62020TJ0590
JUDGMENT OF THE GENERAL COURT (Third Chamber, Extended Composition)
18 October 2023 (
*1
)
(Competition – Agreements, decisions and concerted practices – Ethylene market – Decision finding an infringement of Article 101 TFEU – Coordination on a purchase price element – Settlement procedure – Fine – Adjustment of the basic amount of the fine – Point 37 of the Guidelines on the method of setting fines – Repeat infringement – Point 28 of the Guidelines on the method of setting fines – Unlimited jurisdiction – Counterclaim for increase of the amount of the fine)
In Case T‑590/20,
Clariant AG, established in Muttenz (Switzerland),
Clariant International AG, established in Muttenz,
represented by F. Montag and M. Dreher, lawyers,
applicants,
v
European Commission, represented by A. Boitos, I. Rogalski and J. Szczodrowski, acting as Agents,
defendant,
THE GENERAL COURT (Third Chamber, Extended Composition),
composed, at the time of the deliberations, of M. van der Woude, President, G. De Baere (Rapporteur), G. Steinfatt, K. Kecsmár and S. Kingston, Judges,
Registrar: I. Kurme, Administrator,
having regard to the written part of the procedure,
further to the hearing on 24 November 2022,
gives the following
Judgment
1
By their action under Article 263 TFEU, the applicants, Clariant AG and its subsidiary, Clariant International AG, seek, by way of principal claim, the partial annulment of Commission Decision C(2020) 4817 final, of 14 July 2020, relating to a proceeding under Article 101 TFEU (AT.40410 – Ethylene) (‘the contested decision’) and, in the alternative, a reduction of the amount of the fine imposed on them ‘jointly and severally’ in that decision. The European Commission seeks, by way of counterclaim, an increase of the amount of that fine.
I. Background to the dispute
A. Administrative procedure
2
On 29 June 2016, one of the four undertakings that had participated in collusive contacts relating to purchases of ethylene applied for immunity from fines under the Commission notice on immunity from fines and reduction of fines in cartel cases (OJ 2006 C 298, p. 17; ‘the Leniency Notice’).
3
Between 23 May and 3 July 2017, the three other undertakings that had participated in those collusive contacts also applied for immunity from fines or, in the alternative, for a reduction in the fine that had been imposed on them pursuant to the Leniency Notice.
4
On 10 July 2018, the Commission initiated proceedings pursuant to Article 11(6) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles [101 and 102 TFEU] (OJ 2003 L 1, p. 1) against the four undertakings against whom the proceedings were directed (‘the cartel participants’), with a view to engaging in settlement negotiations with them in accordance with the Commission Notice on the conduct of settlement procedures in view of the adoption of Decisions pursuant to Articles 7 and 23 of Council Regulation (EC) No 1/2003 in cartel cases (OJ 2008 C 167, p. 1) (‘the settlement notice’).
5
By letter of 23 July 2018, the applicants confirmed to the Commission that they were willing to engage in settlement negotiations.
6
In the course of those exchanges, the Commission informed the applicants of the objections it envisaged raising against them and disclosed to them the key evidence in its file that formed the basis for those objections. It also provided them with an estimation of the range of fines it was likely to impose on them.
7
On 20 November 2019, the applicants introduced their settlement submission pursuant to the third paragraph of Article 10a(2) of Commission Regulation (EC) No 773/2004 of 7 April 2004 relating to the conduct of proceedings by the Commission pursuant to Articles [101 and 102 TFEU] (OJ 2004 L 123, p. 18), by which they acknowledged their ‘joint and several liability’ for their participation in the infringement. They also indicated the maximum fine they would accept in the settlement procedure, namely an amount of EUR 159663000.
8
On 7 February 2020, the Commission adopted a statement of objections. The applicants replied to the statement of objections on 24 February 2020, confirming that it reflected their settlement submission and that they remained committed to following the settlement procedure.
B. Contested decision
9
On 14 July 2020, the Commission adopted the contested decision.
1.
Description of the infringement
10
The Commission found that the applicants had participated in a single and continuous infringement consisting in exchanging sensitive commercial and pricing-related information and in fixing a price element relating to purchases of ethylene, in Belgium, Germany, France and the Netherlands during the period from 26 December 2011 to 29 March 2017 (Article 1(c) of the contested decision).
11
The infringing conduct concerned the purchase of ethylene on the merchant market, not including ethylene produced for captive purposes, that is to say, ethylene produced and used by the producers themselves.
12
The ethylene was generally sourced on the basis of long-term supply agreements. In order to reflect the risk of volatility in the purchase prices of ethylene, such supply agreements often referred to the ethylene Monthly Contract Price (the ‘MCP’). In order to establish the ethylene MCP for the month to come, two separate but identical bilateral agreements, also called ‘settlements’, had to be reached between two different pairs of suppliers and buyers. Once the first settlement had been reached, the parties could notify their agreement to a private and independent reporting agency, which published that first settlement to the market. As soon as another supplier-buyer pair had settled at the same price, that price was published by the reporting agencies as the MCP for the month to come.
13
The Commission emphasised that the MCP was not a net price but one variable element in the pricing formulae used for certain supply contracts. The MCP thus directly influenced the actual ethylene purchase price paid under those supply agreements, as well as in certain transactions on the ethylene spot market.
14
The Commission found that the cartel participants had coordinated their market behaviour through bilateral contacts relating to the MCP, by agreeing, first, the price targets they were to use when commencing MCP negotiations with ethylene sellers, as well as, second, the final MCPs they wanted to achieve, which were based on a joint evaluation of market pricing factors and publicly available analyst intelligence. Those participants also colluded on their future positions in negotiations with ethylene sellers. Lastly, they exchanged information on market trends.
15
The objective of that conduct was to influence MCP negotiations in order to obtain the lowest possible purchase price in their negotiations with ethylene sellers.
16
The Commission found that the conduct at issue presented the characteristics of an agreement or a concerted practice within the meaning of Article 101 TFEU having as its object the restriction of competition on the ethylene purchasing market. It was thus unnecessary to consider the effects of that conduct on that market, or to determine whether the cartel participants had ultimately succeeded in reaching the desired MCP.
17
As regards the applicants’ participation in the infringement, the Commission observed, first, that the second applicant, Clariant International, had accepted unreservedly its liability for its direct participation in the infringement committed in the period from 26 December 2011 to 29 March 2017 and, second, that the first applicant, Clariant, had accepted unreservedly its ‘joint and several liability’ for its wholly owned subsidiary’s participation in the infringement committed in the period from 26 December 2011 to 29 March 2017. It accordingly found that there was ‘joint and several liability’ for the second applicant for its direct participation and for the first applicant, in its capacity as parent company of the second applicant, in the infringement for the material period.
2.
Calculation of the amount of the fine imposed on the applicants
18
The Commission imposed on the applicants, ‘jointly and severally’, a fine in the amount of EUR 155769000 (Article 2(c) of the contested decision).
19
First, for the purposes of calculating the basic amount of the fine, the Commission used the figures for the value of purchases of ethylene acquired in the period covering the last full year of the applicants’ participation in the infringement, which was 2016.
20
The Commission took the view that it would not be appropriate to use the value of sales of downstream products as the starting point for calculating the basic amount of the fine, given that the infringement concerned a purchase cartel and that not all the parties were present on the same downstream market(s).
21
Furthermore, the Commission considered it appropriate to include only the value of purchases made under ethylene supply agreements using an MCP-based pricing formula, and that of purchases made on the ethylene spot market based on the MCP.
22
Second, for the determination of the basic amount of the fine, the Commission took account of the gravity and duration of the infringement, as well as the need for deterrence.
23
First of all, having regard to the fact that the infringement consisted in horizontal price-fixing, which is, by its very nature, among the most harmful restrictions of competition, the Commission set the gravity percentage at 15%.
24
Next, the Commission took into account the fact that the applicants had participated in the infringement from 26 December 2011 to 29 March 2017, a period of 1921 days, corresponding to a duration multiplier of 5.25.
25
Lastly, the Commission set the additional amount for the purposes of deterrence at 15%, given the gravity of the infringement.
26
Third, the Commission made some adjustments to the basic amount.
27
On the one hand, applying point 28 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation (EC) No 1/2003 (OJ 2006 C 210, p. 2; ‘the Guidelines on the method of setting fines’), the Commission increased the basic amount of the fine by 50%, on the ground that a similar infringement of Article 101 TFEU had previously been committed by the applicants. The Commission referred, in that regard, to its Decision C(2004) 4876 final of 19 January 2005 relating to a proceeding under Article [101 TFEU] and Article 53 of the EEA Agreement (COMP/E-1/37.773 – MCAA; ‘the MCAA decision’), by which the first applicant and its subsidiary Clariant GmbH had been held liable for a cartel on the monochloroacetic acid market (‘the MCAA cartel’).
28
The Commission also found that there were no mitigating circumstances justifying a reduction of the basic amount of the fine.
29
On the other hand, pursuant to point 37 of the Guidelines on the method of setting fines, in order to take the particular features of the case into account and to achieve sufficient deterrence, the Commission applied an increase of 10% to the basic amount of the fine.
30
Fourth, the Commission ensured that the resulting amount did not exceed 10% of the applicants’ total turnover in 2019, in accordance with Article 23(2) of Regulation No 1/2003.
31
Fifth, the Commission went on to reduce the fine by way of leniency. It thus reduced the fine imposed on the applicants by 30% pursuant to the Leniency Notice.
32
Sixth, it reduced the amount of the fine by 10% to reward each party for its cooperation in the settlement procedure.
II. Forms of order sought
33
The applicants claim that the Court should:
–
annul Article 2(c) of the contested decision, in so far as it relates to the imposition of a fine in an amount exceeding EUR 94405800;
–
in the alternative, reduce the fine imposed on them pursuant to Article 2(c) of the contested decision to a proportionate amount;
–
reject the Commission’s request to increase the fine already imposed on the applicants to EUR 181731000;
–
order the Commission to pay the costs.
34
The Commission contends that the Court should:
–
dismiss the action;
–
set the amount of the fine imposed on the applicants in Article 2(c) of the contested decision at EUR 181731000;
–
order the applicants to pay the costs.
III. Law
A. The claims for annulment and for reduction of the amount of the fine
35
The applicants put forward three pleas in law in support of their action, the first two of which are put forward in support of the claim for annulment and the third in support of the claim for a reduction of the amount of the fine. By the first plea, they claim that the Commission was wrong to increase the basic amount of the fine pursuant to point 28 of the Guidelines on the method of setting fines. By the second plea, they claim that the Commission was wrong to increase the basic amount of the fine pursuant to point 37 of those guidelines. The third plea alleges that the amount of the fine is disproportionate in relation to the gravity of the infringement committed.
1.
First plea: the Commission was wrong to increase the basic amount of the fine pursuant to point 28 of the Guidelines on the method of setting fines
36
As a preliminary point, it should be remembered that it is apparent from recitals 107 to 113 of the contested decision that the fine was imposed on the applicants pursuant to Article 23(2) and (3) of Regulation No 1/2003, in accordance with paragraph 3 of Article 10a of Regulation No 773/2004.
37
Article 23(3) of Regulation No 1/2003 provides that, in determining the amount of the fine, the duration and the gravity of the infringement must be taken into consideration.
38
In that regard, any repeat infringement is among the factors to be taken into consideration in the analysis of the gravity of the infringement in question (judgments of 17 June 2010, Lafarge v Commission, C‑413/08 P, EU:C:2010:346, paragraph 63, and of 12 December 2014, Eni v Commission, T‑558/08, EU:T:2014:1080, paragraph 276; see also, to that effect, judgment of 7 January 2004, Aalborg Portland and Others v Commission, 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, EU:C:2004:6, paragraph 91).
39
The aggravating circumstance of repeat infringement is defined in the first indent of point 28 of the Guidelines on the method of setting fines as the continuation or repetition of the same or a similar infringement after the Commission or a national competition authority has made a finding that the undertaking in question infringed Article 101 TFEU or Article 102 TFEU. In such circumstances, the basic amount of the fine may be increased by up to 100% for each infringement established.
40
The first plea is divided into three parts, the first alleging infringement of Article 23(3) of Regulation No 1/2003 and the principles of proportionality and sound administration in so far as the Commission failed to exercise its discretion; the second, infringement of Article 23(3) of Regulation No 1/2003 and of the principle of proportionality in that the Commission incorrectly categorised the applicants as repeat infringers; and, third, infringement of the duty to state reasons.
(a)
First part of the first plea: failure by the Commission to exercise its discretion
41
The applicants criticise the Commission for having failed to give sufficient consideration to the particular circumstances that led to the finding of an infringement in relation to the MCAA cartel. In recital 138 of the contested decision, the Commission merely found that the circumstances justifying a fine not being imposed in connection with that cartel were not relevant to the present case.
42
The applicants highlight a number of circumstances which the Commission ought to have examined. They observe that the MCAA decision was addressed to the first applicant on the basis of its liability as a parent company. That cartel was put in place, inter alia, by a company that was subsequently acquired by the first applicant. At the time of the acquisition, that cartel had already been in place for at least 14 years. Moreover, the two employees of the abovementioned company acquired by the first applicant, who were responsible for the activities relating to that cartel, continued to participate secretly and no other person in the first applicant was involved. The latter discovered the cartel at issue through internal compliance efforts and notified it, which was why it was granted total immunity from fines by the Commission. Only a single employee participated in the infringement at issue in the present case, without the knowledge of any other employees or management of the applicants. Moreover, that person was not employed by the first applicant at the time of the conduct at issue on the monochloroacetic acid market and acted contrary to the compliance measures taken by the first applicant.
43
The applicants further argue that the Commission infringed the principle of proportionality in setting the amount of the increase in the fine. Given that point 28 of the Guidelines on the method of setting fines provides for a range between 0% and 100% in that regard, it is incumbent on the Commission, by virtue of the principle of proportionality, to assess where the gravity of the alleged repeat infringement fell within that range. According to the applicants, the contested decision nevertheless does not explain why the gravity of the repeat infringement justifies an increase of 50%.
44
The applicants take the view that the Commission used the same criteria to justify both the finding of repeat infringement and the level of the increase, even though they are distinct aspects that require a distinct assessment. The factors taken into account by the Commission are common to any and all instances of recidivism and cannot be relied on to justify a specific increase in a given recidivism case.
45
It is, moreover, apparent from the Commission’s decision-making practice that, first, the only factor taken into account when determining the fine increase for recidivism is the number of previous infringements and, second, the Commission disregards the lower half of the increase range. Thus, the Commission has not complied with its duty to impose an appropriate penalty which reflects the gravity of a particular infringement.
46
In disregarding the first half of the range provided for in point 28 of the Guidelines on the method of setting fines and applying a generic 50% uplift to all cases of first-time recidivism, the Commission infringed the principles of equal treatment, the protection of legitimate expectations and legal certainty.
47
The Commission disputes the applicants’ arguments.
48
It should be borne in mind that the Commission has a particularly wide discretion as regards the choice of factors to be taken into account for the purposes of determining the amount of fines, such as, inter alia, the particular circumstances of the case, its context and the dissuasive effect of fines, without the need to refer to a binding or exhaustive list of the criteria which must be taken into account. The finding and the appraisal of the specific characteristics of a repeat infringement come within the Commission’s discretion (see, to that effect, judgments of 8 February 2007, Groupe Danone v CommissionC‑3/06 P, EU:C:2007:88, paragraphs 37 and 38, and of 29 September 2021, Nec v Commission, T‑341/18, EU:T:2021:634, paragraphs 103 and 104).
49
The purpose of taking repeat infringements into account is to induce undertakings which have demonstrated a tendency towards infringing the competition rules to change their conduct. The Commission may therefore, in each individual case, take into consideration the indicia which confirm such a tendency, including, for example, the time that has passed between the infringements in question (judgments of 7 June 2011, Arkema France and Others v Commission, T‑217/06, EU:T:2011:251, paragraph 294, and of 29 September 2021, Nec v Commission, T‑341/18, EU:T:2021:634, paragraphs 77 and 104).
50
As regards the question whether a fine increase for repeat infringements is proportionate, it should be borne in mind that the General Court may be called upon to scrutinise whether the Commission has complied with the principle of proportionality when it increased, for repeat infringement, the fine imposed, and, in particular, whether such increase was imposed in the light of, among other things, the time passed between the infringement in question and the previous breach of the competition rules (judgments of 17 June 2010, Lafarge v Commission, C‑413/08 P, EU:C:2010:346, paragraph 70, and of 29 September 2021, Nec v Commission, T‑341/18, EU:T:2021:634, paragraph 117).
51
In the present case, the Commission imposed an increase of 50% in the amount of the fine on the applicants for repeat infringement. It found that, at the time when the infringement in question was committed, the first applicant had already been held liable for anti-competitive conduct in the MCAA cartel decision.
52
More specifically, in recital 138 of the contested decision, the Commission set out the factors it took into consideration in its determination that there was a repeat infringement. It observed that:
–
the applicants’ infringing conduct in the present case had begun on 26 December 2011, that is to say, after the adoption of the decision relating to the MCAA cartel on 19 January 2005;
–
a very limited amount of time had passed between the adoption of that decision and the commencement of the infringing conduct in the present case;
–
both infringements must be regarded as being ‘similar’ within the meaning of point 28 of the Guidelines on the method of setting fines, inasmuch as they are both infringements of Article 101 TFEU;
–
the first applicant was the parent company of Clariant GmbH, which had participated directly in the infringement, and constituted a single undertaking with that company during the infringement period; the past conduct of the undertaking fell to be taken into consideration, and not only that of Clariant GmbH;
–
the specific circumstances of the infringement found in that decision and that had justified exempting the applicants from receiving a fine were not relevant for the examination of the applicants’ failure to comply with the competition rules following the adoption of the decision in question.
53
It is apparent from that recital that, in the exercise of its discretion, the Commission identified the indicia enabling it to assess the applicants’ repeat infringement.
54
In particular, the Commission took account of the fact that the first applicant had committed two infringements amounting to infringement of Article 101 TFEU, separated by a relatively short time, which shows a tendency to disregard the competition rules (see, to that effect, judgment of 8 February 2007, Groupe Danone v Commission, C‑3/06 P, EU:C:2007:88, paragraph 40).
55
As regards the choice of rate of increase, the applicants are incorrect in arguing that the Commission could not justify the choice of that rate on the basis of the same factors as those used to determine whether there was a repeat infringement. In determining the choice of rate of increase for repeat infringement, the Commission must examine the indicia enabling such a repeat infringement to be found and, in particular, the time between the infringement at issue and the preceding infringement of the competition rules, in accordance with the case-law cited in paragraph 50 above.
56
Although the Commission is free to take account of other indicia for the purposes of analysing the repeat infringement and the rate of increase, doing so comes within its discretion, in accordance with the case-law cited in paragraphs 48 to 50 above. Thus, in finding, in the present case, that the specific circumstances surrounding the infringement that was the subject of the MCAA cartel decision, highlighted by the applicants, were not relevant, the Commission exercised its discretion.
57
Moreover, the applicants cannot successfully rely on the fact that the Commission did not determine a 50% increase on the basis of the specific gravity of the infringement. The Commission took account specifically of the limited time that passed between the adoption of the MCAA cartel decision and the commencement of the infringing conduct in the present case. The assessment of the time that passed between the finding of a previous infringement and the new infringement depends on the particular case, with the result that that factor enables the Commission to analyse the gravity of the repeat infringement in each specific case.
58
Since the applicants argue that recital 138 of the contested decision does not contain any explicit reasoning justifying the grounds on which the Commission found that certain circumstances surrounding the infringement committed in the context of the MCAA cartel were not relevant, the Court finds, like the Commission, that that argument is aimed at alleging a failure to state reasons in the contested decision. It will accordingly be analysed under the third part of the first plea.
59
The applicants further argue, in essence, that the Commission is infringing the principles of proportionality, equal treatment, the protection of legitimate expectations and legal certainty, inasmuch as it is apparent from its decision-making practice relating to repeat infringements that it considers only the number of previous infringements and imposes a 50% increase in all cases of first-time repeat infringement, without taking into account the first half of the increase range provided for in point 28 of the Guidelines on the method of setting fines. The Commission’s approach does not allow for a case-by-case assessment of the specific gravity of an infringement.
60
The Court finds, however, that that line of argument is based on an analysis of the Commission’s decision-making practice. The Court of Justice has repeatedly held that the Commission’s practice in previous decisions does not itself serve as a legal framework for the fines imposed in competition matters and that decisions in other cases can give only an indication for the purpose of determining whether there is discrimination (judgment of 26 January 2017, Zucchetti Rubinetteria v Commission, C‑618/13 P, EU:C:2017:48, paragraph 38).
61
In any event, first, it has been held that, although taking other indicia into account is not ruled out, the time that passed between two identical or similar infringements enables the Commission to assess an undertaking’s repeat infringement in a given case and thus determines the appropriate increase, in accordance with the principle of proportionality.
62
Second, as regards the breach of the principle of equal treatment, it should be borne in mind that that principle requires that comparable situations must not be treated differently and that different situations must not be treated in the same way unless such treatment is objectively justified (see judgment of 24 September 2020, Prysmian and Prysmian Cavi e Sistemi v Commission, C‑601/18 P, EU:C:2020:751, paragraph 101 and the case-law cited). Given that it is the applicants who are invoking a breach of that principle, it falls to them to set out and establish what comparable situation has been treated differently or how a different situation has been treated identically (judgment of 12 April 2013, Du Pont de Nemours (France) and Others v Commission, T‑31/07, not published, EU:T:2013:167, paragraph 311; see also, to that effect, judgment of 28 May 2020, Agrochem-Maks v Commission, T‑574/18, EU:T:2020:226, paragraph 105 (not published)). The applicants refer to Commission decisions without explaining whether the circumstances of those cases were similar to those of the present case or different.
63
Third, as regards breach of the principles of the protection of legitimate expectations and legal certainty, suffice it to note that those assertions are not substantiated.
64
In the light of the foregoing, the Court finds that the Commission exercised its discretion when it found that there was a repeat infringement and decided to increase the basic amount of the fine by 50%. Moreover, in so exercising its discretion, it did not disregard the principles of proportionality, equal treatment, the protection of legitimate expectations and legal certainty.
65
The first part of the first plea must therefore be rejected.
(b)
Second branch of the first plea: incorrect categorisation of the applicants as repeat infringers
66
The applicants submit that the Commission’s assessment of whether there was a repeat infringement is vitiated by errors of law and put forward, in essence, four complaints in that regard, which are disputed by the Commission.
(1) First complaint: no similarity between the infringement committed in the context of the MCAA cartel and the infringement at issue in the present case
67
The applicants submit that the Commission erred in law when it concluded that the infringement committed in the context of the MCAA cartel and the infringement at issue in the present case constituted the same or similar infringements for the purposes of applying point 28 of the Guidelines on the method of setting fines.
68
According to the applicants, the Commission ought to have made a detailed comparison of the two infringements at issue, the nature and characteristics of which differ considerably. The MCAA cartel consisted of a sales cartel aimed at increasing downstream sales prices through collusive postings of final sales prices. The principal objective of that cartel was to maintain the participants’ market shares using a system for allocating volumes and clients, together with a compensation mechanism to guarantee compliance in practice with the agreed volume quotas. The exchange of sales price information was auxiliary to the principal objective of the cartel.
69
The cartel at issue in the present case, by contrast, concerns upstream purchases of raw materials. Unlike the MCAA cartel, ethylene purchases were subject to a negotiation procedure on the merchant market, in the course of which sellers could choose from among a large number of buyers. The infringing conduct did not include any element of market or customer allocation, and there was no contact between the participants with regard to their respective downstream sales activities. Moreover, the infringing conduct arose from unique circumstances, different from those surrounding the MCAA cartel. For example, that conduct originated from lawful purchasing cooperation between the three participants by virtue of structural and contractual links.
70
In the contested decision, the Commission found that the two infringements at issue for which the first applicant and its subsidiaries were held liable constituted infringements of Article 101 TFEU, with the result that they had to be considered similar within the meaning of point 28 of the Guidelines on the method of setting fines.
71
That assessment is correct. According to the case-law, infringements are similar or of the same type for the purposes of establishing a finding of repeat infringement where they consist of an infringement of Article 101 TFEU (see, to that effect, judgments of 12 December 2007 in BASF and UCB v Commission, T‑101/05 and T‑111/05, EU:T:2007:380, paragraph 64, and of 30 September 2009, Hoechst v Commission, T‑161/05, EU:T:2009:366, paragraph 147).
72
It is true that the infringement committed in the context of the MCAA cartel consisted of a sales cartel aimed at increasing downstream sales prices, whereas the infringement in the present case consisted of a purchase cartel aimed at obtaining a low purchase price for a raw material, namely ethylene. The Court finds, however, that in both cases the first applicant and its subsidiaries participated in an agreement prohibited by Article 101 TFEU.
73
Moreover, as observed by the Commission, both infringements at issue did have shared characteristics. The operative part of the MCAA cartel decision states that the first applicant is liable for infringement of Article 101 TFEU, inter alia, for having agreed on concerted price increases and having exchanged information on sales volumes and prices. The operative part of the contested decision states that the applicants infringed Article 101 TFEU by participating in an infringement consisting, inter alia, in fixing a price element and exchanging information that was commercially sensitive and related to pricing. It is also apparent from the latter decision that the objective of the infringing conduct was to influence negotiations relating to MCP transactions in order to obtain the lowest possible purchase price for ethylene. It follows that the concerted practices for fixing prices or a price element and exchanges of information on prices were part of both cartels in which the first applicant and its subsidiaries participated.
74
Moreover, in the light of the case-law cited in paragraph 71 above, the fact that the infringing conduct in the present case arose from unique circumstances and, inter alia, from lawful cooperation amongst certain participants, is irrelevant for assessing similar repeat infringements.
75
As a result, the Commission did not err in finding that there was a similar infringement for the purposes of point 28 of the Guidelines on the method of setting fines.
(2) Second complaint: amount of time that passed between the two infringements
76
The applicants submit that the starting point for determining the time that passed between the infringement in question and the previous infringement is the time when Clariant GmbH, actively and on its own initiative, put an end to the infringement committed in the context of the MCAA cartel and applied for leniency. According to that logic, more than 12 years passed between the two infringements, with the result that the applicants did not demonstrate a particular tendency to infringe the competition rules.
77
It is also apparent from the judgment of 17 June 2010, Lafarge v Commission (C‑413/08 P, EU:C:2010:346), that the Commission must take account of the actual time of the infringement as a basis for determining the time passed between the two infringements, rather than the time of the first finding of infringement. For reasons of equity and proportionality, the duration of the administrative procedure relating to the previous infringement should not be taken into account.
78
In the contested decision, the Commission found that the applicants’ infringing conduct had begun on 26 November 2011, that is to say, after the adoption of the MCAA decision on 19 January 2005, and that a limited period of time had thus passed between those two dates.
79
That assessment is correct. According to the case-law cited in paragraph 49 above, the Commission may take into account, for example, the time that has passed between the infringements as an indicator of repeat infringements.
80
In particular, it has been held that, if a period of less than ten years has passed between the infringements, this shows a propensity on the part of the undertaking concerned not to draw the appropriate inferences from a finding that it has infringed the competition rules (see, to that effect, judgments of 8 February 2007, Groupe Danone v CommissionC‑3/06 P, EU:C:2007:88, paragraph 40, and of 29 September 2021, Nec v Commission, T‑341/18, EU:T:2021:634, paragraph 105).
81
Given that the applicants’ conduct in relation to the cartel at issue in the present case began almost seven years after the adoption of the MCAA decision, the Commission was correct in finding that that rather brief period of time passed showed a propensity on the part of the applicants not to draw the appropriate inferences from the finding that it had infringed the competition rules referred to in that decision.
82
The applicants submit that the correct starting point for determining the time that passed between the two infringements at issue is the moment at which Clariant GmbH, actively and on its own initiative, put an end to the infringement committed in the context of the MCAA cartel and applied for leniency, rather than the moment at which the infringement was established in the decision relating to that cartel.
83
It must be borne in mind, however, that the taking into account of a repeat infringement is justified by the need to ensure a higher level of deterrence, as demonstrated by the fact that a previous finding of an infringement had not been sufficient to prevent the repetition of the infringement. Thus, a repeat infringement necessarily arises after the finding and the sanctioning of the first infringement, since it is explained by the fact that that penalty was not a sufficient deterrent (see, to that effect, judgments of 8 July 2008, BPB v Commission, T‑53/03, EU:T:2008:254, paragraph 392, and of 7 June 2011, Arkema France and Others v Commission, T‑217/06, EU:T:2011:251, paragraph 299).
84
Moreover, it is apparent from the wording of point 28 of the Guidelines on the method of setting fines that repeat infringement is construed therein to mean the continuation or repetition of the same or a similar infringement after the Commission or a national competition authority has ‘made a finding’ that the undertaking in question infringed Article 101 or 102 TFEU. The Guidelines on the method of setting fines do not constitute the legal basis of a decision imposing fines, which is based on Regulation No 1/2003, but they determine, generally and abstractly, the method which the Commission has bound itself to use in assessing the fines imposed by that decision and, consequently, ensure legal certainty for the undertakings (see judgment of 5 October 2011, Romana Tabacchi v Commission, T‑11/06, EU:T:2011:560, paragraph 71 and the case-law cited).
85
The Commission thus did not err in taking into account the date of the MCAA decision, by which it found that the first applicant and Clariant GmbH had infringed the competition rules, as the starting point for determining the time that passed after the finding of the first infringement.
86
It should also be noted that, in order to substantiate their complaint, the applicants base themselves on a misreading of paragraph 70 of the judgment of 17 June 2010, Lafarge v Commission (C‑413/08 P, EU:C:2010:346). In that paragraph, the Court of Justice stated that the EU Courts may be called upon ‘to scrutinise whether the Commission has complied with [the principle of proportionality] when it increased, for repeat infringement, the fine imposed, and, in particular, whether such increase was imposed in the light of, among other things, the time elapsed between the infringement in question and the previous breach of the competition rules’. The applicants are incorrect in inferring from the wording ‘the previous breach of the competition rules’ that the correct starting point for determining how much time has passed between the two infringements is the time when the previous infringing conduct began. In paragraph 86 of the abovementioned judgment, the Court of Justice held that ‘the General Court’s conclusion is therefore correct in law that it is sufficient for the Commission to be entitled to take account of repeat infringement that the undertaking has previously been found guilty of an infringement of the same type, even if the decision is still subject to review by the courts’. It is apparent from that paragraph that it is the finding of liability of an undertaking for a previous infringement that is determinative for the analysis of repeat infringement.
87
Furthermore, the time when Clariant GmbH put an end to the infringement committed in the context of the MCAA cartel and applied for leniency cannot be considered equivalent to a finding of previous infringement, since at that point the Commission had not yet adopted a position on whether the conduct in question was anti-competitive or on the liability of the first applicant and of Clariant GmbH. An application for immunity merely enables the Commission to find an infringement of Article 101 TFEU in its final decision (see paragraphs 8 and 11 of the Leniency Notice) (see, to that effect, judgment of 20 January 2016, DHL Express (Italy) and DHL Global Forwarding (Italy), C‑428/14, EU:C:2016:27, paragraph 54).
88
Lastly, the fact that the administrative procedure relating to the previous infringement went on for several years is irrelevant to the finding of repeat infringement in the present case, since the correct starting point for that finding is that of the decision relating to the MCAA cartel.
89
The Commission was thus correct in finding that a limited period of time had passed between the adoption of the MCAA cartel decision and the commencement of the infringing conduct in the present case.
(3) Third complaint: no previously imposed pecuniary penalty
90
The applicants submit that the rationale for a fine increase owing to repeat infringement is intrinsically linked to the failure of a previously imposed pecuniary penalty to have any deterrent effect. It follows that the fact that no fine was imposed in the past should be taken into account in the consideration of the particular circumstances of a case and the necessary level of deterrence. The applicants are not undertakings on whom a pecuniary penalty has been imposed previously. The basic amount of the fine is thus a sufficient deterrent in itself, and there is no justification for increasing it.
91
Suffice it to note in that regard that, according to the case-law, the concept of repeat infringement does not necessarily imply that a fine has been imposed in the past, but merely that a finding of infringement of EU competition law has been made in the past (judgments of 25 October 2005, Groupe Danone v Commission, T‑38/02, EU:T:2005:367, paragraph 363, and of 8 July 2008, BPB v Commission, T‑53/03, EU:T:2008:254, paragraph 387).
92
The purpose of taking repeat infringement into account is to induce undertakings which have demonstrated a tendency towards infringing the competition rules to change their conduct when it transpires that a previous finding of infringement on its part has not been sufficient to prevent the repetition of unlawful conduct. Thus, it is not the previous imposition of a fine, and a fortiori not the amount thereof, which is determinative of repeat infringement, but the fact that a previous finding of infringement has been made (judgment of 8 July 2008, BPB v Commission, T‑53/03, EU:T:2008:254, paragraph 388).
93
Consequently, the fact that no fine was imposed on the applicants in the decision relating to the MCAA cartel is not such as to cast doubt on the application of point 28 of the Guidelines on the method of setting fines.
(4) Fourth complaint: other circumstances not taken into account
94
The applicants submit that on previous occasions the Commission and the EU Courts have taken into account other circumstances in the overall assessment of the propensity of an undertaking to infringe the competition rules. In their submission, had such circumstances been taken into account by the Commission, it would not have categorised them as repeat infringers.
95
However, as is apparent from the examination of the first part of the first plea, the finding and assessment of the specific characteristics of a repeat infringement are part of the Commission’s discretion. The Commission could correctly limit itself to finding that the applicants had committed two infringements amounting to an infringement of Article 101 TFEU, each one separated from the other by a relatively brief period of time, and considering that the circumstances highlighted by the applicants were not relevant.
96
Since the complaints put forward by the applicants must be rejected, the second part of the first plea cannot succeed.
(c)
Third part of the first ground: failure to state reasons
97
The applicants submit that the Commission applied a standard increase of 50% of the basic amount of the fine, without providing any reasons for why it opted to apply that rate and in disregard of the detailed arguments put forward by them during the administrative procedure.
98
The applicants refer to the judgments of 13 December 2016, Printeos and Others v Commission (T‑95/15, EU:T:2016:722, paragraph 55), and of 24 September 2019, HSBC Holdings and Others v Commission (T‑105/17, EU:T:2019:675, paragraph 351), in which the General Court held that the Commission was required to provide reasons for the specific amount of the adjustments made by it.
99
The Commission disputes the applicants’ arguments.
100
According to settled case‑law, the statement of reasons required by Article 296 TFEU must be appropriate to the measure at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measures in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the Courts of the European Union to exercise their power of review. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements of Article 296 TFEU must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question (judgments of 2 April 1998, Commission v Sytraval and Brink’s France, C‑367/95 P, EU:C:1998:154, paragraph 63; of 10 July 2019, Commission v Icap Management Services and Icap New Zealand, C‑39/18 P, EU:C:2019:584, paragraph 23, and of 16 June 2022, Sony Optiarc and Sony Optiarc America v Commission, C‑698/19 P, EU:C:2022:480, paragraph 79).
101
In the present case, it is clear that, in recital 138 of the contested decision, the Commission set out in detail the reasons that led it to find that the applicants had engaged in a repeat infringement (see paragraph 52 above).
102
Those reasons enabled the applicants to ascertain the Commission’s reasoning and to challenge it before the General Court, and the latter to review the well-foundedness thereof.
103
Moreover, contrary to the applicants’ assertions, the Commission did not have to explain by way of statement of reasons in the contested decision why, from among the different possible increase rates, it had opted for an increase of 50% for repeat infringement (see, to that effect, judgment of 23 January 2014, Evonik Degussa and AlzChem v Commission, T‑391/09, not published, EU:T:2014:22, paragraph 164 and the case-law cited).
104
Moreover, as correctly observed by the Commission, the judgments of 13 December 2016, Printeos and Others v Commission (T‑95/15, EU:T:2016:722), and of 24 September 2019, HSBC Holdings and Others v Commission (T‑105/17, EU:T:2019:675) are not relevant. In the first of those judgments, the General Court found that an adequate statement of reasons had not been provided for the application of a reduction in the basic amount of the fines, which differed depending on the undertakings concerned, whilst stressing that the Commission had departed from its general methodology set out in the Guidelines on the method of setting fines, as a result of which the duty to state reasons became all the more important. In the second of those judgments, it held that an inadequate statement of reasons had been provided in relation to the determination of the reduction factor, emphasising that, although not departing from its general methodology, the Commission had nevertheless opted for a specific proxy for determining the value of sales, inasmuch as the undertakings did not generate sales in the usual sense of the term.
105
In the present case, the Commission applied point 28 of the Guidelines on the method of setting fines, without departing from the criteria provided for therein, and applying an increase within the range explicitly referred to therein. Thus, no relevant analogy may be drawn with the judgments cited in paragraph 104 above.
106
Accordingly, the third part of the first plea must be rejected, as must, therefore, the plea in its entirety.
2.
Second plea: the Commission was wrong to increase the basic amount of the fine pursuant to point 37 of the Guidelines on the method of setting fines
107
As a preliminary point, it should be noted that, under points 9 to 12 and 19 of the Guidelines on the method of setting fines, ‘without prejudice to point 37 [of those guidelines], the Commission will use the following two-step [method] when setting the fine to be imposed on undertakings’, namely, ‘first, the Commission will determine a basic amount for each undertaking’ and ‘second, it may adjust that basic amount upwards or downwards’, it being specified that the basic amount of the fine must be ‘related to a proportion of the value of sales, depending on the degree of gravity of the infringement’.
108
Point 13 of the Guidelines on the method of setting fines states that ‘in determining the basic amount of the fine to be imposed, the Commission will take the value of the undertaking’s sales of goods or services to which the infringement directly or indirectly relates in the relevant geographic area within the [European Economic Area (EEA)]’.
109
The objective of point 13 of the Guidelines on the method of setting fines is to adopt, in principle, as a starting point for the calculation of the amount of the fine imposed on an undertaking, an amount which reflects the economic significance of the infringement and the size of the undertaking’s contribution to it (see, to that effect, judgments of 22 October 2015, AC-Treuhand v Commission, C‑194/14 P, EU:C:2015:717, paragraph 64, and of 26 January 2017, Zucchetti Rubinetteria v Commission, C‑618/13 P, EU:C:2017:48, paragraph 57).
110
Point 37 of the Guidelines on the method of setting fines states that ‘although these Guidelines present the general methodology for the setting of fines, the particularities of a given case or the need to achieve deterrence in a particular case may justify the Commission’s departing from such methodology’.
111
The second plea is divided into three parts, the first alleging infringement of Article 23(3) of Regulation No 1/2003 and the principles of proportionality and sound administration, on the ground that the Commission failed to exercise its discretion when applying point 37 of the Guidelines on the method of setting fines; the second, infringement of Article 23(3) of Regulation No 1/2003 and the principles of proportionality, the protection of legitimate expectations and legal certainty, on the ground that it was wrong to increase the fine under that point; and the third, infringement of the duty to state reasons.
(a)
First part of the second plea: failure by the Commission to exercise its discretion
112
The applicants in essence criticise the Commission for having mechanically applied point 37 of the Guidelines on the method of setting fines, without exercising its discretion.
113
The applicants argue that, in the contested decision, the Commission based itself on a generic, unproven assumption that the value of purchases is unlikely to reflect the economic impact of a purchase cartel. They state that, in the course of the administrative proceedings, they produced extensive evidence demonstrating that, due to the specific circumstances of the case and of the market in question, there was never a plausible prospect of the infringing conduct producing the slightest material effect on that market. Yet, the Commission did not take account of those factors.
114
The applicants further criticise the Commission for having merely referred to its earlier decision-making practice, whereas point 37 of the Guidelines on the method of setting fines has been applied in only one case relating to an infringement on a purchasing market, the facts of which differed significantly from those of the present case. Thus, the Commission failed to assess all facts of the case carefully and impartially, in accordance with the principle of sound administration, and failed to exercise its discretion.
115
The applicants submit that the Commission’s failure to exercise its discretion also extends to the specific amount of the increase it chose to apply, in that it did not explain why it chose that specific amount but simply stated, in the contested decision, that an increase of 10% would be in line with its previous practice, without considering the particularities of the case at hand.
116
The Commission disputes the applicants’ arguments.
117
It should be borne in mind that the Commission enjoys a broad discretion as regards the method for calculating fines in relation to infringements of the EU competition rules. That method displays flexibility in a number of ways, enabling the Commission to exercise its discretion in accordance with Article 23(2) and (3) of Regulation No 1/2003 (see judgment of 1 August 2022, Daimler (Cartels – Refuse collection trucks), C‑588/20, EU:C:2022:607, paragraph 58 and the case-law cited).
118
Although Article 23(2) of Regulation No 1/2003 leaves the Commission a margin of discretion, it nevertheless limits the exercise of that discretion by establishing objective criteria to which the Commission must adhere. Thus, inter alia, the exercise of that discretion is limited by rules of conduct which the Commission imposed on itself (see, to that effect, judgment of 1 August 2022, Daimler (Cartels – Refuse collection trucks), C‑588/20, EU:C:2022:607, paragraph 59 and the case-law cited).
119
In that context, it follows from paragraphs 107 to 110 above that, under the general method laid down in the Guidelines on the method of setting fines, the Commission is to use the value of sales as a starting point for the calculation of the amount of the fine imposed on an undertaking, in order to arrive, in principle, at an amount which reflects the economic significance of the infringement and the size of that undertaking’s contribution to it. That being so, point 37 of those Guidelines allows it to depart from the general method when justified due to the particularities of a given case or the need to achieve deterrence in a particular case.
120
In the present case, in recitals 116 to 118 of the contested decision, the Commission found that, given that the infringement relating to ethylene amounted to a purchase cartel and that not all participants were present on the same downstream market(s), in its view it was appropriate to calculate the basic amount of the fine on the basis of the value of sales rather than on the basis of the value of sales of products sold on the downstream market.
121
In recitals 141 to 148 of the contested decision, the Commission found that an increase in the basic amount of the fine was justified pursuant to point 37 of the Guidelines on the method of setting fines. It stated as follows:
–
Point 5 of the Guidelines on the method of setting fines indicates that, in order to achieve the objectives of specific and general deterrence, it is appropriate, for determining the fines, to refer to the value of the sales of goods or services to which the infringement relates as a basis for setting the fine (recital 141 of the contested decision);
–
the mechanism of the general method for the setting of fines is such that the more successful a sales cartel is, the higher the value of sales and thus the amount of the fine; according to point 6 of those guidelines, the combination of the value of sales to which the infringement relates and of the duration of the infringement is regarded as providing an appropriate proxy to reflect the economic importance of the infringement as well as the relative weight of each undertaking in the infringement (recital 142 of the contested decision);
–
the infringement at issue in the present case, however, concerns a cartel not for sales prices but for purchase prices. The inherent objective of such a cartel is not to increase the (purchase) price but, on the contrary, to reduce it or to prevent its increase; the setting of the basic amount of the fines according to the value of purchases results in a situation in which the level of the fines is inversely proportional to the objective of the cartel; the more successful the implementation of the cartel is, the lower the value of the purchases is and, therefore, the amount of the fine (recital 143 of the contested decision);
–
it is therefore inherent in the fact that the cartel in question is a purchase cartel that the value of purchases in itself is unlikely to be an appropriate proxy for reflecting the economic importance of the infringement; that is also because, normally in an operating undertaking, purchases are lower than sales in value terms, which gives a lower systematic starting point for the calculation of the basic amount of the fine (recital 144 of the contested decision);
–
therefore, if the general methodology provided for by those guidelines is applied without the slightest adjustment being made, a sufficiently deterrent effect would not be achieved, which is not only necessary to sanction the undertakings concerned by the contested decision (specific deterrence), but also to prevent other undertakings from engaging in the same type of conduct (general deterrence) (recital 145 of the contested decision);
–
in order to take this particularity into account and to achieve sufficient deterrent effect, it is appropriate, in line with previous practice, for an increase of 10% to be applied for all undertakings concerned (recital 146 of the contested decision);
–
in accordance with the case-law, increasing the amount of a fine pursuant to point 37 of those same Guidelines is not conditional on proof that the infringing conduct had any actual effects on the market (recital 147 of the contested decision);
–
the specific position of each of the parties was taken into account in the calculation of the basic amount, since the value of purchases is different for each party, and in the calculation of the duration of their participation (recital 148 of the contested decision).
122
The Commission therefore did not abuse its power of discretion. It follows from the considerations set out in paragraphs 120 and 121 above that the Commission found it necessary, in the exercise of that discretion, to apply point 37 of the Guidelines on the method of setting fines in the present case and to apply a 10% increase to the basic amount of the fine.
123
In that regard, the Commission took account of the particularities of the case, namely the fact that the cartel in question was a purchase cartel and that the value of purchases, taken into account in lieu and stead of the value of sales, was not in itself liable to constitute a suitable proxy to reflect the economic importance of the infringement. It also took account of the need to achieve a deterrent effect of the fine in finding that, if the general method was being applied without the slightest adjustment, the deterrent effect would not be assured.
124
The applicants submit that the Commission failed to make use of its discretion inasmuch as it did not take account of the fact that the infringing conduct had no effects on the market.
125
The Court finds, however, that the Commission was correct in noting that increasing the amount of a fine on the basis of point 37 of the Guidelines on the method of setting fines is not conditional on proof that the conduct at issue had any actual effects on the market (judgment of 7 November 2019, Campine and Campine Recycling v Commission, T‑240/17, not published, EU:T:2019:778, paragraph 345).
126
The objective of point 37 of the Guidelines on the method of setting fines is to enable the Commission to depart from the general method, which may sometimes prove unsuited to the particular circumstances of a case (see, to that effect, judgments of 22 October 2015, AC-Treuhand v Commission, C‑194/14 P, EU:C:2015:717, paragraphs 65 to 67, and of 10 July 2019, Commission v Icap Management Services and Icap New Zealand, C‑39/18 P, EU:C:2019:584, paragraph 27). That point provides that, in order for it to apply, the particular circumstances of a given case or the need to achieve a sufficient deterrent effect must justify departing from the general method. Those criteria are not necessarily contingent on an analysis of the effects of the infringement on the market.
127
As a result, the applicants cannot validly criticise the Commission for having failed to exercise its discretion by not carrying out an analysis of the effects of the infringing conduct of the participants in the cartel on ethylene prices.
128
Moreover, the fact that the Commission took the same approach as that taken in Commission Decision C(2017) 900 final of 8 February 2017 relating to a proceeding under Article 101 TFEU (Case AT.40018 – Car battery recycling) (‘the car battery recycling decision’), examined by the General Court in the judgments of 23 May 2019, Recylex and Others v Commission (T‑222/17, EU:T:2019:356), and of 7 November 2019, Campine and Campine Recycling v Commission (T‑240/17, not published, EU:T:2019:778) is not a failure to exercise its discretion nor contrary to the principle of sound administration. The Commission did not merely refer to that decision or judgments, but rather discussed in detail the particularities of the given case and how those particularities prevented a sufficient deterrent effect from being achieved.
129
The same holds true for the choice of the increase applied. The Commission did not merely find that the 10% increase was in line with its previous practice; it discussed in detail the particularities of the given case and the need to achieve a sufficient deterrent effect, which led it to adjust the basic amount of the fine by increasing it by 10% pursuant to point 37 of the Guidelines on the method of setting fines. In doing so, it exercised its discretion.
130
In so far as the applicants submit that the Commission did not explain its choice of increase sufficiently, the Court finds that that argument is aimed at alleging a failure to provide an adequate statement of reasons in the contested decision and must be rejected for the same reasons as set out in relation to the third part of the second plea.
131
In the light of the foregoing, the first part of the second plea in law must be rejected.
(b)
Second part of the second plea: incorrect application of the increase pursuant to point 37 of the Guidelines on the method of setting fines
132
It should be borne in mind that, in areas where the Commission has maintained a discretion, review of the legality of those assessments is limited to determining the absence of manifest error of assessment (judgments of 18 July 2005, Scandinavian Airlines System v Commission, T‑241/01, EU:T:2005:296, paragraphs 64 and 79, and of 19 May 2010, IMI and Others v Commission, T‑18/05, EU:T:2010:202, paragraph 120).
133
The applicants argue that the assessment relating to the adjustment of the basic amount of the fine pursuant to point 37 of the Guidelines on the method of setting fines, as set out in recitals 141 to 148 of the contested decision, is vitiated by errors and put forward five complaints in that regard, which are disputed by the Commission.
(1) First complaint: the value of the purchases does not contain an underestimate of the economic importance of the infringement in the present case
134
The applicants submit that there never was a plausible prospect that the infringing conduct in question could produce the slightest material effect on the purchase value of ethylene, as demonstrated by an economic analysis provided to the Commission during the administrative procedure.
135
It is apparent from that economic analysis, first of all, that, as there are far more buyers than suppliers in the ethylene market, a small group of ethylene purchasers would not be able to control the outcome of the MCP settlement process. Next, ethylene prices do not simply follow those of naphtha, which is the main factor in the cost of ethylene, but have increased steadily over the years, including during the infringement period. Lastly, MCP settlements generally follow forecasts published by private, independent notification bodies. The fact that the final MCP settlements were almost always in the range forecasted by that body shows that those settlements were concluded for objectively appropriate amounts in line with market data.
136
In the light of those considerations, the applicants question the Commission’s reasoning in so far as it found that the value of purchases entailed an underestimation of the economic importance of the infringement at issue.
137
However, the present complaint is the result of a misreading of the contested decision.
138
As is apparent from paragraph 120 above, the Commission took the view that the infringement at issue in the present case was a purchase cartel and that it was appropriate to calculate the basic amount of the fine on the basis of the value of purchases, a point not disputed by the applicants.
139
As is, in essence, apparent from paragraph 121 above, the Commission then found that the value of purchases in itself was unlikely to be an appropriate proxy for reflecting the economic importance of the infringement. It explained in that regard, first, that the objective of a purchase cartel was to reduce the purchase price or to prevent its increase, so that taking into account the value of purchases resulted in a situation in which the amount of the fine is inversely proportional to the objective of the cartel. Second, it found that, normally in an operating undertaking, purchases were lower than sales in value terms, thus giving a systematic lower starting point for the calculation of the basic amount of the fine.
140
Thus, the Commission’s reasoning is not based on the fact that the cartel at issue was successful and brought the purchase price of ethylene down, so that taking into account the value of purchases was not an appropriate parameter for calculating the amount of the fine. Rather, it is based on the fact that, irrespective of the effects of the infringement on the market, it is inherent in purchase cartels that taking the value of purchases into account is not in itself a value that reflects the economic importance of the infringement. The finding that the value of purchases included an underestimate of the economic importance of the infringement at issue is thus not based on the effects of the infringing conduct on the market but rather on the fact that taking the value of purchases into account for the purpose of calculating the amount of the fine is a flawed approach.
141
That assessment is in line with the case-law, in which it has been held that, for the purposes of applying point 37 of the Guidelines in the method of setting fines, the Commission is not obliged to take account of any actual effects of the infringing conduct on the market (see paragraph 125 above). Thus, the economic analysis provided by the applicants, aimed at showing that the cartel at issue was not successful and that the cartel participants did not succeed in influencing the MCP settlements, does not cast doubt on the Commission’s finding that the value of purchases entails an underestimate of the economic importance of the infringement. The applicants’ arguments must therefore be rejected as ineffective.
(2) Second complaint: the increase in the amount of the fine was not necessary to ensure a deterrent effect
142
The applicants submit that, given that the practices at issue could not generate profits, the fine imposed on them, even without the 10% increase applied pursuant to point 37 of the Guidelines on the method of setting fines, already exceeds the hypothetical profits they could have reasonably have anticipated from the infringement. In addition, since the Commission had already increased the fine by 15% under point 25 of the Guidelines on the method of setting fines, it was not justified in mechanically imposing an additional increase of 10% under point 37 of those guidelines.
143
As is apparent from paragraph 121 above, the Commission found that, if the general method provided for by the Guidelines on the method of setting fines were applied, using the value of sales as a basis, without any adjustment being made, that would not ensure that the fine had a sufficiently deterrent effect. Yet that deterrent effect was necessary to sanction the undertakings concerned by the contested decision (specific deterrence) and also to prevent other undertakings from engaging in the same type of conduct (general deterrence), in keeping with point 4 of those guidelines. That finding flowed, in essence, from the flawed nature of the value of purchases for reflecting the economic importance of the infringement.
144
Thus, contrary to the applicants’ assertions, the Commission’s reasoning is not based on the assumption that the cartel at issue was successful and generated profits for the applicants, but rather on the finding that the value of purchases in itself did not ensure a sufficiently deterrent effect.
145
It follows that any profits the cartel might have generated for the applicants are not relevant. It should also be borne in mind in that regard that the Commission is free to take account of the fact that the cartel was not successful and accordingly generated no profits for its participants at another stage of the calculation of the fine, in particular when setting the gravity percentage. According to the case-law, the factors capable of affecting the assessment of the gravity of the infringements include the conduct of each of the undertakings, the role played by each of them in the establishment of the cartel, the profit which they were able to derive from the cartel, their size, the value of the goods concerned and the threat that infringements of that type pose to the objectives of the European Union (see judgment of 26 January 2017, Roca Sanitario v Commission, C‑636/13 P, EU:C:2017:56, paragraph 49 and the case-law cited).
146
As regards the argument that the Commission has previously applied a percentage for the purposes of deterrence pursuant to point 25 of the Guidelines on the method of setting fines, so that an additional increase pursuant to point 37 of those same guidelines is not justified, it should be borne in mind that those two points have different purposes and may be applied concomitantly.
147
Point 25 of the Guidelines on the method of setting fines provides for the possibility for the Commission to apply an additional amount in order to deter undertakings from participating in horizontal price-fixing, market-sharing and output-limitation agreements, or even in other infringements, irrespective of the duration of their participation in the infringement. That mechanism is intended to deter companies from infringing competition law, even if only for a short period. As regards point 37 of those guidelines, it is intended to give the Commission some flexibility to ensure that the overall amount of the fine is sufficiently high to be deterrent in the light of the particularities of the case (judgment of 7 November 2019, Campine and Campine Recycling v Commission, T‑240/17, not published, EU:T:2019:778, paragraph 346).
(3) Third complaint: an increase applied to all purchase agreements would give rise to systematic, excessive deterrence
148
The applicants submit that, in the context of sales cartels, the method applied by the Commission leads to a situation in which the fine imposed for ineffective cartels is automatically lower than that imposed for effective cartels. In their submission, this mechanism ensures that ineffective cartels do not attract disproportionate fines. They submit that the same mechanism should apply to ineffective purchase cartels. However, the Commission’s approach of applying an increase of 10% to all purchase cartels would lead to a situation in which ineffective purchase cartels were systematically treated less favourably than ineffective sales cartels.
149
The Court finds that the comparison with ineffective sales cartels is not relevant. It is true that, in sales cartels, the basic amount of the fine is normally calculated according to how successful the infringement was in achieving its objective.
150
However, unlike in the case of a sales cartel, achieving the objective of a purchase cartel would result in a lower value of purchases than would be the case in the absence of the infringement, and the fine would not therefore have any deterrent effect (see, to that effect, judgment of 7 November 2019, Campine and Campine Recycling v Commission, T‑240/17, not published, EU:T:2019:778, paragraph 345). As observed by the Commission in the contested decision, the more successful a purchase cartel is, the lower the amount of the value of purchases and thus the amount of the fine. Hence the value of purchases is not a starting point that is liable to reflect the economic importance of the infringement within the meaning of the case-law cited in paragraph 109 above.
151
Moreover, taking into account the value of purchases, even when the cartel was unsuccessful, does not generally reflect the importance of the infringement. In that regard, as observed by the Commission in the contested decision, normally in an operating undertaking, purchases are lower than sales in value terms. In response to a measure of organisation of procedure, the Commission stated, correctly, that a rational economic operator generally sets the sale price of a product at a higher level than the purchase price of that product or than the purchase price of the raw material used in the case of a sale of an integrated product. Accordingly, the value of purchases is, in principle, mechanically lower than that of sales, which justifies an adjustment being applied, where appropriate, pursuant to point 37 of the Guidelines on the method of setting fines.
(4) Fourth complaint: irrelevance of the decision relating to recycling of car batteries on the ground that the agreement at issue concerned only a minor price element
152
Fourth, the applicants challenge the Commission’s reliance on the car battery recycling case as justification for increasing the amount of the fine by 10% under point 37 of the Guidelines on the method of setting fines, submitting that the facts of that case differed significantly from those of the present case. The conduct at issue in the present case concerns only an extremely small proportion of the overall ethylene purchase value, whereas in the case that was the subject matter of the car battery recycling decision, the undertakings involved had jointly determined the actual purchase prices paid to the suppliers. Moreover, in that case, the Commission had found that the purchasing side of the market was made up of a relatively small number of undertakings with significant market power, whereas in the present case, market power and influence over price setting was present only on the supply side. According to the applicants, the fact that the same increase of 10% was applied in both cases, despite their differences, shows that the fine that was imposed on them is not proportionate to the infringement.
153
The Court finds that, in the car battery recycling decision, which was the subject of the judgments of 23 May 2019, Recylex and Others v Commission (T‑222/17, EU:T:2019:356), and of 7 November 2019, Campine and Campine Recycling v Commission, (T‑240/17, not published, EU:T:2019:778), for the purposes of calculating the basic amount of the fine, the Commission had taken account of the value of purchases in lieu and stead of the value of sales and had applied an increase of 10% of the basic amount of the fine pursuant to point 37 of the Guidelines on the method of setting fines. To justify that increase, it had put forward considerations relating, on the one hand, to the particularities of the case, namely the fact that it was a purchase cartel in which the participants’ objective was to keep purchase prices as low as possible, and for which the value of purchases had to be taken into account for the purpose of calculating the amount of the fine, and also, on the other hand, considerations relating to ensuring a deterrent effect.
154
It follows that the case that was the subject matter of the car battery recycling decision and the present case bear some common characteristics. Thus, the Commission’s reference thereto in the contested decision was pertinent.
155
Nor can the applicants base any argument on a comparison of the part of the price over which the participants may have had an actual influence in the case that was the subject matter of the car battery recycling decision and in the present case. That comparison is not relevant, given that it is not necessary to examine the actual effects of the infringement on the market for the application of point 37 of the Guidelines on the method of setting fines (see paragraph 125 above).
(5) Fifth complaint: the potential benefits of the purchase cartels are less than those of the sales cartels
156
The applicants submit that the need for deterrence is intrinsically linked to the potential benefits that an undertaking can expect from its participation in an infringement. In their submission, the potential benefits that an undertaking could hypothetically derive from its participation in a purchase cartel would, by definition, be lower compared to sales cartels and cannot justify an additional increase for purposes of deterrence. They criticise the Commission’s logic, according to which the fines imposed, including for the sales cartels, should be adjusted pursuant to point 37 of the Guidelines on the methods of setting fines, in order to avoid excessive or insufficient deterrence, depending on the value of the products taken into account.
157
However, as is apparent from paragraph 144 above, the Commission’s reasoning is not based on the assumption that the cartel at issue was successful and generated profits for the applicants, but rather on the finding that the value of purchases in itself did not ensure a sufficiently deterrent effect. Accordingly, the comparison of the potential benefits that might have accrued to the parties to a purchase cartel, on the one hand, and the parties to a sales cartel, on the other, is not relevant.
158
Moreover, the applicants’ argument to the effect that, following the Commission’s logic, any fine, including one imposed in the context of sales cartels, should systematically be adjusted pursuant to point 37 of the Guidelines on the methods of setting fines, cannot succeed. It is clear that that point does not apply when it is not necessary to depart from the general method provided for by those guidelines, particularly when the value of sales is taken into account in the context of a sales cartel, in accordance with point 13 of those guidelines. Point 37 of those guidelines is applied only when it has been found that the general method is not suitable and a departure from it must be made, in so far as the particularities of a given case or the need to achieve deterrence in a particular case so require. Thus, the Commission need not systematically adjust the amount of the fine pursuant to that provision.
159
It follows from all the foregoing that the complaints aimed at alleging manifest errors of assessment in the application of point 37 of the Guidelines on the methods of setting fines must be rejected. Nor can those arguments establish that the 10% increase in the fine was disproportionate to the deterrent effect sought.
160
The applicants add, by way of elaboration on their argument, that the imposition of a standard increase for sales cartels pursuant to point 37 of the Guidelines on the methods of setting fines runs counter to the objective and wording of that provision and is, therefore, contrary to the principles of the protection of legitimate expectations and legal certainty. It is clear, however, that those allegations are not substantiated.
161
The second part of the second plea must therefore be rejected.
(c)
Third part of the second plea: infringement of the duty to state reasons
162
The applicants submit that the Commission infringed its duty to state reasons by not explaining, in the contested decision, why the particularities of the present case justified an increase of the fine pursuant to point 37 of the Guidelines on the method of setting fines, or why it was necessary to set the level of that increase at 10%.
163
In that regard, the applicants submit, first, that recital 146 of the contested decision relates to the alleged general need to apply an increase pursuant to point 37 of the Guidelines on the method of setting fines in order to achieve deterrence and yet provides no explanation as to the specific increase allegedly needed to achieve it.
164
Second, the Commission’s reference in recital 146 of the contested decision to previous practice is not relevant, both because the Commission is not bound by its previous practice and because a decision in another case, the facts of which differ from the present case, cannot constitute valid reasoning justifying an increase in the fine, given that any fine must be proportionate to the gravity of the infringement at hand.
165
Third, the reasoning set out in recital 146 of the contested decision does not comply with the duty to state reasons in that the Commission ought to have explained specifically how it exercised its discretion, especially since it decided to depart from its general method and adjust the fine pursuant to point 37 of the Guidelines on the method of setting fines. Specific reasoning is imperative, given that point 37 does not provide for any specific range of adjustment limiting the Commission’s discretion. The Commission ought to have given clear and precise reasons explaining why the increase chosen was necessary in view of the particularities of the case and in order to achieve deterrence, and also why a lower amount would not have been sufficient.
166
The Commission disputes the applicants’ arguments.
167
In addition to the principles referred to in paragraph 100 above, it should be noted that where the Commission relies on point 37 of the Guidelines on the method of setting fines, it is obliged to set out the reasons enabling it to consider that the particularities of the case before it or the need to achieve deterrence justify that it departs from the method set out in those Guidelines (judgment of 10 July 2019, Commission v Icap Management Services and Icap New Zealand, C‑39/18 P, EU:C:2019:584, paragraph 30). In that regard, the requirements relating to the duty to state reasons must be complied with all the more rigorously (judgments of 13 December 2016_Printeos and Others v Commission, T‑95/15, EU:T:2016:722, paragraph 48, and of 12 July 2019, Hitachi-LG Data Storage and Hitachi-LG Data Storage Korea v Commission, T‑1/16, EU:T:2019:514, paragraph 80).
168
In the present case, in recitals 141 to 148 of the contested decision, the Commission set out in detail the reasons that led it to consider that the particularities of the case and the need to achieve a deterrent effect with the fine justified departing from the general method and applying a 10% increase to the basic amount pursuant to point 37 of the Guidelines on the method of setting fines. As is apparent from paragraph 121 above, it observed that the case concerned a purchase cartel, which meant that the value of purchases had to be taken into account for the purposes of calculating the basic amount of the fine, although that value was not completely suitable for calculating the basic amount, which is to reflect the economic importance of the infringement.
169
Moreover, it is clear that those considerations enabled the applicants to understand the Commission’s reasoning and to challenge it before the General Court, and the latter to review the well-foundedness thereof.
170
Furthermore, and contrary to what the applicants suggest, such considerations are not ‘general concerns’, but rather considerations that are specific to the given case and relate to the nature of the cartel at issue, namely a purchase cartel.
171
As correctly observed by the Commission in its response to a measure of organisation of procedure and at the hearing, the particularities of a given case within the meaning of point 37 of the Guidelines on the method of setting fines may be particularities relating to the type of cartel at issue and need not necessarily be circumstances that are unique to the individual case.
172
Those circumstances are sufficiently specific and detailed and therefore comply with the Commission’s heightened duty to state reasons for the application of point 37 of the Guidelines on the method of setting fines.
173
As regards the reasons for the choice to apply a 10% increase pursuant to point 37 of the Guidelines on the method of setting fines, it is apparent, in essence, from recital 146 of the contested decision that, in order to take account of the particularities of the case and achieve sufficient deterrence, it was appropriate for the Commission to apply a 10% increase pursuant to that provision, in line with its previous decision-making practice, in particular the car battery recycling decision.
174
In that regard, the Commission stated, in response to a measure of organisation of procedure and at the hearing, that, in the present case, it had considered that an increase of 10% was appropriate, in line with what it had decided in the car battery recycling decision, given that the application of point 37 of the Guidelines on the method of setting fines to a purchase cartel was a fairly recent practice and the case at issue was only the second application after that decision.
175
However, those explanations may not be taken into account by the Court in its review of compliance with the duty to state reasons because they are not found in the contested decision. Compliance with the duty to state reasons must be assessed in the light of the information available to the applicant at the time the application was brought and the reasons for a decision cannot be explained for the first time ex post facto before the Court, save in exceptional circumstances (see, to that effect, judgment of 19 May 2021, Ryanair v Commission (KLM; Covid-19), T‑643/20, EU:T:2021:286, paragraph 66 and the case-law cited).
176
The absence of such an explanation does not, however, amount to failure to comply with the duty to state reasons for the choice of increase.
177
It should be noted in that regard that, contrary to what the applicants suggest, in recital 146 of the contested decision the Commission did not merely make a general reference to the car battery recycling decision in order to justify its choice of increase; it also, and especially, referred to the particularities of the case and the need to achieve deterrence.
178
In that regard, according to the case-law, the Commission fulfils its obligation to state reasons when it sets out, in its decision, the factors which enabled it to determine the gravity of the infringement and its duration. Although it is not required to provide all of the figures relating to each of the intermediate steps relating to the method of calculation of the fine imposed, it is nevertheless incumbent on it to explain the weighting and assessment of the factors taken into account (see judgment of 10 July 2019, Commission v Icap Management Services and Icap New Zealand, C‑39/18, EU:C:2019:584, paragraph 31 and the case-law cited). As is apparent from paragraph 168 above, the Commission duly explained the factors it took into consideration in order to determine that an increase of 10% applied to the basic amount of the fine was appropriate under point 37 of the Guidelines on the method of setting fines. Contrary to what the applicants suggest, given that the Commission is not required to state the figures relating to each step in the calculation method, it was not required to provide any additional explanations about the specific increase chosen.
179
It should also be noted that, during the administrative procedure, the Commission had communicated to the applicants its intention to increase the basic amount pursuant to point 37 of the Guidelines on the method of setting fines. It is apparent, inter alia, from the last settlement meeting on 29 October 2019 that the Commission clearly stated to the applicants that the application of the general method to a purchase cartel led to an underestimate of the economic importance of the infringement and a fine that was under-deterrent, so that it intended to apply a 10% increase for that purpose pursuant to that provision. In accordance with the case-law cited in paragraph 100 above, those factors form part of the context of which the contested decision also forms a part and in the light of which the sufficiency of the statement of reasons must be assessed.
180
In the light of all the foregoing, the third part of the second plea in law must be rejected, as must, therefore, that plea in its entirety.
181
Given that the first and second pleas in law cannot succeed, the forms of order seeking annulment must be rejected. It is appropriate at the present juncture to examine the forms of order seeking to have the fine reduced, put forward in the alternative, in support of which the third plea is put forward.
3.
Third plea: the disproportionate amount of the fine
182
The applicants submit that even if the Court were to reject the first two pleas as unfounded, it should hold that the fine imposed on them is not proportionate to the gravity of the infringement committed. They take the view that, although the circumstances of the present case justified some increase, it should be well below 50% in relation to the repeat infringement pursuant to point 28 of the Guidelines on the method of setting fines and at a much lower level in relation to the increase pursuant to point 37 of the Guidelines on the method of setting fines.
183
In that regard, the applicants list a certain number of factors which the Court should take into account ex officio and ask it, in the light of those factors, to reduce the amount of the fine imposed on them.
184
The Commission disputes those points relied on and submits that the applicants’ claim is completely unfounded.
185
It should be borne in mind that the review of legality is supplemented by the unlimited jurisdiction which the EU Courts were afforded by Article 31 of Regulation No 1/2003, in accordance with Article 261 TFEU. That jurisdiction empowers the EU Courts, in addition to carrying out a mere review of the lawfulness of the penalty, to substitute their own appraisal for the Commission’s and, consequently, to cancel, reduce or increase the fine or periodic penalty payment imposed (judgments of 8 December 2011, Chalkor v Commission, C‑386/10 P, EU:C:2011:815, paragraph 63, and of 16 July 2020, Nexans France and Nexans v Commission, C‑606/18 P, EU:C:2020:571, paragraph 96).
186
In order to determine the amount of the fine imposed, it is for the EU Courts to assess for themselves the circumstances of the case and the nature of the infringement in question. That exercise involves, in accordance with Article 23(3) of Regulation No 1/2003, taking into consideration, with respect to each undertaking sanctioned, the seriousness and duration of the infringement at issue, in compliance with the principles of, inter alia, adequate reasoning, proportionality, the individualisation of penalties and equal treatment, without the General Court being bound by the indicative rules defined by the Commission in its guidelines (see, to that effect, judgments of 21 January 2016, Galp Energía España and Others v CommissionC‑603/13 P, EU:C:2016:38, paragraphs 89 and 90, and of 16 June 2022, Sony Optiarc and Sony Optiarc America v Commission, C‑698/19 P, EU:C:2022:480, paragraphs 173 and 174).
(a)
The claim for a reduction in the increase pursuant to point 28 of the Guidelines on the method of setting fines
187
The applicants submit, first, that they put an end to the MCAA cartel and notified it more than 12 years before the start of the infringement at issue in the present case; second, that the infringement committed in the context of that cartel and the infringement at issue in the present case are different in nature, concern different products and involved different entities; third, that that cartel was discovered though their internal compliance measures; fourth, that Clariant GmbH was not itself involved in the setting-up and operation of that cartel; fifth, that the infringing conduct at issue resulted from previously lawful conduct with other participants in the cartel at issue; sixth, that the infringements relating to purchase prices are generally less likely than sales cartels to produce effects that are harmful to competition and, in particular, consumers; seventh, that an increase of 50% applied to the basic amount of the fine is disproportionate when compared with other cases in which the same increase was imposed when the repeat infringement was much more serious than in the present case.
188
The Court finds, first of all, that the applicants merely reiterate the circumstances already highlighted under the first plea in order to seek a reduction in the fine. In accordance with the case-law cited in paragraph 50 above, the Court considers that, irrespective of those circumstances, the imposition of a 50% increase is not disproportionate in view of the relatively brief amount of time that passed between the finding of the first infringement of Article 101 TFEU in the MCAA cartel decision and the start of the infringement of that same article dealt with in the contested decision.
189
Next, the applicants’ argument to the effect that a 50% increase is disproportionate when compared with other cases in which the same increase was applied to more serious repeat infringements cannot lead to a reduction in the fine. Suffice it to note in that regard that, in paragraph 60 of the reply, the applicants referred to 28 decisions in which the Commission applied a 50% increase in cases of first repeat infringement, as in the present case.
190
Lastly, the applicants’ argument to the effect that a purchase cartel is less harmful to the normal functioning of competition than a sales cartel is not a relevant factor for assessing whether a 50% increase for repeat infringement pursuant to point 28 of the Guidelines on the method of setting fines is proportionate to the gravity of the infringement committed. In any event, in that regard, it must be borne in mind that the first example of a cartel given in Article 101(1)(a) TFEU, expressly declared incompatible with the internal market, is precisely one which ‘directly or indirectly [fixes] purchase or selling prices or any other trading conditions’. The practice that was the object of the cartel, namely coordination on an element of the price of ethylene, is thus expressly prohibited by Article 101(1) TFEU, as it involves inherent restrictions on competition in the internal market (see, to that effect, judgment of 7 November 2019, Campine and Campine Recycling v Commission, T‑240/17, not published, EU:T:2019:778, paragraph 297 and the case-law cited).
(b)
The claim for a reduction in the increase pursuant to point 37 of the Guidelines on the method of setting fines
191
The applicants submit, first, that the economic analysis they provided to the Commission during the administrative procedure shows that the conduct at issue was not liable to have the slightest meaningful effect on the purchase price of ethylene and, second, that the Commission’s reasoning developed in the car battery recycling case, to the effect that the value of purchases is not a suitable basis for determining the basic amount of the fine, is not applicable to the present case.
192
However, it should be noted, first, that, according to the case-law cited in paragraph 125 above, increasing the amount of a fine pursuant to point 37 of the Guidelines is not conditional on proof that the conduct at issue had any actual effects on the market, with the result that the economic analysis aimed at showing that the infringing conduct had no effect on the purchase price of ethylene is not relevant and cannot lead to a reduction in the amount of the fine. Moreover, the application of a rate of 10% to remedy the imperfectness of the value of purchases, taken into account for the purpose of calculating the basic amount of the fine, does not appear disproportionate. The applicants do not put forward any other relevant factor liable to justify a reduction in that rate.
193
Consequently, the third plea in law must be rejected.
194
It follows from all the foregoing that the forms of order seeking a reduction in the amount of the fine must be rejected, as must, therefore, the action in its entirety.
B. The Commission’s counterclaim
195
The Commission requests the Court to increase the fine, in the exercise of its unlimited jurisdiction, by not granting a reduction of 10% for the applicants’ cooperation during the administrative procedure pursuant to point 32 of the settlement notice.
196
The Commission submits that, by the present action, the applicants dispute the amount of the fine, although it was an essential factor of their settlement submission and had been the subject of a common understanding.
197
In that regard, the Commission states that the applicants did not withdraw from the settlement procedure, even though they disagreed with the application of points 28 and 37 of the Guidelines on the method of setting fines. On the contrary, the applicants undertook to continue the settlement procedure by presenting their settlement submission and by recognising that the statement of objections duly reflected the content of those submissions.
198
The Commission adds that the existence of a ‘common understanding’ regarding the scope of the potential objections and the estimation of the range of likely fines to be imposed form the essential basis for a decision to invite an undertaking to present a settlement submission. That range must be included in the settlement submissions. In its submission, as long as the amount of the fine stated in the final decision does not exceed the maximum amount of the range that was the subject of the discussions leading to the settlement submission, the final decision must be considered to reflect the settlement submission in that regard.
199
The applicants’ challenge to an essential element of the settlement submission undermines the objective of the settlement procedure.
200
As a first point in that regard, the Commission submits that the settlement procedure is, by its very nature, synallagmatic. The parties have the option, and even the duty, to flag up any hindrances which might preclude reaching a common understanding. In its submission, the approach taken by the applicants in the course of the administrative procedure was purely strategic and nothing more than a means of achieving a reduction of the fine, with a view to subsequently challenging the decision on the basis of the same facts and matters which formed part of that common understanding, in order to obtain further reductions from the EU Courts.
201
Second, the Commission submits that the gains in efficiency sought through the settlement procedure are no longer achieved in the present case. The objective of the settlement procedure is to enable it to deal with cartel cases more rapidly, and to deal with a greater number of cartel cases with the same resources. Since the Commission’s resources were mobilised both for the administrative phase and the litigious phase of the present case, thereby leading to additional work, it is not in a position to deal with a larger number of cases.
202
Although the Commission recognises that it benefited from the fact that the applicants have not challenged certain elements relating to their liability and the infringement and that they did not request access to documents in the file, it nevertheless stresses that it invested additional resources in the organisation of a number of meetings with the parties on the two increases in dispute. Nor did it spare any resources in the statement of reasons and justification for the calculation of the amount of the fine contained in the statement of objections in the final decision.
203
The Commission submits that it is impossible to quantify, ex post, the degree of cooperation of a party to the settlement procedure. It states that it is thus difficult for it to determine whether it would have undertaken the settlement procedure if the undertakings’ cooperation had been limited or non-existent but that certain efficiency gains could still have been achieved.
204
Third, the Commission notes that the Court acknowledged, in its judgment of 29 April 2004, Tokai Carbon and Others v Commission (T‑236/01, T‑244/01 to T‑246/01, T‑251/01 and T‑252/01, EU:T:2004:118), that the benefit of reductions in fines under the Leniency Notice could be withdrawn and the fine thus increased when the applicant’s attitude changes and the applicant challenges for the first time before the General Court facts that were established or recognised during the administrative procedure. In addition to that judgment, in other cases the Court examined, in the exercise of its unlimited jurisdiction, whether it was appropriate to withdraw a reduction that the parties to the dispute had obtained in exchange for their cooperation during the administrative procedure, even though the conditions for such withdrawal were not met.
205
Fourth, the Commission submits that the applicants’ right to judicial review is fully respected. In its submission, the exercise of that right does not mean that the action has no consequences for the fine. The withdrawal of the 10% reduction under the settlement procedure is not a sanction for the applicants’ having exercised their right to judicial review, but is simply a consequence of the fact that the applicants are calling into question facts that they had recognised and confirmed during the administrative procedure.
206
Consequently, the Commission submits that the benefit of the reduction in the fine that was granted to the applicants to reward them for their cooperation should be withdrawn. It is therefore requesting the Court to increase the fine imposed on the applicants and fix the amount thereof at EUR 181731000.
207
The applicants dispute the Commission’s arguments.
1.
Preliminary considerations concerning the settlement procedure
208
The settlement procedure was established by Commission Regulation (EC) No 622/2008 of 30 June 2008 amending Regulation No 773/2004, as regards the conduct of settlement procedures in cartel cases (OJ 2008 L 171, p. 3). That procedure was clarified in the settlement notice.
209
According to recital 4 of Regulation No 622/2008, the settlement procedure enables the Commission to handle cartel cases faster and more efficiently. The aim of that procedure is to simplify and speed up administrative procedures, in order to enable the Commission to handle more cases with the same resources (see, to that effect, judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraph 60).
210
In essence, the settlement procedure provides that undertakings which are the subject of investigations, which face incriminating evidence, and which have decided to enter into settlement discussions, are to admit their involvement in the infringement, to waive, under certain conditions, their right to have access to the administrative file and their right to be heard, and to agree to receive the statement of objections and the final decision in an agreed official language of the European Union (settlement notice, point 20). Furthermore, if the statement of objections reflects their settlement submissions, the undertakings are required to respond to it within the period allowed, confirming that that statement corresponds to the contents of their submissions and that they therefore remain committed to following the settlement procedure (settlement notice, point 26). In return, the Commission may grant them a 10% reduction in the amount of the fine which would have been imposed upon them under the standard procedure by applying the Guidelines on the method of setting fines and the Leniency Notice (settlement notice, points 30 to 33) (see, to that effect, judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraphs 61 and 62).
211
It is apparent from recital 4 of Regulation No 622/2008 and from paragraph 5 of the settlement notice that the Commission must take account of the probability of reaching a common understanding regarding the scope of the potential objections with the parties involved within a reasonable time frame, in view of factors such as the number of parties involved, foreseeable conflicting positions on the attribution of liability, and the extent of the challenge of the facts. It is also apparent from that recital that the Commission may take account of concerns other than those relating to possible efficiency gains, such as the possibility of setting a precedent. It follows that the Commission has a wide discretion as to the identification of cases that may lend themselves to a settlement (see, to that effect, judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraph 64).
212
The settlement procedure is conducted in essence in the following manner. The procedure is initiated by the Commission with the agreement of the undertakings concerned (settlement notice, points 5, 6 and 11). Once the procedure is initiated, undertakings which are subject to investigations and which take part in the settlement procedure are informed by the Commission, during bilateral discussions, of the essential elements ‘such as the facts alleged, the classification of those facts, the gravity and duration of the alleged cartel, the attribution of liability, an estimation of the range of likely fines, as well as the evidence used to establish the potential objections’ (settlement notice, point 16). That mechanism allows the parties to express their views on the objections which the Commission could raise against them and to make an informed decision on whether or not to settle (settlement notice, point 16) (judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraphs 66 and 67).
213
Following the notification of that information, the undertakings concerned may opt for the settlement procedure and put forward a settlement submission. That settlement submission must contain, inter alia, an acknowledgement in clear and unequivocal terms of the parties’ liability for the infringement; an indication of the maximum amount of the fine the parties foresee to be imposed by the Commission and which the parties would accept in the framework of a settlement procedure; and confirmation that they do not envisage requesting access to the file or requesting to be heard again in an oral hearing, unless the Commission’s statement of objections and decision do not reflect their settlement submission (settlement notice, point 20) (see, to that effect, judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraph 68).
214
Following that recognition of their liability and the confirmations provided by the undertakings concerned, the Commission sends them the statement of objections and then adopts a final decision. That decision is based in essence on the fact that the parties have unequivocally acknowledged their liability, have not disputed the statement of objections, and have kept to their commitment to achieve a settlement (settlement notice, points 23 to 28) (judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraph 69).
215
If the undertaking concerned decides not to enter into settlement discussions, the procedure leading to the final decision is governed by the general provisions of Regulation No 773/2004, instead of those governing the settlement procedure. The same applies even if the Commission takes the initiative to terminate the settlement procedure (settlement notice, points 19, 27 and 29) (judgment of 20 May 2015, Timab Industries and CFPR v Commission, T‑456/10, EU:T:2015:296, paragraph 70).
216
Final decisions taken following a settlement procedure, adopted pursuant to Articles 7 and 23 of Regulation No 1/2003, are subject to judicial review in accordance with Article 263 TFEU (settlement notice, point 41).
2.
Conduct of the settlement procedure
217
At the time of the discussions between the Commission and the applicants, between 18 September 2018 and 29 October 2019, the Commission indicated the objections it intended to raise in respect of them and its intention to increase the fine by 50% and 10% respectively, pursuant to points 28 and 37 of the Guidelines on the method of setting fines. The applicants were able to put forward their observations.
218
On 20 November 2019, the applicants put forward a settlement submission in which they, inter alia, recognised their liability for their participation in the cartel at issue in the present case and stated that they agreed with the imposition of a fine not exceeding EUR 159663000.
219
The Commission adopted the statement of objections in which it stated, inter alia, the increases applied to the basic amount of the fine pursuant to points 28 and 37 of the Guidelines on the method of setting fines, without however indicating the specific increases intended. In response to that statement, the applicants confirmed that it reflected their settlement submission and that they remained committed to following the settlement procedure.
3.
Whether the Commission’s counterclaim is well-founded
220
As observed in paragraph 185 above, the EU Courts are empowered, in the exercise of their unlimited jurisdiction and in addition to carrying out a mere review of the lawfulness of the penalty, to cancel, reduce or increase the fine or periodic penalty payment imposed.
221
Although the exercise of unlimited jurisdiction is most often requested by applicants in the sense of a reduction of the fine, there is nothing preventing the Commission from also referring to the EU Courts the question of the amount of the fine and from applying to have that fine increased (judgment of 8 October 2008, Schunk and Schunk Kohlenstoff-Technik v Commission, T‑69/04, EU:T:2008:415, paragraph 244).
222
Thus, although the possibility cannot be ruled out that the General Court might decide to increase the fine following a counterclaim by the Commission, the latter must nevertheless demonstrate that the requested increase in the amount of the fine is appropriate, inter alia in the light of the facts and circumstances that arose during the proceedings, and of which it was unaware at the time it adopted its decision. The Court finds that the Commission has not managed to demonstrate that such an increase was appropriate in the present case.
223
The Commission’s argument relating to the 10% reduction for the cooperation given during the administrative procedure is based on the incorrect premiss that, by the present action, the applicants are challenging facts recognised by them in their settlement submission or accepted by them during the settlement procedure.
224
It should be borne in mind in that regard that point 16 of the settlement notice states that, in the settlement discussions, the parties are informed, inter alia, of the ‘estimation of the range of likely fines’. Point 17 of that notice states that that element must be the subject of a ‘common understanding’ following bilateral discussions before the Commission grants a time limit to the undertakings in which to put forward a settlement submission. Point 20 of that notice states, in regard to the amount of the fine, that settlement submissions must contain ‘an indication of the maximum amount of the fine the parties foresee to be imposed by the Commission and which the parties would accept in the framework of a settlement procedure’.
225
It is thus not required of the parties to the settlement procedure that they accept the final amount of the fine and all of its parameters, such as adjustments pursuant to points 28 and 37 of the Guidelines on the method of setting fines, in order to enter into settlement discussions, but only a likely range or maximum amount of the fine.
226
In the present case, as is apparent from paragraph 218 above, in their settlement submission, the applicants accepted only a maximum amount of the fine that the Commission intended to impose on them. Thus, the increases pursuant to points 28 and 37 of the Guidelines on the method of setting fines were not an essential feature of that submission. Subsequently, the applicants’ confirmation that the statement of objections duly reflected their settlement submission cannot be construed as an acceptance of the increases pursuant to those points, especially since that statement did not indicate the increases the Commission intended to apply.
227
The Commission’s argument to the effect that the maximum amount of the fine included the increases intended pursuant to points 28 and 37 of the Guidelines on the method of setting fines cannot succeed. As correctly stated by the applicants in response to a measure of organisation of procedure, the fact of having accepted a maximum amount of the fine in their settlement submission is not the same as accepting the exact final amount of the fine, the method of its calculation and the reasoning on which the Commission based itself in order to arrive at that final amount.
228
It should be noted in that regard that, in the contested decision, the Commission could have decided not to increase the amount of the fine pursuant to points 28 and 37 of the Guidelines on the method of setting fines or to decide to apply lower increases than those ultimately applied. It was thus only after having become cognizant of the contested decision, in which the Commission decided on the final amount of the fine pursuant to point 30 of the settlement notice, that the applicants were able to challenge effectively the parameters of the calculation of that amount, as they argue in response to a measure of organisation of procedure.
229
Moreover, as acknowledged by the Commission itself, it must be remembered that bilateral discussions for the purposes of reaching a settlement had not enabled the Commission and the applicants to reach a consensus as to the increases applied pursuant to points 28 and 37 of the Guidelines on the method of setting fines. It is apparent from the final remarks in the minutes of the last settlement meeting on 29 October 2019 that the applicants’ representative had reiterated her disagreement as to the application of the two abovementioned points. It cannot therefore be held that there was a common understanding between the Commission and the applicants about those increases.
230
Accordingly, contrary to the Commission’s assertions, the fine increases applied pursuant to points 28 and 37 of the Guidelines on the method of setting fines were not expressly acknowledged by the applicants in their settlement submission and were not the subject of a common understanding. Given that, by the present action, the applicants are challenging the amount of the fine imposed on them by arguing that the application of those points was incorrect, the Commission has not succeeded in demonstrating that it is justified not to grant a 10% reduction to compensate them for their cooperation during the administrative procedure.
231
That conclusion is not affected by the other arguments put forward by the Commission.
232
First, the Commission submits that the applicants did not withdraw from the settlement procedure and did not indicate to it that, in their view, it was impossible to reach a common understanding, when they were under a duty to flag up any hindrance that might prevent such an understanding. It takes the view that the approach taken by the applicants during the administrative procedure was purely strategic and nothing more than a means of achieving a reduction of the fine by cooperating, so as to subsequently attempt to obtain further reductions from the EU Courts.
233
However, as is apparent from paragraph 225 above, it is not required of the parties to the settlement procedure that they accept the final amount of the fine and all of its parameters, such as adjustments pursuant to points 28 and 37 of the Guidelines on the method of setting fines, in order to enter into settlement discussions. It should also be noted that, as observed in paragraph 229 above, the applicants expressed their disagreement about the application of points 28 and 37 of the Guidelines on the method of setting fines during those bilateral discussions, with the result that, contrary to what the Commission suggests, it was not misled by the applicants.
234
It should also be borne in mind that, as observed in paragraph 211 above, under point 5 of the settlement notice, the Commission retains a broad margin of discretion to determine which cases may be suitable to explore the parties’ interest to engage in settlement discussions, as well as to decide to engage in them or discontinue them or to definitely settle. Thus the Commission may decide, at any time during the procedure, to discontinue settlement discussions. In the present case, it did not find it appropriate to discontinue the discussions, even though it was aware of the applicants’ disagreement about the application of points 28 and 37 of the Guidelines on the method of setting fines.
235
Second, the Commission submits that the gains in efficiency sought through the settlement procedure are no longer achieved in the present case.
236
It should be borne in mind in that regard that the aim of the settlement procedure is to enable the Commission to deal with cartel cases more rapidly, and to deal with a greater number of cartel cases with the same resources (see paragraph 209 above).
237
As acknowledged by the Commission, moreover, it benefited from procedural gains by committing to the settlement procedure with the applicants. In that regard, first, it produced a simplified version of the statement of objections and the contested decision, in one language. Second, it did not have to prepare a non-confidential version of that statement, organise a hearing or arrange for access to the file for the applicants. It thus benefited from procedural efficiency gains which, as correctly observed by the applicants, remain vested, irrespective of the present action being brought.
238
As to the mobilisation of additional resources for organising meetings with the parties about the two disputed increases, this must be considered a mobilisation of resources inherent in the settlement procedure.
239
The impossibility of quantifying after the fact any gains which may or may not be kept during the administrative procedure is not relevant. Point 17 of the settlement notice states that the Commission is to invite the undertaking to present a settlement submission only if it ‘takes the preliminary view that procedural efficiencies are likely to be achieved in view of the progress made overall’. It must therefore proceed with a prior assessment of the efficiency of the procedure, in the light of the discussions initiated with the parties and decide, on that basis and in its discretion, whether or not to continue the settlement procedure.
240
Third, the Commission submits that, although it recognises the applicants’ right to bring an action against the contested decision, the exercise of that right does not mean that the action has no consequences for the fine. It refers inter alia to the judgment of 29 April 2004, Tokai Carbon and Others v Commission (T‑236/01, T‑244/01 to T‑246/01, T‑251/01 and T‑252/01, EU:T:2004:118), delivered in the context of fine reductions pursuant to the Notice on the non-imposition or reduction of fines in cartel cases (OJ 1996 C 207, p. 4), in which the Court held that such a reduction could be withdrawn from the applicant.
241
It is true that, in the judgment referred to in paragraph 240 above, the General Court allowed an increase requested by the Commission, stating that the Commission, against any expectation that it could reasonably base on the applicant’s objective cooperation during the administrative procedure, had been required to draft and submit a defence before the General Court dealing specifically with the challenge of the facts constituting the infringement, which it had rightly considered that the applicant would no longer call in question.
242
However, it should be noted that, in the present case, the applicants dispute the increases applied pursuant to points 28 and 37 of the Guidelines on the method of setting fines, which were not in their settlement submission and which they had not accepted at the time of the administrative procedure. As a result, the Commission could not assume that they would no longer question them in the context of an action.
243
It follows from all the foregoing that the Commission’s counterclaim must be rejected.
IV. Costs
244
Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Pursuant to Article 134(3) of those rules, where each party succeeds on some and fails on other heads, the parties are to bear their own costs. However, if it appears justified in the circumstances of the case, the General Court may order that one party, in addition to bearing his own costs, pay a proportion of the costs of the other party.
245
In the present case, the applicant’s application has been unsuccessful, and the Commission has not succeeded in its counterclaim. As the Commission sought to secure only a marginal increase in the amount of the fine, it must be held that it is essentially the applicant that has been unsuccessful in the form of order sought and in its pleas in law. In those circumstances, the applicants should bear their own costs and pay 90% of the costs incurred by the Commission, and the Commission should bear 10% of its own costs.
On those grounds,
THE GENERAL COURT (Third Chamber, Extended Composition)
hereby:
1.
Dismisses the action;
2.
Dismisses the European Commission’s counterclaim;
3.
Orders Clariant AG and Clariant International AG to bear their own costs and to pay 90% of the costs incurred by the Commission;
4.
Orders the Commission to bear 10% of its own costs.
van der Woude
De Baere
Steinfatt
Kecsmár
Kingston
Delivered in open court in Luxembourg on 18 October 2023.
V. Di Bucci
Registrar
M. van der Woude
President
Table of contents
I. Background to the dispute
A. Administrative procedure
B. Contested decision
1. Description of the infringement
2. Calculation of the amount of the fine imposed on the applicants
II. Forms of order sought
III. Law
A. The claims for annulment and for reduction of the amount of the fine
1. First plea: the Commission was wrong to increase the basic amount of the fine pursuant to point 28 of the Guidelines on the method of setting fines
(a) First part of the first plea: failure by the Commission to exercise its discretion
(b) Second branch of the first plea: incorrect categorisation of the applicants as repeat infringers
(1) First complaint: no similarity between the infringement committed in the context of the MCAA cartel and the infringement at issue in the present case
(2) Second complaint: amount of time that passed between the two infringements
(3) Third complaint: no previously imposed pecuniary penalty
(4) Fourth complaint: other circumstances not taken into account
(c) Third part of the first ground: failure to state reasons
2. Second plea: the Commission was wrong to increase the basic amount of the fine pursuant to point 37 of the Guidelines on the method of setting fines
(a) First part of the second plea: failure by the Commission to exercise its discretion
(b) Second part of the second plea: incorrect application of the increase pursuant to point 37 of the Guidelines on the method of setting fines
(1) First complaint: the value of the purchases does not contain an underestimate of the economic importance of the infringement in the present case
(2) Second complaint: the increase in the amount of the fine was not necessary to ensure a deterrent effect
(3) Third complaint: an increase applied to all purchase agreements would give rise to systematic, excessive deterrence
(4) Fourth complaint: irrelevance of the decision relating to recycling of car batteries on the ground that the agreement at issue concerned only a minor price element
(5) Fifth complaint: the potential benefits of the purchase cartels are less than those of the sales cartels
(c) Third part of the second plea: infringement of the duty to state reasons
3. Third plea: the disproportionate amount of the fine
(a) The claim for a reduction in the increase pursuant to point 28 of the Guidelines on the method of setting fines
(b) The claim for a reduction in the increase pursuant to point 37 of the Guidelines on the method of setting fines
B. The Commission’s counterclaim
1. Preliminary considerations concerning the settlement procedure
2. Conduct of the settlement procedure
3. Whether the Commission’s counterclaim is well-founded
IV. Costs
(
*1
)	Language of the case: English.