7.  The applicant company has its seat in Rovaniemi.
8.  The applicant company is a limited liability company which was carrying out business in the asphalt sector until February 2000. In 2002 the Finnish Competition Authority (kilpailuvirasto, konkurrensverket) started to investigate whether the applicant company, among others, had been involved in nationwide or regional cartels in this sector.
9.  On 31 March 2004 the Competition Authority lodged an application before the Market Court (markkinaoikeus, marknadsdomstolen), requesting that the court impose a penalty payment on the applicant company, among others, on the grounds that it had participated in a cartel from 1995 to 2000.
10.  Between 14 November and 18 December 2006 the Market Court held an oral hearing in the course of which forty-eight witnesses were heard. Documentary evidence, including telephone recordings were also presented to the court.
11.  On 19 December 2007 the Market Court found, inter alia, that the applicant company had taken part in a cartel in respect of asphalt contracts commissioned by the central government authorities, by participating in territorial allocation of markets, by participating to a minor degree in price-fixing activities and by participating in restrictions on the supply of asphalt mass. A penalty payment (seuraamusmaksu, påföljdsavgift) of 75,000 euros (EUR) was imposed on the applicant company. With regard to the allegation of territorial allocation and price-fixing in the markets for local government and private sector asphalt contracts, the Market Court found that the applicant company had not participated in a cartel.
12.  The Market Court found that the territorial allocation of the markets and the bid-rigging between the companies involved in the cartel had amounted to a single continuous infringement of competition law rules, and that they were not to be regarded as individual unconnected infringements. According to the court, the infringements of competition law rules had lasted for more than seven years. Although some companies had participated in the infringements for a longer time than others, all the companies had infringed the competition law rules for three years at least. In addition, geographically, the infringements covered the entire country in respect of central government asphalt contracts, and several regions of the country in respect of local government and private sector contracts.
13.  The Market Court found it established that between 1996 and 2000 the applicant company had agreed with three other asphalt companies about the allocation of central government asphalt contracts, and had done the same with three more asphalt companies between 1999 and 2000. Moreover, from 1996 until the end of 2000, the applicant company had agreed with another cartel company in advance the prices to be offered in competitive bidding, and had tendered accordingly. Between 1996 and 2000, as far as central government asphalt contracts were concerned, it had also agreed with the other cartel companies that none of them would supply asphalt mass to companies outside the cartel. The court held that the applicant company had infringed the prohibition on the division of markets by its above-mentioned conduct regarding central government asphalt contracts.
14.  When considering the amount of the penalty payment the Market Court took into account, for each company, its turnover from the asphalt business in Finland during the last year of its participation in the infringement of competition law rules. In addition, considering the relatively low turnover of the applicant company, its market position, and the regionally limited scope of the related restriction of competition, the Market Court held that it was not justifiable to penalise the applicant company with a penalty payment exceeding the normal scale.
15.  Concerning the evidence, the Market Court noted that evidence in competition law cases could be either direct or indirect, such as economic evidence. As direct evidence was not always available, an assessment was to be made of whether indirect evidence was sufficient to prove the existence of a cartel. The court found that, in the present case, the economic evidence alone was not sufficient to prove the existence of a cartel. The court also found that the existence of a cartel could not be proved on the basis of hearsay evidence. In the present case, the Market Court reached its conclusion in respect of the central government asphalt contracts by relying, inter alia, on the testimonies of eight witnesses. However, to the extent that those testimonies contained hearsay evidence, such evidence was not taken into account. As far as local government and private sector contracts were concerned, the Market Court analysed the evidence for restrictions of competition region by region and found it sufficient in respect of certain regions while insufficient in respect of others. As regards the regions where the applicant company was doing business (Northern Finland and North Karelia), the Market Court found that the evidence in support of a cartel was not sufficient. In this context, the Market Court stated, inter alia, that the testimonies of two witnesses who had been heard on this matter had been based solely on what the witnesses had heard from other people, whereas other witnesses had not given evidence that was capable of substantiating the existence of a cartel for local government and private sector contracts in this particular region.
16.  In January 2008, the Competition Authority and the defendant companies, including the applicant company, lodged appeals at the Supreme Administrative Court (korkein hallinto-oikeus, högsta förvaltnings­domstolen). In its appeal, the Competition Authority contested the interpretation adopted by the Market Court as regards the scope of the cartel, arguing that there was nothing to suggest that the territorial allocation of markets did not encompass contracts in all the above mentioned categories of works and pointing out that the exclusion of supplies of asphalt mass outside the cartel companies affected competition in the entire sector. The Competition Authority maintained that there had been a single, nationwide cartel encompassing the entire market for state, local authority and private sector asphalt contracts. In so far as evidence was concerned, the Competition Authority argued, inter alia, that even hearsay evidence should have been taken into account by the Market Court. The company which had been found to play a leading role in the cartel lodged a partial appeal. In its appeal, the applicant company claimed that the Market Court had drawn the wrong conclusions from the evidence, as the Competition Authority had not been able to show that the company had participated in a cartel. In its response to the appeal brought by the Competition Authority, the applicant company reiterated its submissions already made before the Market Court and argued, inter alia, that reliance on any elements of hearsay in the evidence should remain excluded.
17.  On 25 February 2009 the Supreme Administrative Court held a preparatory meeting with the parties for the oral hearing of the case. The oral hearing itself was held between 20 and 23 April 2009, at which the court again heard six key witnesses. Four of them had been called by the Competition Authority, and two by one of the asphalt companies. The parties, including the applicant company, did not ask the court to hear any other persons.
18.  On 29 September 2009 the Supreme Administrative Court overturned the Market Court’s decision. In its judgment, the Supreme Administrative Court held that the Competition Authority’s application was well-founded in respect of all but one of the defendants. Inter alia, the Supreme Administrative Court concluded that the applicant company had participated in a nationwide cartel between May 1995 and 15 February 2000, and the applicant company was ordered to pay a penalty payment of EUR 500,000.
19.  In regard to matters of procedure, the Supreme Administrative Court noted that the concept of “criminal charge” had an autonomous meaning in the established case-law of the European Court of Human Rights on Article 6 § 1 of the Convention, and that therefore certain sanctions imposed in administrative-law proceedings fell within the scope of Article 6. The court stated that in the light of that case-law, the procedure for imposing a penalty payment under the Restriction of Competition Act had to be considered to fall within the scope of Article 6 (see Jussila v. Finland [GC], no. 73053/01, § 43, ECHR 2006‑XIV). The court further noted that the Court of Justice of the European Communities, when applying Article 6 as a part of the general principles of Community law, had held that the proceedings under Community competition law had to comply with the requirements of Article 6. The Supreme Administrative Court, citing the case of Jussila, considered that while Article 6 of the Convention under its criminal limb thus applied to proceedings imposing a penalty payment, in such cases the Article 6 requirements were not necessarily identical to the requirements which were applicable in the core areas of criminal procedure.
20.  In its judgment, the Supreme Administrative Court made a number of general statements about the assessment of evidence in competition proceedings. It emphasised at the outset that the domestic legislation in this regard was based on the principle of free assessment of evidence. This meant, inter alia, that the court was to take into account all evidence adduced before the Market Court, in addition to the evidence adduced in its own proceedings, while also bearing in mind the finality of the Market Court’s findings to the extent that it had not been challenged by a party on appeal.
21.  The court also referred to the particular difficulties in obtaining evidence of practices aimed at restricting competition. In this context, it cited the relevant case-law of the Court of Justice of the European Union. The court thus recalled that as the prohibition of anti-competitive agreements and the penalties which offenders may incur are well known, it is normal for the activities relating to restrictive practices and agreements to take place in a clandestine fashion, for meetings to be held in secret, and for the associated documentation to be reduced to a minimum. Evidence of unlawful contact between economic operators will normally be only fragmentary and sparse, so that it is often necessary to reconstitute certain details by deduction. In most cases, the existence of an anti-competitive practice or agreement must be inferred from a number of coincidences and indicia which, taken together and in the absence of another plausible explanation, may constitute evidence of an infringement of the competition rules (see Aalborg Portland and Others v. the Commission, 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, ECLI:EU:C:2004:6, §§ 55-57). Accordingly, the competent court was not precluded from taking into account circumstantial evidence, or from drawing inferences from various elements of proof, including testimony containing references to what the witness has heard from others. Various factual elements attesting to similar events or patterns occurring in a given market, alongside other kinds of circumstantial evidence may, in the absence of any other reasonable explanation, demonstrate the existence of restrictive practices. Furthermore, the court cited case-law of the General Court of the EU emphasising that while the competition authority must produce sufficiently precise and consistent evidence to support the firm conviction that the alleged infringement of competition rules took place, it is not necessary for every item of evidence produced to satisfy those criteria in relation to every aspect of the infringement. It is sufficient if the body of evidence relied on, viewed as a whole, meets that requirement (see JFE Engineering Corp. and Others v. the Commission, Joined cases T-67/00, T-68/00, T-71/00 and T-78/00, ECLI:EU:T:2004:221, §§ 179-180).
22.  The court stated that the evidence provided in a competition law case could not be subject to the same requirements as evidence in criminal cases, inter alia, because Finnish competition law was a part of EU competition law. In this regard, the court also cited case-law of the General Court of European Union (see BPB plc v. the Commission, Case T-53/03, ECLI:EU:T:2008:254, § 64), according to which a standard of proof beyond reasonable doubt cannot be required in competition cases. It further cited case-law of the Court of Justice of the European Union according to which it is incumbent on the Commission as competition authority to prove the infringements of competition rules and to adduce evidence capable of demonstrating to the requisite legal standard the existence of the circumstances constituting an infringement, and where such evidence had been presented the court was entitled to consider that it was for the defendant to provide another explanation for the incriminating circumstances. This did not unduly reverse the burden of proof or set aside the presumption of innocence (see Montecatini Spa v. the Commission, Case C-235/92 P, ECLI:EU:C:1999:362, §§ 179-181).
23.  According to the Supreme Administrative Court, circumstantial evidence as well as inferences could also be relied on for establishing prohibited cooperation in the absence of any alternative reasonable explanation. When drawing such inferences, the court was not precluded from taking into account hearsay evidence alongside other scattered evidence. It was essential to take a holistic approach to the evidence presented. When it came to the duration of the infringement of competition law rules, it was sufficient that the presented evidence related to facts sufficiently close in terms of time, in order that it could be established with reasonable certainty that the suspected infringement had continued without interruption between the dates when the alleged cartel had started and ended.
24.  In this case, the Supreme Administrative Court had at its disposal all written evidence, including economic and financial evidence, as well as the records of statements made by all of the witnesses heard by the Market Court. The court also heard six witnesses in person. The gist of testimonies relied on is cited in the judgment. The court’s findings indicate, inter alia, that independently of each other, a number of witnesses mentioned examples from different geographical regions in different parts of Finland where the companies had agreed about the allocation of markets either by geographical regions or by the volumes of contracts. The witnesses expressed a common understanding that a cartel had dominated the Finnish asphalt markets throughout the country in respect of both local government and private sector contracts and central government contracts. Several witnesses also reported consistently on the practices by which the cartel companies had agreed the price to be offered by each of them in competitive bidding. The witnesses reported that the practices followed in competitive bidding had been intended to ensure that the markets were divided as agreed. The reported tendering practices were confirmed by the recordings of telephone calls presented as evidence, and by the written evidence relating to certain competitive biddings. Furthermore, the witnesses reported consistently on how the cartel had supervised the geographical division of the markets. In addition, three witnesses testified before the court about their experience regarding the alleged division of the markets, the related false invoices and the supply of cost-free asphalt mass, as well as some consistent hearsay. They testified that if the contracted works had not corresponded to the amounts agreed in advance, the company which had been awarded too many contracts would pay compensation to those which had received too few contracts, for example by means of false invoices. These witnesses also testified about the pressure exerted by cartel members on smaller companies to join the cartel and about measures taken to conceal the infringements.
25.  On the basis of the evidence before it, the Supreme Administrative Court found that a single nationwide cartel had existed between 1994 and 2002 in respect of central and local government as well as private sector asphalt contracts. It found that the Competition Authority had presented extensive evidence of the existence of the cartel, by means of witness statements, documents, telephone recordings and other evidence. Although the evidence provided by the Competition Authority had not covered all incidents in the asphalt markets during the period covered by its application, either geographically or in terms of time, it had nevertheless permitted the court to get an overall picture of the functioning of the asphalt markets during the period in question. The evidence had excluded the possibility that the established facts were a matter of similar practices which had coincided accidentally. Taking into account what is generally known about the functioning of cartels on the basis of earlier experience and research, the most credible explanation for the similarity between the events which had occurred in different regions and the observations made by the witnesses was that the asphalt companies had agreed about the territorial allocation of the asphalt markets in the whole of Finland, as well as about the measures for implementing the agreed allocation in practice. In its final conclusion, the court stated that the Competition Authority had adduced extensive evidence of the existence of a cartel, while the defendants had not been able to refute the credibility or reliability of that evidence, nor the conclusions which the Competition Authority had drawn from it.
26.  As to the applicant company’s participation in the cartel, the Supreme Administrative Court held that:
“(1274)  [o]n the basis of [the three witness] statements adduced before the Market Court and the Supreme Administrative Court and the written evidence consisting of the [chart on the geographical division of the markets], it has been shown that [the applicant company] took part in the cartel, in particular in Lapland and the North Karelia region. It had been agreed that the area of Northern Finland was allocated to [the applicant company], and in general the other cartel companies had no right to do business there.
(1275)  In addition, it has been shown that there were restrictions in respect of works on central government contracts as well as the supply of asphalt mass. When taking into account that works commissioned by the State were executed throughout the country, the restrictions relating to such contracts necessarily affected the whole State territory.
(1276)  On the above-mentioned grounds, [the applicant company] has participated in the nationwide cartel the existence of which the Supreme Administrative Court has found established in Part 9 of the present judgment.”
27.  It further held that the applicant company had taken part in this cartel for almost five years. It had been established that the applicant company through its representatives had been an active operator in the cartel, taken initiatives for agreements regarding bidding for contracts, hampered the business of new and smaller companies in the market and exerted pressure on other companies to join the cartel.
28.  The Supreme Administrative Court based its above mentioned findings concerning the applicant company on one witness statement given directly before it, which was corroborated by several witness statements given before the Market Court. The court noted that witnesses heard before it and the Market Court had given evidence about matters based on what they had experienced, heard or inferred concerning the applicant company’s conduct. Those statements could not be excluded when assessing the nature and extent of the restrictions of competition in which the applicant company had been involved. The court specifically stated that the economic evidence of the applicant company’s unusual financial performance was not taken into account as evidence of the existence of the cartel. Moreover, the court found that the applicant company had not been able to present any credible alternative explanations for its behaviour on the markets, or to refute the Competition Authority’s conclusions.
29.  The applicant company had thus participated in a very serious and extensive cartel, which had aimed to eliminate all functioning competition in the Finnish asphalt markets and which had been particularly harmful for this sector. However, in determining the penalty payment, account was taken of the relatively small market share of the applicant company and the regional and temporal dimensions of the applicant company’s infringements, which were smaller than those of the prime participants in the cartel.
30.  After the Supreme Administrative Court’s decision of 29 September 2009, and on the basis of that decision, the Finnish State and several municipalities brought compensation claims in the civil courts against the participants in the cartel, including the applicant company. Those claims amounted to several million euros in total.
31.  On 28 November 2013 the Helsinki District Court (käräjäoikeus, tingsrätten) rejected the Finnish State’s claims against all asphalt companies, including the applicant company. The Finnish State was ordered to pay the asphalt companies’ litigation costs, some EUR 2.6 million. On the other hand, most of the municipalities won their cases against the asphalt companies. The applicant company lost two out of the four cases brought against it, but it was not ordered to pay any compensation to either of those two municipalities, since another asphalt company had already been ordered to do so.
32.  The Finnish State appealed against the District Court judgment. Also, in three of the four cases which the municipalities had brought against the applicant company appeals were lodged with the Court of Appeal (hovioikeus, hovrätten).
33.  On 20 October 2016 the Helsinki Court of Appeal accepted the claims of the Finnish State against the asphalt companies in four cases out of seven. The applicant company was among those asphalt companies which lost their case against the State, and it was ordered to pay some EUR 1.7 million in compensation to the State. Moreover, the Court of Appeal rejected the appeals of most of the municipalities. The applicant company thus won all of its three cases against the municipalities before the Court of Appeal.
34.  The applicant company appealed against the judgment of the Court of Appeal in respect of the claim by the Finnish State which it had lost. Two of the three cases brought by the municipalities against the applicant company were also appealed against to the Supreme Court (korkein oikeus, högsta domstolen).
35.  On 6 September 2017 the Supreme Court refused the applicant’s request for leave to appeal. The judgment of 20 October 2016 by the Court of Appeal thus became final in respect of the applicant company.
36.  On 25 September 2014 the applicant company requested the Supreme Administrative Court to annul its decision of 29 September 2009.
37.  On 3 January 2017 the Supreme Administrative Court decided to suspend the proceedings until the Strasbourg Court renders a decision in the present case.