61992CC0049_EN
Opinion of the Advocate-General
Opinion of the Advocate-General
In this case the Court of Justice is called upon to deliver judgment, on the one hand, on the appeal brought by the Commission pursuant to Article 49 of the EEC Statute of the Court of Justice and, on the other, on the cross-appeal by Enichem Anic SpA (hereinafter `Anic') (1) against the judgment of the Court of First Instance of 17 December 1991. (2)
The judgment under appeal upheld in part the action for annulment brought by the appellant company pursuant to Article 173 of the EEC Treaty (hereinafter the Treaty) against the Commission's decision of 23 April 1986 (hereinafter the polypropylene decision). (3)
That decision concerned the application of Article 85 of the Treaty in the polypropylene production sector.
I - Facts and course of the procedure before the Court of First Instance
1 As regards the facts of the dispute and the course of the procedure before the Court of First Instance, the judgment under appeal relates as follows:
Before 1977 the west European polypropylene market was supplied almost exclusively by ten producers, one of which was Anic, with a market share fluctuating between 3.7% and 4.2%. In 1977 and following the expiry of the controlling patents held by Montedison, seven new producers appeared with substantial production capacity.
This was not accompanied by a corresponding increase in demand, with the consequence that demand did not match supply, at least until 1982.
More generally, for the greater part of 1977-1983, the polypropylene market was characterised by low profits or even significant losses.
2 On 13 and 14 October 1983 Commission officials, acting under the powers conferred by Article 14(3) of Council Regulation No 17 of 6 February 1962 (4) (hereinafter `Regulation No 17') carried out simultaneous investigations in a number of undertakings operating in the polypropylene production sector.
Following those investigations, the Commission addressed requests for information, under Article 11 of Regulation No 17, to the above companies, and also to other related undertakings.
From the evidence obtained during the course of those investigations the Commission concluded that, between 1977 and 1983, certain polypropylene producers, including Anic, had been acting in contravention of Article 85 of the Treaty.
On 30 April 1984 the Commission decided to open the proceedings provided for by Article 3(1) of Regulation No 17 and sent a written statement of objections to the undertakings in contravention.
3 At the end of that procedure, the Commission adopted the abovementioned decision 23 April 1986, which has the following operative part:
`Article 1
(The Companies) ... Anic SpA ... have infringed Article 85(1) of the EEC Treaty, by participating: ... in the case of Anic from November 1977 until about the end of 1982 or the beginning of 1983, ...
in an agreement and concerted practice originating in mid-1977 by which the producers supplying polypropylene in the territory of the EEC:
(a) contacted each other and met regularly (from the beginning of 1981, twice each month) in a series of secret meetings so as to discuss and determine their commercial policies;
(b) set "target" (or minimum) prices from time to time for the sale of the product in each Member State of the EEC;
(c) agreed various measures designed to facilitate the implementation of such target prices, including (principally) temporary restrictions on output, the exchange of detailed information on their deliveries, the holding of local meetings and from late 1982 a system of "account management" designed to implement price rises to individual customers;
(d) introduced simultaneous price increases implementing the said targets;
(e) shared the market by allocating to each producer an annual sales target or "quota" (1979, 1980 and for at least part of 1983) or in default of a definitive agreement covering the whole year by requiring producers to limit their sales in each month by reference to some previous period (1981, 1982).
...
Article 3
The following fines are hereby imposed on the undertakings named herein in respect of the infringement found in Article 1:
(i) Anic SpA, a fine of 750 000 ECU, or ITL 1 103
692 500 (...).'
4 Fourteen of the fifteen companies which were the addressees of the decision, including Anic, brought an action for its annulment.
At the hearing which took place from 10 to 15 December 1990, the parties presented oral argument and answered questions from the Court.
5 In its abovementioned judgment of 17 December 1991, the Court of First Instance, after hearing the views of the Advocate General, upheld in part the action brought by Anic and reduced the fine which had been imposed on it. The Commission lodged an appeal with the Court seeking partial annulment of the judgment of the Court of First Instance, review of the fine to be imposed on Anic and an order for costs against the latter.
6 In its reply Anic requested the Court, on the one hand, to dismiss the Commission's appeal and, on the other, to annul in part the judgment of the Court of First Instance, in support of which plea it put forward its own grounds of appeal.
At the same time Anic sought an order for costs against the Commission in respect of all the costs incurred both at first instance and in the appeal proceedings.
7 In the context of the case pending DSM NV sought leave to intervene in support of the form of order sought by Anic. By order of 30 September 1992 the Court refused leave to intervene.
II - Grounds of appeal
A - The existence of substantial procedural defects vitiating the contested Commission decision
8 Anic considers that it has good grounds for believing that the Commission did not observe the proper procedure in adopting the polypropylene decision. It relies in that connection on the judgment of the Court of First Instance in the related PVC case (5) and on the disclosures made by the Commission's representatives at the hearing at first instance in that case. Anic infers from the PVC judgment of the Court of First Instance that non-observance by the Commission of the rules of procedure concerning the linguistic rules governing its decisions (6) and their authentication (7) unfailingly leads to the non-existence of the decision vitiated by such defects. The disclosures made by the Commission's representatives at the hearing at first instance in the PVC case lead Anic to conclude that the procedural irregularities found as a matter of fact by the Court of First Instance in that case are in all likelihood to be found in the case of the polypropylene decision at issue in these proceedings. According to Anic, there is sufficient evidence to show that in adopting the contested decision the Commission infringed essential procedural requirements. Anic takes the view, in any event, that the Court may, if it thinks fit, order the necessary measures of organisation of procedure in order to ascertain, first, whether an Italian version of the contested decision was in existence on the adoption thereof and, secondly, whether the Italian original of the decision had been authenticated in accordance with Article 12 of the Commission's rules of procedure. In light of the foregoing Anic requests the Court to declare the decision non-existent or, in the alternative, null and void to the extent to which it is concerned by it. Indeed it maintains that its claim in that regard was properly put forward at the appellate stage in such a way as to be admissible under Article 116 of the Rules of Procedure of the Court. It also takes the view that the Court may, at the appeal stage, examine new matters which were not before the Court of First Instance for determination, provided those matters emerged after the conclusion of the proceedings at first instance, by analogy with the possibility afforded under Article 42(2) of the Rules of Procedure of the Court.
9 The Commission claims that Anic's submissions are inadmissible since they do not reveal any error of law in the judgment appealed against.
10 Indeed, Anic's abovementioned arguments (8) cannot be examined by the Court on appeal. For Anic to seek a declaration that the Commission decision at issue is non-existent or invalid without at the same time arguing that the judgment appealed against is vitiated by some error of law is inadmissible: it flies directly in the face of Article 49 of the EC Statute of the Court of Justice under which an appeal is to be directed exclusively against decisions of the Court of First Instance and not against the acts of the other Community institutions. (9)
B - Pleas based on the application of the competition rules
(1) Legal classification of the infringement
(a) Meaning of the term `concerted practice'
11 Of central importance to the overall appraisal of the correctness at Community law of the judgment appealed against is the question of the legal classification of the relevant conduct of the polypropylene undertakings as an `agreement' and `concerted practice'. The definition of the second of those two concepts essentially forms the cornerstone of the reasoning of the Court of First Instance since both the correctness of its single classification of the conduct in question as an `agreement and concerted practice' and the distribution of the burden of proof are directly connected to what precisely constitutes a `concerted practice' under Article 85 of the Treaty. Any error in the definition of this concept would be a ground for setting aside the judgment at first instance.
12 (i) In that context Anic stresses the difference between the terms `agreement' and `concerted practice'. According to Anic, that difference is to be found chiefly in the fact that the concerted practice, as opposed to an agreement, presupposes the existence of external market activity, of substantive conduct which constitutes a further element pointing to the existence of an infringement and giving concrete form to, if not substantiating, the content of the unlawful arrangements between the undertakings.
13 For its part, the Commission repudiates the interpretative approach advocated by Anic, taking the view that it would result in a diminution and weakening of the protection of competition afforded by Article 85 because its consequence would be to impose stricter requirements of proof for a concerted practice than for an agreement. In the Commission's view, that would run counter to the rationale of Article 85 which extends the prohibition to any kind of concertation affecting competition even where it is inchoate and less complete than an agreement.
14 As may be seen from the foregoing, the focus of the legal dispute is the simultaneous definition of the terms `agreement' and `concerted practice' in Article 85 of the Treaty and, in particular, the determination of what constitutes a `concerted practice'. On that point it should be pointed out that, under Article 85, the anticompetitive nature of the agreements or concerted practices in question is to be inferred from their `object' or `effect'. Accordingly, the following four logical combinations of unlawful conduct are possible: agreement/object, agreement/effect, concerted practice/object and concerted practice/effect.
15 In the present case the concept of agreement does not give rise to any problems and has, moreover, been thoroughly elaborated in a whole series of cases. Under the Court's case-law, it is sufficient for an agreement to have as either its object or effect a restraint on competition for there to be an infringement of the provisions of Article 85 of the Treaty. (10)
16 Problems arise, however, concerning the definition of the term `concerted practice'. The cases which have hitherto exercised the Court have exclusively involved situations in which the concerted practice was anticompetitive in its effect. The following conclusions may be drawn from the case-law:
First, the point of departure of the judicial reasoning is as a rule an evaluation of the discernible effect on the market.
Secondly, a conceptual distinction is drawn between the legal categories of `concerted practice' and `agreement'.
Thirdly, `concertation' constitutes a sine qua non of illegality.
17 Thus, the Court has held that: (11)
`Article 85 draws a distinction between the concept of "concerted practices" and that of "agreements between undertakings" or of "decisions by associations of undertakings"; the object is to bring within the prohibition of that article a form of coordination between undertakings which, without having reached the stage where an agreement properly so-called has been concluded knowingly substitutes practical cooperation between them for the risks of competition. By its very nature, then, a concerted practice does not have all the elements of a contract but may inter alia arise out of coordination which becomes apparent from the behaviour of the participants' (emphasis added).
18 None the less, it should be noted that not all conduct by an undertaking which has a similar kind of effect on the market constitutes an infringement of Article 85:
`The criteria of coordination and cooperation laid down by the case-law of the Court, which in no way require the working out of an actual plan, must be understood in the light of the concept inherent in the provisions of the Treaty relating to competition that each economic operator must determine independently the policy which he intends to adopt on the common market including the choice of the persons and undertakings to which he makes offers or sells. Although it is correct to say that this requirement of independence does not deprive economic operators of the right to adapt themselves intelligently to the existing and anticipated conduct of their competitors it does however strictly preclude any direct or indirect contact between such operators, the object or effect whereof is either to influence the conduct on the market of an actual or potential competitor or to disclose to such a competitor the course of conduct which they themselves have decided to adopt or contemplate adopting on the market' (12) (emphasis added).
19 Consequently, in the cases which have hitherto been before the Community judicature concerning `concerted practices', the problem has always been that of establishing that a given practice, in the way it affected the market, resulted from concertation. (13)
20 The question arises, therefore, whether, under that case-law, the existence of an effect on the market of successful coordination between the undertakings constitutes an element of the concerted practice qua infringement under Article 85. In such a case is it possible to conceive of conduct which is classifiable as a concerted practice merely by virtue of its object? And conversely: what other meaning can `practice' have when it is considered that the infringement is established merely by the fact of coordination, that is to say by the contexts and concerted action between undertakings, without there being any effect on the market?
21 This problem has been dealt with only peripherally by the Court, in Opinions of its Advocates General. In those Opinions it appears that initially the view was taken that de facto joint conduct in the market was a sine qua non of concertation (14) for an infringement of Article 85 of the Treaty to be established. However, in recent years there has been a discernible distancing from that position, as is highlighted by the Opinion of Advocate General Darmon in the Woodpulp cases. (15)
22 I think that on this point the path to be followed by the case-law must be that outlined by Advocate General Darmon in his abovementioned Opinion.
23 Allow me to explain: as has already, I believe, clearly emerged, a literal interpretation of Article 85 does not resolve that aspect of the problem. Rather it permits of several different constructions which however lead to diametrically opposed results. What constitutes a concerted practice whose `object' is anticompetitive must in the end be determined on the basis of a reading of Article 85 as a whole which is such as to safeguard the rational coherence of that provision and, above all, with reference to the objective which the rules on competition seek to serve both generally and with specific regard to Article 85 (systematic and teleological interpretation).
24 In that context I believe that the Court was right to take as the model of economic activity under the Treaty rules on competition the `economic operator (who) determine(s) independently the policy which he intends to adopt on the common market'. Viewed in that light, `this requirement of independence strictly preclude(s) any direct or indirect contact between such operators the object or effect whereof is (...) to disclose to such a competitor the course of conduct which they themselves have decided to adopt or contemplate adopting on the market' (Suiker Unie, loc. cit., paragraphs 173 and 174).
25 Consequently, the spirit of the rules on competition is broken once there has been contact between undertakings with a view to disclosure of the course of conduct which they contemplate adopting on the market. At that point one is faced with a breakdown of the free-competition model upheld by the Community provisions under which each undertaking individually plans the policy which it will adopt on the market following its own appraisal of market conditions.
26 The reasoning set out above ensures that a broader view be taken of the terms of Article 85, does not prejudice the protection afforded to competition and, in my view, represents the schematically correct approach. By also including within the sphere of Article 85 concerted practices which merely intend to affect competition, not only the letter but also the rationale of the rules on competition are observed.
27 At this juncture it is worthwhile dwelling on the term `practice'. If, in the case of a concerted practice, an infringement of Article 85 can also be established solely on the basis of `coordination' between the undertakings (that is to say solely on the basis of participation in the unlawful purpose of a given concertation), then the concept of `practice' is independent of any effect on or activity in the market. In that context the substantive external element immanent in the concept of practice is identical with the concept itself. It could be argued that the fact that concertation and practice are essentially identical might create the impression that the provision contains a pleonasm.
28 However, I do not believe, given the objective pursued by the rules on competition, that arguments of that kind can be availed of in order to arrive at an exhaustive interpretative solution. In that connection the use of the term `practice' is to be viewed in light of the fact that it `... distinguishes between and contrasts de facto concertation or concertation in practice, on the one hand, and formal concertation resulting from an agreement, on the other'. (16) Accordingly, the decisive factor in identifying an infringement of Article 85 continues to be in each case concertation in the broadest sense.
Once that is established, the `objective existence' of the infringement is proven, irrespective of whether it is patent (in the case of an agreement) or latent (in the case of a concerted practice). (17)
29 That acceptance of the purely `objective' nature of the infringement, constituted by participation in conduct which, on an objective view, is anticompetitive, and the failure to review the impact on the market of the concertation, highlight as a decisive element in establishing illegality the content of certain conduct and the conceptual difference between an `agreement' and a `concerted practice'. For there to be an `agreement', it is simply that a higher level of concertation between the parties is required, as evidenced by a consensus ad idem between them. This finding is a natural consequence of the matters set out above concerning an interpretation in keeping with the spirit of the rules on competition. (18)
30 Accordingly, it may be concluded that the concept of concerted practice/object is not dependent on effect being given to it in the market. For an infringement of Article 85 of the Treaty to be made out, there does not need to be any effect on trade either as a result of activities of the undertakings concerned stemming from the preceding concertation, as is contended for on behalf of Anic, or simply
the presence of those undertakings on the market.
31 (ii) It is, moreover, necessary to determine the content which a concertation must have in order to constitute unlawful conduct under Article 85 of the EEC Treaty. (19)
32 The decisive criterion for the lawfulness of business activity continues to be the exercise of autonomy by each undertaking in the choice of the policy which it opts to pursue on the market. When, however, is that autonomy lost? In the Court's judgment in Suiker Unie (20) it was held, as has already been stated, that what is required is any direct or indirect contact between such operators, the object or effect whereof is either to influence the conduct on the market of an actual or potential competitor or to disclose to such a competitor the course of conduct which they themselves have decided to pursue or contemplate adopting on the market (paragraph 174). Accordingly, it is sufficient for there to be influence, by means of contact, on a competitor's conduct. The judgment appealed against precisely follows that criterion in holding that: `Through its participation in those meetings, it took part, together with its competitors, in concerted action the purpose of which was to influence their conduct on the market and to disclose to each other the course of conduct which each of the producers itself contemplated adopting on the market. Accordingly, (...) the applicant pursue(d) the aim of eliminating in advance uncertainty about the future conduct of its competitors (and) could not fail to take account, directly or indirectly, of the information obtained (...)' (paragraphs 200 and 201 of the judgment appealed against).
33 More recently, however, in the Woodpulp cases (21) the Court was called upon to adjudicate on the legality of a system of three-monthly price announcements operating in that market. After reaffirming the obligation on each undertaking to determine its policy independently, it went on to hold that:
`In this case, the communications arise from the price announcements made to users. They constitute in themselves market behaviour which does not lessen each undertaking's uncertainty as to the future attitude of its competitors. At the time when each undertaking engages in such behaviour, it cannot be sure of the future conduct of the others' (paragraph 64).
On the basis of that reasoning the Court held that there had not been an infringement of Article 85 of the Treaty in that case.
34 In that judgment the Court would appear to have adopted a more stringent criterion as opposed to that applied in Suiker Unie. The objective requirement of Article 85 would not appear to be met by `influence' on the conduct of an undertaking which corresponds to a `lessening of uncertainty' as to the future conduct of its competitors without amounting to `certainty' as to that conduct. Following the Court's judgment in the Woodpulp cases, the question arises whether, in order for a concerted practice to be established, it is necessary in each case for each of the participants in the relevant meetings to acquire certainty as to the conduct to be expected of its competitors (22).
35 None the less, I do not believe that the Court's judgment in the Woodpulp cases may be transposed to the generality of cases in which the question of the existence of concerted practices arises. That would curtail the scope of the provision to an unreasonable extent and with it the concomitant protection of free competition. In fact, it is particularly doubtful whether an undertaking may acquire `certainty' as to the conduct of its competitors, even if it has entered into an agreement with them on the matters concerned. In any event, that approach would create major problems as regards proof of the concerted practice since, in cases of exchange of information, such as the present case, there would have to be a presumption as to the reliability of the data and an unambiguous obligation to use the data communicated, which are all matters which are inconsistent with the `flexible' concept of the concerted practice.
36 Moreover, I consider that the criterion of `certainty' was used by the Court, owing to the particular circumstances of the Woodpulp case, for the specific case of indirect contact between the undertakings by means of price announcements to users. For that reason I do not believe that the dicta in Suiker Unie are undermined as regards the other cases in which the question arises as to the existence of a concerted practice and direct and, a fortiori, secret meetings have been found to have taken place between the undertakings. The relevant criterion continues to be whether the object of the meetings is to influence the conduct on the market of a given undertaking (or undertakings) by lessening its (or their) uncertainty as to the conduct of competitors.
Accordingly, the legal classification of the facts contained in the judgment at first instance is correct in that respect as well.
37 (iii) At this juncture it is necessary to examine one last matter which also concerns the legal classification of the conduct at issue and is of particular interest in the context of this case. The question is whether a concerted practice is established where, in the context of contacts between undertakings taking the particular form of the provision of information, there is no reciprocity in the exchange of information with the result that uncertainty as to the future conduct of competitors is limited or removed only in the case of certain of the undertakings. (23)
38 Of course it is extremely difficult to imagine situations in which there is no element of reciprocity in the broad sense of the term. Indeed the rule is the establishment of a reciprocal relationship between undertakings with communications of analogous content being made in swift succession or indeed simultaneously. For example, a situation could occur in which there are alternate unilateral announcements (24) or unilateral announcements dictated by corporate requirements or calculations of whatever kind.
39 According to one view a `precondition of concertation is by definition reciprocity in the provision of information as between the competitors'. (25)
40 None the less, I do not see why reciprocity must be deemed to be an element of the notion of concerted practice. What must be ascertained is whether there has been `concertation' between undertakings and not whether that `concertation' is based on reciprocity. In other words, what is relevant in each case is the ascertainment of contacts between competitors whose object or effect is to lessen uncertainty as to future initiatives on the market. Whether in that context information is communicated on the basis of reciprocity or not cannot, in my view, be regarded as a decisive factor.
41 The legal interest protected by Article 85 is not the untrammelled business activity of each individual undertaking but freedom of competition as a doctrine which is reflected specifically in the model of the undertaking operating independently in the market. On that view of the matter, contact between undertakings is anticompetitive if it removes the uncertainty, even of one of them, as to the conduct of competitors. (26)
In that case, both the undertakings providing information and the recipients thereof have participated in the `concerted practice' on the supposition that the latter's involvement in the unlawful conduct may be demonstrated or inferred. (27)
42 To recapitulate, I would observe that:
the concept of `concerted practice' does not necessarily presuppose the adoption of any conduct on the market;
there is a `concerted practice' where there have been found to be cases of conduct which seek to lessen uncertainty between competitors in connection with their activity on the market and
there may also be a `concerted practice' where one competitor unilaterally provides information to all the others.
(b) Whether conduct may be classified in law as both an agreement and a concerted practice
43 Closely linked to the correct interpretation of the concept of concerted practice is the question whether the Court of First Instance, on the one hand, correctly categorised as a matter of law the individual conduct of the undertakings as an `agreement' or `concerted practice' and, on the other, whether it correctly classified their overall conduct as an `agreement and concerted practice'.
44 More particularly, the Court of First Instance held at paragraph 202 of the judgment appealed against that `the Commission was (...) justified (...), having regard to their purpose, in categorising the regular meetings of polypropylene producers in which the applicant participated between the end of 1978 or the beginning of 1979 and mid-1982 and its communication to ICI of its sales volume aspirations for the first quarter of 1983 as concerted practices within the meaning of Article 85(1) of the EEC Treaty.'
45 Secondly, at paragraph 205 of the judgment appealed against it held that `the Commission was (...) entitled to characterise that single infringement as "an agreement and a concerted practice" since the infringement involved at one and the same time factual elements to be characterised as "agreements" and factual elements to be characterised as "concerted practices". Given such a complex infringement, the dual characterisation by the Commission in Article 1 of the Decision must be understood not as requiring, simultaneously and cumulatively, proof that each of those factual elements presents the constituent elements both of an agreement and of a concerted practice, but rather as referring to a complex whole comprising a number of factual elements some of which were characterised as agreements and others as concerted practices for the purposes of Article 85(1) of the EEC Treaty, which lays down no specific category for a complex infringement of this type.'
46 According to Anic, every aspect of the alleged infringement by the undertakings must receive a distinct classification, so that it may be determined whether it constitutes an agreement or concerted practice. For that was the criterion laid down for determination of whether the conduct as a whole was unlawful. Examination of whether that interpretative approach is correct is not without its importance, inasmuch as it also affects the solution of other issues such as distribution of the burden of proof and protection of the rights of defence of the accused.
47 It may be inferred, I believe, from paragraphs 11 to 30 above that the four categories of infringements of Article 85 of the EC Treaty do not differ in their legal nature. What is relevant always is the object or effect of the agreement or concerted practice. (28)
It is that of object or effect that evidence is chiefly sought in the investigative procedure. Accordingly, the fact that the Court of First Instance categorised that conduct in the alternative as a concerted practice, in relation to the concept of an agreement (paragraph 202 of the judgment at first instance), cannot be deemed to constitute a misinterpretation of Article 85.
48 Moreover, the legal classification of the conduct as a whole as an `agreement or concerted practice' is based on the analogy between those two types of infringement. (29) However, the fact that those legal classifications are used in order to describe overall conduct does not mean that every single item of conduct constitutes both an agreement and a concerted practice. On that point the judgment at first instance correctly points out that: `the dual characterisation (...)
must be understood not as requiring, simultaneously and cumulatively, proof that each of those factual elements presents the constituent elements both of an agreement and of a concerted practice (...).' The two elements in Article 85, notwithstanding the affinity which they exhibit in the present case, may stand alone. Each single item of conduct may in the final analysis constitute either an agreement or a concerted practice, but not both at the same time. (30)
In that respect only the complex whole of individual items of conduct may be characterised as an `agreement and concerted practice.'
49 In conclusion the twofold legal classification adopted in the judgment appealed against cannot be deemed, in the factual context of the present case, to constitute a misapplication of Article 85 of the Treaty.
(2) Allocation of the burden of proof
50 Anic submits that, as regards the finding of an infringement, the Court of First Instance contravened the rules governing the burden of proof. It particularly seeks to repudiate paragraph 110 of the judgment appealed against in which the Court of First Instance inferred participation by Anic in the price initiatives from its participation in the relevant meetings of polypropylene producers and held that it was for Anic to provide evidence to the contrary. The company alleges that the Court of First Instance erred in not deeming the fact that Anic did not apply the agreed price initiatives to constitute such evidence. (31)
51 The Commission considers that the Court of First Instance did not err in distributing the burden of proof when it inferred from participation in meetings involvement also in the content of those meetings. It further contends that whether or not Anic gave effect to what was agreed is irrelevant to proof of participation in the infringement in question.
52 It should be emphasised, at the outset, in connection with this ground of appeal, that the Court of First Instance founded its judgment as to the infringement of Article 85 on the purpose of the meetings of polypropylene producers, which was chiefly to fix target prices. That view of the matter is based on an interpretative approach to Article 85 whereby it is possible, first, for there to be a concerted practice without there being any effect on the market and, secondly, for conduct to be described, alternatively, as an agreement or concerted practice. (32) Against that background it is useful on each occasion to elucidate the content of the conduct to be reviewed and its compatibility with the rules on competition.
53 Accordingly, it was for the Commission, as `prosecuting authority', to demonstrate that the subject-matter of the understandings between the polypropylene producers ran counter to the rules laid down in Article 85. In the present case the Commission discharged that obligation because, as is stated in paragraph 109 of the judgment appealed against, there was sufficient evidence that agreements on the fixing of prices formed the subject-matter of the meetings between polypropylene producers.
54 Since Anic's participation in meetings of polypropylene producers is not in doubt, the further question arises as to whether the inference may be drawn solely from its participation therein that it was involved in the unlawful purpose of those meetings. Indeed the Court of First Instance found Anic's participation in the unlawful agreements or concerted practices in relation to prices to be proven on the ground, first, that it was present at the relevant meetings and, secondly, that it did not adduce any evidence from which it might be inferred that its participation in the meetings did not at the same time constitute involvement in the unlawful purpose of those meetings (paragraph 110 of the judgment appealed against).
55 On this aspect of the question it should first of all be acknowledged - and I think this emerges clearly from the terms in which the relevant paragraph of the judgment is couched - that it is theoretically possible to participate in a meeting at which the other participants agree on an unlawful course of conduct without participating in the unlawful action itself. On that view of the matter it may be said that mere participation does not of itself suffice to give rise to collaboration and, thus, to an infringement of the rules on competition. (33)
56 But does that mean that the Commission is obliged to produce additional evidence in order to establish that matters have passed from the stage of mere participation to that of an agreement, that is to say the commission of unlawful activity? I do not think that the answer to that question can necessarily be the same in every case. The requirements concerning the production of evidence by the party bearing the burden of proof are not imposed in the abstract but in terms of each individual case. In regard to the present case the following matters should be emphasised: a case in which an undertaking participates on an isolated occasion in a meeting whose purpose is unlawful is different from that in which it takes part in a series of similar meetings stretching over several years, as in the present case. In the latter case proof of its presence at successive meetings having the same unlawful purpose is in itself sufficient for the conclusion to be drawn that the Commission adequately established the undertaking's involvement in the unlawful activity. It is then for the other party to adduce further evidence in rebuttal of the inferences thus drawn from the Commission's evidence.
57 Thus, in upholding the Commission's point of view, the Court of First Instance correctly allocated the burden of proof as regards the finding of an infringement by Anic, since the undertaking in question was at liberty to produce evidence in rebuttal.
58 Anic then raises the question whether the fact that the undertaking did not implement the price-fixing initiatives can overturn the finding that it participated in the unlawful conduct.
59 I would observe that this submission concerns the outcome of discussions at meetings of polypropylene producers. The fact that it did not give effect to what was agreed at those meetings is put forward by Anic as evidence in support of its argument that it did not participate in those agreements. In so arguing, Anic is seeking to shift the legal basis of its arguments by adopting the view that there cannot be a concerted practice if effect is not given to it in the market. That view of the matter has been examined and rejected in an earlier part of my Opinion in the present case. (34)
60 As I have already pointed out, the relevant issue which had to be proved in the present case was the subject-matter of the successive meetings of polypropylene producers. Whether or not the decisions adopted at those meetings were acted upon cannot be used as evidence of non-participation in the unlawful activities in question. Consequently, inasmuch as the Court of First Instance correctly based its conclusions on the sole fact that price-fixing initiatives were agreed (paragraphs 112 and 113 of the judgment appealed against), it did not contravene the rules on the burden of proof by not taking into account, as evidence of participation or not in the subject-matter of the meetings, Anic's submissions concerning the faithful implementation or otherwise of what was agreed at those meetings. Thus, the submissions on this point cannot avail Anic.
Consequently, I consider that the ground of appeal under consideration must be dismissed in its entirety.
(3) Correctness of the term `single infringement'
61 The most important chapter in the dispute between the Commission and Anic in the context of the present appeal concerns the categorisation by the Commission of the conduct in question as a `single infringement', which was accepted by the Court of First Instance, and the relationship between that concept and the notion of `collective responsibility'.
62 It is to that issue that the whole of the Commission's submissions in support of its appeal refer, as well as a major portion of Anic's cross-appeal.
The convergence of the legal issues raised by both parties is conducive to a joint examination of the arguments advanced which frequently are no more than a rehearsal of the same arguments viewed from opposing viewpoints.
63 First of all, it will be useful to set out paragraphs 203 and 204 of the judgment appealed against which are in the following terms:
`As
regards the question whether the Commission was entitled to find that there was a single infringement, described in Article 1 of the Decision as "an agreement and concerted practice", the Court points out that, in view of their identical purpose, the various concerted practices followed and agreements concluded formed part of systems of regular meetings, target-price fixing and quota-fixing.
Those schemes were part of a series of efforts made by the undertakings in question in pursuit of a single economic aim, namely to distort the normal movement of prices on the market in polypropylene. It would thus be artificial to split up such continuous conduct, characterised by a single purpose, by treating it as consisting of a number of separate infringements. The fact is that the applicant took part - over a period of years - in an integrated set of schemes constituting a single infringement, which progressively manifested itself in both unlawful agreements and unlawful concerted practices.'
(a) Parties' arguments
64 In its arguments the Commission dwells on the determination of liability in the case of each polypropylene producer on the basis that they had committed a `single infringement'. By using that term the Commission is seeking principally to describe the whole of the unlawful agreements of the polypropylene producers over a relatively long period. In the Commission's view, classifying the infringement as a `single' one means that each producer is deemed liable for the whole of the unlawful activity in respect of the period during which it participated in concerted action, whether or not it attended every one of the meetings organised and had a part in the various manifestations of the overall unlawful conduct. Proof of participation in the various unlawful actions is important only, the Commission says, for the purpose of determining the fine.
65 The Commission emphasises that that is the purport of the matters set out in the polypropylene decision at issue in this case. Consequently, by annulling the Commission decision to the extent to which it deems Anic to be liable for certain of the conduct constituting the `single infringement' (namely its participation, first, in the price initiatives in the second half of 1982, secondly in the restriction of their monthly sales in that period and, thirdly, in the measures designed to facilitate the implementation of the price initiatives, see paragraphs 115, 178 and 127 of the judgment appealed against), the Court of First instance, in the Commission's view, misinterpreted the polypropylene decision by inferring from it findings which it does not contain. At the same time, to deem Anic to be not liable for those various actions is, on the same reasoning, incompatible with the Court's appraisal to the effect that the Commission was entitled to conclude that the polypropylene producers' infringement was in the nature of a `single infringement' (paragraphs 203 and 204 of the judgment appealed against). The Commission takes the view that on this point the grounds of the judgment are in contradiction with its operative part.
66 In sum, the Commission seeks annulment of the judgment in so far as it deems Anic not to be liable for the infringement as a whole during the period in which it participated in it and on that ground reduced the fine imposed.
67 For its part, Anic also pleads a contradiction between the grounds of the judgment and its operative part but, obviously, from a different angle. It claims that, since the Court was of the view that its participation at meetings of polypropylene producers was decisive in establishing its liability, the Court ought then to have held Anic not liable, owing to the infringement being a `single' one, in respect of the period after it had ceased to take part in those meetings (that is to say the period subsequent to mid-1982; see paragraphs 91 and 100 of the judgment). At the same time it points to defects vitiating the judgment in so far as it deals with the undertaking's participation in the infringement after mid-1982.
68 Anic amplifies its criticism of the judgment of the Court of First Instance by challenging the classification of the infringement as a `single one', principally owing to the effect thereof which, according to Anic, is to attribute to it collective liability for the infringements committed. Anic considers that conduct is being attributed to it in which it is not established as having taken part. The Court of First Instance is thus disregarding, in Anic's view, the general principle of the personal nature of criminal liability, which is applicable by analogy to the imposition of fines for infringements of competition law. At the same time Anic claims that the judgment is based on inadequate reasoning since it does not deal with the plea concerning collective liability.
69 Thus, Anic is challenging the judgment by asserting that its reasoning is in contradiction with its operative provisions inasmuch as, although its participation in four out of five cases of conduct constituting a `single infringement' was not established, none the less liability for that infringement was attributed to it. (35)
(b) My reply on the abovementioned issues
(i) Personal nature of an undertakings' liability for infringements of Article 85
70 The specific nature of the facts of the dispute and the description given to them are at the heart of the legal issue raised by the appellants in their pleas under examination. To designate the various, successive and complex items of conduct by the polypropylene producers by the term `single infringement' is regarded by both parties as having direct consequences as regards the precise determination of the liability to be attributed to persons infringing Community rules on freedom of competition. The nature of that liability must therefore be examined.
71 Infringements of Article 85 are committed by more than one trader unlawfully coordinating their conduct. The coordination of the conduct is the most important element of the facts constituting the infringement. Individual involvement in the unlawful conduct caught by Article 85 may be described by the term `participation' in an agreement or concerted practice.
72 It is none the less useful at this stage to comment on the distinction that exists between, on the one hand, the fact that an undertaking has fulfilled the factual requirements for the applicability of Article 85 and, on the other, the imputation to that undertaking of the conduct concerned. `Participation' in the infringement is conceptually on a different plane from liability and precedes it in time. The final imputation of liability presupposes that a number of requirements are met, and first of all the substantive requirement that the unlawful conduct has been committed. Liability (which determines the imposition of a fine (36)) is founded only if the unlawful activity has been established and always in relation thereto.
73 In the present case the difficulty resides in the complex nature of the unlawful conduct. It is spread over a considerable period, may be broken down into distinct actions and involves a number of companies whose composition and participation have fluctuated during the course of their common campaign. (37)
The situation one is faced with is therefore one in which the participation in meetings by the polypropylene producers varies over time depending on each company and in which there is a different degree of participation in the various agreements and concerted practices. That being the case, how may the individual liability of each undertaking be determined?
74 I think that the correct answer is as follows: each undertaking can be held liable only for its own acts. In other words the principle of personal liability is to be applied: liability cannot be imputed to a person for infringements which he did not commit either singly or jointly or in which he was an accomplice. Of course it could be objected that this is a principle applicable at criminal law and that, in the present case, the Commission has no competence at criminal law. However, in my opinion the decisive factor continues to be the fact that, within the framework of the powers conferred on it by Article 15 of Regulation No 17 of the Council, the Commission is performing a function which is purely one of imposing penalties. (38)
75 The principles of legality and, in wider terms, of the rule of law, which constitute fundamental principles of the Community legal order and of the respective national laws of the Member States, dictate that the principle of personal liability be observed, whether repression of certain unlawful conduct by the legal system specifically manifests itself in the form of a criminal penalty or an administrative penalty outside the remit of the criminal law. (39)
76 However, a proclamation of the personal nature of liability does not automatically resolve the issue arising here. What precisely did each of the polypropylene producers do for which they must, consequently, bear the corresponding liability?
The proper answer to that question is that the undertaking's personal liability stems from its participation in a series of meetings and its involvement in the subject-matter of each one of those meetings, to the detriment of free competition. These actions, which are similar as to their legal nature (whether they took the form of agreements or concerted practices), (40) took place in a chronological series and were also interconnected in the sense that they were all committed in pursuit of the same economic objective in a given economic situation. Nevertheless, as external occurrences, in a temporal and spatial setting, they retain their autonomy and specificity, especially since their specific content is each time different. Thus, in order precisely to determine the infringement committed by each undertaking taken in isolation, it was relevant to have regard to the actual objectives in contemplation of which the undertaking decided to engage in an unlawful concerted practice and to coordinate its commercial conduct with that of its competitors. (41)
77 The contrary view whereby each undertaking would be deemed to have incurred objective liability in abstracto within the limits of the period during which it took part in the agreement, in respect of the entirety of the `single infringement' committed by the polypropylene producers, irrespective of whether it is established as having taken part in each of the various actions, belongs to the realms of deductive logic and does not comply with the principle of personal liability.
(ii) Concept of `single infringement' in the Court's reasoning
78 The first matter to be pointed out is that, as far as I can see, in having recourse to the concept of the `single infringement' to describe the overall conduct of the polypropylene producers, the Court of First Instance did not impute collective liability in general to the undertakings involved or to Anic in particular. In other words, it did not contravene the principle of personal liability.
79 The fact that the conduct of the polypropylene producers is closely connected and interrelated has already been alluded to: they contravened the same rule of law by successive and repeated acts having the same objective set against the same economic background. That observation leads on to the conclusion that inherent in the overall conduct at issue is continuity and unicity which is not without its effects from a legal point of view.
80 If this reasoning is followed the complex nature of the phenomenon in question, as described, may be comprehended with sufficient accuracy by use of the terms `continuing' or `single' infringement. That designation is dictated, on the basis of the criminal law model, (42) by the need for procedural rationalisation. Thus, inter alia, a uniform method for calculating the prescription is used, the starting point being the date on which the continuing infringement ceased, and the penalty to be imposed on each participant is only in respect of the whole of its unlawful conduct.
81 Consequently, categorisation of conduct as constituting a single or continuing offence is based on facts the proof and legal categorisation of which is posited and succeeded by such categorisation. What is expressed in that designation, in abstract terms, is the interrelationship between several acts each of which, viewed in isolation, in itself constitutes an infringement.
82 Accordingly, the concept of a single or continuing infringement encompasses the various distinct infringements: it follows that, although it is not the mere sum of those infringements, it encompasses nothing more than them. Since as a logical outcome it gives a precise overall picture, as far as possible, of the reality, the concept cannot, logically, be used ex post facto to conduct a separate legal appraisal of the individual features of that reality.
83 From that point of view, the fact that the Court of First Instance designated the conduct of polypropylene producers as a single infringement does not give rise to a problem. It is a designation of the facts which is justified by the nature of the case. It is, I believe, in that light that we should interpret the observation of the Court of First Instance when it said that `It would thus be artificial to split up such continuous conduct, characterised by a single purpose, by treating it as consisting of a number of separate infringements.' Taken in the abstract, this sentence is not free from uncertainty as to its meaning. However, in actual fact the Court of First Instance is bringing out the way the unlawful conduct of the polypropylene producers is interlinked, without making any prejudgment as to the individual liability to be imputed to each company. (43)
(iii) Whether the parties' arguments are well founded
84 The plea relied on by the Commission that the Court of First Instance misinterpreted its decision makes sense, in the context of appellate review, only if it is deemed to be based on misapplication of the law. However, the Court of First Instance did not err on the issue of the liability to be attributed to Anic in the present case, pursuant to Article 85(1) of the Treaty.
85 Nor does the plea relied on by Anic pursuant to which liability is attributed to it for conduct in which it personally had no part appear to be well founded. The undertaking takes the view that it did not take part in a concerted practice on the ground that it never put into effect on the market the decisions agreed at meetings between polypropylene producers. However, that is a matter which has no effect on the establishment of participation in a concerted practice where it pursues an objective contrary to the rules on competition.
86 Viewed in that light, the Court of First Instance was entitled to arrive at the conclusion that `the Commission has proved to the requisite legal standard each of the aspects of the infringement for the duration of its participation in the system of regular meetings of polypropylene producers and that it did not therefore attribute to the applicant liability for the conduct of other producers' (paragraph 206 of the judgment appealed against). Consequently, the judgment at first instance neither expressly nor indirectly imputed any `collective liability'.
87 There remains to be examined the plea raised by Anic as to a contradiction in the judgment: on the one hand, Anic submits, its involvement in the single infringement is linked to its participation in meetings of polypropylene producers but, on the other, the Court of First Instance chronologically extends its liability beyond the date on which it ceased to participate in those meetings. Anic adds that the matter relied on by the Court in order to attribute to Anic liability in respect of the period after mid-1982, that is to say the notification at the end of October 1982 of a document mentioning Anic's `aspirations' with regard to sales volumes for the first quarter of 1983, is not sufficient to establish an infringement of Article 85 during that period. (44)
88 The line of argument put forward by Anic is essentially based on the viewpoint that a decisive element taken into account for the purpose of describing the infringement as a single one is the very existence of a system of periodic meetings. I do not believe that to be a matter of such decisive importance. The fact that the infringement is single stems, as I have already said, from the identical nature of the subject-matter and of the legal categorisation of the individual actions examined. In the present case, since those actions amount to agreements and concerted practices, the essential feature is that of coordination and concertation. However, how that concertation is to be effected in each case is of no importance. It may take place during meetings, by means of telephone conversations, the exchange of documents, a combination of those procedures or in any other way.
Of course the fact and subject-matter of concertation have to be proven. The fact that in the present case the system adopted was one of periodic meetings does not therefore mean that a single infringement may cover only the actual meetings. Any other conduct constituting an infringement of Article 85 and pursuing the same objective of distorting the natural movement of polypropylene prices may also be covered by the term `single infringement'. Thus, the imputation to Anic of liability in respect of a period beyond the date on which it ceased to participate in meetings of polypropylene producers is not at odds with categorisation of the infringement as a `single' one. (45)
89 It follows that the Court of First Instance correctly attributed to Anic liability in this case, without there being any discernible contradiction in the reasoning underlying that attribution. Accordingly, the sole ground of appeal relied on by the Commission and the grounds of appeal relied on by Anic referable to the relevant paragraphs of the judgment given at first instance must be rejected as unfounded.
(4) The allegation of discriminatory (unequal) treatment
90 Anic also argues that it received discriminatory treatment, inasmuch as the Commission appealed against the judgment at first instance concerning Anic, whereas it refrained from doing so as regards that part of the judgment given by the Court of First Instance in Shell v Commission (46) in which the fine imposed by the Commission was also reduced, although in that judgment the reasoning of the Court of First Instance, in determining the liability of the undertaking in question, was on all fours with its reasoning concerning Anic.
91 Suffice it to state, with regard to this point, that, as was contended for on behalf of the Commission, in so far as Anic's argument may be regarded as containing a plea for annulment, it must be dismissed as inadmissible since that plea does
not allege any irregularity in the judgment given at first instance.
(5) Imputation of the infringement to Anic
92 According to Anic's line of argument on this point, the Court of First Instance misdirected itself in adopting a twofold criterion in order to identify the undertaking to which the infringement of Article 85 was to be imputed. More specifically, according to Anic, the court below, in attributing liability to it, alternately applied the criteria of legal continuity and of the economic and functional continuity of the undertaking. In that way, according to Anic, legal certainty is undermined, whilst the opportunity is given to undertakings, either by merging with other undertakings or by the sale of the whole of their business to various buyers, to enjoy impunity for any illegalities committed.
93 What is more, says Anic, owing to the error made by the Court of First Instance as regards the criterion for attributing liability, Anic has received discriminatory legal treatment as opposed to the other undertakings. According to Anic, the Commission applied different treatment to the Anic/SIR pairing, on the one hand, and Saga Petrokjemi/Statoil, on the other. Thus, whereas the merger of Saga Petrokjemi with Statoil resulted in liability being attributed merely to the latter, in the present case, Anic was held liable both for the infringements alleged against SIR, a company which it bought in 1980, and for infringements occurring during the period after the date on which Anic assigned its business in the polypropylene sector to Monte.
94 The Commission's view is that this plea is couched in terms which are too general and is, therefore, inadmissible. Furthermore, in its view, the Court of First Instance in no way applied that twofold criterion in attributing liability to Anic. It merely rejected Anic's allegations of discrimination in favour of the Saga Petrokjemi undertaking. In that connection the Commission emphasises the fact that Saga Petrokjemi was merged with Statoil and that the latter's liability for the acts of the former is a natural consequence of that merger. On the other hand, the transfer to Monte of Anic's polypropylene department did not signal the end of the latter's existence as a legal person. In that regard, the Commission contends that a distinction must be drawn between a sector of production and the whole of an undertaking. Anic operated in the market as a single undertaking and was not made up of the same number of undertakings as production sectors contained within it. Also, it pursued a single marketing strategy. Finally, the Commission points out that, as is stated at paragraphs 241 and 242 of the judgment, Anic was never made liable for the acts of SIR.
95 In raising this ground of appeal, Anic is challenging the criterion adopted by the Court of First Instance in order to `identify the natural or legal person who was responsible for the operation of the undertaking at the time when the infringement was committed, so that it can answer for it' (paragraph 236 of the judgment appealed against). As far as Anic is concerned, the Court of First Instance acknowledges that `the legal person responsible for the operation of the undertaking when the infringement was committed continued to exist until the adoption of the Decision. The Commission was therefore entitled to hold it answerable for the infringement' (paragraph 238 of the judgment appealed against).
96 In light of the foregoing considerations, the ground of appeal raised by Anic is relevant and in principle admissible only in so far as it concerns the imputation of liability to it, as described in the paragraph of the judgment of the Court of First Instance cited above.
97 It is none the less true that, on this point, the reasoning of the Court of First Instance does exceed the limits of the present case since it seeks to examine the case where, between the time when the infringement was committed and the time when the undertaking in question must answer to that charge, the undertaking responsible for operating that undertaking has legally ceased to exist (paragraph 237 of the judgment appealed against). It is specifically this part of the judgment which Anic is essentially challenging when it refers to a twofold criterion for attributing liability. However, its arguments, it seems to me, do not challenge, as I have already observed, the sole criterion in accordance with which liability was attributed to Anic: the company continued to exist as a legal person at the time when the administrative penalties were imposed on it. Accordingly, since Anic's arguments do not refer to the criterion in accordance with which liability was attributed to it, they must be rejected as irrelevant. (47)
98 On the other hand, when Anic alleges that the Court of First Instance unlawfully distinguished between its liability and that attributed to other undertakings, it rightly highlights a flaw vitiating the judgment appealed against. However, it is sufficient to point out in this connection, as the Court of First Instance does at paragraph 239 of the judgment appealed against, that the case of Saga Petrokjemi is different and cannot therefore be compared with Anic's case, since the former case is that of an undertaking which had ceased to exist qua legal person at the time when the administrative penalties were imposed.
99 Moreover, the Court of First Instance emphasises that no liability was attributed to Anic for acts committed by SIR itself (paragraph 241 of the judgment appealed against). If an administrative procedure concerning such acts had been instituted, it would have been necessary to hold SIR itself answerable for any infringement committed by it, since the legal person which was responsible for the operation of that undertaking when any infringement was committed continued to exist even though in liquidation (paragraph 242 of the judgment). Therefore, it follows that, in the case of SIR, the Court of First Instance applied the same criterion for attributing liability as it did in the case of Anic.
In light of the foregoing considerations, it follows that the reasoning followed by the
Court of First Instance on the abovementioned points is entirely correct.
(6) As to the fine
100 According to Anic, the Court of First Instance ought to have further reduced the amount of the fine imposed on it, owing to the fact the infringement established ceased in its case in June and not October 1982. Moreover, Anic alleges that the Court of First Instance did not correctly appraise the seriousness of the infringement which it was said to have committed. First, it did not take into account the extremely limited role played by Anic in the polypropylene-producers cartel. At the same time, in examining the effects of the infringement (paragraph 280 of the judgment appealed against), it failed to take into account the individual conduct of Anic when determining the amount of the fine to be imposed, thus contravening the principle of personal liability. Finally, Anic asserts that, in order to assess the gravity of its conduct, the Court of First Instance erroneously paid heed to information concerning its market share in the polypropylene sector which had been communicated to the Court by the Commission. Apart from the fact that it was imprecise, that information referred to 1983, not 1982, the time when Anic's unlawful conduct ceased. What is more, Anic's contention is that the Commission was wrong to calculate the amount of its turnover on the basis of the Lira-Ecu exchange rate in force in 1982; it ought to have applied the exchange rate in force in 1986 when the fine was imposed on it.
101 In the Commission's view, Anic's argument concerning the limited duration of its involvement in the infringement must be rejected as inadmissible because it calls in question findings of fact made by the Court of First Instance. Anic's allegations concerning the Court's findings on the seriousness of the conduct at issue are, it says,
likewise inadmissible because paragraph 280 of the judgment appealed against does not contravene the principle of personal liability. It is right that the amount of the fines imposed should vary depending on the seriousness of each undertaking's conduct.
102 Furthermore, the Commission maintains that, on adoption of the contested decision, it did not take into account the table showing market shares in the polypropylene sector held in 1983 by the various companies. In any event, determination of fines is not, and cannot be, a purely arithmetical operation. Finally, the Commission maintains that Anic's turnover is the same whether it is calculated in Lira or Ecus, the decisive factor from a legal point of view being the average equivalence of those two currencies in 1982.
103 It should, first of all, be pointed out that the possibility of imposing fines for infringement of Article 85(1) of the Treaty is expressly provided for in Article 15(2) of Regulation No 17 of the Council. Under that provision the criteria to be taken into account in determining the amount of the fine are the seriousness of the infringement and its duration.
104 Of those two criteria the one which needs to be further particularised is the criterion concerning the seriousness of the unlawful conduct. In that connection the Court has held that: `the gravity of infringements must be determined by reference to numerous factors such as, in particular, the particular circumstances of the case, its context and the dissuasive element of fines; moreover, no binding or exhaustive list of the criteria which must be applied has been drawn up'. (48)
105 Against that background the Court of First Instance has sole competence as the court trying the case on its merits to review the manner in which the Commission assesses in each case the gravity of the unlawful conduct. Appellate review can only be intended to verify whether the court trying each case on its merits gave proper consideration to all substantive factors in assessing the gravity of given conduct in light of Article 85 of the Treaty. However, such review does not extend to the manner in which the Court of First Instance on each occasion assessed those factors.
106 In the present case the following observation may be made: as I have already stated in an earlier part of my Opinion herein, (49) Anic's argument concerning the temporal limits of its involvement in the infringement of Article 85 committed by the polypropylene producers must be rejected.
Anic takes the view that it is wrong in law to take into account the overall effects of the infringement as the criterion for determining the fine imposed on it individually. Yet there is a difference between the effects brought about by conduct as described in Article 85(1) of the Treaty, which is the relevant issue in this case, and the more
specific role played by each undertaking in the context of that conduct.
107 Both criteria must be taken into consideration in assessing the gravity of the infringement committed. Accordingly, on a correct interpretation and application of the relevant provisions of Community law, and after holding that `the effects taken into account by the Commission in setting the general level of fines are not those resulting from the actual conduct which an undertaking claims to have adopted but those resulting from the whole of the infringement in which the undertaking participated' (paragraph 280 of the judgment), the Court of First Instance was of the view that those matters had properly been taken into consideration (paragraph 282).
108 Anic also challenges that part of the judgment appealed against concerning the assessment of its individual contribution to the overall infringement, claiming that the Court of First Instance did not pay sufficient heed to the marginal nature of its involvement.
It is clear from the judgment appealed against that the Court of First Instance rejected Anic's arguments as to its role in the infringement, dwelling on its deliberate involvement in the infringement and distinguishing the role played by it from that of the `big four' polypropylene producers (paragraphs 262 to 266 of the judgment appealed against). On this point, therefore, the Court of First Instance underpinned its judgment with adequate reasoning, and appraisal of the facts is not a matter for the appellate jurisdiction.
109 It remains to examine that part of Anic's arguments dealing with the manner in which its share of the polypropylene market and its global turnover were evaluated and used as criteria for determining the fine imposed on it. Indeed those two elements are important in determining the size and financial significance of a given undertaking, so as to calculate subsequently the fine to be imposed on it. Moreover, Article 15(2) of Regulation No 17 provides that the fine imposed may not in any event exceed 10% of the turnover achieved during the financial year preceding that in which the infringements were committed.
110 Yet, apart from this limitation, assessment of the other factors in the final determination of the fine is a matter for the Commission's discretion and is subject to review by the court trying the case on its merits, in this case the Court of First Instance. In any event, the relevant criteria are evaluated by the Commission which enjoys a margin of discretion in that regard, inasmuch as the final amount of the fine is not arrived at on the basis of an arithmetical computation of the abovementioned factors. In the context of the present case the Court of First Instance acknowledged (see paragraph 273 of the judgment appealed against) that the Commission, as indicated at paragraph 109 of the polypropylene decision, took account both of the sales of each undertaking within the Community and of the total turnover of each one. The issue as to whether the turnover used for Anic was that of 1983, as the company alleges, or 1982, as the Commission asserts, is a matter for factual determination and appraisal by the Court of First Instance. To call in question the evidence is to impinge on the substantive appraisal by the Court of First Instance and cannot be allowed on appeal.
111 Finally, Anic alleges that the fine imposed on it ought to have been calculated on the basis of turnover as determined in Ecus, in accordance with the average Lira-Ecu equivalence in 1986.
112 On that point I think that Article 15(2) of Regulation No 17 is clear. Under the terms thereof, fines are to be imposed in units of account (Ecus) and the relevant period for determining the amount of the fine is the accounting period preceding that during which the infringement was committed. The logical consequence of that is that the conversion into ECUs of the various currencies in which the turnover of each undertaking is calculated must be effected on the basis of the parities in force in the accounting period preceding that in which the infringement was committed.
Consequently, the determination reached by the Court of First Instance in that regard is in accordance with the Community rules and thus lawful, and any arguments to the contrary are ill-founded.
III - Conclusion
113 In light of all the foregoing, I propose that the Court should:
(1) Dismiss the Commission's appeal in its entirety;
(2) Dismiss in its entirety the cross-appeal by Enichem Anic SpA;
(3) Order each party to bear its own costs.
(1) - The cross-appeal was submitted in accordance with Article 116(1) of the Rules of Procedure of the Court in the reply by Anic to the Commission's appeal.
(2) - Case T-6/89 Enichem Anic v Commission [1991] ECR II-1623.
(3) - IV/31.149 - Polypropylene, OJ 1986 L 230, p. 1.
(4) - First Regulation implementing Articles 85 and 86 of the Treaty (OJ, English Special Edition 1959-1962, p. 87).
(5) - Joined Cases T-79/89, T-84/89, T-85/89, T-86/89, T-89/89, T-91/89, T-92/89, T-94/89, T-96/89, T-98/89, T-102/89 and T-104/89 BASF and Others v Commission [1992] ECR II-315).
(6) - Article 3 of Regulation No 1 of the Council of 15 April 1958 determining the languages to be used by the European Economic Community (OJ, English Special Edition 1952-58, p. 59).
(7) - Article 12 of the rules of procedure of the Commission.
(8) - It is doubtful whether any ground of appeal is in the end discernible in those arguments.
(9) - As stated, Anic relies in support of its arguments on a series of factual matters which were not before the Court of First Instance for a determination, because either they occurred after delivery of the judgment at first instance or they were not known to the applicant or to the Court of First Instance during the whole of the procedure at first instance. It is inadmissible for such matters to be raised at the appeal stage. They might possibly serve to support an application for revision of the judgment at first instance under Article 41 of the EC Statute of the Court of Justice and Articles 125 to 128 of the Rules of Procedure of the Court of First Instance. Since Anic did not avail itself of the opportunity afforded to it under the procedural rules it cannot remedy its omission by raising the matters in question at the appeal stage.
(10) - See, for example, judgment in Joined Cases 56/64 and 58/64 Consten & Grundig v Commission [1966] ECR 429.
(11) - Judgment in Case 48/69 ICI v Commission [1972] ECR 619, paragraphs 64 and 65.
(12) - Judgment of the Court in Joined Cases 40/73 to 48/73, 50/73, 54/73, 55/73, 56/73, 111/73, 113 and 114/73 Coöperatieve Vereniging `Suiker Unie' UA and Others v Commission [1975] ECR 1663, paragraphs 173 and 174, also known as the `Sugar' case.
(13) - Those cases involved an indirect means of proof in the sense that the parallel or analogous conduct may be used as evidence of the existence of concertation, but is not sufficient by itself. It is for the Commission to produce `sufficiently precise and coherent' proof or, according to another formulation, `a firm, precise and consistent body of evidence' to justify the view that the parallel behaviour of the two undertakings in question was in fact the result of concerted action (see, respectively, judgments in Joined Cases 29/83 and 30/83 Compagnie Royale Asturienne des Mines and Rheinzink v Commission [1984] ECR 1679, paragraph 20 and in Joined Cases C-89/85, C-104/85, C-114/85, C-116/85, C-117/85 and C-125/85 to C-129/85 Ahlström Osakeyhtiö and Others v Commission [1993] ECR I-1307, paragraph 127, hereinafter the `Woodpulp' cases). Accordingly,
it was sufficient for the applicants to prove circumstances which cast a different light on the facts established by the Commission and thus allowed another explanation of the facts to be substituted for the one adopted by the Commission's decision (Compagnie Royale Asturienne des Mines and Rheinzink, cited above, at paragraph 16). See also judgment in Case C-53/92 P Hilti v Commission [1994] ECR I-667, paragraphs 33 to 38.
(14) - In fact, in Case 41/69 ACF Chemiefarma v Commission [1970] ECR 661, Advocate General Gand said in his Opinion that `a concerted practice .... according to the prevailing view, presupposes that the agreement is actually carried out so that it is necessary to establish the actual conduct of the undertakings concerned and the existence of a link between such conduct and a prearranged plan' (p. 715). Advocate General Mayras expressed an essentially similar view in his Opinion in the Dyestuffs case (cited above): `... an objective criterion ... situation within the Common Market.
However, an objective criterion, which is basic to the concept of a concerted practice, must also be met. This is that the participating undertakings must in fact have acted in the same way.
This is the first difference of principle from the concept of an agreement in that, according to your case-law, an agreement, provided that its existence is established and that it has as its object an adverse effect on competition within the Common Market, is prohibited under Article 85 without its being necessary to consider the real effect of the said agreement on competition.
Thus it seems to me that one cannot dissociate the idea of a concerted practice from the real effect that it has on the competitive situation within the Common Market.'
(15) - In his Opinion in Ahlström Osakeyhtiö and Others v Commission (cited above at footnote 13) Advocate General Darmon took a view contrary to those expressed above, considering that `... to take the view that de facto identical conduct forms part of the concept of concerted practices would lead to a particularly restrictive conception of the Treaty, which is contrary to Article 85(c)' (p. 1489).
(16) - See Opinion of Advocate General Darmon in the Woodpulp cases cited above at footnote 13, paragraph 187.
(17) - An alternative conclusion on the preceding point was offered by Judge Vesterdorf, acting as Advocate General in the Joined Opinions delivered before the Court of First Instance in the `Polypropylene' cases ([1991] ECR II-869). On that view, the point in time when an infringement occurs in the case of a concerted practice is subsequent to the concertation and, in actual fact, when the undertaking participating in the concerted practice takes action on the market. Whatever action is taken is of necessity determined by the concertation and in that way has a direct impact om competition. It is therefore irrelevant whether the conduct on the market has a specific purport, namely that which constituted the object of the concertation, or indeed whether that action had any impact (pp. II-941 to 942). In that way, the rationale of Article 85 coincides with a literal construction of the letter of the provision under which the term `practice' means activity on the market. As has, I believe, become clear, I am not persuaded by this particular argument.
It should also be pointed out that the judgment at first instance did not expressly accept the point of view adopted by Judge Vesterdorf. It is true that in paragraph 201 the Court of First Instance comes close to a declaration on those lines: `Accordingly, not only did the applicant pursue the aim of eliminating in advance uncertainty about the future conduct of its competitors but also, in determining the policy which it intended to follow on the market, it could not fail to take account, directly or indirectly, of the information obtained during the course of those meetings. Similarly, in determining the policy which they intended to follow, its competitors were bound to take into account, directly or indirectly, the information disclosed to them by the applicant about the course of conduct which the applicant itself had decided upon or which it contemplated adopting on the market.' However, in the context of this part of the reasoning the action on the market is not being considered as an element of the concerted practice. The Court of First Instance is merely endeavouring to determine the anticompetitive nature of the concertation between the polypropylene producers. The matters to be taken into account of necessity by every producer active on the market must be regarded as forming part of the area of its autonomy ceded to the cartel which in itself constitutes an infringement of Article 85. However, the practical difference between the two views is limited to extreme cases where concertation is not followed by any activity on the market, which is not the case here.
(18) - If one were to borrow the terminology of the criminal law one would regard a concerted practice as an offence as to both conduct and result.
(19) - I do not intend to dwell at this stage on the question whether the unlawful concertation in question must also be classified as a `concerted practice' or an `agreement'. As I shall explain in more detail below, the distinction between those two legal terms is in certain cases, such as this, a secondary matter.
(20) - See footnote 12 above.
(21) - See judgment in Ahlström, at footnote 13 above.
(22) - This line of reasoning was also followed by Advocate General Darmon in his Opinion in the Woodpulp cases referred to at footnote 13 (paragraphs 173 and 174). The like inference may, it seems, be drawn from ICI v Commission (the `Dyestuffs' case, cited at footnote 11) in which reference was made to `(...) prior elimination of all uncertainty as to each other's conduct regarding the essential elements of that action (...)' (paragraph 118).
(23) - In light of the facts of the case, the question may be put in the following terms: can a handwritten note drawn up by an employee of ICI and dated 28 October 1982 which sets out the applicant's sales volume `aspirations' and its proposals regarding the quotas to be allocated to other producers (paragraph 175 of the judgment appealed against) constitute sufficient proof of participation by Anic in the infringement in the time between July and October 1983? That argument does not go to the appraisal of the facts by the Court of First Instance, as the Commission contends, but concerns the question whether the facts as found are sufficient to warrant the legal conclusion that Anic participated in a concerted practice at the relevant time. Accordingly, the ground of appeal in that connection concerns the application to the facts by the Court of First Instance of the concept of `concerted practice', and it is admissible for that plea to be raised at the appeal stage. But the judgment on the merits is dependent on the solution of the question now under examination. As the Court of First Instance acknowledged (paragraph 176 of the judgment appealed against), the handwritten note by ICI essentially constitutes the only piece of evidence as to the participation, in whatever form, of Anic in the activities of the polypropylene producers over a certain period of time. During that period, therefore, and since Anic did not participate in the meetings of the other producer undertakings which followed, there was no reciprocity in the exchange of information but merely a unilateral initiative by Anic, dictated by its own calculations, with a view to its withdrawal from the polypropylene market (see paragraph 176 of the judgment appealed against). If, therefore, the view that the reciprocity of information communicated constitutes an essential element of the objective existence of a concerted practice, then the judgment at first instance would be liable to be set aside as regards this point.
(24) - Certainly, alternate unilateral announcements in the final analysis satisfy the requirement of reciprocity, as Advocate General Darmon appears to accept in his Opinion in the abovementioned Ahlström case (see footnote 13 above), in which he also referred to the `Containers' decision of the Supreme Court of the United States which turned on similar matters of fact and law (see paragraph 81 of Advocate General Darmon's Opinion in that case). However, the question arising here is whether a concerted practice is established where the only actual evidence is constituted by the disclosure of relevant information by one only of the undertakings involved and not by all the undertakings.
(25) - See Opinion of Advocate General Darmon (paragraph 169) cited at footnote 13. In that connection the Advocate General referred to the definition of `arrangement' in English law given in British Basic Slag Ltd's Application (1962) 3 AER 247.
(26) - See also the terms in which paragraph 64 of the judgment in Ahlström (cited at footnote 13) is couched, namely: `At the time when each undertaking engages in such behaviour, it cannot be sure of the future conduct of the others.'
(27) - The first and essential element for establishing participation in a concerted practice (and also an agreement) under Article 85 is the substantive act of participating in the unlawful action which, in the present case, is equivalent to the implementation of unlawful co-operation. In the case of the unilateral notification of information, a fortiori, the addressee of the information must be shown to have accepted the notification of information, or at least acquiesced in it, failing which he cannot incur liability.
(28) - Even under the interpretation according to which for there to be a concerted practice there must be a subsequent intervention on the market by the undertakings involved, the only difference is in fact the time when the infringement occurs and not the fact that it is incompatible with free competition. Moreover, the consensus between the parties to act in a specific manner, which is required in order to prove the agreement, is of limited significance in the present case.
(29) - Here it is not relevant whether it is correct to classify the activities in question as a `single infringement' (see in that connection paragraph 61 et seq.); rather it must be established whether and, if so, under what circumstances they can be deemed cumulatively to constitute an `agreement and concerted practice'.
(30) - The distinction between agreement and concerted practice continues to be of practical value in connection with allocation of the burden of proof in cases where a concerted agreement has been found to exist following observation of parallel conduct by undertakings on the market. On this point see the case-law referred to earlier in footnotes 10 to 12.
(31) - Anic emphasises that that was also found as a matter of fact to be the case by the Court of First Instance and refers for that purpose to paragraphs 112 and 113 of the contested judgment.
(32) - See on that point my previous analysis at paragraph 22 et seq.
(33) - See Opinion of Advocate General Sir Gordon Slynn in Joined Cases 100/80, 101/80, 102/80 and 103/80 Musique Diffusion Française and Others v Commission [1983] ECR 1825. See also the American case: Hunt v Mobil Oil Corp. (Supreme Court 1977) 465F Supp. 195, 231.
(34) - See in that connection paragraph 22 et seq.
(35) - This submission relates essentially to the content and definition of the terms `single infringement' and `collective liability' and is therefore linked to the question whether the Court of First Instance applied Article 85(1) correctly or not rather than to whether there is an inherent contradiction in the judgment. That is why Anic is not seeking at this stage annulment of the judgment appealed against for contradictory reasoning but merely in relation to the duration of its participation in the infringement.
(36) - See Article 15(2) of Regulation No 17 of the Council.
(37) - On the other hand, cases which I will refer to incorrectly as normal infringements of the rules on competition (in the sense that they have been subjected to scrutiny by the Court) in this respect presented no problem concerning the imputation of liability. `Participation' in an isolated infringement founded the corresponding liability.
(38) - Notwithstanding the terms of Regulation No 17 the imposition of a fine is nevertheless a penalty outside the purview of the criminal law.
(39) - The tendency to approach the legal analysis of administrative penalties from the point of view of the corresponding criminal penalties is dictated by what is in my view a more accurate and democratic understanding of State-citizen relations and individual-public authority, in general. This tendency would appear to have become prevalent in recent years in national legal systems and may also be discerned in recent judgments of the European Court of Human Rights (see, for example, the judgment of 21 February 1984, Oztürk). Moreover, notwithstanding the wording of Article 15(4) of Regulation No 17, it may be convincingly affirmed that the fines which can be imposed in the event of a breach of the rules on competition, by their scope and amount, are `corrective' in nature, in which case application of the principle of personal liability ought to be regarded as self-evident.
(40) - See paragraph 22 et seq. above.
(41) - As has, of course, been set out, the `participation' of a company in the unlawful conduct at issue is in fact its participation in a concerted practice whose object runs counter to freedom of
competition. That constitutes the `act' which in the present case meets the objective conditions laid down in Article 85 and is thus the matter of which proof has to be adduced in relation to each aspect of the unlawful activity.
(42) - For the concept of continuing infringements, see Stephani, Levasseur and Bouloc, Droit pénal général, 15th Ed., Paris, 1994, p. 188 et seq. It should be noted that, although the continuing infringement is similar to the perpetual infringement on a number of points (beginning and interruption of prescription period, single prosecution, single penalty), it is not identical to it. It is in fact a hybrid form lying somewhere between a one-off infringement and a perpetual infringement. More precisely, it is a series of one-off infringements displaying features of continuity and uniformity. Accordingly, the term `continuing infringement' is legally more accurate than the expression `single infringement'. For the purposes of the present case both terms should be regarded as synonymous.
(43) - In order for such liability to be firmly founded, in light of the foregoing, the Court of First Instance proceeds to examine whether each separate undertaking, and in this case Anic, participated in each part of the conduct at issue and for how long.
(44) - On this plea see paragraph 37 et seq. above.
(45) - Once, of course, participation is proven, if not at the meetings, at least in the concertation undertaken.
(46) - Judgment of 10 March 1992 in Case T-11/89 Shell v Commission [1992] ECR II-757, which was another in the series of Polypropylene cases.
(47) - A fortiori, as the Court of First instance correctly observed, hypothetical situations such as that of an undertaking which has disappeared as both a legal and economic entity, or where the infringement is committed by an undertaking belonging to a group, are irrelevant in the context of the present case.
(48) - Order of the Court in Case C-137/95 P SPO and Others v Commission [1996] ECR I-1611, paragraph 54. See also judgments in Cases 45/69 Boehringer Mannheim v Commission [1970] ECR 769; Musique Diffusion Française and Others v Commission (cited above at footnote 33, paragraph 120) and Joined Cases 96/82 to 102/82, 104/82, 105/82, 108/82 and 110/82 IAZ and Others v Commission [1983] ECR 3369, paragraph 52.
(49) - See paragraphs 87 to 89 above.