Order — ECLI:EU:T:2019:176
Date: 2019-03-18
Language of the case: German

Summary — Judgment of the General Court (Ninth Chamber, Extended Composition), 13 December 2018 1. Procedure — Application initiating proceedings — Formal requirements — Brief summary of the pleas in law on which the application is based — Pleas in law not set out in the application — General reference to other documents — Inadmissibility (Statute of the Court of Justice, Arts 21 and 53, first para.; Rules of Procedure of the General Court (1991), Art. 44(1)(c)) 2. Dominant position — Abuse — Refusal by a dominant undertaking to allow another undertaking access to a product or a service — Access by third undertakings to the incumbant operator’s local loop on the broadband telecommunications services market — Implied refusal of access — Regulatory framework requiring access — Obligation for the Commission to show the indispensable nature of that access for competing operators to enter the market — Absence (Art. 102 TFEU; EEA Agreement, Art. 54) 3. Competition — Administrative procedure — Statement of objections — Necessary content — Commission decision finding an infringement — Decision not identical to the statement of objections — Infringement of the rights of the defence — Conditions — Assessment on a case-by-case basis (Art. 102 TFEU; EEA Agreement, Art. 54; Council Regulation No 1/2003, Art. 27(1)) 4. Dominant position — Abuse — Margin squeeze — Concept — Criteria for assessment (Art. 102 TFEU; EEA Agreement, Art. 54) 5. Dominant position — Abuse — Margin squeeze — As-efficient competitor test — Positive margins — Burden of proof of the exclusionary effect imposed on the Commission (Art. 102 TFEU; EEA Agreement, Art. 54; Council Regulation No 1/2003, Art. 2) 6. Competition — EU rules — Infringements — Attribution — Parent company and subsidiaries — Economic unit — Criteria for assessment — Exercise of decisive influence over the conduct of the subsidiary that may be inferred from a body of evidence relating to the economic, organisational and legal links with the parent company — Circumstances allowing the existence of decisive influence to be established — Actual control of the board of directors of the subsidiary — Influence over the decision-making processes within the subsidiary’s board of directors — Overlaps in the management staff between the parent company and the subsidiary — Secondment of staff — Regular receipt of information on the subsidiary’s commercial strategy — High level of involvement of the parent company in the definition of the commercial policy of its subsidiary — Influence on the strategic choices (Art. 102 TFEU; EEA Agreement, Art. 54) 7. Acts of the institutions — Statement of reasons — Obligation — Scope — Decision imposing fines for breach of the competition rules and concerning a number of addressees — Attribution of the practices of a subsidiary to its parent company — Need for express statement of reasons — Scope (Arts 102 and 296 TFEU; EEA Agreement, Art. 54) 8. Competition — Fines — Joint and several liability for payment — Scope — Attribution to the parent company of the infringing conduct of its subsidiary — Determination of the amount of the fine payable by the parent company — Purely derivative liability of the parent company — Separate fine imposed only on the parent company — Aggravating circumstances — Repeated infringement on the part only of the parent company — Factor that individually characterises the conduct of the parent company (Art. 102 TFEU; EEA Agreement, Art. 54; Council Regulation No 1/2003, Art. 23(2) and (3); Commission notice 2006/C 210/02, points 29 and 30) 9. Competition — Fines — Joint and several liability for payment — Scope — Attribution to the parent company of the infringing conduct of its subsidiary — Purely derivative liability of the parent company — Separate fine imposed only on the parent company — Application of a multiplier for deterrence — Volume of turnover of the parent company — Factor that does not individually characterise the conduct of the parent company (Art. 102 TFEU; EEA Agreement, Art. 54; Council Regulation No 1/2003, Art. 23(2) and (3); Commission notice 2006/C 210/02, points 29 and 30) 10. Competition — Fines — Amount — Determination — Determination of the basic amount — Determination of the value of sales — Gravity of the infringement — Determination of the fine in proportion to the factors for assessment of the gravity of the infringement — Turnover achieved with the services in respect of which the infringement was committed — Turnover achieved over the course of the last full business year of their participation in the infringement — Increased turnover during the infringement period — Obligation to take into account the average turnover during the infringement period — Absence (Art. 102 TFEU; EEA Agreement, Art. 54; Council Regulation No 1/2003, Art. 23(3); Commission notice 2006/C 210/02, point 13) 11. Competition — Fines — Amount — Determination — Whether the Commission is obliged to abide by its previous decision-making practice — Absence (Art. 102 TFEU; EEA Agreement, Art. 54; Council Regulation No 1/2003, Art. 23(2) and (3); Commission notice 2006/C 210/02, point 13) 12. Competition — Fines — Amount — Determination — Discretion of the Commission — Judicial review — Unlimited jurisdiction of the EU judicature — Scope (Arts 261 TFEU and 263 TFEU; Council Regulation No 1/2003, Art. 31) 1. See the text of the decision. (see paras 77-80, 171) 2. In order for the refusal by a dominant undertaking to grant access to a service to constitute an abuse within the meaning of Article 102 TFEU, that refusal must be likely to eliminate all competition on the market on the part of the person requesting the service, such refusal must not be capable of being objectively justified, and the service must in itself be indispensable to carrying on that person’s business. Moreover, it is clear from paragraphs 43 and 44 of the judgment of 26 November 1998, Bronner, that, in order to determine whether a product or service is indispensable for enabling an undertaking to carry on business in a particular market, it must be determined whether there are products or services which constitute alternative solutions, even if they are less advantageous, and whether there are technical, legal or economic obstacles capable of making it impossible or at least unreasonably difficult for any undertaking seeking to operate in the market to create, possibly in cooperation with other operators, alternative products or services. According to paragraph 46 of that judgment, finally, in order to accept the existence of economic obstacles, it must be established, at the very least, that the creation of those products or services is not economically viable for production on a scale comparable to that of the undertaking which controls the existing product or service. However, since the legislation relating to the telecommunications sector defines the legal framework applicable to it and, in so doing, contributes to the determination of the competitive conditions under which a telecommunication undertaking carries on its business in the relevant markets, that legislation constitutes a relevant factor in the application of Article 102 TFEU to the conduct of that undertaking, in particular for assessing the abusive nature of such conduct. Therefore, where the relevant regulatory framework clearly requires the incumbent operator on the broadband telecommunications services to grant all reasonable and justified requests for unbundling of its local loop in order to enable alternative operators to use that loop with a view, on that basis, to offer their own services on the retail mass market for broadband services at a fixed location, the demonstration, by the Commission, that such access was indeed indispensable, is not required. (see paras 95-97, 101) 3. See the text of the decision. (see paras 123-129, 140) 4. See the text of the decision. (see paras 162-165, 205-208) 5. As regards practices resulting in the margin squeeze, to the extent that a dominant undertaking sets its prices at a level covering the great bulk of the costs attributable to the supply of the goods or services in question, it is, as a general rule, possible for a competitor as efficient as that undertaking to compete with those prices without suffering losses that are unsustainable in the long term. Admittedly, if a margin is positive, it is not ruled out that the Commission can, in the context of the examination of the exclusionary effect of a pricing practice, demonstrate that the application of that practice was, by reason, for example, of reduced profitability, likely to have the consequence that it would be at least more difficult for the operators concerned to trade on the market concerned. However, in the light of the presence of positive margins over a certain period, the Commission is subject to a particular obligation relating to the proof of exclusionary effects of the practice of a margin squeeze alleged against the undertaking during that period. That case-law can be read in conjunction with Article 2 of Regulation No 1/2003, according to which, in any proceedings for the application of Article 102 TFEU, the burden of proving an infringement of that article rests on the party or the authority alleging the infringement, namely, in the present case, the Commission. In that context, the mere claim by the Commission that the operators other than the dominant company consider their ability to earn a reasonable return over a longer period, lasting several years, cannot constitute such proof. Such a fact, assuming it is established, is based on a prospective examination of profitability, which is necessarily hypothetical. Furthermore, such a claim cannot constitute proof of proof of exclusionary effects and does not satisfy the requirement arising from the principle of legal certainty, according to which a dominant undertaking must be in a position to assess the conformity of its conduct with Article 102 TFEU. For that reason, the finding of negative margins, by means of the application of the multi-period (multi-year) approach, cannot undermine that assessment, since that approach resulted in such a finding only by means of a weighting of the positive margins for a certain year with the negative margins found for the other years. (see paras 210, 212, 214, 215, 217) 6. See the text of the decision. (see paras 227-235, 253-255, 261, 262, 267, 282, 285, 294, 305, 335, 340, 345, 359, 362, 363, 368, 386, 392, 430, 439, 468-472) 7. See the text of the decision. (see para. 270) 8. For the purposes of applying and enforcing decisions adopted by the Commission pursuant to Articles 101 and 102 TFEU, it is necessary to identify an entity possessing legal personality to be the addressee of the decision finding and penalising an infringement of one of those provisions. An infringement of EU competition law must thus be imputed unequivocally to a legal person on whom fines may be imposed and to whom the statement of objections will be addressed. In that regard, neither Article 23(2)(a) of Regulation No 1/2003 nor the case-law determines which legal or natural person the Commission is obliged to hold responsible for the infringement or to punish by the imposition of a fine. On the other hand, the unlawful conduct of a subsidiary may be imputed to its parent company in particular where, although it has separate legal personality, that subsidiary does not decide independently on its own conduct on the market, but carries out, in all material respects, the instructions given to it by the parent company, having regard in particular to the economic, organisational and legal links between those two legal entities. In a situation in which the parent company’s liability is purely derived from that of its subsidiary and in which no factor individually reflects the conduct for which the parent company is held liable, the parent company’s liability cannot exceed that of its subsidiary. Although the unity of the conduct of an undertaking on the market justifies that, in the case of an infringement of the competition rules, the different companies that formed part of the undertaking throughout the infringement period being, in principle, all held jointly and severally liable for payment of the same amount of the fine, an exception must be made where there are aggravating or mitigating circumstances and, more generally, circumstances that justify a variation in the amount of the fine which apply only in respect of some of those companies and not others. Therefore, an entity in respect of which the aggravating circumstance of repeated infringement has not been found cannot be held jointly and severally liable, with an entity in respect of which that circumstance has been found, for the part of the fine corresponding to the increase for repeated infringement. It follows that the aggravating circumstance of repeated infringement may constitute a factor that individually characterises the conduct of a parent company and justifies the extent of its liability exceeding that of its subsidiary from which that liability is wholly derived. (see paras 494-496, 499, 505, 506) 9. In a situation in which the parent company’s liability is purely derived from that of its subsidiary and in which no factor individually reflects the conduct for which the parent company is held liable, the parent company’s liability cannot exceed that of its subsidiary. Where, as in the present case, the Commission, in order to assess the gravity of the infringement committed by the undertaking and to calculate the fine to be imposed on it, relies on the subsidiary’s turnover, the turnover of the parent company, even if it is considerably higher than the subsidiary’s, is not a factor of such a kind as to characterise the individual conduct of the parent company in committing the infringement attributed to the undertaking, as the parent company’s liability in that regard is purely derivative from the liability of its subsidiary. Furthermore, the mere finding of a turnover is an element of fact that cannot individualise the parent company’s conduct. The Commission is therefore not entitled, in order to justify the application of the specific weighting for deterrence to the parent company, to take its turnover into consideration. (see paras 499, 520) 10. See the text of the decision. (see paras 530-534, 537, 544) 11. See the text of the decision. (see paras 539-544) 12. See the text of the decision. (see paras 552-554)