62021TJ0561_RES
Case T‑561/21
HSBC Holdings plc and Others
v
European Commission
Judgment of the General Court (Seventh Chamber) of 27 November 2024
(Competition – Agreements, decisions and concerted practices – Euro Interest Rate Derivatives sector – Decision establishing an infringement of Article 101 TFEU and Article 53 of the EEA Agreement – Failure to discharge the obligation to state reasons – Annulment in part of the decision by a judgment of the General Court – Amending decision – Fines – Limitation – Basic amount – Value of sales – Article 23(2) and (3) of Regulation (EC) No 1/2003 – Equal treatment – Proportionality – Unlimited jurisdiction)
Competition – Administrative procedure – Time-limit with regard to proceedings – Suspension – Suspensive effect attaching to pending judicial proceedings – Condition – Existence of uncertainty as to the lawfulness of the Commission’s decision that is the subject of the pending proceedings – Objective pursued by bringing those proceedings – Irrelevant – Findings in the judicial decision bringing the pending proceedings to an end – Irrelevant
(Council Regulation No 1/2003, Art. 25(5) and (6))
(see paragraphs 39-50)
Appeal – Interest in bringing proceedings – Annulment in part by the General Court of a decision imposing a fine in respect of an infringement of competition law – Appeal brought by the Commission – Preparatory actions by the Commission with a view to adopting a decision amending the decision that has been annulled in part – No impact on the Commission’s interest in bringing proceedings
(Statute of the Court of Justice, Art. 56)
(see paragraphs 51, 52)
Competition – Fines – Amount – Determination – Determination of the basic amount – Determination of the value of sales – Application of the methodology set out in the Guidelines – Proxy established on the basis of discounted cash receipts calculated by applying a reduction factor – No error of law or error of assessment by the Commission
(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, points 13, 15, 16)
(see paragraphs 61-68, 77-95)
Competition – Fines – Amount – Determination – Determination of the basic amount – Determination of the value of sales – Application of the methodology set out in the Guidelines – Choice of a proxy for the value of sales – Proxy established on the basis of discounted cash receipts calculated by applying a reduction factor – Failure to discharge the obligation to state reasons – None
(Arts 101(1) and 296, second subpara., TFEU; Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, point 13)
(see paragraphs 69, 73-76)
Appeal – Grounds – Inadequate statement of reasons – Separate ground from the one concerning substantive legality
(Art. 296 TFEU; Statute of the Court of Justice, Art. 58, first para.)
(see paragraphs 70-72)
Competition – Fines – Amount – Determination – Determination of the basic amount – Determination of the value of sales – Application of the methodology set out in the Guidelines – Proxy established on the basis of discounted cash receipts calculated by applying a reduction factor – Determination of the reduction factor – No infringement of the obligation to state reasons – No errors of assessment – No failure to observe the principle of proportionality or the principle that penalties must be specific to the offender – No infringement of the equal treatment principle
(Arts 101(1) and 296, second subpara., TFEU; Charter of Fundamental Rights of the European Union, Arts 20 and 21; Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, point 13)
(see paragraphs 99-110, 121-124, 131-146, 152-169, 173-187)
Competition – Fines – Amount – Determination – Determination of the basic amount – Gravity of the infringement – Criteria for assessment – Nature and geographic extent of the infringement – Respect for the principles of proportionality and equal treatment
(Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, points 19 to 23)
(see paragraphs 193-209)
Competition – Fines – Amount – Determination – Determination of the basic amount – Gravity of the infringement – ‘Entry fee’ – Factors to be taken into consideration
(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, point 25)
(see paragraphs 211-224)
Competition – Fines – Amount – Determination – Adjustment of the basic amount – Mitigating circumstances – Lower intensity of participation in the infringement as compared with that of the main players – 15% reduction of the basic amount – Failure to observe the principle of proportionality, the principle of equal treatment or the principle that penalties must be specific to the offender – None
(Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, point 29)
(see paragraphs 228-234, 238-240)
Competition – Fines – Amount – Determination – Discretion of the Commission – Judicial review – Unlimited jurisdiction of the EU judicature – Scope – Determination of the amount of the fine imposed – Criteria for assessment – Gravity and duration of the infringement – Respect for the principles of adequate reasoning, proportionality, that penalties must be specific to the offender and of equal treatment
(Arts 101(1) and 261 TFEU; Council Regulation No 1/2003, Arts 23(3) and 31)
(see paragraphs 243-250)
Résumé
The General Court dismisses the application for annulment brought by the entities HSBC Holdings plc, HSBC Bank plc and HSBC Continental Europe (together ‘HSBC’) against the Commission’s decision amending its decision to impose a fine of EUR 33606000 on HSBC in respect of an infringement of EU competition law. (
1
) Given that, when the 2021 Amending Decision was adopted, the Commission’s initial decision was still the subject of pending proceedings before the Court of Justice, the General Court provides, in its judgment, details on the suspensive effect of those pending proceedings on the limitation period within which the Commission may impose a fine on HSBC.
In 2016, the Commission found that HSBC had infringed Article 101 TFEU and Article 53 of the European Economic Area (EEA) Agreement by participating, from 12 February to 27 March 2007, in a single and continuous infringement with the object of distorting the normal course of pricing on the Euro Interest Rate Derivative market. Accordingly, the Commission imposed on the three entities referred to above jointly and severally a fine of EUR 33606000. (
2
)
By judgment of 24 September 2019, the General Court found that the Commission had made errors as to the scope of the infringement it found HSBC had committed in the 2016 Decision, but also found that those errors had no effect on the lawfulness of Article 1(b) of the 2016 Decision, since the conclusion set out therein remained substantiated by other elements appearing in the 2016 Decision, but that those errors might be taken into account when assessing the proportionality of the fine. (
3
)
In addition, since it had found that the 2016 Decision was vitiated by an error of reasoning, the General Court annulled it in so far as it imposed a fine of EUR 33606000 on HSBC. Both the Commission and HSBC brought an appeal before the Court of Justice against that judgment.
However, by letter of 8 May 2020, the Member of the Commission responsible for competition notified HSBC of her intention to propose to the College of Commissioners that a new decision be adopted in order to remedy the situation resulting from the judgment of the General Court of 24 September 2019.
By the 2021 Amending Decision, the Commission reduced the fine imposed on HSBC by the 2016 Decision to EUR 31739000 and supplemented the reasoning set out in that decision, which the General Court had deemed to be inadequate. Approximately one month after the adoption of the 2021 Amending Decision, the Commission withdrew its appeal against the judgment of the General Court of 24 September 2019.
HSBC brought an action before the General Court for annulment of the 2021 Amending Decision and therefore of the fine imposed by the 2016 Decision, as amended. In the alternative, the applicants asked the Court to exercise its power of unlimited jurisdiction and to reduce substantially the fine imposed on them in the 2021 Amending Decision.
Findings of the Court
In support of its action for annulment, HSBC complains that, inter alia, the Commission adopted the 2021 Amending Decision outside the maximum limitation period of ten years laid down in Article 25(5) of Regulation No 1/2003 (
4
) for imposing a fine in respect of the infringement found in the 2016 Decision.
On that point, HSBC submits, in essence, that the appeal brought by the Commission against the judgment of the General Court of 24 September 2019 did not have the effect of suspending that 10-year limitation period, since, already at the time when that appeal was brought, the Commission intended to adopt the 2021 Amending Decision without awaiting the outcome of those appeal proceedings. In addition, according to the applicants, even if the appeal brought by the Commission had suspended the limitation period, that suspension came to an end in any event when the Member of the Commission responsible for competition notified HSBC of her intention to propose to the College of Commissioners that a new decision to be addressed to HSBC be adopted, which it did because the Commission had lost its interest in the outcome of the appeal.
After stating that, on the date on which the Commission brought the appeal, the limitation period for imposing a fine on HSBC in respect of the infringement found in the 2016 Decision had not yet expired, the Court recalls that, under Article 25(6) of Regulation No 1/2003, the limitation period for the imposition of fines is to be suspended for as long as the Commission’s decision finding the infringement and imposing a fine is the subject of proceedings pending before one of the EU Courts. Under paragraph 5 of that article, the maximum limitation period of 10 years is to be extended by the time during which limitation is suspended pursuant to paragraph 6.
Contrary to what is argued by HSBC, Article 25(6) of Regulation No 1/2003 does not make the suspensory effect of pending court proceedings subject to any subjective condition, such as an ‘objective’ pursued by the bringing of the action or the ‘intention’ of the party bringing it.
That provision protects the Commission against the effect of the limitation period in situation in which it is ‘prevented’ from acting in so far as it must await the decision of the EU Courts in proceedings beyond its control before it knows whether the contested measure is or is not unlawful. That notion of being ‘prevented’ is therefore an objective circumstance that relates to whether there are pending court proceedings as a result of which there is uncertainty as to the lawfulness of the Commission’s decision.
In the light of that clarification, the General Court finds that, while the Commission’s appeal proceedings were pending, there was uncertainty as to the lawfulness of the 2016 Decision in so far as it imposed a fine of EUR 33606000 on HSBC. It follows that the limitation period for imposing a new fine on HSBC for the infringement found in the 2016 Decision was suspended until the Court of Justice adopted a decision bringing those appeal proceedings to an end, irrespective of the steps taken by the Commission with a view to adopting the 2021 Amending Decision.
In that context, the General Court also rejects HSBC’s argument that the Commission had no interest in bringing or maintaining its appeal against the judgment of the General Court of 24 September 2019.
In that regard, the General Court states that, while the absence of any interest in bringing proceedings at the time when the appeal was brought – assuming that it were established – could lead an appeal to be dismissed as inadmissible, and while, if the interest in bringing proceedings were to fall away in the course of the proceedings, this could lead the Court of Justice to rule that there was no need to give judgment, it is precisely the fact that an action is pending before the General Court or the Court of Justice that justifies the suspension of the limitation period and not the conclusions reached by those courts in their decision bringing the proceedings to an end.
In any event, the mere fact that the Commission took steps to adopt a new decision following the delivery of the judgment of 24 September 2019 does not show that it lost all interest in seeking a declaration that the 2016 Decision was lawful, since that interest continued until the Court of Justice adopted a decision bringing the proceedings to an end or, at the very least, until that new decision was adopted. The fact that, after the adoption of the 2021 Amending Decision, the Commission withdrew its appeal does not in any way alter that conclusion.
In the light of all of the above, the General Court finds that the Commission’s exercise of its power to impose penalties in respect of the infringement found in the 2016 Decision was not time-barred on the day on which the 2021 Amending Decision was adopted. The General Court then goes on to dismiss all of the other pleas relied on by HSBC in support of its application for annulment of the 2021 Amending Decision, as well as HSBC’s claim for a reduction of the fine imposed in that decision, and, consequently, dismisses the action in its entirety.
(
1
)	Commission Decision C(2021) 4600 final of 28 June 2021 amending Commission Decision C(2016) 8530 final of 7 December 2016 relating to a proceeding under Article 101 TFEU and Article 53 of the EEA Agreement (Case AT.39914 – Euro Interest Rate Derivatives) (‘the 2021 Amending Decision’).
(
2
)	Commission Decision C(2016) 8530 final of 7 December 2016 relating to a proceeding under Article 101 TFEU and Article 53 of the EEA Agreement (Case AT.39914 – Euro Interest Rate Derivatives (EIRD)) (‘the 2016 Decision’).
(
3
)	Judgment of 24 September 2019, HSBC Holdings and Others v Commission (T‑105/17, EU:T:2019:675).
(
4
)	Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles [101 and 102 TFEU] (OJ 2003 L 1, p. 1).