard (see, to that effect, Case T‐410/03 *Hoechst* v *Commission* [2008] ECR II‐881, paragraph 196).

62      Secondly, Article 3 of the contested decision requires the undertakings listed in Article 1 to refrain from repeating any
act or conduct described in Article 1 and from adopting any measure having equivalent object or effect.

63      It should be borne in mind that the application of Article 7(1) of Regulation No 1/2003 may involve a prohibition on continuing
certain activities, practices or situations which have been found to be unlawful, but also a prohibition on adopting similar
future conduct. Such obligations on undertakings must not, however, exceed the limits of what is appropriate and necessary
to achieve the aim pursued (see, by analogy, Joined Cases T‐25/95, T‐26/95, T‐30/95 to T‐32/95, T‐34/95 to T‐39/95, T‐42/95
to T‐46/95, T‐48/95, T‐50/95 to T‐65/95, T‐68/95 to T‐71/95, T‐87/95, T‐88/95, T‐103/95 and T‐104/95 *Cimenteries CBR and Others* v *Commission* [2000] ECR II‐491, paragraphs 4704 and 4705 and the case-law cited). Furthermore, the Commission’s power to issue injunctions
is to be applied according to the nature of the infringement found (Joined Cases 6/73 and 7/73 *Istituto Chemioterapico Italiano and Commercial Solvents* v *Commission* [1974] ECR 223, paragraph 45; Case T‐228/97 *Irish Sugar* v *Commission* [1999] ECR II‐2969, paragraph 298; and Case T‐128/98 *Aéroports de Paris* v *Commission* [2000] ECR II‐3929, paragraph 82).

64      In the present case, the Commission found, in Article 1 of the contested decision, that Zwicky, with other undertakings, had
infringed Article 81 EC and Article 53 of the EEA Agreement by participating – over the course of a very long period indeed
– in agreements and concerted practices in the industrial thread sector in Benelux and the Nordic countries, in the framework
of which Zwicky and the other undertakings had agreed to fix future price lists, maximum rebates, reductions in rebates and
increases in special prices applied to certain customers; to avoid undercutting, to the advantage of the incumbent supplier;
and to arrange customer allocation. Zwicky does not dispute the statements made in the contested decision in that regard.

65      In those circumstances, by enjoining the undertakings concerned to refrain in future, in the market for industrial thread
in Benelux and the Nordic countries, from any measure having the same or equivalent object or effect, the Commission did not
exceed the powers conferred on it under Article 7(1) of Regulation No 1/2003 (see, to that effect and by analogy, *Hoechst* v *Commission*, paragraph 61 above, paragraph 199).

66      The fact that Zwicky was no longer active in the industrial thread sector on the day that the contested decision was adopted
does not cast doubt on that conclusion. An injunction such as that in issue is, of its very nature, preventive and does not
depend on the situation of the undertakings concerned at the time when the contested decision was adopted.

67      The fact that Zwicky had given no undertaking to refrain from repeating its anti-competitive conduct means that the Commission
was all the more justified in including that injunction in the enacting terms of the contested decision (see, to that effect,
Case T‐141/94 *Thyssen Stahl* v *Commission* [1999] ECR II‐347, paragraph 678).

68      In addition, the judgment in *GVL* v *Commission*, paragraph 57 above, relied on by Zwicky, is irrelevant to the present case. Above and beyond the fact that the circumstances
of the present case are different from those in *GVL* v *Commission*, it has been shown in paragraphs 60 to 67 above that Zwicky was not concerned by the injunction to bring to an end immediately
the infringements referred to in Article 1 of the contested decision and that the Commission had a perfectly legitimate interest
in ordering it to refrain in future from any act relating to those infringements or any conduct having an equivalent object.

69      For all of those reasons, the present plea must be rejected.

2.     *The pleas challenging the fine and the amount thereof*

*The plea, put forward by Zwicky, alleging that the upper limit of 10% of turnover has been exceeded*

Arguments of the parties

70      After indicating that it had discontinued its commercial activities in the industrial thread sector in November 2000, Zwicky
complains first that the Commission took Gütermann’s turnover as the basis for calculating the maximum fine of 10% of turnover.
Gütermann had taken over only a part of Zwicky’s activities and was not under Zwicky’s control. Accordingly, only Zwicky’s
turnover matters. Since Zwicky has had no turnover since 2001, no fine can be imposed on it under Article 23(2) of Regulation
No 1/2003. Regulation No 1/2003 refers to the total turnover in the last business year preceding the adoption of the decision.
The fact of linking the fine to the latter figure makes it possible to take account of the size and influence of the undertaking
on the market. Thus, what matters is the present position of undertakings with regard to turnover. An undertaking which no
longer has a turnover has no influence on the market and, as a consequence, cannot be fined.

71      Zwicky then states that the judgment in Case T‐33/02 *Britannia Alloys & Chemicals* v *Commission* [2005] ECR II‐4973, relied on by the Commission, must be interpreted as meaning that the taking into account of a turnover
figure which is not that of the last complete business year preceding the adoption of the decision is possible where the undertaking
concerned has ceased its commercial activities or diverted its turnover in order to avoid the imposition of a heavy fine.
That is not the position in the present case. Zwicky claims in that regard that it sold its commercial activities one year
before the Commission’s inspections, following a decline in its competitive situation.

72      Zwicky also states that, in the present case, Gütermann acquired Zwicky’s commercial business in the framework of an asset
deal and that, in consequence, income related to the activities acquired should have been passed to Gütermann to increase
the turnover to be taken into account for the purposes of applying Article 23(2) of Regulation No 1/2003. In addition, Zwicky
argues that the sale of its activities to Gütermann does not constitute a mere internal reorganisation.

73      Finally, the fact that the applicants sent a single document in reply to the statement of objections is explained by the fact
that Zwicky’s industrial thread activities had been taken over by Gütermann and that, as a result of that transaction, the
chairman of Zwicky’s Board of Directors had been appointed to the Board of Gütermann. However, that in no way alters the fact
that Zwicky is independent of Gütermann and that Gütermann did not become a shareholder in Zwicky.

74      The Commission argues that the present plea is ineffective *ab initio* inasmuch as, even if Zwicky’s argument were correct, the Commission would have determined the maximum fine permissible by
taking account of the turnover for the preceding business year, as it has already done in other cases. It notes that Zwicky’s
total turnover for 1999 was EUR 4.5 million and that the fine of EUR 0.174 million in no way exceeds the upper limit of 10%
of turnover.

75      In the alternative, the Commission contends first that even though, in November 2000, Gütermann bought the business activities
of Zwicky that were connected with the cartel on the industrial thread market, the Commission took account of the fact that
Zwicky had been implicated for 10 years in the infringement being penalised and formed the view that, after Zwicky’s sale
of its commercial activities, the fact of continuing to exist in law in the form of an ‘empty shell’ was a strategy which
had been adopted for the specific purpose of avoiding penalties for infringement of the competition rules. The Commission
also points out that Zwicky did not challenge the case-law to the effect that, in principle, it falls to the natural or legal
person managing the undertaking in question at the time when the infringement is committed to answer for that infringement.
The Commission adds that, since Zwicky’s chairman was a director of Gütermann and therefore had precise knowledge of the participation
of the two undertakings in the cartel, the reasons for maintaining Zwicky in existence are easy to understand.

76      The Commission also maintains that Zwicky’s interpretation of the second subparagraph of Article 23(2) of Regulation No 1/2003
is not compatible with the principle of effectiveness, because it would enable undertakings to escape their liability by carrying
out purely internal reorganisations. That was the Court’s approach in *Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above.

77      Finally, the Commission contends that the close links between Zwicky and Gütermann are clear from the wording of a common
reply to the statement of objections and from the fact that the same lawyers defended both undertakings before the Court.

Findings of the Court

78      Under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003, the Commission may impose on undertakings
fines not exceeding 10% of turnover for the business year preceding the adoption of the decision. The purpose of the upper
limit of 10% is to prevent fines from being disproportionate to the size of the undertaking and, in particular, to prevent
the imposition of fines which undertakings are unlikely to be able to pay. Since only the total turnover figure can effectively
give an approximate indication of that size, the aforementioned percentage must be understood as referring to the total turnover
(Joined Cases 100/80 to 103/80 *Musique Diffusion française and Others* v *Commission* [1983] ECR 1825, paragraph 119).

79      It should also be pointed out that the purpose of Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003
is to give the Commission power to impose fines so as to enable it to carry out the task of supervision entrusted to it by
Community law (*Musique Diffusion française and Others* v *Commission*, paragraph 78 above, paragraph 105, and Case T‐224/00 *Archer Daniels Midland and Archer Daniels Midland Ingredients* v *Commission* [2003] ECR II‐2597, paragraph 105). That task includes the duty to investigate and punish individual infringements, but it
also encompasses the duty to pursue a general policy designed to apply, in competition matters, the principles laid down by
the Treaty and to guide the conduct of undertakings in the light of those principles. It follows that the Commission must
ensure that fines have a deterrent effect (Case T‐224/00 *Archer Daniels Midland and Archer Daniels Midland Ingredients* v *Commission*, paragraphs 105 and 106).

80      It should also be noted that ‘preceding business year’ within the meaning of Article 15(2) of Regulation No 17 and the second
subparagraph of Article 23(2) of Regulation No 1/2003 refers, in principle, to the last complete business year for each of
the undertakings concerned at the date on which the decision was adopted (Case C‐76/06 P *Britannia Alloys & Chemicals* v *Commission* [2007] ECR I‐4405, paragraph 32).

81      In the present case, since the contested decision is dated 14 September 2005, the preceding business year is that from 1 July
2004 to 30 June 2005. However, Zwicky sold its industrial thread business to Gütermann in November 2000. Consequently, the
Commission formed the view that, at the time when the contested decision was adopted, it did not have to hand a turnover figure
for Zwicky in respect of an economic activity pursued by that undertaking in the preceding business year. Taking as its basis,
in recital 383 of the contested decision, the assumption that the relationship between Gütermann and Zwicky following the
latter’s sale of its industrial thread business to the former was that of holding company and subsidiary, the Commission considered
itself entitled to use Gütermann’s turnover for the purposes of applying the 10% upper limit.

82      There are two aspects to the complaints put forward by Zwicky: (i) the fact that the Commission chose to take account of Gütermann’s
turnover and (ii) the failure to take account of Zwicky’s turnover for the business year ending on 30 June 2005, even though
it was nil.

83      With regard to the first aspect of Zwicky’s complaints, it must be stated that the Commission erred in referring to Gütermann’s
turnover for the purposes of determining the upper limit of 10% of turnover not to be exceeded when calculating the amount
of the fine to be imposed on Zwicky.

84      Gütermann merely took over Zwicky’s industrial thread business in November 2000. Zwicky explained at the hearing that that
cessation of activity took place in two ways, namely by the conclusion in Switzerland of a contract for the transfer of assets
such as warehouses and machines and by the sale of shares in Germany.

85      However, the Commission acknowledged at the hearing that Gütermann had in no sense taken over Zwicky and that, in consequence,
Gütermann had not become the owner of Zwicky. The sale of the industrial thread business thus had no effect on Zwicky’s legal
and economic independence.

86      The arguments that Zwicky’s chairman became a director of Gütermann, that the two undertakings consulted the same lawyer and
that they provided a common reply to the statement of objections are not enough in themselves to justify, in the present case,
the Commission’s view that the relationship between the two undertakings was that of holding company and subsidiary.

87      In addition, the Commission has in no way shown how it was misled by the information provided by Zwicky in response to the
Commission’s request for information concerning the sale of Zwicky’s business and its links to Gütermann.

88      It follows that, by referring to Gütermann’s turnover, the Commission committed an error of assessment, the consequences of
which are set out in paragraph 104 et seq. below.

89      The second aspect of Zwicky’s complaints – namely the failure to take account of Zwicky’s zero turnover from its declared
business activities in the year preceding the adoption of the contested decision – necessitates consideration of the manner
in which the Commission is required to define the concept of ‘preceding business year’ in cases where the economic situation
of the undertaking concerned undergoes substantial changes between the end of the period during which the infringement was
committed and the date of the adoption of the Commission decision imposing the fine.

90      As regards the concept of ‘preceding business year’, it should be pointed out that, according to settled case-law, in interpreting
a provision of Community law it is necessary to consider not only its wording, but also its context and the objectives pursued
by the rules of which it is part (Case C‐17/03 *VEMW and Others* [2005] ECR I‐4983, paragraph 41; Case C‐391/05 *Jan De Nul* [2007] ECR I‐1793, paragraph 20; and *Britannia Alloys & Chemicals* v *Commission*, paragraph 80 above, paragraph 21).

91      In that regard, as was pointed out in paragraph 79 above, the purpose of Article 15(2) of Regulation No 17 and Article 23(2)
of Regulation No 1/2003 is to give the Commission power to impose fines so as to enable it to carry out the task of supervision
entrusted to it by Community law. That task includes, in particular, the curbing of illegal activities and the prevention
of repeat offences (Case 41/69 *ACF Chemiefarma* v *Commission* [1970] ECR 661, paragraph 173).

92      It should be added that, pursuant to Article 15(2) of Regulation No 17 and Article 23(3) of Regulation No 1/2003, the Commission
is required to take into account the gravity and the duration of the infringement in question.

93      In the light of those factors, the purpose of the upper limit, expressed in terms of turnover and laid down in Article 15(2)
of Regulation No 17 and the second subparagraph of Article 23(2) of Regulation No 1/2003, is to prevent fines imposed by the
Commission from being disproportionate to the size of the undertaking concerned (*Musique Diffusion française and Others* v *Commission*, paragraph 78 above, paragraph 119).

94      It is clear from the above considerations that, in determining the ‘preceding business year’, the Commission must assess,
in each specific case and having regard both to the context and to the objectives pursued by the scheme of penalties created
by Regulation No 17 and Regulation No 1/2003, the intended impact on the undertaking in question, taking into account in particular
a turnover which reflects the undertaking’s true economic situation in the period during which the infringement was committed
(*Britannia Alloys & Chemicals* v *Commission*, paragraph 80 above, paragraph 25).

95      It is clear, however, both from the objectives of the system of which Article 15(2) of Regulation No 17 and the second subparagraph
of Article 23(2) of Regulation No 1/2003 form part and from the case-law cited in paragraph 80 above, that the application
of the 10% upper limit presupposes, first, that the Commission has at its disposal the turnover figure for the last business
year preceding the date of adoption of the decision and, second, that those data represent a full year of normal economic
activity over a period of 12 months (*Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above, paragraph 38).

96      Thus, if the business year had ended before the adoption of the decision but the annual accounts of the undertaking in question
had not yet been drawn up or had not been disclosed to the Commission, the latter would have the right, indeed the obligation,
to use the turnover achieved in an earlier business year in order to apply Article 15(2) of Regulation No 17 and the second
subparagraph of Article 23(2) of Regulation No 1/2003. Similarly, if, as a result of a reorganisation or a change in accounting
practices, an undertaking has, for the preceding business year, produced accounts which relate to a period shorter than 12
months, the Commission is entitled to rely on the turnover achieved in an earlier complete year in order to apply those provisions
(*Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above, paragraph 39). The same is true if an undertaking has not carried on any economic activity during the
preceding business year and, accordingly, the Commission does not have at its disposal a figure for the undertaking’s turnover,
representing economic activity carried on by it during that year. Contrary to the requirements of the case-law, the turnover
for that period gives no indication of the size of the undertaking and, in consequence, cannot serve as a basis for determining
the maximum amount permissible under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003 (*Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above, paragraph 42).

97      It should also be borne in mind that – as is clear from *Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above, paragraph 49, applicable by analogy to the present case – even in a year of normal business activity,
the turnover of an undertaking may fall significantly, or indeed substantially, as compared with previous years, for various
reasons, such as a difficult economic context, a crisis in the sector concerned, an accident or a strike. However, as long
as an undertaking has in fact achieved a turnover during a complete year in which economic activities, albeit on a reduced
scale, have been carried on, the Commission must take account of that turnover for the purposes of determining the maximum
amount permissible under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003. Accordingly, at least
in situations where there is no indication that an undertaking has ceased its commercial activities or has diverted its turnover
in order to avoid the imposition of a heavy fine, it is appropriate to regard the Commission as obliged to fix the maximum
limit of the fine by reference to the most recent turnover corresponding to a complete year of economic activity (*Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above, paragraph 49).

98      According to Zwicky, the Commission has in no way shown that Zwicky had diverted its turnover and it therefore misapplied
the exception to the principle that the turnover for the preceding business year is to be taken into account. However, as
it stated at the hearing, the Commission is in no way claiming that Zwicky acted improperly in order to avoid the imposition
of a heavy fine; the Commission merely states that, on the facts, Zwicky has ceased to trade and therefore exists as an ‘empty
shell’.

99      In its written pleadings, Zwicky mentioned that, since 2001, it had merely managed real estate and pointed out that it had
had no turnover since then. Consequently, it must be concluded that Zwicky did not achieve a turnover in the complete business
year preceding the contested decision, that is to say, in the period from 1 July 2004 to 30 June 2005. When asked at the hearing
about the exact nature of its activities, Zwicky reiterated its statements that it managed real estate which had remained
its property. It explained that its real estate consisted of buildings formerly occupied by its industrial thread business
and which have been empty since the sale of that business to Gütermann, as well as dwellings let to former employees. It argued
that the dwellings could be used for rental purposes and that investments will be made with that end in view. It also referred
to a development plan drawn up jointly with the local authorities. Lastly, it admitted that since the sale of its industrial
thread business, it no longer had any employees.

100    Although it is common ground that Zwicky continued to exist in law after the sale of its business to Gütermann, it must be
stated that there are serious grounds – such as a zero turnover over several years, the lack of employees or the lack of solid
evidence that it is making use of its real estate or has investment projects for that purpose – for supposing that Zwicky
did not continue to carry on a normal economic activity within the meaning of the abovementioned case-law, and specifically
in the period between 1 July 2004 and 30 June 2005.

101    The answers provided by Zwicky in its written pleadings and at the hearing remained vague and have not therefore enabled the
Court to determine the existence of a ‘normal economic activity’. In addition, Zwicky has confirmed the content of an extract
from an economic summary of its situation, read by the Commission at the hearing, which shows that Zwicky’s turnover is nil,
its profits are nil and it has no employees; nor does Zwicky deny that that was the situation specifically in the period between
the sale of its industrial thread business to Gütermann and 30 June 2005.

102    Contrary to Zwicky’s claims at the hearing, the mere fact that a board of directors and a manager are dealing with the company’s
development plan, the reality of which, moreover, has not been established, is not sufficient to constitute conclusive evidence
of the existence of a normal economic activity on the part of that company as the Court understood that concept in *Britannia Alloys & Chemicals* v *Commission*, paragraph 71 above.

103    It follows that the Commission was required to take account of an overall turnover figure for Zwicky which pre-dated that
for the business year that ended on 30 June 2005.

104    With regard to the consequences of the Commission’s error in referring to Gütermann’s overall turnover, it must be determined
whether that error justifies a reduction in the fine imposed on Zwicky, or even its cancellation, by the Community judicature.

105    It must be pointed out that the Court has jurisdiction in two respects over actions contesting Commission decisions imposing
fines on undertakings for infringement of the competition rules. In the first place, it has the task of reviewing the lawfulness
of those decisions under Article 230 EC (Case C‐297/98 P *SCA Holding* v *Commission* [2000] ECR I‐10101, paragraphs 53 and 54).

106    In the second place, the Court has power to assess, in the context of the unlimited jurisdiction accorded to it by Article
229 EC, Article 17 of Regulation No 17 and Article 31 of Regulation No 1/2003, the appropriateness of the amounts of fines.
That assessment may justify the production and taking into account of additional information which is not as such required,
by virtue of the duty under Article 253 EC to state reasons, to be set out in the decision (*SCA Holding* v *Commission*, paragraph 105 above, paragraph 55).

107    In the present case, the Court considers, in the exercise of its unlimited jurisdiction, that reference must be made to Zwicky’s
turnover, not Gütermann’s.

108    For the reasons set out above and in the light of the line of authority established in the judgments in *Britannia Alloys & Chemicals* v *Commission*, paragraphs 71 and 80 above, the last turnover for Zwicky arising from real economic activities on its part, to which the
Commission should have referred, is that arising from the business year running from 1 July 1999 to 30 June 2000. It can be
seen from recital 76 of the contested decision that that turnover is EUR 4.5 million. The basic amount of the fine which the
Commission imposed on Zwicky is EUR 205 000 and does not therefore exceed 10% of that turnover.

109    It should also be noted that, at the hearing, Zwicky argued that the alternative approach of referring to its turnover for
the business year which ended on 30 June 2000 is unacceptable on the ground that it would amount to taking account of its
turnover twice. Since Zwicky’s industrial thread business had been taken over by Gütermann, the Commission had already taken
account of the turnover generated by that business in Gütermann’s overall turnover. The Commission contends that that is a
new argument and must therefore be rejected.

110    Zwicky’s argument must be rejected as unfounded.

111    Zwicky’s argument consists in maintaining that the alternative approach would be tantamount to attributing to Zwicky the turnover
already attributed to Gütermann. However, the Court considers that the only question which arises in this connection is that
of identifying the relevant turnover figure to be used for calculating the 10% upper limit for the purposes of the fine to
be imposed on Zwicky. As has been shown above, the only acceptable figure is the EUR 4.5 million achieved by Zwicky in the
business year running from 1 July 1999 to 30 June 2000.

112    Even supposing that it had to be accepted that that approach is tantamount to attributing Zwicky’s turnover twice at that
stage of the calculation of the fine to be imposed on Gütermann and Zwicky, it must be considered that the illegality was
to the disadvantage of Gütermann. Zwicky’s argument thus really amounts to asking the Court to review the legality of the
amount of the fine imposed on Gütermann. However, Zwicky cannot claim any right of action in that regard. If an addressee
of a decision decides to bring an action for annulment, the matter to be adjudicated by the Community judicature relates only
to those aspects of the decision which concern that addressee. Unchallenged aspects concerning other addressees, on the other
hand, do not form part of the matter to be adjudicated by the Community judicature (Case C‐310/97 P *Commission* v *AssiDomän Kraft Products and Others* [1999] ECR I‐5363, paragraph 53).

113    In the light of those considerations, the plea, put forward by Zwicky, alleging infringement of Article 15(2) of Regulation
No 17 and the second subparagraph of Article 23(2) of Regulation No 1/2003 must be rejected.

*The plea, put forward by Gütermann and Zwicky, alleging incorrect assessment of the gravity of the infringement as regards
its effects*

Arguments of the parties

114    First of all, the applicants claim that, in accordance with the Guidelines on the method of setting fines imposed pursuant
to Article 15(2) of Regulation No 17 and Article 65(5) [CS] (OJ 1998 C 9, p. 3; ‘the Guidelines’) and settled decision-making
practice, the assessment of the gravity of the infringement expressly depends on the actual impact of the infringement on
the market. The principle of proportionality requires the Commission to take account of any such impact in assessing the gravity
of the infringement. The applicants explain that, by this complaint, they are not seeking to challenge the infringement as
such but are challenging its categorisation as a very serious infringement.

115    Secondly, the applicants conclude, after considering the question of the actual impact of the infringement on the market,
that it had no impact. They therefore argue that the Commission could not rely on impact as a basis for categorising the infringement
as very serious. Although they admit that the price increases mentioned in the lists decided on during the meetings were mostly
put into effect by the various undertakings, they maintain that those price increases did not lead to an increase in real
net prices. The considerations set out by the Commission in Section 4.1.4 of the contested decision do not support the conclusion
that there was such an impact. The fact that the undertakings met over a period of 11 years is not in itself a sufficient
basis for concluding that the price increases had an influence on net prices. According to the applicants, they have provided
proof that the principal purpose of the meetings was to exchange legal information. The Commission itself admits that it does
not have sufficient evidence of actual impact.

116    By reason of the particular way in which prices are determined in the industrial thread sector – invoices to customers are
almost never based on the prices quoted in the lists – the applicants submit that it is in no way possible in the present
case to infer from the implementation of the agreement that there was an actual impact on the market. On the contrary, real
average prices on the market did not rise and even dropped.

117    Thirdly, the applicants submit that, on the facts, the infringement had no actual impact on their real average prices; they
argue that the infringement should not have been categorised as very serious at individual level; and they accordingly maintain
that the Commission should have credited them with that factual situation.

118    In view of the considerable disparity between the size of the undertakings concerned and the low turnover they achieved on
the market concerned, the applicants claim that the Commission should have accepted, as an exculpatory circumstance in accordance
with Section 1A of the Guidelines, the fact that the infringement had no actual impact on their net prices.

119    They complain that the Commission merely compared, on the basis of their turnover, the relative significance on the market
of the various undertakings and thus took account only of their abstract economic capacity to influence competition, giving
no consideration to the actual impact of their conduct on net prices.

120    Fourthly, according to the applicants, the Commission erred in finding that Zwicky had participated in the infringements on
the industrial thread market in the Nordic countries, since Zwicky had never done business on the industrial thread market
in those countries.

121    The Commission contends that this plea should be rejected.

Findings of the Court

122    First of all, it should be pointed out that, with regard to the assessment of the gravity of an infringement as such, the
first and second paragraphs of Section 1A of the Guidelines state as follows:

‘In assessing the gravity of the infringement, account must be taken of its nature, its actual impact on the market, where
this can be measured, and the size of the relevant geographic market.

Infringements will thus be put into one of three categories: minor infringements, serious infringements and very serious infringements.’

123    In the contested decision, the Commission pointed to the following three factors:

–        the infringement at issue consisted essentially in the exchange of sensitive information on price lists and/or prices charged
to individual customers, in agreements on price increases and/or on target prices, and in refraining from undercutting, to
the advantage of the incumbent supplier, such practices constituting by their very nature the most serious type of infringement
of Article 81(1) EC and Article 53(1) of the EEA Agreement (contested decision, recital 345);

–        the collusive agreements were implemented and had an impact on the market in the EEA for the product concerned, but that impact
cannot be measured with precision (contested decision, recital 351);

–        the cartel covered a number of parties to the EEA Agreement, namely Benelux and the Nordic countries (contested decision,
recital 352);

124    The Commission’s conclusion is worded as follows (contested decision, recital 353);

‘Taking all these factors into account, the Commission considers that the undertakings concerned by [the contested decision]
have committed a very serious infringement of Article 81 [EC] and Article 53 of the EEA Agreement.’

125    The applicants challenge the very serious nature of the infringement: on the one hand, they argue that the Commission concluded
that there had been an actual impact on the market without being able to prove this and, on the other, they claim that there
had been no impact on net prices or, at least, no actual impact on real average prices.

126    It should be pointed out, first, that, in order to assess the actual impact of an infringement on the market, the Commission
must take as a reference the competition which would normally have existed if there had been no infringement (Case T‐69/04
*Schunk and Schunk Kohlenstoff-Technik* v *Commission* [2008] ECR II‐2567, paragraph 165; see, to that effect, Case T‐347/94 *Mayr-Melnhof* v *Commission* [1998] ECR II‐1751, paragraph 235, and *Thyssen Stahl* v *Commission*, paragraph 67 above, paragraph 645).

127    In the present case, it should be noted that the applicants in no way deny the implementation of the cartel. On the contrary,
it is clear from point 40 of Gütermann’s application and point 46 of Zwicky’s application that they ‘expressly admitted both
in the reply to the statement of objections and in the presentation of the facts in [those applications]’ that ‘the price
increases appearing in the lists decided on at the meetings were mostly implemented by the various undertakings’.

128    In the case of a price cartel, in particular, the Commission may legitimately infer that the infringement had effects from
the fact that the cartel members took measures to apply the agreed prices, for example by increasing the list prices that
serve as a basis for the calculation of real prices; by giving up rebates; by increasing special prices; and by exerting pressure,
by means of complaints, on undertakings which have breached the agreement to refrain from undercutting, to the advantage of
the incumbent supplier. In order to conclude that there has been an impact on the market, it is sufficient that the agreed
prices have served as a basis for determining individual transaction prices, thereby limiting customers’ room for negotiation
(*Schunk and Schunk Kohlenstoff-Technik* v *Commission*, paragraph 126 above, paragraph 166; see, to that effect, *Limburgse Vinyl Maatschappij and Others* v *Commission*, paragraph 61 above, paragraphs 743 to 745).

129    On the other hand, the Commission cannot be required, where the implementation of a cartel has been established, systematically
to demonstrate that the agreements in fact enabled the undertakings concerned to achieve a higher level of transaction prices
than that which would have prevailed in the absence of a cartel (*Hoechst* v *Commission*, paragraph 61 above, paragraph 348; see, to that effect, *Limburgse Vinyl Maatschappij and Others* v *Commission*, paragraph 61 above, paragraphs 743 to 745). It would be disproportionate to require such proof, which would absorb considerable
resources, given that it would necessitate making hypothetical calculations based on economic models whose accuracy it would
be difficult for the Court to verify and whose infallibility has in no way been demonstrated (*Schunk and Schunk Kohlenstoff-Technik* v *Commission*, paragraph 126 above, paragraph 167).

130    In order to assess the gravity of the infringement, the decisive point is whether the cartel members did all they could to
give practical effect to their intentions. What then happened at the level of the market prices actually obtained is liable
to have been influenced by other factors outside the control of the members of the cartel. The cartel members cannot therefore
benefit from external factors which counteracted their own efforts by turning them into factors justifying a reduction of
the fine (*Schunk and Schunk Kohlenstoff-Technik* v *Commission*, paragraph 126 above, paragraph 168).

131    Furthermore, in Section 4.1.4 of the contested decision, the Commission set out a list of specific and credible evidence indicating
that the cartel had an actual impact on the market. First of all, the Court agrees with the Commission’s argument, set out
in recital 164 of the contested decision, that the increases in the list prices – which Gütermann itself confirmed – resulted
in higher net prices for certain small customers, whose negotiating power is generally weaker. The Court also agrees with
the finding made by the Commission in recital 165 of the contested decision that the increases in the list prices could also
have influenced the prices actually charged to large customers inasmuch as the list prices served as the starting point for
negotiations with those customers. Lastly, the Commission’s argument regarding the fact that certain undertakings applied
genuine increases to special prices and dropped rebate arrangements tends to confirm that the infringement had an actual impact
on the market concerned.

132    It follows from those considerations and from the finding that the cartel had lasted for more than 11 years that the Commission
was properly entitled to conclude that there had been an actual impact on the market concerned.

133    Secondly, the arguments relating to the cartel’s alleged lack of actual impact on the applicants’ real average prices and
to the fact that Zwicky never traded on the industrial thread market in the Nordic countries concern the individual conduct
of those two undertakings and cannot therefore be accepted. The actual conduct which an undertaking claims to have adopted
is irrelevant for the purposes of assessing the impact of a cartel on the market. Only the effects resulting from the whole
of the infringement are to be taken into account (*Commission* v *Anic Partecipazioni*, paragraph 45 above, paragraph 152, and Case T‐7/89 *Hercules Chemicals* v *Commission* [1991] ECR II‐1711, paragraph 342).

134    Thus, the Commission’s consideration of the unlawful conduct of Gütermann and Zwicky with regard to competition sheds light
on the individual situation of the two undertakings, but can have no bearing whatsoever on the categorisation of the infringement
as ‘very serious’.

135    In addition, the fact that Zwicky never traded on the industrial thread market in the Nordic countries is irrelevant. As was
pointed out in paragraph 51 above, Zwicky has in no way denied the single and continuous nature of the infringement on the
industrial thread market in Benelux and the Nordic countries.

136    With regard to the evidence based on the long duration of the infringement, put forward by the Commission in recital 166 of
the contested decision in relation to the impact of the cartel, it should be pointed out that since the practices complained
of were applied for at least 11 years, it is unlikely that the producers regarded them at the time as wholly ineffective and
pointless (see, to that effect, *Limburgse Vinyl Maatschappij and Others* v *Commission*, paragraph 61 above, paragraph 748, and Case T‐64/02 *Heubach* v *Commission* [2005] ECR II‐5137, paragraph 130).

137    Lastly, it should be noted that the three aspects of the assessment of the gravity of the infringement do not each carry the
same weight in the context of an overall examination. The nature of the infringement plays a major role, in particular, in
distinguishing ‘very serious’ infringements. It is clear from the description of very serious infringements given in the Guidelines
that agreements or concerted practices which – as in the present case – are mainly designed to fix prices may, on the basis
of their nature alone, be categorised as ‘very serious’, without there being any need to distinguish such conduct by reference
to a particular impact or geographic area. That conclusion is corroborated by the fact that, whilst the description of serious
infringements expressly mentions their impact on the market and their effects on extensive areas of the common market, the
description of very serious infringements makes no mention of any requirement as to actual market impact or effects produced
in a particular geographic area (Joined Cases T‐49/02 to T‐51/02 *Brasserie nationale and Others* v *Commission* [2005] ECR II‐3033, paragraph 178; Case T‐38/02 *Groupe Danone* v *Commission* [2005] ECR II‐4407, paragraph 150; *Hoechst* v *Commission*, paragraph 61 above, paragraph 345; and *Schunk and Schunk Kohlenstoff-Technik* v *Commission*, paragraph 126 above, paragraph 171).

138    In the present case, it is clear from the facts set out in Part I of the contested decision and from recitals 345 and 346
of that decision that, by its very nature, the infringement was a very serious one. It follows that, solely on the basis of
the nature of the infringement, its categorisation as ‘very serious’ remains appropriate.

139    It follows from all of the above considerations that the plea alleging incorrect categorisation of the infringement as regards
its effects must be rejected.

*The plea, put forward by Gütermann and Zwicky, alleging incorrect assessment of the duration of the infringement*

Arguments of the parties

140    A number of claims have been put forward in support of this plea.

141    First of all, the applicants complain that the Commission automatically applied to the starting amount a 10% increase for
each year of the infringement even though that percentage is merely the upper limit provided for in the Guidelines for long-term
infringements and not the rule. The Guidelines do not require the Commission to increase the starting amount automatically
by an additional amount equal to a certain percentage for each year of the infringement; rather, they leave the Commission
a measure of discretion. In the present case, the Commission did not exercise that discretion either as regards the basic
principle of increasing the starting amount for the fine or as regards the size of that increase.

142    Secondly, the 5% increase applied to the fines imposed on the applicants – in the case of Gütermann, for a nine-month infringement
in 2001 and, in the case of Zwicky, for a 10-month infringement in 2000 – are at odds with the plain meaning of Section 1B
of the Guidelines, which provides for an increase only in respect of an entire year. Moreover, the Commission’s approach in
that regard has not been confirmed by the case-law.

143    Thirdly, the fixed increases of 115% for Gütermann and 105% for Zwicky in the starting amounts for the fines are unlawful
inasmuch as they were calculated in the same way for all the countries concerned by the infringement, regardless of the true
duration of the infringements. It is true that the Commission considered that, although Benelux and the Nordic countries constituted
two separate markets, they had to be examined together since the discussions concerning them took place on the same days and
involved the same undertakings. However, Zwicky points out that it was never present on the industrial thread market in the
Nordic countries and states that, as a consequence, it did not participate in the infringements regarding those countries.
Similarly, the applicants point out that the EEA Agreement did not enter into force until 1 January 1994 and state that, in
so far as the agreements also concern Finland, Norway and Sweden, they infringed neither Article 81 EC nor Article 53 of the
EEA Agreement before that date. They conclude from this that the Commission should have taken account of that fact in assessing
the duration of the infringement.

144    The applicants thus claim that the Commission failed to distinguish between, on the one hand, the facts constituting infringements
of competition law – from January 1990 to September 2001 in the case of Gütermann and from January 1990 to November 2000 in
the case of Zwicky – in the sense of a single or continuous act of infringement and, on the other, the legal assessment of
those facts as an infringement of Article 81 EC and Article 53 of the EEA Agreement.

145    According to Gütermann, the Commission should therefore have determined the starting amount for the fine by means of a specific
and separate calculation on the basis of the turnover achieved on the industrial thread market in Benelux and Denmark, on
the one hand, and in Finland, Norway and Sweden, on the other. In that way, the Commission would have obtained two segments
of the starting amount, to each of which it would have been appropriate to apply a percentage reflecting the duration of the
infringement in each of those groups of countries, namely 115% to the segment relating to the infringement in Benelux and
Denmark and 75% to the segment relating to the infringement in Finland, Norway and Sweden.

146    The Commission disputes those arguments.

Findings of the Court

147    Under Article 15(2) of Regulation No 17 and Article 23(3) of Regulation No 1/2003, the duration of the infringement is one
of the factors to which regard is to be had in fixing the amount of the fine to be imposed on undertakings which have infringed
the competition rules.

148    In relation to that factor, the Guidelines distinguish between infringements of short duration (in general, less than one
year), for which the starting amount determined for gravity should not be increased; infringements of medium duration (in
general, one to five years), for which the starting amount may be increased by 50%; and infringements of long duration (in
general, more than five years), for which the starting amount may be increased by 10% for each year (Section 1B, first paragraph).

149    It is clear from recitals 359 and 360 of the contested decision, the content of which is not disputed by the applicants, that
they participated in the cartel on the industrial thread market in Benelux and the Nordic countries from January 1990 to September
2001 in the case of Gütermann (that is to say, an infringement which lasted 11 years and 9 months) and from January 1990 to
November 2000 in the case of Zwicky (that is to say, an infringement which lasted 10 years and 10 months). In both cases,
the duration is that of a long-term infringement. The starting amount for the fine was consequently increased by 115% for
Gütermann and 105% for Zwicky, on the basis of the duration of the infringement.

150    As regards, first, the applicants’ objection to the fact that the Commission automatically applied the maximum rate of 10%
for each year of infringement, it should be borne in mind that, even though the third indent of the first paragraph of Section
1B of the Guidelines does not provide for an automatic increase of 10% per year for long-term infringements, it leaves the
Commission a measure of discretion in that regard (*Hoechst* v *Commission*, paragraph 61 above, paragraph 396, and Case T‐53/03 *BPB* v *Commission* [2008] ECR II‐1333, paragraph 362).

151    In the present case, it is clear from paragraph 149 above that the Commission complied with the rules which it had laid down
for itself in the Guidelines when it applied an increase, proportionate to the duration of the infringement, to the amount
of the fines imposed on the basis of the gravity of the infringement. Taking into account the factors in the case before it,
the Commission did not make a manifest error of assessment by increasing the fine by 10% for each year of the infringement.

152    Secondly, the complaint alleging an unjustified 5% increase in the starting amount for each period exceeding six months must
be rejected. There is nothing in the Guidelines to prevent the actual duration of the infringement from being taken into account
in the calculation of the amount of the fine. Such an approach is entirely logical and reasonable and falls, in any event,
within the Commission’s discretion (*BPB* v *Commission*, paragraph 150 above, paragraph 361).

153    Thirdly, the applicants argue, wrongly, that the duration of the infringement was not calculated in the same way for all the
countries concerned by the infringement inasmuch as no consideration was given to Zwicky’s absence from the industrial thread
market in the Nordic countries and proper account was not taken of the true duration of the infringements on the markets in
Benelux and the Nordic countries.

154    It must first be recalled that, according to the Commission, the applicants participated in a continuous ‘single complex infringement’
of Article 81(1) EC and Article 53(1) of the EEA Agreement, and that infringement extended to several EEA countries. It should
also be noted that the applicants confirmed at the hearing that they do not deny the existence in the present case of a single
infringement.

155    With regard, first, to Zwicky’s argument that it was not present on the industrial thread market in the Nordic countries,
that undertaking has not shown how such an absence could have affected the calculation of the duration of the infringement,
as carried out by the Commission. The additional amount of the fine, reflecting the duration of the infringement, was calculated
on the basis of the starting amount for the fine, which was in turn fixed on the basis of Zwicky’s turnover on the market
concerned in 1999. The fact that Zwicky did no business on the industrial thread market in the Nordic countries is already
reflected in that turnover inasmuch as, by definition, it includes no revenue from non-existent activity on the market in
the Nordic countries.

156    Moreover, as was recalled in paragraph 50 above, the fact that an undertaking has not taken part in all aspects of a cartel
or that it played only a minor role in the aspects in which it did participate is of no relevance to the establishment of
the existence of an infringement. Where it is established that an undertaking was aware of the offending conduct of the other
participants or that it could reasonably have foreseen it and that it was prepared to take the risk, it is also regarded as
responsible, throughout the entire period of its participation in that infringement, for conduct put into effect by other
undertakings in the context of the same infringement (Joined Cases C‐204/00 P, C‐205/00 P, C‐211/00 P, C‐213/00 P, C‐217/00 P
and C‐219/00 P *Aalborg Portland and Others* v *Commission* [2004] ECR I‐123, paragraph 328). In the present case, far from being unaware of the unlawful conduct of the other cartel
participants on the industrial thread market in the Nordic countries, Zwicky actually took part in the meetings concerning
that market. The Commission was therefore right to impute to Zwicky the single and continuous infringement, including the
part of the infringement committed on the market in the Nordic countries, and to consider, implicitly, that the duration of
the infringement could not be divided on the basis of the intensity of the participation in the markets concerned.

157    If the role played in a cartel by an undertaking has been correctly taken into account in determining the starting amount
for the fine, the fact that the undertaking did not take part in all the conduct by which the cartel is identified cannot
once again be taken into account in determining the duration of the infringement (judgment of 8 July 2008 in Case T‐50/03
*Saint-Gobain Gyproc Belgium* v *Commission* (not published in the ECR), paragraph 108).

158    Secondly, the Court must reject the applicants’ argument that, in calculating the duration of the infringement, account should
have been taken of the varying intensity of the infringement and that, in consequence, a distinction should have been made
in that calculation between the groups of countries, that is to say, between Benelux and Denmark, on the one hand, and Finland,
Norway and Sweden, on the other.

159    It is clear from the case-law that the increase is calculated by the application of a certain percentage to the starting amount
which is determined according to the gravity of the infringement as a whole, thus already reflecting the varying levels of
intensity of the infringement. Thus, it would not be logical to take into account, for the increase of that amount on the
basis of the duration of the infringement, a variation in the intensity of the infringement during the period concerned (*BPB* v *Commission*, paragraph 150 above, paragraph 364).

160    In that regard, even on the assumption that certain types of cartel are inherently meant to last, a distinction should always
be made, pursuant to Article 15(2) of Regulation No 17 and Article 23(3) of Regulation No 1/2003, between the duration of
their actual operation and their gravity as resulting from their particular nature (judgment of 15 June 2005 in Joined Cases
T‐71/03, T‐74/03, T‐87/03 and T‐91/03 *Tokai Carbon and Others* v *Commission* (not published in the ECR), paragraph 275). Accordingly, the increase for the duration of the infringement does not take
account of the gravity of the infringement for a second time (*Hoechst* v *Commission*, paragraph 61 above, paragraph 397).

161    In the present case, the infringement first became apparent on the industrial thread market in Denmark and in Benelux. From
the date on which the EEA Agreement entered into force, the infringement increased in intensity because it was extended to
the industrial thread market in the Nordic countries. Since it has been shown that the infringements on the various geographic
markets were part of a single and continuous infringement, account must be taken of the duration of that infringement as a
whole when calculating the amount of the fine. The starting amount, which was determined on the basis of the gravity of the
infringement, had already reflected the varying intensities of the infringement. Doubt is not cast on that reasoning by the
fact that the increase in the intensity of the infringement originates in the legal fact that the rules prohibiting anti-competitive
practices had begun to apply in territories not originally covered by those rules.

162    It follows that the Commission was not required to take account of the variations in the intensity of the infringement when
it increased the starting amount for the fine in proportion to the duration of the infringement.

163    Accordingly, the Court must reject the applicants’ argument that the duration of the infringement was incorrectly assessed.

*The plea, put forward by Gütermann and by Zwicky, alleging failure to take account of certain mitigating circumstances*

Arguments of the parties

164    First of all, the applicants point out that Section 3 of the Guidelines sets out a series of mitigating circumstances which
give rise to a reduction of the fine. The Commission has thus restricted its discretion when it comes to setting the amount
of the fines.

165    The applicants also draw attention to the fact that Section 3 of the Guidelines permits account to be taken of other mitigating
circumstances not expressly listed and that those other circumstances have been accepted by the Commission in its decision-making
practice.

166    In support of this plea, the applicants rely on three mitigating circumstances which, they maintain, the Commission ought
to have taken into account.

167    First, the applicants state that the Commission should have taken into account, as justifying a reduction of the fine, the
fact that the infringement had no actual impact on real prices. They rely in that regard on the second indent of Section 3
of the Guidelines, which provides that the non-implementation in practice of an agreement related to the infringement is to
give rise to a reduction of the fine.

168    Secondly, they maintain that, pursuant to the first indent of Section 3 of the Guidelines, account should have been taken
of their exclusively passive or ‘follow-my-leader’ role.

169    Zwicky claims that it did no business on the markets in the Nordic countries and could not therefore have participated in
the infringements concerning those countries. Similarly, given its insignificant position on the industrial thread market
in Benelux, it could not have influenced either the discussions concerning price lists for those three countries or the bilateral
contacts. Gütermann, too, claims that it occupied a minor place on the industrial thread market in Benelux and the Nordic
countries and that it could not influence the discussions concerning price lists or the bilateral contacts, such influence
being primarily exercised by Coats.

170    With regard to bilateral contacts, the applicants argue that they took part only rarely in such contacts, unlike Coats and
Amann, which maintained much more frequent bilateral contacts.

171    As proof of the insignificant nature of their role in the cartel in question, the applicants point to their limited market
shares. Zwicky argues that its share of the industrial thread market in Benelux between 1990 and 2000 was less than 1%. Gütermann
argues that its market share in Benelux and the Nordic countries is approximately 5.6%. Those shares are derisory when compared
with the shares of Coats and Amann on the market in the Nordic countries (44% and 46% respectively) and on the Benelux market
(40% and 27% respectively).

172    According to the applicants, the passive nature of their conduct is not called into question by the allegation that their
respective former employees, Mr B. and Mr F., chaired the meetings. The chairmanship was allocated on the basis of age and
the employees concerned had no influence whatsoever on the conduct or content of the meetings, such influence – including
influence at the organisational level – being exercised by Coats. The applicants rely in that regard on an e-mail from the
representative of Coats, Mr L., dated 10 November 2000, in which it can be seen that the latter had reserved a room in a hotel
near Frankfurt-am-Main (Germany) for the purpose of holding a meeting on 16 January 2001, for which he had drawn up the agenda.

173    Thirdly, the Commission should have taken account of the economic crisis which has been present for many years in the industrial
thread sector in Europe. The applicants refer, in that regard, to the Commission’s ‘Seamless steel tubes’ decision (Commission
Decision of 8 December 1999 relating to a proceeding under Article 81 [EC] (Case IV/E-1/35.860-B – Seamless steel tubes),
recital 168) and to the Commission’s ‘Alloy surcharge’ decision (Commission decision of 21 January 1998 relating to a proceeding
pursuant to Article 65 [CS] (Case IV/35.814 – Alloy surcharge), recital 83), in which the economic crisis in those sectors
was taken into account, and to the Commission’s ‘French beef’ decision (Commission Decision of 2 April 2003 relating to a
proceeding pursuant to Article 81 [EC] (Case COMP/C.38.279/F3 – French beef), recital 185), in which account was taken of
the bovine spongiform encephalopathy (ESB) crisis.

174    In the alternative, the applicants claim, referring to case-law, that the principle of the individuality of punishments and
penalties should have led the Commission to take account of the individual conduct of each undertaking when considering the
gravity of their participation in the infringement and, consequently, to reduce significantly the fines imposed on them.

175    The Commission challenges the arguments put forward by the applicants.

Findings of the Court

176    Section 3 of the Guidelines provides for a reduction in the starting amount for the fine for ‘special mitigating circumstances’
such as an exclusively passive or ‘follow-my-leader’ role in the carrying-out of the infringement, the non-implementation
in practice of the collusive agreements, termination of the infringement as soon as the Commission intervened and other circumstances
not expressly mentioned.

177    First of all, the applicants claim that the Commission should have given them the benefit of the mitigating circumstances
arising from the non-implementation in practice of the agreement by reason of the fact that the infringement had no actual
impact on prices.

178    However, it should be borne in mind that the abovementioned mitigating circumstances are all based on the individual conduct
of each undertaking. It follows that in order to assess any mitigating circumstances, including those relating to the non-implementation
of agreements, it is necessary to take into account not the effects arising from the infringement as a whole, which must be
taken into consideration in assessing the actual impact of an infringement on the market for the purposes of determining its
gravity (first paragraph of Section 1A of the Guidelines), but the individual conduct of each undertaking, for the purposes
of examining the relative gravity of the participation of each undertaking in the infringement (*Groupe Danone* v *Commission*, paragraph 137 above, paragraph 384).

179    It follows that the applicants’ argument based on the infringement’s lack of actual impact on prices must be rejected.

180    The Court therefore considers it necessary to determine whether the applicants have put forward other arguments which are
capable of showing that, during the period in which they were party to the unlawful agreements, they actually avoided implementing
those agreements by adopting competitive conduct on the market or, at the very least, that they clearly and substantially
breached the obligations relating to the implementation of the cartel to the point of disrupting its very operation (see,
in that respect, Case T‐26/02 *Daiichi Pharmaceutical* v *Commission* [2006] ECR II‐713, paragraph 113).

181    It must be stated that the applicants have provided no evidence in support of such a conclusion. On the contrary, they admit
that the price increases indicated in the lists decided on at the meetings were mostly put into effect by the various undertakings,
including themselves.

182    Consequently, the applicants cannot validly rely on their purported non-implementation in practice of the agreements.

183    It must be considered, secondly, that the argument based on their purportedly exclusively passive or ‘follow-my-leader’ role
in the infringement is unfounded.

184    A passive role implies that the undertaking adopted a ‘low profile’, that is to say, that it did not actively participate
in the creation of any anti-competitive agreements (Case T‐220/00 *Cheil Jedang* v *Commission* [2003] ECR II‐2473, paragraph 167, and the judgment of 8 July 2008 in Case T‐54/03 *Lafarge* v *Commission* (not published in the ECR), paragraph 765).

185    It is clear from the case-law that amongst the circumstances that may indicate the adoption by an undertaking of a passive
role within a cartel is the situation where the undertaking’s participation in cartel meetings is significantly more sporadic
than that of the ‘ordinary’ members of the cartel, and likewise its belated entry to the market where the infringement occurred,
regardless of the duration of its participation in the infringement, or again the existence of express statements to that
effect emanating from representatives of other undertakings which participated in the infringement (*Cheil Jedang* v *Commission*, paragraph 184 above, paragraph 168; Joined Cases T-236/01, T-239/01, T‐244/01 to T-246/01, T-251/01 and T-252/01 *Tokai Carbon and Others* v *Commission* [2004] ECR II-1181 (‘*Tokai I*’), paragraph 331; and Case T‐62/02 *Union Pigments* v *Commission* [2005] ECR II‐5057, paragraph 126).

186    In the present case, it should first be noted that the Commission has established to the requisite legal standard that the
applicants had participated in numerous meetings of the cartel and in bilateral meetings, and had repeatedly participated
in a number of the collusive practices referred to in the contested decision. The claim that those undertakings had fewer
bilateral contacts with the other cartel members than Amann and Coats had with their competitors is irrelevant in that regard.

187    Secondly, neither Gütermann nor Zwicky has referred to any specific circumstances, or evidence such as statements by other
cartel members, capable of demonstrating that their respective attitudes differed significantly – on account of their purely
passive or ‘follow-my-leader’ nature – from the conduct of the other participants in the cartel.

188    The limited market share or the lack of market share on which they rely cannot be regarded as evidence of a passive or purely
‘follow-my-leader’ role of any sort. To accept such a fact as a mitigating circumstance would duplicate the taking into account
of the size of Gütermann and Zwicky for the purposes of calculating the fines on the basis of different treatment by category
of undertaking, since the size by turnover already reflects the significance of each undertaking for the purposes of assigning
them to different categories.

189    It is true that the Court accepted, in*Cheil Jedang* v *Commission*, paragraph 184 above, paragraph 180, that the small size of an undertaking is an important factor to take into consideration
in assessing the actual impact of its late entry on the market on which the infringement occurred and its conduct in relation
to the other producers. However, the circumstances of *Cheil Jedang* v *Commission* were very specific since the undertaking concerned was clearly placed at a disadvantage within the cartel concerning sales
quotas as compared with the other producers and since it was possible to construe that as being a direct consequence of its
more sporadic attendance at meetings and its late entry on the market. Those special circumstances do not exist in the present
case.

190    Finally, the Commission was fully entitled to consider that the fact that representatives of Gütermann and Zwicky, respectively,
undertook the role of chairman at a number of meetings belies the passivity of the conduct of those undertakings.

191    Gütermann and Zwicky do not in any way deny that their representatives formally chaired a number of meetings. However, they
try to minimise that role by referring to the fact that, in reality, the chairmanship was effectively undertaken by Mr L.,
the representative of Coats, even when a representative of one or other of the applicants was in the chair.

192    However, although it is true that the e-mail of 10 November 2000, on which the applicants rely, shows that the representative
of Coats played an active role in the organisation of the meeting of 16 January 2001, the fact remains that it was indeed
the representative of Zwicky, Mr F., who sent the invitations to the other participants. It must be stated that the fact that
invitations were sent on 2 December 2000 – that is to say, immediately after the period during which Zwicky has been found
to have participated in the infringement – is irrelevant in that regard. Sending the invitations is the last stage of preparatory
work which began after reception of the e-mail of 10 November 2000. In any event, the mere fact that Zwicky allowed its representative
to accept the chair reveals an attitude which was in no way passive or ‘follow-my-leader’.

193    With regard to Gütermann’s representative, Mr B., not merely did he act as chairman of cartel meetings, but he also organised
them, as can be seen from his statements appended to Gütermann’s reply to the statement of objections.

194    It is settled law that convening meetings, proposing an agenda and distributing preparatory documents for meetings are incompatible
with a low-profile, passive or ‘follow-my-leader’ role. Such initiatives show the applicant’s positive and active attitude
to the founding, continuation and control of the cartel (see, to that effect, Case T‐43/02 *Jungbunzlauer* v *Commission* [2006] ECR II‐3435, paragraph 257).

195    Thirdly, the applicants cannot properly rely on the economic difficulties they encountered in the period covered by the cartel.
It is precisely because of the difficulties encountered by all undertakings in the industrial thread market in the mid-1990s
that some of them, including Gütermann and Zwicky, decided to engage in anti-competitive conduct. As a general rule, cartels
like those in the present case come into being when a sector encounters problems (see, to that effect, *Tokai I*, paragraph 185 above, paragraph 345, and *Jungbunzlauer* v *Commission*, paragraph 194 above, paragraph 256).

196    Even supposing that, as Gütermann and Zwicky claim, a number of Commission decisions take account of the poor financial health
of the sector in question, the fact that in previous cases the Commission took account of the economic situation in the sector
as a mitigating circumstance does not mean that it must necessarily continue to do so (Case T‐13/89 *ICI* v *Commission* [1992] ECR II‐1021, paragraph 372). The Commission is required to carry out an individual appraisal of the circumstances
of each case, without being bound by previous decisions concerning other undertakings, other product and service markets or
other geographical markets at different times (Joined Cases T‐346/02 and T‐347/02 *Cableuropa and Others* v *Commission* [2003] ECR II‐4251, paragraph 191).

197    Fourthly, the applicants put forward, in their replies, a complaint alleging breach of the principle of the individual nature
of punishments.

198    In the first place, it should be recalled that, under Article 48(2) of the Rules of Procedure, no new plea in law may be introduced
in the course of proceedings unless it is based on matters of law or of fact which have come to light in the course of the
procedure.

199    In the second place, according to settled case-law, a plea which may be regarded as amplifying a plea put forward previously,
whether directly or by implication, in the original application, and which is closely connected therewith, will be declared
admissible (Case T‐252/97 *Dürbeck* v *Commission* [2000] ECR II‐3031, paragraph 39; *Cableuropa and Others* v *Commission*, paragraph 196 above, paragraph 111; and the judgment of 12 July 2007 in Case T‐229/05 *AEPI* v *Commission* (not published in the ECR), paragraph 21).

200    In the present case, it must be held, first, that no argument concerning the individual nature of punishments was raised in
the applications and, secondly, that the present plea does not amplify another plea put forward in the applications and is
not closely connected with the pleas put forward therein.

201    Since the argument also does not make reference to matters of law or of fact which have come to light in the course of the
procedure, it must be rejected as inadmissible.

202    It follows that the plea alleging failure to take account of certain mitigating circumstances cannot be upheld.

*The plea, put forward by Gütermann and Zwicky, alleging misapplication of the Leniency Notice*

Arguments of the parties

203    The applicants were granted a 15% reduction in the fine in return for their cooperation before notification of the statement
of objections and for not contesting the facts in their reply to that statement. In their view, a reduction of that size is
insufficient given that their cooperation after the notification of the statement of objections went well beyond merely not
contesting the facts.

204    First, the applicants provided information which permitted the Commission to have a complete overview of the conduct, content
and context of the meetings and bilateral contacts.

205    With regard to the conduct of the meetings, they point out, first, that they corrected the statements made by Coats, which
claimed, wrongly, that the meeting on 19 September 2000 was the only one during which increases in list prices were discussed
and agreed on. Discussions concerning list prices and increases in those prices were held at all the meetings. The applicants
also argue that the purported explanations provided by Coats in its reply to the statement of objections dealt only with the
special prices and could not therefore call into question the usefulness of the corrections made by the applicants. Lastly,
they maintain that those corrections, on the one hand, and the clarifications made by Coats, on the other, were provided at
an essentially identical stage of the administrative procedure, even though the clarifications reached the Commission a few
days before the corrections, and that chronological order cannot therefore be decisive in assessing cooperation.

206    Secondly, the applicants claim that they were the only ones who clearly explained that the purpose of the meetings was to
reduce the difference between actual net prices and list prices, a point which is confirmed in recital 167 of the contested
decision. The Commission wrongly relied on paragraph 141 of the statement of objections as a basis for arguing that, in that
paragraph, it had already taken note of that purpose and the effects of the agreements on list prices. In fact, paragraph
141 of the statement of objections merely reveals that the Commission was able to prove that the participants in the meetings
had tried, in a single case, to bring about an indirect increase in planned net prices but that the Commission did not, at
that time, have any indications as to the general background to the discussions concerning list prices.

207    Secondly, the applicants claim that their cooperation was erroneously categorised as less useful than that of BST, to which
the Commission granted a 20% reduction in the fine, and argue that this constitutes an infringement of the principle of equal
treatment.

208    Thirdly, the applicants regard the 15% reduction in the fine, granted to them by the Commission, as insufficient on the ground
that it is clear from the Commission’s previous decision-making practice and from the case-law that the fact of not contesting
the correctness of the facts gives rise to a reduction of at least 10% and, in certain cases, even 20%. It follows, in their
view, that cooperation after notification of the statement of objections which goes well beyond merely not contesting the
facts should have led the Commission to grant a much larger reduction.

209    Fourthly, the applicants claim that they cooperated with the Commission within the meaning of the two indents of Section D2
of the Leniency Notice and that, on that basis, each should have been granted a reduction in the fine of at least twice 10%.

210    In that regard, according to the applicants, it does not appear from the contested decision that the Commission actually assessed
their cooperation after they had received the statement of objections. Moreover, even supposing that their cooperation after
receiving the statement of objections effectively went no further than not contesting the correctness of the facts, a reduction
of at least 20% should have been granted to them even if their cooperation was of no use except in so far as the fact that
they refrained from contesting the facts served to confirm the Commission’s evidence. The applicants point out in that regard
that, unlike the notice applicable in the present case, the Commission Notice of 19 February 2002 on immunity from fines and
reduction of fines in cartel cases (OJ 2002 C 45, p. 3) lays down the condition that the evidence provided must add significant
value to that already in the Commission’s possession.

211    Fifthly, the previous decision-making practice of the Commission has not been taken into account. The applicants claim that
their cooperation is comparable to that of KME, the undertaking concerned in the ‘Industrial tubes’ case, which was granted
a 30% reduction in the fine (Commission Decision of 16 December 2003 relating to a proceeding pursuant to Article 81 [EC]
and Article 53 of the EEA Agreement (Case COMP/E-1/38.240 – Industrial tubes), recital 423). The only difference lies in the
fact that the applicants corrected statements made by the other participants in the reply to the statement of objections and
not at an earlier stage. In their view, it does not follow from Section D2 of the Leniency Notice that the contributions made
by undertakings to establishing the facts are to be assessed differently according to whether those contributions were made
before or after notification of the statement of objections and, accordingly, the Commission should also have granted the
applicants a total reduction in the fine of at least 30%.

212    The Commission contests that plea.

Findings of the Court

213    In its Leniency Notice, the Commission sets out the conditions in accordance with which undertakings cooperating with the
Commission during its investigation into a cartel may be exempted from fines, or may be granted reductions in the fine which
would otherwise have been imposed upon them (Section A3 of the Leniency Notice).

214    According to Section D1 of the Leniency Notice, ‘[w]here an enterprise cooperates without having met all the conditions set
out in Sections B or C, it will benefit from a reduction of 10% to 50% of the fine that would have been imposed if it had
not cooperated’.

215    Section D2 of the Leniency Notice states as follows:

‘Such cases may include the following:

–        before a statement of objections is sent, an [undertaking] provides the Commission with information, documents or other evidence
which materially contribute to establishing the existence of the infringement;

–        after receiving a statement of objections, an [undertaking] informs the Commission that it does not substantially contest
the facts on which the Commission bases its allegations.’

216    In the present case, it is clear from the contested decision that the Commission considered that it could grant Gütermann
and Zwicky a 15% reduction each in the fine, pursuant to the first and second indents of Section D2 of the Leniency Notice
(contested decision, recital 397).

217    To justify its assessment, the Commission states, first, that the information, documents and other evidence provided by Gütermann
and Zwicky before notification of the statement of objections had materially contributed to establishing the existence of
the infringement (contested decision, recital 395). It then pointed out that the applicants had admitted, in their first reply
to the request for information, that list prices had been exchanged and discussed at the meetings. Lastly, the Commission
stated that the applicants had not substantially contested the facts on which the Commission’s allegations were based (contested
decision, recital 396).

–       The usefulness of the cooperation

218    First of all, it should be pointed out that the applicants do not deny the truth of the statement made in recital 385 of the
contested decision that they did not meet the conditions for application of Section B and Section C of the Leniency Notice,
with the result that their conduct had to be assessed in the light of Section D of that notice, which is entitled ‘Significant
reduction in a fine’.

219    It should also be recalled that the Commission has a broad discretion as regards the method of calculating fines and that
it may, in that regard, take account of numerous factors, including the cooperation provided by the undertakings concerned
during the investigation conducted by its departments. In that context, the Commission is required to make complex assessments
of fact, such as those relating to the cooperation provided by the individual undertakings concerned (Case C‐328/05 P *SGL Carbon* v *Commission* [2007] ECR I‐3921, paragraph 81).

220    The Commission enjoys a broad discretion in assessing the quality and usefulness of the cooperation provided by an undertaking,
especially in comparison with the contributions made by other undertakings (*SGL Carbon* v *Commission*, paragraph 219 above, paragraph 88).

221    Lastly, it should be borne in mind that, according to the case-law, the reduction of fines in cases where the undertakings
which participated in infringements of Community competition law have offered cooperation is justified only where it is considered
that the cooperation made it easier for the Commission to establish an infringement and, as the case may be, to put an end
to it (Joined Cases C‐189/02 P, C‐202/02 P, C‐205/02 P to C‐208/02 P and C‐213/02 P *Dansk Rørindustri and Others* v *Commission* [2005] ECR I‐5425, paragraph 399, and Case T-338/94 *Finnboard* v *Commission* [1998] ECR II-1617, paragraph 363). In view of the rationale for the reduction, the Commission cannot disregard the usefulness
of the information provided, which inevitably depends on the evidence already in its possession.

222    To that effect, it can be seen from the case-law that where an undertaking providing cooperation does no more than confirm,
in a less precise and explicit manner, certain information that has already been provided by another undertaking by way of
cooperation, the extent of the cooperation provided by the former undertaking, while possibly of some benefit to the Commission,
cannot be treated as comparable with that provided by the undertaking which was the first to supply that information. A statement
which merely corroborates to a certain degree a statement which the Commission already had at its disposal does not facilitate
the Commission’s task significantly, that is to say, sufficiently to justify a reduction in the fine for cooperation (see,
to that effect, *Groupe Danone* v *Commission*, paragraph 137 above, paragraph 455).

223    In the present case, it is important first to make it clear that, although Section D2 of the Leniency Notice does not contemplate
the possibility of new information and evidence being provided after notification of the statement of objections, that in
no way rules out the possibility that such a circumstance might lead to a reduction in the fine on the basis of that provision.
The list of circumstances set out in Section D2 of the Leniency Notice is merely illustrative, as is confirmed by the use
of the words ‘may include’ (Joined Cases T‐45/98 and T‐47/98 *Krupp Thyssen Stainless and Acciai speciali Terni* v *Commission* [2001] ECR II‐3757, paragraph 274).

224    That assessment is confirmed in Joined Cases C‐65/02 P and C‐73/02 P *ThyssenKrupp* v *Commission* [2005] ECR I‐6773, paragraph 59, inasmuch as the Court of Justice accepted in that case that the Commission may take account
of an admission by undertakings as to the legal characterisation of the facts complained of at an early stage of the procedure,
since that amounts to an admission of the infringement. That situation is referred to in Sections B and C of the Leniency
Notice but is not expressly envisaged in Section D. The Court of Justice held, however, that there was no reason why an undertaking
should not be rewarded for such an admission, even if it was made at an earlier stage than that envisaged in Sections B and
C of the Leniency Notice. By opting for that approach, the Court of Justice confirmed the more general principle that leniency
is a reward granted by the Commission in return for facilitating establishment of the infringement, whatever the stage at
which the undertaking provided assistance and regardless of whether the assistance consisted in the provision of new information
and evidence, or in the admission of facts or of the legal characterisation of the facts.

225    It follows that, in the present case, the question whether the new information and evidence provided by Gütermann and Zwicky
after notification of the statement of objections must be taken into account and, accordingly, whether that must lead to a
reduction in the fine in recognition of that cooperation, depends principally on the quality and usefulness of the cooperation
provided, which, as was pointed out in paragraphs 219 and 220 above, is a matter for the Commission to assess in the exercise
of its broad discretion.

226    Thus, a satisfactory answer to that question does not emerge from the simple finding that the information and evidence was
provided after notification of the statement of objections; on the contrary, it is necessary to determine specifically – with
regard both to the quality and usefulness of the information and evidence and to the time at which it was provided – whether
the Commission committed a manifest error in its assessment of the degree of cooperation shown by Gütermann and Zwicky.

227    It should be noted from the start that the applicants do not dispute the finding that the information provided by Coats was
decisive in establishing the existence of the cartel on the industrial thread market in Benelux and the Nordic countries.
On that basis, recital 387 of the contested decision lists the evidence, provided by Coats, which was used to substantiate
many points made in the statement of objections.

228    First, however, the applicants claim that they corrected the statements made by Coats concerning the frequency of the meetings
dealing with list prices and increases in those prices, and of the meetings dealing with the special prices.

229    With regard, in the first place, to the frequency of the meetings dealing with list prices and increases in those prices,
the applicants rely, wrongly, on a statement, made by the representative of Coats in the request for application of the Leniency
Notice, to the effect that the meeting on 19 September 2000 was the only one at which increases in ‘actual prices’ were discussed
and agreed on.

230    The Commission found, in paragraph 100 of the statement of objections, that the suppliers – including Coats, BST, Gütermann
and Zwicky – had admitted that price lists had been discussed and exchanged at the meetings. Moreover, it is clear from the
observations set out in paragraph 102 of the statement of objections that, unlike Gütermann and Zwicky, Coats had conceded
that, at those meetings, the undertakings had agreed on future price lists and the dates on which the increases would be put
into effect. The information provided by Gütermann and Zwicky concerning actual prices did not therefore enhance the Commission’s
understanding of the situation. In consequence, the applicants’ argument is irrelevant.

231    With regard, in the second place, to the frequency of discussions concerning the special prices, it should be pointed out
that, in paragraph 107 of the statement of objections, the Commission stated that the suppliers, including Coats, had denied,
or had failed to mention, that they had exchanged information and arrived at agreements concerning special prices and net
prices. Moreover, with regard to the exchange of information on discounts and rebates, the Commission stated in paragraph 105
of the statement of objections that the suppliers – with the exception of Coats in the period up to the mid-1990s – had denied,
or failed to mention, the existence of discounts and rebates. It should also be noted that the undertakings concerned, such
as Coats, Zwicky, Gütermann and BST, did not point out until after the statement of objections had been notified that special
prices had been discussed and agreed on at the meetings.

232    However, the Commission correctly argues that it was able to prove those aspects of the infringement by virtue of documents
which Coats had appended to its reply to the request for information. Those documents include, first, the minutes of a meeting
held on 8 September 1998, drawn up by a representative of Barbour Threads, indicating the existence of agreements providing
for discounts and reductions in rebates and of agreements on increases in special prices. The Commission referred to those
documents several times in the statement of objections (paragraphs 106, 108 and 121). The documents also include an e-mail
of 10 October 2000, appended to the statements made by F. S., the representative of Coats, confirming that reductions in discounts
and increases in special prices had been agreed on at a meeting on 19 September 2000. The Commission mentions this in paragraph
126 of the statement of objections. Lastly, the documents include e-mails appended by Coats to its request for leniency, including
an e-mail of October 2000 which indicates an exchange of information with Amann and Gütermann concerning special prices. That
document is mentioned in paragraph 133 of the statement of objections, in the footnote on page 268.

233    The Commission was also right to point out that the information provided by BST had also helped it to establish the existence
of the discussions and agreements concerning special prices. That finding emerges, in particular, from paragraphs 104 and
106 of the statement of objections, as well as from the footnotes on pages 173, 174 and 176.

234    It follows that the alleged corrections made to the statement of objections by the applicants were merely confirmations of
what the Commission already knew, by virtue of the information referred to above, before notification of the statement of
objections.

235    Consequently, the Commission’s assessment of the cooperation provided by the applicants was unaffected by the fact that Coats’
comments concerning the special prices, made following that notification, reached the Commission before the applicants’ comments.

236    Secondly, the applicants’ argument that they were the only undertakings to have explained, in their reply to the statement
of objections, that the purpose of the meetings was to close the gap between list prices and actual net prices, and to increase
indirectly the net prices for various products, must be rejected.

237    Although it is true that, in recital 167 of the contested decision, the Commission quoted words used by Gütermann in its reply
to the statement of objections in order to explain the purpose of the meetings, the fact remains that the Commission had already
discovered that purpose, as well as the effects of the agreements, as is clear from paragraphs 141 and 142 of the statement
of objections. The information mentioned in those paragraphs was provided by Coats in the framework of its request for leniency,
and by giving a specific example – the increase in the list prices – that information enabled the Commission to provide details
concerning the general background to the discussions concerning list prices.

–       The allegedly incorrect assessment of the cooperation as compared with that of BST

238    As regards the applicants’ request for a reduction at least equivalent to that granted to BST, it should be borne in mind
that, according to settled case-law, when assessing the cooperation provided by the undertakings concerned, the Commission
cannot ignore the principle of equal treatment, which is infringed where comparable situations are treated differently or
different situations are treated in the same way, unless such treatment is objectively justified (see *Tokai I*, paragraph 185 above, paragraph 394 and the case-law cited). However, it must be accepted that the Commission has a broad
discretion in assessing the quality and usefulness of the cooperation provided by the various members of a cartel, and only
a manifest abuse of that discretion can be censured.

239    However, it can be seen from a comparison of the cooperation provided by those undertakings that the Commission did not infringe
the principle of equal treatment in any way.

240    With regard, first, to the cooperation provided before notification of the statement of objections of 15 March 2004, the Commission
considered that BST had helped it considerably to establish the content of many agreements (including the greater part of
the content of the agreements concluded at the beginning of the 1990s, the content of the agreement concluded in Vienna (Austria)
on 8 October 1996 and the content of the agreement concluded in Zurich (Switzerland) on 9 September 1997); that BST had been
the only undertaking to provide it with the price lists it had received from its competitors at the meetings; and that BST
had provided information going well beyond what was required by the request for information. In support of its findings, the
Commission refers to numerous footnotes in the statement of objections which show that BST had provided a great deal of evidence
(including Annex 14 to BST’s reply to the request for information, which contains the price lists exchanged at the meetings)
and that it was also an important source of information in the context of the Commission’s provisional findings.

241    With regard to the applicants’ cooperation before notification of the statement of objections, it should be pointed out that
the Commission certainly admits that the applicants also provided it with documents giving an overview of the meetings at
the beginning of the 1990s. It is none the less true that the Commission considered that that information turned out to be
less useful than the information provided by BST. The applicants have not challenged those findings; they have merely claimed
that the information available to them did not permit them to know whether BST had provided more information and evidence
than they had. However, as was pointed out above, it is clear from recitals 391 to 397 of the contested decision and from
numerous references in the footnotes to documents supplied by BST in support of the Commission’s findings in the statement
of objections that BST’s cooperation was more significant.

242    With regard, secondly, to the cooperation shown after notification of the statement of objections, it is clear from the contested
decision that neither BST nor the applicants challenge the accuracy of the facts found and that all three undertakings provided
identical cooperation at the stage of the administrative procedure. In the light of the observations made in paragraphs 228
to 237 above, the applicants are wrong to argue that, after notification of the statement of objections, they provided the
Commission with information of which it had been unaware. Consequently, they cannot claim to have provided information so
useful as to justify a reduction in their fines at least equal to that granted to BST.

243    Even supposing that it had to be accepted that the applicants had provided details as useful as those provided by BST concerning
certain points in the statement of objections, the Commission did not commit a manifest error of assessment by giving priority
to the fact that the information and evidence from BST was provided before notification of the statement of objections.

–       The alleged misapplication of the Leniency Notice and the alleged failure to take account of the case-law of the Court

244    The applicants argue – incorrectly – that, since the Commission accepted that their cooperation met the conditions characterising
the two categories of conduct referred to in Section D of the Leniency Notice, it should have granted each of them a reduction
in the fine of at least twice 10%, that is to say, of at least 20%.

245    It must be stated that Section D of the Leniency Notice provides for a range extending from 10% to 50%, without setting particular
criteria for the adjustment of the reduction within that range. The Leniency Notice does not therefore give rise to any legitimate
expectation of a specific percentage reduction. In addition, contrary to what the applicants are essentially arguing, Section
D of the Leniency Notice is in no way to be interpreted as requiring the Commission to grant a specific minimum reduction
of 10% for every case which has been found to constitute cooperation covered by that provision but, on the contrary, must
be understood as providing for a single reduction of at least 10%.

246    Thus, so long as the Commission does not manifestly exceed its broad discretion when it assesses the extent to which its work
has been facilitated by the cooperation of an undertaking, it is perfectly free to mention in its decision the specific percentages
which it has adopted for each case of cooperation which has been found to fall under Section D of the Leniency Notice and
then to add them together, just as it is permissible to mention only a single overall percentage which it considers itself
able to grant for the same situations. As the Commission correctly points out, the assessment of the usefulness of cooperation
is in no way based on an arithmetical formula automatically indicating a reduction of at least 20% if the two indents of Section
D of the Leniency Notice are found to apply.

247    The judgment in*Tokai* *I*, paragraph 185 above, on which the applicants rely, does not cast doubt on that assessment. It is clear from Commission Decision
2002/271/EC of 18 July 2001 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement (Case COMP/E-1/36.490
– Graphite electrodes) (OJ 2002 L 100, p. 1), which was at issue in *Tokai* *I*, that the Commission had relied solely and expressly on the first indent of Section D2 of the Leniency Notice in the case
of the undertaking concerned. However, the Court found that the undertaking concerned had also cooperated under the second
indent. The Commission sought to explain that it had carried out a single reduction, combining the two types of cooperation.
However, in contrast with the present case, the finding that the undertaking concerned had not contested the facts did not
appear in any of the recitals concerning that undertaking’s cooperation. That is why the Court considered itself compelled
to accept that the Commission had not allowed the undertaking concerned the benefit of the second indent of Section D2 of
the Leniency Notice.

–       The alleged failure to take account of previous decision-making practice

248    The argument put forward by the applicants on the basis of the alleged previous decision-making practice of the Commission
must be rejected. The mere fact that, in the framework of its previous decision-making practice, the Commission granted a
certain rate of reduction for given conduct does not mean that it is required to grant a reduction of the same proportion
when assessing similar conduct in the course of a later administrative procedure (*Brugg Rohrsysteme* v *Commission*, paragraph 50 above, paragraph 193).

249    In any event, the applicants’ cooperation is in no way comparable with that of KME, as determined in the ‘Industrial Tubes’
decision, paragraph 211 above, to which they refer. It is clear from that decision that, before receiving the statement of
objections, KME had provided significant cooperation which contributed to proving as a fact the existence of the cartel over
its entire duration. KME had in fact produced documents concerning the infringement, together with a detailed description
of how the cartel operated, explaining in detail the context in which to place the various documents which the Commission
had discovered during its inspections. The applicants’ cooperation before the notification of the statement of objections
was not of that degree of significance.

250    In the light of the above, the plea alleging misapplication of the Leniency Notice must be rejected.

*The plea, put forward by Gütermann and Zwicky, alleging that the fines are disproportionate*

Arguments of the parties

251    The applicants put forward a number of arguments in support of their plea alleging that the fines are disproportionate.

252    First of all, they argue that the Commission did not take account of the considerable economic difficulties they had encountered
for many years as a result of the structural changes undergone by the thread industry. The crisis in the sector caused a drop
in their profits and led Zwicky to terminate its activities on the market in November 2000. The Commission also overlooked
the banking problems encountered by Gütermann and the additional interest burden which flowed from them.

253    Secondly, according to the applicants, the fines imposed on Gütermann (EUR 4.021 million) and Zwicky (EUR 0.174 million) are
disproportionate to their turnover on the market concerned by the infringement. In support of that position, they argue that
Gütermann’s operating results, during the eleven and a half years of the infringement, amounted to EUR 318 000 after taxes
and Zwicky’s turnover for 2000 was only EUR 200 000.

254    Similarly, Gütermann – supported by Zwicky in its reply – claims that the starting amounts used to calculate the fines (EUR
2.2 million for Gütermann and EUR 100 000 for Zwicky) are, on the one hand, disproportionate to the cumulative turnover of
all the undertakings in respect of the products concerned by the infringement (EUR 50 million) and, on the other hand, excessive
when compared with the latter figure, which reflects the size of the market for the products concerned, and the size of the
world market for industrial thread (EUR 4 billion to EUR 5 billion).

255    In the applicants’ view, the Commission had a duty, in accordance with the case-law, to take account of the size of the relevant
market when considering the gravity of the infringement and the proportional nature of the fine. The Commission is thus incorrect
in arguing that that criterion was merely one factor among others and that it was not therefore required to take it into account.

256    Thirdly, Gütermann claims that the method of calculation used in order to arrive at the amount of the fine imposed on it is
clearly disadvantageous to small and medium-sized undertakings. The size of such undertakings is not taken into account and
the fines obtained by that method of calculation are thus disproportionate. The effect is that, in the present case, the fine
imposed on it is disproportionate to the fines imposed on other undertakings such as BST or Coats.

257    Fourthly, the application of the Guidelines in the present case is inappropriate, particularly from the point of view of equal
treatment, in the light of the fact that, for future cases concerning small and medium-sized undertakings, more equitable
treatment is provided for in 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).

258    The Commission contests that plea.

Findings of the Court

259    First, the applicants are incorrect in arguing that the fine imposed on them was disproportionate in the light of their precarious
financial situation and because of the risk that the fine might cause them to cease trading.

260    According to settled case-law, and as was repeated in recital 404 of the contested decision, the Commission is not required,
when determining the amount of the fine, to take into account the poor financial situation of an undertaking, since recognition
of such an obligation would be tantamount to conferring an unfair competitive advantage on the undertakings least well adapted
to market conditions (Joined Cases 96/82 to 102/82, 104/82, 105/82, 108/82 and 110/82 *IAZ International Belgium and Others* v *Commission* [1983] ECR 3369, paragraphs 54 and 55; *Dansk Rørindustri and Others* v *Commission*, paragraph 221 above, paragraph 327; and Case C‐308/04 P *SGL Carbon* v *Commission* [2006] ECR I‐5977, paragraph 105).

261    Furthermore, even if a measure taken by a Community authority were to lead to the liquidation of an undertaking, such a liquidation
of the undertaking in its existing legal form – although it may adversely affect the financial interests of the owners, investors
or shareholders – does not mean that the personal, tangible and intangible elements represented by the undertaking would also
lose their value (see, to that effect, *Tokai I*, paragraph 185 above, paragraph 372).

262    In the light of that case-law, it must be concluded that the Commission had absolutely no obligation to take account of Gütermann’s
economic situation in the contested decision or even to mention the explanations put forward by Gütermann with regard to that
situation. The fact that the Commission considered it appropriate to refer to the financial situation of Zwicky, and not that
of Gütermann, is easy to understand in the light of Zwicky’s particularly difficult economic situation, which led it to sell
its industrial thread business to Gütermann.

263    Secondly, the applicants complain, in essence, that the Commission did not take account of the size of the relevant market
and thus imposed a fine which was out of all proportion to the size of that market. They also refer to the disproportionate
nature of the fine in relation to the turnover which each of them achieved on the market concerned by the infringement and
to the disproportionate nature of the starting amount in relation to their respective turnovers.

264    It should be borne in mind, first, that the principle of proportionality requires that measures adopted by Community institutions
must not exceed the limits of what is appropriate and necessary for attaining the objective pursued. When it comes to the
calculation of fines, the gravity of infringements has to be determined by reference to numerous factors and it is important
not to confer on one or other of those factors an importance which is disproportionate in relation to other factors. In this
context, the principle of proportionality requires the Commission to set the fine proportionately to the factors taken into
account for the purposes of assessing the gravity of the infringement and also to apply those factors in a way which is consistent
and objectively justified (*Jungbunzlauer* v *Commission*, paragraph 194 above, paragraphs 226 to 228).

265    With regard to the complaint that the Commission did not take account of the size of the relevant market, it should be borne
in mind that, under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003, the Commission may impose
fines on undertakings but, for each undertaking participating in the infringement, the fine must not exceed 10% of its turnover
in the preceding business year. Article 23(3) of Regulation No 1/2003 requires that, for the purposes of determining the amount
of the fine within that limit, regard be had to the gravity and to the duration of the infringement. Moreover, in accordance
with the Guidelines, the Commission is to determine the starting amount on the basis of the gravity of the infringement, taking
account of the intrinsic nature of the infringement, its actual impact on the market, if that is measurable, and the size
of the relevant geographic market.

266    Thus, neither Regulation No 17, nor Regulation No 1/2003, nor the Guidelines provide that the amount of fines must be determined
in direct relation to the size of the affected market, that being only one relevant factor among others. That legal framework
does not therefore expressly require the Commission to take account of the limited size of the product market (Case T‐322/01
*Roquette Frères* v *Commission* [2006] ECR II‐3137, paragraph 148).

267    However, according to the case-law, in assessing the gravity of an infringement, the Commission must have regard to a large
number of factors, the nature and importance of which vary according to the type of infringement in question and the particular
circumstances of the case (*Musique Diffusion française and Others* v *Commission*, paragraph 78 above, paragraph 120). It cannot be ruled out that cases may arise in which one of the factors indicative of
the gravity of an infringement is the size of the market for the product in question.

268    Consequently, although market size may constitute a factor to be taken into account in establishing the gravity of the infringement,
its importance varies according to the particular circumstances of the infringement concerned.

269    In the present case, the infringement consisted essentially in the exchange of sensitive information on price lists and/or
prices charged to individual customers; in agreements on price increases and/or on target prices; and in refraining from undercutting,
to the advantage of the incumbent supplier and with a view to customer allocation (contested decision, recitals 99 to 125
and 345). Such practices constitute horizontal restrictions of the ‘price cartel’ type within the meaning of the Guidelines
and, accordingly, are inherently ‘very serious’. In that context, the limited size of the relevant market – even if that were
to be established – is of lesser importance than all the other factors indicative of the gravity of the infringement.

270    In any event, account should be taken of the fact that the Commission considered that the infringement had to be regarded
as very serious within the meaning of the Guidelines, which provide that a starting amount in excess of EUR 20 million may
be regarded as ‘likely’ for such cases. In the present case, the Commission, in the contested decision, divided the undertakings
concerned into a number of categories according to their relative importance on the relevant market. It can be seen from recital
358 of the contested decision that the Commission fixed a starting amount of only EUR 14 million for undertakings in the first
category, EUR 5.2 million for those in the second category, EUR 2.2 million for those in the third category (such as Gütermann),
and EUR 0.1 million for those in the fourth category (such as Zwicky). It follows that the amounts which served as the starting
point for the calculation of the fines to be imposed on Gütermann and Zwicky are significantly lower than those which, pursuant
to the Guidelines, the Commission could have regarded as ‘likely’ for very serious infringements. The starting amounts determined
for the fines suggest that account was indeed taken of the size of the market for the products in question.

271    In the light of those considerations, it must be concluded that the fines imposed on Gütermann and Zwicky are in no way disproportionate
to the size of the market for industrial thread in Benelux and the Nordic countries.

272    In addition, the argument that the starting amount for the fines was disproportionate to the turnover of Gütermann and of
Zwicky on the market in question must also be rejected.

273    It should be borne in mind that, in order to fix the starting amount for the fine, to be determined according to the gravity
of the infringement, the Commission considered it necessary to treat the undertakings which had participated in the cartels
differently, so as to take account of the effective economic capacity of each offender to cause significant damage to competition
and so as to fix the fine at a level ensuring sufficient deterrent effect. The Commission added that account had to be taken
of the specific weight of each undertaking, hence the actual impact on competition of its offending conduct. The Commission
chose to base its assessment of those factors on the turnover achieved by each undertaking on the relevant market for the
product covered by the cartel.

274    Consequently, and as was pointed out in paragraph 270 above, the Commission divided the undertakings into four categories.
In view of its turnover of EUR 2.36 million, Gütermann was placed in the third category and Zwicky, in view of its turnover
of EUR 0.2 million, was placed in the fourth. On the basis of the gravity of the infringement, the Commission decided on a
starting amount of EUR 2.2 million for Gütermann and EUR 0.1 million for Zwicky (contested decision, recitals 356 to 358).

275    It is clear from settled case-law that the proportion of turnover derived from the goods in respect of which the infringement
was committed is likely to give a fair indication of the scale of the infringement on the relevant market (*Cheil Jedang* v *Commission*, paragraph 184 above, paragraph 91, and *Archer Daniels Midland and Archer Daniels Midland Ingredients* v *Commission*, paragraph 79 above, paragraph 196). That turnover figure is likely to give a fair indication of the liability of each cartel
member on those markets, since it constitutes an objective criterion which gives a proper measure of the harm which the offending
conduct represents for normal competition and it is therefore a good indicator of the capacity of each undertaking to cause
damage.

276    In the light of those considerations, it must be concluded that the starting amounts decided upon for the calculation of the
fines to be imposed on Gütermann and Zwicky do not appear to be in any way disproportionate to the turnovers of those undertakings
on the relevant market.

277    As a consequence, it is also necessary to reject the argument that the fine is disproportionate to the turnovers respectively
achieved by the applicants on the relevant market. The applicants cannot legitimately claim that the final amount of the fine
imposed on them is disproportionate, since the starting point for their fines is justified in the light of the criteria which
the Commission used in assessing the importance of each of the undertakings on the relevant market (see, to that effect, Case
T‐23/99 *LR AF 1998* v *Commission* [2002] ECR II‐1705, paragraph 304, and Case T‐303/02 *Westfalen Gassen Nederland* v *Commission* [2006] ECR II‐4567, paragraph 185). In any event, it should be pointed out that Community law contains no general principle
that the penalty be proportionate to the turnover which the undertaking made from the sale of the product in respect of which
the infringement was committed (see, to that effect, Case C‐397/03 P *Archer Daniels Midland and Archer Daniels Midland Ingredients* v *Commission* [2006] ECR I‐4429, paragraph 339).

278    Thirdly, it is also necessary to reject Gütermann’s argument that the method of calculation is disadvantageous to small and
medium-sized undertakings and leads, in the present case, to the imposition of a fine which is disproportionate for Gütermann,
when compared with the fines imposed on the other undertakings.

279    Since the Commission is under no obligation to base its calculation of the fines on the turnover of the undertakings concerned,
it is by the same token under no obligation, where fines are imposed on a number of undertakings involved in the same infringement,
to ensure that the final amounts calculated for the fines reflect every difference between the undertakings concerned in terms
of their overall turnover or their turnover on the market for the product in question (Case T‐21/99 *Dansk Rørindustri* v *Commission* [2002] ECR II‐1681, paragraph 202).

280    It should be noted in that regard that, likewise, there is no requirement under Article 15(2) of Regulation No 17 or Article
23(2) of Regulation No 1/2003 to the effect that, where fines are imposed on a number of undertakings involved in the same
infringement, the fine imposed on a small or medium-sized undertaking must not be greater, as a percentage of turnover, than
the fines imposed on the larger undertakings. It is clear from those provisions that, both for small or medium-sized undertakings
and for larger undertakings, account must be taken, in determining the amount of the fine, of the gravity and duration of
the infringement. Where the Commission imposes on undertakings involved in a single infringement fines which are justified,
for each of them, by reference to the gravity and duration of the infringement, it cannot be criticised on the ground that,
for some of them, the amount of the fine is greater, by reference to turnover, than the amount of the fines imposed on other
undertakings (*Dansk Rørindustri and Others* v *Commission*, paragraph 279 above, paragraph 203, and *Westfalen Gassen Nederland* v *Commission*, paragraph 277 above, paragraph 174).

281    Thus, there is nothing to compel the Commission to moderate fines where the undertakings concerned are small or medium-sized
undertakings. The size of the undertaking is already taken into consideration by virtue of the upper limit laid down in Article
15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003, and the provisions of the Guidelines (*Westfalen Gassen Nederland* v *Commission*, paragraph 277 above, paragraph 174). Apart from those considerations concerning size, there is no reason to treat small
and medium-sized undertakings differently from other undertakings. The fact that the undertakings concerned are small or medium-sized
undertakings does not exempt them from their duty to comply with the competition rules (Case T‐52/02 *SNCZ* v *Commission* [2005] ECR II‐5005, paragraph 84).

282    The complaint that the Commission failed to take account of the overall turnover of the various undertakings when it set the
amount of the fine is irrelevant. It should be borne in mind that, according to the Guidelines, it is necessary to take account
of the offenders’ effective economic capacity to cause significant damage to other operators – in particular, consumers –
and to set the fine at a level which ensures that it has sufficient deterrent effect (Section 1A, fourth paragraph). The Guidelines
add that in cases involving a number of undertakings, such as cartels, it may be necessary to apply weightings to the general
starting amount in order to take account of the specific weight, hence the actual impact on competition, of the unlawful conduct
of each undertaking, particularly where there is considerable disparity in terms of size between undertakings which have committed
infringements of the same type. As a consequence, it may be necessary to adjust the general starting amount according to the
specific nature of each undertaking (Section 1A, sixth paragraph) (*Cheil Jedang* v *Commission*, paragraph 184 above, paragraph 81).

283    The Guidelines do not state that fines should be calculated according to the overall turnover of the undertakings concerned
or their turnover on the relevant market. Nor, however, do they preclude the Commission from taking either figure into account
in determining the amount of the fine, in order to ensure compliance with the general principles of Community law and where
circumstances so require. Thus, turnover may be relevant for the purposes of taking into consideration the various factors
referred to in paragraph 273 above (see, to that effect, *Cheil Jedang* v *Commission*, paragraph 184 above, paragraph 82, and *Tokai I*, paragraph 185 above, paragraph 195).

284    In the present case, however, as was pointed out in paragraph 275 above, it was consistent and objectively justified on the
part of the Commission to refer to the turnover on the relevant market in order to determine the capacity of each of the undertakings
concerned to cause damage. In so doing, the Commission also sought to deter, inasmuch as it made public the fact that, where
undertakings participated in a cartel on a market where they had significant weight, it would penalise them more severely.

285    Fourthly, Gütermann is wrong in relying, in support of its plea concerning the disproportionate nature of the fine, on the
2006 Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003. The Court finds
that it cannot be inferred that the fine imposed by the contested decision is disproportionate merely because, if the new
method for calculating fines – as set out in those guidelines, which are not applicable to the facts of the present case –
were applied, the fine would be lower.

286    That finding merely reflects the margin of discretion enjoyed by the Commission for the purposes of establishing, in compliance
with the requirements set out in Regulation No 17 and Regulation No 1/2003, the method which it intends to apply in order
to calculate the fines and thus to give practical effect to the competition policy for which it is responsible. The Court
may therefore take into account, as some of the criteria for assessing whether the fines imposed at a particular time are
proportionate, the circumstances of fact and law obtaining in the period when the unlawful conduct took place, as well as
the competition objectives current at that time, as defined by the Commission in accordance with the requirements of the EC
Treaty.

287    The plea alleging that the fines are disproportionate must therefore be rejected in its entirety.

288    It follows from the above considerations that the actions in Cases T‐456/05 and T‐457/05 must be dismissed.

**Costs**

289    Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been
applied for in the successful party’s pleadings. Since the applicants have been unsuccessful, they must be ordered to pay
the costs, in accordance with the form of order sought by the Commission.

On those grounds,

THE GENERAL COURT (Fifth Chamber)

hereby:

1.      **Dismisses the actions;**

2.      **Orders Gütermann AG and Zwicky & Co. AG to pay the costs.**

| Vilaras | Prek | Ciucǎ |
| ------- | ---- | ----- |

Delivered in open court in Luxembourg on 28 April 2010.

[Signatures]

Table of contents

Background to the dispute

1.  Subject-matter of the dispute

2.  Administrative procedure

3.  The contested decision

Definition of the relevant markets

Product market

Geographic markets

Size and structure of the relevant markets

Description of the unlawful conduct

Enacting terms of the contested decision

Procedure and forms of order sought

Law

1.  The pleas challenging the finding that an infringement has occurred and the injunctions to bring that infringement to
an end and to refrain from repeating it

The plea, put forward by Gütermann and Zwicky, alleging infringement of Article 7(1) of Regulation No 1/2003

Arguments of the parties

Findings of the Court

The plea, put forward by Zwicky, alleging that the injunctions to bring the infringement to an end and to refrain from repeating
such conduct were unjustified

Arguments of the parties

Findings of the Court

2.  The pleas challenging the fine and the amount thereof

The plea, put forward by Zwicky, alleging that the upper limit of 10% of turnover has been exceeded

Arguments of the parties

Findings of the Court

The plea, put forward by Gütermann and Zwicky, alleging incorrect assessment of the gravity of the infringement as regards
its effects

Arguments of the parties

Findings of the Court

The plea, put forward by Gütermann and Zwicky, alleging incorrect assessment of the duration of the infringement

Arguments of the parties

Findings of the Court

The plea, put forward by Gütermann and by Zwicky, alleging failure to take account of certain mitigating circumstances

Arguments of the parties

Findings of the Court

The plea, put forward by Gütermann and Zwicky, alleging misapplication of the Leniency Notice

Arguments of the parties

Findings of the Court

–  The usefulness of the cooperation

–  The allegedly incorrect assessment of the cooperation as compared with that of BST

–  The alleged misapplication of the Leniency Notice and the alleged failure to take account of the case-law of the Court

–  The alleged failure to take account of previous decision-making practice

The plea, put forward by Gütermann and Zwicky, alleging that the fines are disproportionate

Arguments of the parties

Findings of the Court

Costs

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- Language of the case: German.