JUDGMENT OF THE COURT OF FIRST INSTANCE (Second Chamber)

21 September 2005 ( )

(Competition – Concentration – Regulation (EEC) No 4064/89 – Decision declaring a concentration incompatible with the common market – Portuguese electricity and gas markets – Acquisition of GDP by EDP and Eni – Directive 2003/55/EC – Liberalisation of gas markets – Commitments)

In Case T-87/05,

EDP – Energias de Portugal SA, established in Lisbon (Portugal), represented by C. Botelho Moniz, R. García-Gallardo, A. Weitbrecht and J. Ruiz Calzado, lawyers,

applicant,

v

Commission of the European Communities, represented by A. Bouquet and M. Schneider, acting as Agents, with an address for service in Luxembourg,

defendant,

supported by

Gas Natural SDG SA, established in Barcelona (Spain), represented by J. Perez-Bustamante Köster and P. Suárez Fernández, lawyers,

intervener,

APPLICATION for annulment of Commission Decision C(2004) 4715 final of 9 December 2004 declaring incompatible with the common market the concentration by which EDP – Energias de Portugal SA and Eni Portugal Investment SpA proposed to acquire joint control of Gás de Portugal SGPS SA (Case COMP/M.3440 – EDP/ENI/GDP),

THE COURT OF FIRST INSTANCEOF THE EUROPEAN COMMUNITIES (Second Chamber),

composed of J. Pirrung, President, N.J. Forwood and S. Papasavvas, Judges,

Registrar: J. Plingers, Administrator,

having regard to the written procedure and further to the hearing on 5 July 2005,

gives the following

Judgment

Legal context

1 Article 2(3) of Council Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between undertakings (OJ 1989 L 395, p. 1, corrected version, OJ 1990 L 257, p. 13, as amended by Council Regulation (EC) No 1310/97 of 30 June 1997, (OJ 1997 L 180, p. 1) (‘the Merger Regulation’), provides:

‘A concentration which creates or strengthens a dominant position as a result of which effective competition would be significantly impeded in the common market or in a substantial part of it shall be declared incompatible with the common market.’

2 Article 18(2) of Commission Regulation (EC) No 447/98 of 1 March 1998 on the notifications, time-limits and hearings provided for in [the Merger Regulation] (OJ 1998 L 61, p. 1), provides:

‘Commitments proposed to the Commission by the undertakings concerned pursuant to Article 8(2) of [the Merger Regulation] which are intended by the parties to form the basis for a decision pursuant to that Article shall be submitted to the Commission within not more than three months from the date on which proceedings were initiated. The Commission may in exceptional circumstances extend this period.’

3 Point 43 of the Commission notice on remedies acceptable under the Merger Regulation (OJ 2001 C 68, p. 3: ‘the Notice on Remedies’), states:

‘… Where the parties subsequently modify the proposed commitments, the Commission may only accept these modified commitments where it can clearly determine – on the basis of its assessment of information already received in the course of the investigation, including the results of prior market testing, and without the need for any other market test – that such commitments, once implemented, resolve the competition concerns identified and allow sufficient time for proper consultation of Member States.’

4 Article 3(1) of Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas and repealing Directive 98/30/EC (OJ 2003 L 176, p. 57; ‘the Second Gas Directive’) states:

‘Member States shall ensure, on the basis of their institutional organisation and with due regard to the principle of subsidiarity, that, without prejudice to paragraph 2, natural gas undertakings are operated in accordance with the principles of this Directive with a view to achieving a competitive, secure and environmentally sustainable market in natural gas, and shall not discriminate between these undertakings as regards either rights or obligations.’

5 Article 1(31) of the Second Gas Directive defines ‘emergent market’ as ‘a Member State in which the first commercial supply of its first long-term natural gas supply contract was made not more than 10 years earlier.’

6 Article 28(2) and (3) of the Second Gas Directive provides:

‘2. A Member State, qualifying as an emergent market, which because of the implementation of this Directive would experience substantial problems may derogate from Articles 4, 7, 8(1) and (2), 9, 11, 12(5), 13, 17, 18, 23(1) and/or 24 of this Directive This derogation shall automatically expire from the moment when the Member State no longer qualifies as an emergent market. Any such derogation shall be notified to the Commission.

3. On the date at which the derogation referred to in paragraph 2 expires, the definition of eligible customers shall result in an opening of the market equal to at least 33% of the total annual gas consumption of the national gas market. Two years thereafter, Article 23(1)(b) shall apply, and three years thereafter, Article 23(1)(c). Until Article 23(1)(b) applies the Member State referred to in paragraph 2 may decide not to apply Article 18 as far as ancillary services and temporary storage for the re-gasification process and its subsequent delivery to the transmission system are concerned.’

Background to the dispute

7 The applicant, EDP – Energias de Portugal SA (‘EDP’ or ‘the applicant’) is the incumbent electricity company in Portugal. Its main activities consist of the generation, distribution and supply of electricity in Portugal. EDP is quoted on the Euronext Lisbon (Portugal). The Portuguese State is the largest shareholder, holding, directly or indirectly, a 30% share, while the remaining shares are widely held. EDP controls Hydrocantábrico, which is active in the electricity and gas sectors in Spain. EDP holds a 20% share in Turbogás and a 10% share in Tejo Energia, companies active in the generation of electricity in Portugal. EDP also holds a 30% share in Rede Eléctrica Nacional SA, which manages the Portuguese electricity network.

8 Eni SpA is an Italian company active at all levels in the energy supply and distribution chain.

9 Gás de Portugal SGPS SA (‘GDP’) is the incumbent Portuguese gas company. GDP is a wholly-owned subsidiary of the Portuguese company Galp Energia SGPS SA (‘GALP’). GALP is currently jointly controlled by the Portuguese State and Eni, with interests in both the oil and the gas sectors. GDP and its subsidiaries cover all levels of the gas supply chain in Portugal. GDP, through its subsidiary Transgás, imports natural gas into Portugal, through pipelines and through the Sinès LNG (Liquefied Natural Gas) terminal, and is responsible for transportation, storage, transport and supply through the high-pressure gas pipeline network (‘the gas network’). GDP is also active in the natural gas supply to large industrial customers and in the development and future operation of the first underground natural gas storage caverns in Portugal. Through its subsidiary GDP Distribuição Energia SA, GDP also controls five of the six local gas distribution companies.

10 Rede Eléctrica Nacional SA (‘REN’) is a Portuguese company resulting from the 1994 spin-off from EDP of the Portuguese electricity grid. REN currently manages the Portuguese electricity grid and acts as a single buyer for the purposes of the Community directives, buying electricity from producers and reselling it to the distributor/supplier for the supply of non-eligible customers, that is, customers who cannot choose their suppliers. The Portuguese State controls directly or indirectly 70% of REN.

11 In 2003, the Portuguese Government set its policy for the restructuring of the energy sector in Portugal in the light of the forthcoming full liberalisation of that sector required by the relevant Community directives. As originally planned by the Portuguese Government, that restructuring would consist of the following phases:

– the separation of the gas and oil business of GALP into three separate parts (a) gas transmission (Transgás); (b) gas distribution and supply (GDP); and (c) oil refining and oil products distribution (Petrogal);

– the promotion of the gas and electricity businesses’ integration within the same economic group;

– the acquisition of the gas transmission activities (in particular the gas network and, potentially, other regulated assets) by REN.

12 Pursuant to a share purchase agreement of 31 March 2004, EDP, Eni (through its wholly-owned subsidiary Eni Portugal Investment SpA) and REN were to jointly acquire the whole of GDP’s share capital from GALP. A further agreement was concluded on the same date concerning the temporary participation of REN in GDP and the future sale of the gas network to REN in exchange for the latter’s shares in GDP. The completion of the whole transaction was conditional on the clearance of the entire transaction by the competent competition authorities.

13 On 9 July 2004, the Commission received notification of the entire transaction pursuant to Article 4 of the Merger Regulation. Taking the view that the entire transaction would lead to two distinct operations, first, sole control of the gas network by REN and, second, acquisition of joint control of GDP by EDP and Eni (‘the parties’) by way of purchase of shares, the Commission considered that the second operation had a Community dimension (OJ 2004 C 185, p. 3).

14 On the same day, the acquisition by REN of sole control of the gas network was notified to the Portuguese competition authority.

15 After a preliminary examination, the Commission concluded that the concentration raised serious doubts as to its compatibility with the common market. Accordingly, on 12 August 2004, the Commission initiated proceedings in respect of the concentration, in accordance with Article 6(1)(c) of the Merger Regulation.

16 On 12 October 2004, the Commission sent the parties a statement of objections in which it concluded, on a provisional basis, that the concentration was incompatible with the common market.

17 On 27 October 2004, the parties replied to the statement of objections.

18 On 28 October 2004, the parties offered commitments designed to meet the competition concerns identified by the Commission in the statement of objections.

19 On 29 October and 4 November 2004, the Commission sent a questionnaire, pursuant to Article 11 of the Merger Regulation, to potential competitors of the merged entity, to the Spanish and Portuguese regulators and to the operator of the Spanish gas network (‘the market test’).

20 On 17 November 2004, the parties submitted modified commitments.

21 On 26 November 2004, the parties submitted further modifications to their commitments in respect of the electricity sector and announced new modifications of their commitments in respect of the gas sector. On the evening of 3 December 2004, they communicated to the Commission the final version of the modifications concerning the gas sector.

22 By decision of 9 December 2004 (Case No COMP/M.3440 – EDP/ENI/GDP C(2004) 4715 final (‘the contested decision’), the Commission declared the concentration incompatible with the common market.

23 For the purposes of the present case, the contested decision may be summarised as follows.

24 First, the Commission identified the following eight relevant markets which would be affected by the concentration:

– in the electricity sector:

– wholesale supply of electricity in Portugal;

– retail supply of electricity to large industrial customers (LICs) in Portugal;

– retail supply of electricity to smaller industrial, commercial and domestic customers in Portugal;

– ‘balancing power’ and ancillary services in Portugal;

– in the gas sector:

– supply of gas to power producers operating Combined Cycle Gas Turbine power stations (CCGTs) in Portugal;

– supply of gas to Local Distribution Companies (LDCs) in Portugal;

– supply of gas to LICs in Portugal;

– supply of gas to small industrial, commercial and household customers in Portugal or on a local scale.

25 Second, the Commission stated, in its competitive assessment, that the concentration would have:

– in the electricity markets:

– eliminated the significant potential competition from GDP on the wholesale electricity market (a horizontal effect);

– eliminated GDP’s significant potential competition on each retail electricity market (a horizontal effect);

– eliminated GDP’s significant potential competition on the balancing power and ancillary services markets (a horizontal effect);

– given EDP knowledge of its current competitors’ input costs and daily nomination gas needs and further deterred or delayed the entry of potential competitors wishing to operate new CCGTs (a non-horizontal effect);

– given EDP privileged and preferential access to natural gas resources available in Portugal (a non-horizontal effect);

– given EDP the ability and the incentive to significantly foreclose its competitors by raising the level of gas prices and/or lowering the quality of supply (a non-horizontal effect);

– foreclosed gas demand on the market for gas supply to power producers (a non-horizontal effect);

– on the gas markets:

– foreclosed gas demand on the market for gas supply to LDCs (a non-horizontal effect);

– eliminated EDP’s significant potential competition on the market for the supply of natural gas to LICs (a horizontal effect);

– eliminated EDP’s significant potential competition on the market for the supply of natural gas to small customers (a horizontal effect).

26 As indicated above, the parties proposed several commitments to the Commission on 28 October 2004 (A – P), on 17 November 2004 (EDP.1 – EDP.5; ENI.I – ENI.XIV), on 26 November and on 3 December 2004. These commitments covered the following matters:

– sale to REN of the Sinès re-gasification terminal (A/ENL.II);

– sale to REN of the Carriço underground storage facility (B/ENI.III);

– early sale of the Gas Network to REN (ENI.IV);

– guarantees of access to the Gas Network pending publication of the relevant third party access rules or the sale of the Gas Network to REN (C/ENI.V);

– release of the gas capacity at the Campo Maior, entry point of the gas pipeline into Portugal, currently booked for and unused by Transgás (D/ENI.VI);

– commitment not to book further capacity at Campo Maior (E/ENI.VII);

– commitment not to book further capacity on the Extremadura pipeline (F/ENI.VIII);

– commitment to make capacity available on the Extremadura pipeline and/or at the Campo Maior entry point under certain conditions (ENI.IX);

– amendment of the purchase agreement dated 31 March 2004 concerning those rights of GDP known as the ‘matching the best offer mechanism’ concerning EDP’s offers of short term gas supply on the market (G/ENI.X);

– measures aimed at eliminating concerns relating to possible privileged access to price information (H/ENI.XI);

– measures aimed at ensuring the effective liberalisation of the demand represented by LICs (I/ENI.XII);

– commitment to sell one or more LDCs controlled by one of the parties (J/ENI.XIV);

– commitment not to engage in dual offers of natural gas and electricity to LICs and small customers in Portugal until these markets are liberalised (K/ENI.XIII);

– reduction of EDP’s shareholding in REN from 30% to around 5% (L/EDP.1);

– moratorium on the construction of new CCGTs (M/EDP.3);

– commitment to lease temporarily the capacity of one of EDP’s three gas fired power plants situated at Ribatejo (TER) (N/EDP.4);

– commitment to sell EDP’s shareholding in Tejo Energia (O/EDP.2);

– commitment to suspend temporarily certain of EDP’s voting rights in Turbogás and to appoint independent members to the Turbogás board (P/EDP.5).

27 Thirdly, the Commission proceeded to assess the effects of the set of commitments of 28 October 2004, then the effects of the modified set of commitments of 17 November 2004 and concluded that none of them resolved the competition concerns it had identified. The Commission found that the modified set of commitments proposed on 26 November 2004 did not fully and unambiguously remove the competition concerns, except on the market for gas supply to LDCs and that those commitments were, in part, mere expressions of intention. It also rejected the modified set of commitments of 3 December 2004 for two reasons, on one hand because it was presented too late and, on the other hand, because it merely implemented the set of commitments submitted on 26 November 2004.

28 In conclusion, for the reasons mentioned above, whether considered individually or together, the Commission came to the conclusion that, despite the commitments proposed by the parties, the Concentration would strengthen EDP’s dominant positions on the markets for the wholesale supply of electricity, balancing power and ancillary services and retail supply of electricity in Portugal as well as GDP’s dominant positions in the supply of gas to CCGTs, to LICs and to small customers, as a result of which effective competition would be significantly impeded in a substantial part of the common market. The Concentration was therefore declared incompatible with the common market pursuant to Article 2(3) of the Merger Regulation.

Procedure and forms of order sought by the parties

29 By application registered at the Registry of the Court of First Instance on 25 February 2005, the applicant brought the present action against the contested decision.

30 By a separate document lodged on the same day, the applicant also applied for an expedited procedure, pursuant to Article 76a of the Rules of Procedure of the Court of First Instance.

31 By way of measures of organisation of procedure in accordance with Article 64 of the Rules of Procedure of the Court of First Instance, the applicant and the Commission attended an informal meeting on 6 April 2005 with the Judge-Rapporteur in order to examine the possibility of the application for an expedited procedure being granted. As a result of the informal meeting, the applicant undertook to lodge its application in an abbreviated form in conformity with the requirements of the Court of First Instance’s Practice Directions, and the Commission requested further time to prepare its defence. A provisional timetable for the procedure was produced by the Judge-Rapporteur. On 22 April 2005, the applicant lodged an abbreviated application, which differs from the initial one primarily in that the first and the second pleas are withdrawn. The Commission lodged its defence on 14 May 2005.

32 On 25 May 2005, the Second Chamber of the Court of First Instance, to which the case was assigned, decided to grant the application for an expedited procedure.

33 By order of the President of the Second Chamber of the Court of First Instance of 13 June 2005, the main parties having been heard, Gas Natural SDG SA was granted leave to intervene, during the hearing, in accordance with Article 76(a) of the Rules of Procedure, in support of the form of order sought by the Commission and the application by the main parties for confidentiality was also granted, subject to the observations of the intervener. The intervener confirmed that it had no objection to that request for confidentiality.

34 Upon hearing the report of the Judge-Rapporteur, the Court decided to open the oral procedure and, by way of measures of organisation of procedure, invited the intervener to provide in advance a skeleton argument of the presentation it intended to make at the hearing. Further to a request of the applicant, the Court invited the Commission and the intervener to provide the minutes of the meeting held on 27 August 2004 in Madrid between these two parties, which they did. Finally, the Court put written questions to the main parties and invited them to answer these questions at the hearing. The applicant provided written answers to these questions on the eve of the hearing (hereinafter the ‘answers for the hearing’). These answers were transmitted to the other parties the same day.

35 The parties presented oral arguments and replied to the Court’s questions at the hearing on 5 July 2005. The documents submitted by the applicant during the hearing were not added to the case file.

36 The applicant claims that the Court should:

– annul the contested decision;

– order the Commission to pay the costs.

37 The Commission contends that the Court should:

– dismiss the application;

– order the applicant to pay the costs.

38 The intervener claims that the Court should dismiss the application.

Substance

39 It must be noted, by way of preliminary observation, that owing to the constraints of the expedited procedure granted in the present case, and, moreover, with the agreement of the main parties, in principle only the substance of the arguments of the party which is unsuccessful on the ground under consideration will be set out in this judgment, and then only to the extent necessary. In that regard, all the arguments submitted by the parties that are capable of affecting the outcome of the dispute, including those not expressly set out in the Report for the Hearing, which was approved by the parties subject only to minor amendments, have been taken into account. Accordingly, the Court’s reasoning will be limited to what is necessary to provide full and complete support for the operative part of the present ruling (see, to that effect, Case C-237/98 P Dorsch Consult v Council and Commission [2000] ECR I-4549, paragraph 51).

40 The Court records that the applicant expressly agreed, on condition that the procedure was expedited, to withdraw its first two pleas in law and also the third limb of the third plea of its initial application, in order to facilitate the rapid adoption of a decision by the Court. Its stated reason for so doing was that, should the contested decision be annulled on account of those first two procedural pleas, alleging lack of access to the file and a failure to state reasons, or on account of the third limb of the third plea, alleging breach of the principle of sound administration, the Commission would not have been bound, a priori, to adopt a different competitive analysis from that adopted in the contested decision, when adopting any new decision. As the expedited procedure has been granted in this case, the Court takes formal note of the withdrawal of those two pleas and of the third limb of the third plea.

41 In its abbreviated application, the applicant advances four pleas in law. First, it claims that the Commission ignored the derogation which the Portuguese Republic enjoys under Article 28(2) of the Second Gas Directive. Second, it claims that there has been a breach of Article 2(3) of the Merger Regulation, in that the Commission did not establish that the second criterion laid down in that article was satisfied. Third, the applicant claims that there have been a number of formal and/or procedural breaches of Article 8(2) and (3) of the Merger Regulation. Fourth, it claims that the Commission made errors of assessment in relation to the commitments given pursuant to Article 8(2) and (3) of the Merger Regulation.

42 The Court observes at the outset that certain pleas of a general nature, that is to say, pleas not specifically connected with one of the markets in issue, may in themselves lead to the annulment of the contested decision. Consequently, it is appropriate to examine at the outset those general pleas, namely the second and third pleas, then the first plea, which relates primarily to the gas markets, and, finally, the fourth plea.

43 At the hearing, the Commission expressed reservations about the fact that the applicant had provided in writing its answers for the hearing. It must be pointed out, in that regard, that of the 23 questions put by the Court to the main parties, only two had requested a written response. None the less, the applicant provided all of its answers in writing on the day before the hearing and at the hearing merely referred to that written document. In so far as the Commission invokes a breach of its rights of defence, it should be emphasised that that written document was delivered to it late in the afternoon of the day before the hearing, and that the Commission was given adequate opportunity to comment on that document at the hearing. Although undoubtedly brief, the period thus afforded to the Commission is within the bounds of what is acceptable in the context of the expedited procedure that characterises the present case, during which extremely tight time-limits were imposed on all the parties and also on the Court. Furthermore, the fact that the Commission was given the opportunity to acquaint itself with the essence of the applicant’s answers on the day before the hearing, instead of on the day itself, enhanced the smooth running of the adversarial debate.

I – Second plea: breach of Article 2(3) of the Merger Regulation

44 By this plea, the applicant claims, in substance, first, that Article 2(3) of the Merger Regulation contains two distinct criteria and, second, that in the contested decision the Commission has not determined whether the second of those criteria was satisfied.

45 The Court observes that Article 2(2) and (3) of the Merger Regulation lays down two cumulative criteria, the first of which relates to the creation or strengthening of a dominant position and the second to the fact that effective competition in the common market will be significantly impeded by the creation or strengthening of such a position (see, to that effect, Case T-2/93 Air France v Commission [1994] ECR II-323, paragraph 79; Case T-290/94 Kaysersberg v Commission [1997] ECR II-2137, paragraph 156; and Case T-5/02 Tetra Laval v Commission [2002] ECR II-4381, paragraph 146).

46 In certain cases, however, the creation or strengthening of a dominant position may in itself have the consequence that competition is significantly impeded.

47 Thus, the fact that an undertaking in a dominant position, by acquiring a competitor, strengthens that position to such an extent that the degree of dominance thus attained substantially impedes competition may constitute an abuse of a dominant position (Case 6/72 Europemballage Corporation and Continental Can v Commission [1973] ECR 215, paragraph 26). The relevance of that case-law is increased by the fact that the situation examined by the Court of Justice in that judgment, at a time when the Merger Regulation did not exist, was very similar to the situation that could arise following a concentration within the meaning of that regulation.

48 Likewise, in relation to concentrations, a dominant position is characterised by a situation in which one or more undertakings wield economic power which would enable them to prevent effective competition from being maintained in the relevant market by giving them the opportunity to act to a considerable extent independently of their competitors, their customers and, ultimately, of consumers (Case T-102/96 Gencor v Commission [1999] ECR II-753, paragraph 200).

49 It follows that proof of the creation or strengthening of a dominant position within the meaning of Article 2(3) of the Merger Regulation may in certain cases constitute proof of a significant impediment to effective competition. That observation does not in any way mean that the second criterion is the same in law as the first, but only that it may follow from one and the same factual analysis of a specific market that both criteria are satisfied.

50 It follows that, in so far as it is clear from the grounds of a decision finding that a concentration is incompatible with the common market, including those formally devoted to an analysis of the creation or strengthening of a dominant position, that that transaction will produce significant anti-competitive effects, the decision cannot be held to be vitiated by illegality solely because the Commission did not expressly and specifically relate its description of those elements to the second criterion laid down in Article 2 of the Merger Regulation, whether from the viewpoint of the obligation to state reasons laid down in Article 253 EC or from a substantive viewpoint. To adopt the contrary approach would be to place the Commission under a purely formal obligation requiring it to invoke certain identical considerations twice, first in its analysis of the creation or strengthening of a dominant position on a given market and second by reference to the significant impediment to competition in the common market.

51 In the present case, the Commission’s argument that this plea is based on a failure to state reasons must be rejected at the outset. Were it to appear from the contested decision that the Commission did not in fact consider whether the second criterion in Article 2(3) of the Merger Regulation was satisfied or did not demonstrate that it was, then it would be necessary to conclude that the decision was not consistent with that provision. Indeed, in the context of this regulation, an absence of reasoning in this regard could indicate only the absence or insufficiency of any examination of whether the second criterion was satisfied, and not that such an examination was in fact carried out but omitted from the decision.

52 As regards the applicant’s main complaint, the Court finds that the Commission took care to conclude in the contested decision, in the case of each of the markets concerned, that both criteria laid down in Article 2(3) of the Merger Regulation were satisfied. Thus, the Commission concluded that the concentration would strengthen EDP’s and GDP’s pre-existing dominant positions, with the consequence that effective competition would be significantly impeded in the wholesale electricity market (recitals 364, 379, 410, 428 and 429), the market for balancing power and ancillary services (recital 432), the retail electricity markets (recital 473), the market for the supply of gas to electricity producers (recital 528), to LDCs (recital 538), to large customers (recital 550), to small customers (recital 602) and in general (recital 609), even after it had examined all the commitments (recital 914).

53 Admittedly, it must also be noted that in the contested decision the Commission examined together, and without distinction, the elements leading it to conclude that EDP’s and GDP’s pre-existing dominant positions would be strengthened and the elements leading it to conclude that the concentration would also have the consequence that effective competition would be significantly impeded.

54 However, since the elements relied on in the contested decision to show that EDP’s and GDP’s dominant positions would be significantly strengthened and the elements showing that effective competition would be significantly impeded following the concentration are frequently identical, the mere fact that the Commission did not devote specific parts of the decision to examining the significant impediment to competition does not justify the conclusion that the Commission failed to have regard to the second criterion laid down in Article 2(3) of the Merger Regulation. Thus, in the present case, most, or indeed all, of the considerations which led the Commission to conclude that the pre-existing dominant positions would be strengthened are based on an effective restriction of the competition that could exist in the absence of the concentration and therefore also seek to demonstrate that the second criterion laid down in Article 2(3) of the Merger Regulation was satisfied. In particular, in so far as the concentration does not lead, or leads only incidentally, to an increase in the parties’ market share on one of the markets concerned, the anti-competitive effects of the concentration result primarily, or indeed essentially, in the Commission’s submission, from effective restrictions of competition on each of the markets concerned. For example, proof that EDP’s and GDP’s dominant positions would be strengthened owing to the disappearance of an important or significant potential competitor on most of the markets considered in the contested decision relies on proof that competition, which according to the Commission would have been effective, would be significantly impeded as a result of the concentration (see, for example, as regards the disappearance of GDP as the most likely important potential competitor on the wholesale electricity market, recitals 335 to 364; on the retail electricity markets, recitals 450 to 473; or, as regards the disappearance of EDP as the most significant potential competitor on the retail gas market, recitals 559 to 599).

55 It also follows that, contrary to the applicant’s contention, the Commission, in the contested decision, did not treat the question as to whether the second criterion laid down in Article 2(3) of the Merger Regulation was satisfied as an automatic consequence of the first criterion, but, on the contrary, based its reasoning on the fact that the significant impediments to competition strengthened EDP’s or GDP’s dominant positions.

56 Consequently, the analysis of the commitments which the Commission carried out on the basis of that reasoning is not affected either by the defect which the applicant alleges. Thus, when the Commission concluded that the commitments were insufficient to resolve the competition concerns previously identified, it considered that EDP’s or GDP’s dominant positions would continue to be strengthened because competition would still be significantly impeded (see, for example, as regards the disappearance of GDP as the most likely important potential competitor on the wholesale electricity market, recitals 650 to 675; on the retail electricity markets, recitals 708 to 714; or, as regards the disappearance of EDP as the most significant potential competitor on the retail gas market, recitals 735 to 738).

57 Last, it should be observed that the applicant’s complaint does not go beyond general criticism. In particular, in the context of this plea, the applicant does not claim, still less prove, that on any one of the markets concerned the competition considerations put forward by the Commission would be incapable of proving as a fact the existence of a significant impediment to effective competition.

58 It follows from the foregoing that the Commission did not disregard the second criterion laid down in Article 2(3) of the Merger Regulation. Consequently, the present plea must be rejected.

II – Third plea: breach of Article 8(2) and (3) of the Merger Regulation

59 The applicant relies on four limbs in support of its plea in respect of the commitments, relating, first, to failure to have regard to the burden of proof; second, failure to have regard to the comprehensive nature of the commitments; third, to a misuse of powers; and, fourth, to exaggeration of the difficulties in monitoring compliance with certain behavioural commitments.

A – First limb of the third plea, concerning the burden of proof

60 The applicant maintains that the Commission wrongly relied on the presumption that it was for the parties to prove that their commitments eliminated the competition concerns identified by the Commission. In doing so, the Commission misapplied a standard of control set out in paragraph 6 of the Notice on Remedies.

61 It must be borne in mind that Article 2(2) of the Merger Regulation provides that the Commission ‘shall’ declare compatible with the common market a concentration which does not create or strengthen a dominant position as a result of which effective competition would be significantly impeded in the common market. It follows that it is for the Commission to demonstrate that a concentration cannot be declared compatible with the common market.

62 Furthermore, Article 8(2) of the Merger Regulation provides that the Commission is to adopt a decision declaring the concentration compatible with the common market where it finds that a notified concentration, ‘following modification by the undertakings concerned if necessary’, fulfils the criterion laid down in Article 2(2) of the Merger Regulation. It follows that, in so far as the burden of proof is concerned, a concentration modified by commitments is subject to the same criteria as an unmodified concentration.

63 Accordingly, first, the Commission is under an obligation to examine a concentration as modified by the commitments validly proposed by the parties to the concentration (see, to that effect, Case T-158/00 ARD v Commission [2003] ECR II-3825, paragraph 280) and, second, the Commission can declare the concentration incompatible with the common market only where those commitments are insufficient to prevent the creation or strengthening of a dominant position having the consequence that effective competition would be significantly impeded. In that regard, it must none the less be borne in mind that, in the case of complex economic assessments, the burden of proof placed on the Commission is without prejudice to its wide discretion in that sphere (see, to that effect, Case T-342/00 Petrolessence and SG2R v Commission [2003] ECR II-1161, paragraph 101, and the case-law cited, and Case C-12/03 P Commission v Tetra Laval [2005] ECR I-0000, paragraph 38).

64 Furthermore, the fact that paragraph 6 of the Notice on Remedies indicates that ‘[i]t is the responsibility of the parties to show that the proposed remedies … eliminate the creation or strengthening of … a dominant position identified by the Commission’ cannot alter that legal position. Even on the assumption that the Commission thereby intended to make the parties to a notified concentration responsible for demonstrating the effectiveness of the proposed commitments, an exercise which is consistent with their interests, the Commission could not conclude that where there is doubt it must prohibit the concentration. Quite to the contrary, in the last resort, it is for the Commission to demonstrate that that concentration, as modified, where appropriate, by commitments, must be declared incompatible with the common market because it still leads to the creation or the strengthening of a dominant position that significantly impedes effective competition.

65 It follows that it is for the Commission to demonstrate that the commitments validly submitted by the parties to a concentration do not render that concentration, as modified by the commitments, compatible with the common market.

66 The Commission claims that a distinction must be drawn in that regard between the commitments submitted before the deadline laid down in Article 18(2) of the Merger Regulation for submitting commitments and those submitted after that deadline. In this case it is common ground that the parties submitted modifications to their first series of commitments both before the expiry of that deadline, on 17 November 2004, and afterwards, on 26 November 2004, and even on 3 December 2004. In fact, point 43 of the Notice on Remedies, read in the light of points 41 and 42, makes no distinction according to whether the modification of the commitments is submitted before or after the deadline. None the less, point 43 provides that the modified commitments must, in particular, enable the Commission to establish clearly, without the need for any other test and with sufficient time for proper consultation of the Member States, that once implemented such commitments will resolve the competition concerns identified.

67 In that regard, first, the wording of point 43 of the Notice on Remedies does not provide that the parties to a concentration are responsible for proving that their modified commitments will clearly resolve the competition concerns identified. Second, since the Commission is required to accept modified commitments, on certain conditions, it does not have the power to alter the burden of proof established by the Merger Regulation for the purpose of issuing a final decision under Article 8(2) or (3) of that regulation, on the ground that the concentration fulfils the criteria laid down in Article 2(2) or (3) of that regulation. Thus, according to the special conditions set out at point 43 of the Notice on Remedies, it is also for the Commission to demonstrate that the modified commitments are not sufficient to establish clearly, without the need for further investigation or in the absence of sufficient time for consultation of the Member States, that they will resolve the competition concerns identified.

68 Last, it should be emphasised that, according to the logic of the administrative procedure in relation to concentrations, the Commission provisionally identifies the competition concerns which in its view are raised by the concentration, first explaining why it considers it necessary to initiate proceedings under Article 6(1) of the Merger Regulation and then, second, issuing a statement of objections to the parties to the transaction. At that stage, the parties to the transaction may dispute the very existence of those competition concerns and/or offer commitments capable of resolving them, whether at the time of responding to the statement of objections or at a later stage in the discussions. It is thus clear that by proposing commitments the parties to the transaction intend to convince the Commission that those commitments wholly resolve the competition concerns previously identified. On the other hand, when it regards those commitments as insufficient, the Commission necessarily considers that the parties to the transaction have failed to convince it of the value of their commitments for the purpose of resolving the anti-competitive problem or problems caused by the transaction concerned.

69 It follows that the fact that the Commission regards commitments which have been validly submitted, i.e. either with the first proposal or, in accordance with point 43 of the Notice on Remedies, in the form of a modification of the initial commitments, as insufficient constitutes an improper reversal of the burden of proof only where the Commission bases that finding of their insufficiency, not upon an assessment of the commitments based on objective and verifiable criteria, but rather upon the assertion that the parties have failed to provide sufficient evidence to carry out a substantive assessment. In the latter case, doubt does not operate in favour of the parties to the transaction and it would have to be concluded that the burden of proving that such a transaction was compatible with the common market has been reversed.

70 In the present case, the applicant puts forward a single example based on recital 833 to the contested decision, relating to the commitments of 17 November 2004, which were given before the deadline, and which provide that ‘considerable doubts and uncertainties remain whether the combined effect of [the proposed measures] will sufficiently compensate for the loss of EDP as a major potential competitor’ on the wholesale gas supply market. In the contested decision, the Commission expressly bases that assessment on the Notice on Remedies.

71 It should be noted that the Commission concluded the recital in question in a very affirmative manner, maintaining that the measures proposed by the parties would not prevent the strengthening of GDP’s dominant position in the market concerned as a result of the merger. Thus, the Commission found that the commitments in question were insufficient to allow the merger to be authorised.

72 Furthermore, the doubts and uncertainties to which the Commission refers relate to whether the commitments were, inter alia, unconditional and certain. At recital 832 to the contested decision it sets out five reasons for its view that the commitments in question were insufficient to ensure that additional gas capacities would actually be made available for third parties (exclusion of the parties’ Spanish subsidiaries from the commitment not to reserve additional capacity; absence of mandatory approval by the Spanish regulator of the access code for third parties; the parties’ right to reserve so-called strategic capacities; reduced effectiveness of the commitment to release capacity at Campo Maior owing to the limited current pipeline capacity and the negative consequences for the capacities available at the Sinès LNG terminal; the parties’ special rights vis-à-vis the operator of that terminal and the option to build a storage tank for natural gas). Accordingly, the doubts expressed refer not to the possibility of adverse effects with competition resulting from the merger but rather to the fact that it was impossible to be satisfied that the commitments in question would be fully operational. The Commission is entitled to reject non-binding commitments or, which amounts to the same thing, commitments the effect of which may be reduced, or even eliminated, by the parties. In doing so, the Commission did not transfer the burden of proof to the parties but denied the certain and measurable character which the commitments had to display. Last, it should be noted that, in the context of this plea, the applicant did not dispute before the Court of First Instance the uncertain nature of the commitments in question.

73 In the light of the foregoing, it must be held that in the contested decision the Commission did not reverse the burden of proof which it bore in relation to its obligation to establish that the merger was incompatible with the common market. On the contrary, it sought to demonstrate why the merger should be prohibited in spite of the proposed commitments.

74 The first limb of the third plea in law must therefore be rejected.

B – Second limb of the third plea in law, relating to the overall assessment of the merger as modified

75 The applicant claims, in substance, that the Commission did not assess the situation as it would exist after the merger, taking account of the commitments, by reference to the situation which would exist if the merger did not take place. In its written reply for the hearing, the applicant explained its argument as meaning that it criticises the Commission for having assessed the weaknesses that could be identified in the commitments rather than assessing the likely effects of the merger as modified on a particular market, which would lead to a different outcome. The applicant further alleges that the Commission assessed each commitment in isolation from the others. In its written reply, it gave the example of the separate examination of the commitments designed to resolve the horizontal problem on the wholesale electricity market and of the commitments relating to the non-horizontal problems on that market.

76 It should be observed that the contested decision is formally structured in such a way as to present, in turn, the identification of the competition concerns caused by the merger, as notified, on each of the markets (recitals 280 to 609), then the competitive assessment of the commitments of 28 October 2004 (recitals 650 to 738), then those of 17 November 2004 (recitals 741 to 841) and, finally, those of 26 November 2004 (recitals 860 to 912). In carrying out its assessment, the Commission examined in turn each of the commitments deemed relevant for each of the markets concerned. Where a number of competition concerns were identified on one market, the Commission examined the commitments in turn within the framework of each of those concerns. It concluded, in each case, with the exception of the market for the supply of gas to LDCs, that the commitments were insufficient to resolve the competition concern identified and/or prevent the strengthening of the dominant position in question (see, in relation to the wholesale electricity market taken as an example by the applicant, as regards the horizontal problem, recitals 675, 767 and 868, or, as regards the non-horizontal problems, recitals 700, 702, 703, 801, 874 and 875).

77 It must be borne in mind that the Commission has a duty to examine a concentration as modified by the commitments validly proposed by the parties (see paragraph 63 above). However, as the applicant acknowledged at the hearing, such a premiss does not preclude the examination, in turn, of the competition concerns caused by that transaction, then the commitments offered by the parties to the transaction with a view to resolving those concerns, nor does it preclude the examination, in turn, of each of the relevant commitments by reference to those concerns, provided that the Commission ultimately arrives at a global assessment of the merger as modified, that is of the effects of that transaction on each of the markets identified taking account of all the commitments relevant to that market.

78 Furthermore, it is for the Commission to examine all the relevant commitments by reference to a competition concern identified on any of the markets concerned, including those not expressly designated as such by the parties to a merger. However, the Commission does not err in law by assessing only the commitments specific to a single market or to a single competition concern by reference to that market or that concern, if the other commitments are irrelevant and have no real economic significance in that context.

79 In the present case, the applicant’s complaint is based on an unrealistic premiss and a misreading of the contested decision.

80 First, it should be borne in mind that the commitments offered by the parties to a merger are specifically intended to resolve the competition concerns previously identified. It is therefore inevitable that the Commission, when faced with a commitment, will seek first of all to determine the scope of that commitment and, in particular, any intrinsic weaknesses which it may have, and then ascertain whether that commitment constitutes a suitable means of resolving the identified concern, in whole or in part. The analysis of the likely effects of the modified merger presupposes an initial assessment of the scope of that modification. In that regard, it is important to note that, both in the application and in the annexes thereto, the applicant also adopted that step-by-step approach, leading the Court, moreover, to do likewise. It is unrealistic to imagine, moreover, that the Commission could, within the time constraints imposed by the Merger Regulation, recommence entirely its analysis of a merger, in the light of the submission of commitments, as though that transaction had been notified anew in the form modified by the commitments. Such an approach would conflict with the requirement of speed that characterises the general structure of the Merger Regulation (Case T-221/95 Endemol v Commission [1999] ECR II-1299, paragraph 68). The unrealistic nature of the approach impliedly suggested by the applicant is reinforced, in this case, by the fact that three, or indeed four, series of commitments were proposed in turn, the last one, or last ones, out of time, and when the procedure was in its final states. In that regard, the applicant’s argument that those successive series are merely modifications of the earlier commitments and not new commitments does not alter that analysis. In that situation, the Commission is required, each time, to deal with those new elements in its analysis, in order to consider whether those commitments are capable of invalidating its previous findings.

81 Second, in the contested decision, the Commission was careful to explain in what way the weaknesses of each of the commitments meant that it could not, on its own, enable the Commission to resolve the competition concern at issue. However, it systematically followed that specific analysis by concluding that the whole body of commitments relevant to that concern was also insufficient to resolve it. For the commitments of 18 October and 17 November 2004, it stated that the dominant position concerned would still be strengthened (see, for example, in relation to the wholesale electricity market to which the applicant refers, as regards the horizontal problem, recitals 675 and 767, or, as regard the non-horizontal problems, recitals 700, 702, 703 and 801). When considered necessary, it also examined commitments other than those specifically proposed by the parties with a view to resolving the particular competition concern (recitals 809 to 812). In that way, the Commission’s analysis was equivalent to an analysis of the concentration as modified by the commitments. Although in the case of the commitments of 26 November 2004, the Commission merely concluded that those commitments were insufficient to resolve the competition concerns in question, it none the less carried out an overall assessment of those commitments by reference to those concerns (see, as regards the horizontal concern on the wholesale electricity market, recital 868, or, as regards the non-horizontal concerns on that market, recitals 874 and 875). Furthermore, as the examination of the belated commitments satisfies special conditions set out in the Notice on Remedies, it cannot be inferred from the fact that the Commission did not expressly find that they strengthened the dominant positions examined that it did not carry out an overall examination of the merger as modified.

82 It follows that the Commission did carry out an overall analysis of the merger as modified by the commitments proposed by the parties.

83 As regards the instance of the separate examination of the commitments relating to the horizontal concern and the non-horizontal concerns on the wholesale electricity market, to which the applicant refers, it must be held that that argument is wholly coterminous with the argument, set out in the context of the fourth plea in law, that the commitments relating to non-horizontal problems would allow a number of competitors to enter the market, whereas GDP was merely a potential competitor. Even on the assumption that the Commission did wrongly consider that it could decide not to examine the indirect scope of certain commitments by reference to a competition concern or a market to which they were not directly relevant, that would not constitute an error of law but an error of assessment. Although the Commission is required to examine all the relevant commitments by reference to competitive concerns identified on any of the markets concerned, including those not specifically designated as such by the parties to a merger, the question whether or not a particular commitment is relevant to a specific concern raised by a merger is a matter for the economic assessment of the transaction in question and must be examined in that context.

84 As the applicant has also put forward this argument in the context of its fourth plea in law, relating to the existence of errors of assessment by the Commission with regard to the merger as modified, it is appropriate to deal with it when examining that plea.

85 In the light of the foregoing, the second limb of the third plea must be rejected.

C – Third limb of the third plea in law, relating to misuse of powers

86 The applicant claims, essentially, that the Commission misunderstood the powers conferred on it by the Merger Regulation by requiring that the commitments should be aimed at the liberalisation of the electricity and gas markets.

87 According to consistent case-law, the concept of misuse of powers refers to cases where an administrative authority has used its powers for a purpose other than that for which they were conferred on it. A decision may amount to a misuse of powers only if it appears, on the basis of objective, relevant and consistent factors, to have been taken for such a purpose (Case C-331/88 Fedesa and Others [1990] ECR I-4023, paragraph 24, and Case C-400/99 Italy v Commission [2005] ECR I‑0000, paragraph 38). Where more than one aim is pursued, even if the grounds of a decision include, in addition to proper grounds, an improper one, that would not make the decision invalid for misuse of powers, since it does not nullify the main aim (Case 2/54 Italy v High Authority [1954] ECR 37, 54, and, to that effect, Case T-266/97 Vlaamse Televisie Maatschappij v Commission [1999] ECR II‑2329, paragraph 131).

88 It should be observed at the outset that it is common ground that the merger falls within the scope of the Merger Regulation (recitals 12 and 13 to the contested decision). It must also be observed that the applicant does not claim that the merger could not form the subject-matter of a decision to initiate the investigation proceedings under Article 6 of the Merger Regulation and, therefore, of a final decision under Article 8 of the Merger Regulation. In that regard, the applicant acknowledges, notably in its written answer for the hearing, that the merger as notified strengthened EDP’s dominant positions on the electricity markets. Accordingly, it was inevitable that the parties would give commitments with a view to obtaining a decision declaring the merger compatible with the common market.

89 It is therefore quite plain that, in taking account of the commitments proposed for the purposes of the adoption of the contested decision, the Commission acted wholly within the framework of the Merger Regulation. The Commission thus pursued the objective of that regulation, which seeks to prohibit the creation or strengthening of a dominant position which would have the consequence of significantly impeding effective competition.

90 The applicant claims, however, that the Commission demanded more such commitments, going beyond what was necessary to ensure that EDP’s and GDP’s dominant positions would not be strengthened. In particular, it claims that the Commission required that the market be opened to a greater extent than was necessary to resolve the competition concern caused by the merger.

91 The numerous examples provided by the applicant – to the effect, in substance, that the Commission deemed the commitments insufficient to ensure that new competitors would enter the relevant markets (see, in particular, recitals 659, 665, 707, 714, 725, 749, 805, 812, 862, 879 and 888 to the contested decision) –, demonstrate simply that the objective of the Merger Regulation, namely to prevent the creation or strengthening of dominant positions having the effect that effective competition would be significantly impeded by a concentration, was pursued by the Commission. Indeed, the entry of new competitors on markets where it is not disputed that EDP and GDP hold very strong dominant positions constitutes one essential aim of competition in the context of the application of Article 2(3) of the Merger Regulation. Accordingly, the essential objective pursued by the Commission in its refusal to modify its position in the light of the commitments falls squarely within the framework of the Merger Regulation.

92 In that regard, it must be noted that, in the context of its plea relating to the competitive assessment of the concentration as modified, the applicant relies on the fact that the concentration would constitute a significant advance towards the opening of the gas and electricity markets to competition. Unless it is to contradict itself, therefore, the applicant accepts that the resolution by the commitments of the competition concerns raised by the concentration and the pursuit of the opening of the markets to competition may co-exist.

93 Even on the assumption, and this question will be examined below, that the finding that one of the proposed commitments is insufficient or that the Commission’s requirement of a particular commitment should be considered excessive by reference to the resolution of the competition concerns identified by the Commission in the contested decision, such an error would constitute a breach of Article 2(3) of the Merger Regulation and not a misuse of powers.

94 The applicant maintains, moreover, that the Commission seems to have been attracted by the argument set out in a report entitled ‘Report on Electricity and Gas Markets in Portugal’, prepared by Cambridge Economic Policy Associates at the request of the Portuguese competition authority, according to which, in the applicant’s submission, the Commission should actively use the concentration to improve competitive conditions. However, it must be noted that in the passages in the contested decision in which that report is cited (see, in particular, recitals 137, 172, 333 and 573), the Commission did not in any way embrace the objective put forward as a possibility by the report, but merely drew from it certain objective economic assessments. The references to that report cannot therefore constitute an indication of a misuse of powers.

95 As regards the remaining elements adduced by the applicant, in particular the declarations of Mr Monti, the then Member of the Commission responsible for competition, and other Commission decisions on concentrations in the energy sector (Commission Decision of 7 February 2001 in Case COMP/M.1853 – EDF/EnBW; Commission Decision of 19 March 2002 in Case COMP/M.2684.1853 – EnBW/EDP/Gastajur/Hidrocantábrico), these cannot constitute relevant indicia for the purpose of establishing the existence of a misuse of powers in the present case, since they do not form the basis of the contested decision. Furthermore, even if those two concentration decisions were defective in the manner alleged by the applicant, namely that they required that the markets be opened to an extent that was unnecessary by reference to the competition concerns identified in those decisions, that would not mean that the contested decision, which is based on a competitive situation specific to its own case, is defective in the same way.

96 The fact, alleged by the applicant, that the Commission was in reality seeking to attain the objectives of the Second Gas Directive, whereas that directive is based on Article 47(2) EC (right of establishment), Article 55 EC (freedom to provide services) and Article 95 EC (harmonisation of legislation), does not show that the Commission wrongly intended to pursue those objectives. First, the legal basis of that directive tends rather to show that the Commission could only very indirectly pursue the aims of that directive by favouring the entry of new competitors, notably national competitors, on the relevant markets. Second, it must be held that Directive 98/30/EC of the European Parliament and of the Council of 22 June 1998 concerning common rules for the internal market in natural gas (OJ 1998 L 204, p. 1; ‘the First Gas Directive’) and the Second Gas Directive have the effect, if not the object, of introducing competition into a sector which had hitherto not been subject to competition (see recitals 2, 6, 21, 22, 26 and, particularly, 31 to Directive 2003/54/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in electricity and repealing Directive 96/92/EC (OJ 2003 L 176, p. 37; ‘the Second Electricity Directive’), and recitals 2, 7, 19, 21, 25, 27 and, in particular, 30 to the Second Gas Directive; see also, in regard to Directive 96/92/EC of the European Parliament and of the Council of 19 December 1996 concerning common rules for the internal market in electricity (OJ 1996 L 27, p. 20), the judgment of the Court of Justice in Case C-17/03 VEMW and Others [2005] ECR I-0000, paragraph 62). It follows that one of the aims of the Second Gas Directive is clearly competitive. It is no surprise, therefore, that the competitive objective of the Merger Regulation should also be assumed by one of the objectives of the second electricity and gas directives. Consequently, the fact that the Commission pursued the practical realisation of the Second Gas Directive cannot indicate a misuse of powers when that objective is also the objective for which that regulation conferred its powers on the Commission.

97 The applicant claims, last, that the liberalisation of the energy sectors ought to have been implemented by the application of Article 86 EC. Without there being any need to resolve the question of whether the Commission could still use the powers conferred on it by that article, notwithstanding the existence of the second electricity and gas directives, the applicant’s argument is irrelevant in the context of the present limb. Even on the assumption that Article 86 did permit the liberalisation of the markets in question to be achieved, such an assumption could only lead to a finding that that competition provision and the Merger Regulation, the objectives of which have been seen to have been properly pursued by the Commission, can be applied together.

98 In the light of the foregoing, the third limb of the third plea must be rejected.

D – Fourth limb of the third plea, relating to the difficulties in monitoring certain behavioural commitments

99 The applicant claims that the Commission rejected certain commitments because of their behavioural nature and of the need to carry out ex-post monitoring. It submits that in doing so the Commission acted inconsistently with the case-law and with its recent administrative practice, and failed to take into account the possibility that that ex-post monitoring could be carried out by the competent Portuguese authorities.

100 It must be borne in mind at the outset that behavioural commitments are not by their nature insufficient to prevent the creation or strengthening of a dominant position, and that they must be assessed on a case-by-case basis in the same way as structural commitments (Gencor v Commission, paragraph 48 above, paragraph 319, and Tetra Laval v Commission, paragraph 45 above, paragraph 161, upheld in that regard by the Court of Justice in Commission v Tetra Laval, paragraph 63 above, paragraph 85).

101 However, the applicant’s complaint is based on a misreading of the contested decision, since in the three examples which it puts forward the Commission did not reject the commitments in question solely because of their behavioural nature or because of the difficulties in monitoring those commitments, but because of their overall insufficiency by reference to the competition concerns identified.

102 Thus, at recital 663, the Commission did indeed conclude that the commitment in respect of the leasing of production capacity equivalent to one CCGT of TER was far from securing the same advantages as a structural commitment, and that it required extensive subsequent verification on the Commission’s part. However, the Commission intended thereby only to emphasise that the parties had made provision for the early termination of that commitment when certain complex conditions were satisfied, and that they had asked that the Commission verify one of those conditions was satisfied. In fact, the Commission considered principally that those conditions gave rise to serious uncertainties affecting that commitment. First, it was not therefore the behavioural nature of the commitment that led to its being rejected by the Commission. Second, the difficulty of monitoring those conditions resulted from the complexity and inappropriateness of the conditions, and not from a refusal on the Commission’s part to carry out ex-post monitoring. Third, and last, recitals 662 and 664 describe several other factors, such as, in particular, the fact that the lessee would not be in a position to manage the CCGT autonomously, that it would become dependent on EDP and that the conditions of the early termination of the commitment were based on transnational considerations although the market will remain a national market, which in the Commission’s view also justified the rejection of that commitment.

103 At recital 678, the Commission puts forward merely as a supplementary and marginal reason the fact that the commitment relating to the sale of the Sinès LNG terminal required extensive subsequent monitoring by the Commission. It did not in any way rely on the behavioural nature of that commitment, and virtually the entire recital is devoted to other reasons, such as, in particular, the date of the divestment, the weaknesses relating to third-party access to gas capacities, and the retention by GDP of a minority shareholding in the operator managing the terminal, leading the Commission to conclude in the following recital that the positive effects of that commitment were likely to be seriously reduced.

104 At recital 719, the Commission did indeed consider that the commitment relating to the suspension of EDP’s voting rights in the Board of Directors of Turbogás with regard to the supply of gas and investments and the appointment of independent members to the board of Turbogás, were purely behavioural and would be difficult to monitor. However, that aspect was emphasised only incidentally and is preceded by three principal reasons why the Commission considered that commitment insufficient, namely the fact that the independence of the appointed member was not guaranteed, the fact that EDP would retain voting rights on important questions and could indirectly influence the choice of gas supplier, and the fact that the suspension of the voting rights would be limited to three years.

105 Last, as regards the criticism that the Commission failed to take into account the possibility that the competent Portuguese authorities might carry out the monitoring necessary to ascertain whether the conditions for the early termination of the commitments in question were satisfied, it must be held, first, that, as regards the leasing of the TER, it was the parties themselves that expressly envisaged requesting the Commission to verify that those conditions were satisfied. The Commission was therefore not in a position, without itself modifying the proposed commitment, which it is not empowered to do, to entrust that monitoring to the national authorities. Likewise, as regards the other two commitments to which the applicant refers, the Commission had no obligation, even if had been able to do so in the discussions with the parties, to establish a particular method of monitoring, notably one delegated to the competent national authorities. It was for the parties, on the contrary, to propose commitments that were full and effective from all aspects, especially if those behavioural commitments had intrinsic weaknesses as regards their binding nature that justified ex-post monitoring.

106 In the light of the foregoing, the fourth limb of the third plea must be rejected.

107 Consequently, the third plea must be rejected in its entirety.

III – First plea, relating to the derogation which Portugal enjoys under the Second Gas Directive

108 The applicant maintains, in substance, that in assessing the competitive situation on markets not open to competition the Commission disregarded (i) the temporary derogation from the liberalisation calendar enjoyed by the Portuguese Republic under the Second Gas Directive and (ii) Article 2(3) of the Merger Regulation by projecting its competitive analysis more than five years after the concentration.

A – Preliminary observations

109 It must be borne in mind, as a preliminary point, that the electricity and gas markets in the Community were, de facto, markets that were not necessarily open to competition before the adoption of the first and Second Gas Directives, owing to the national monopolies in certain Member States. However, the Court of Justice has had occasion to observe that the provisions on competition in the EC Treaty were applicable to decisions by undertakings active in those sectors (Case C‑393/92 Almelo and Others [1994] ECR I-1477, paragraphs 34 to 51). None the less, the First Gas Directive, then the Second Gas Directive, which speeds up the calendar provided for in the First Gas Directive, are based on the premiss that Member States were not immediately required, from the date of implementation of those directives, to open the gas markets to competition. It must therefore be accepted that the various gas markets are not required to be open to competition before the deadlines set in the Second Gas Directive.

110 The Second Gas Directive seeks to establish an internal gas market in which fair competition prevails (recital 30 to the Second Gas Directive), that is, to give consumers the opportunity freely to choose their suppliers and to give suppliers the opportunity to deliver to their customers – without hindrance (recital 4 to the Second Gas Directive). One of the main axes of that liberalisation of the gas markets consists in setting a calendar for the progressive opening of those markets, based on the progressive increase in the number of eligible customers, that is of customers free to purchase gas from the supplier of their choice. Under the Second Gas Directive, all non-domestic customers were to be eligible on 1 July 2004 and all customers will have to be eligible on 1 July 2007.

111 Under Article 28(2) of the Second Gas Directive, however, a Member State which qualifies as an emergent market is subject to an exceptional calendar. Until the dates provided for in that calendar, such a Member State may derogate from the following obligations: non-discriminatory authorisation for the construction or operation of gas facilities, designation of system operators, definition of the tasks of such operators, unbundling of system operators, designation of distribution system operators, definition of the balancing tasks of distribution system operators, unbundling of distribution system operators, unbundling of accounts, introduction of third-party access to the natural gas system and to LNG installations, introduction of a calendar for liberalisation and introduction of a system for direct pipelines (see paragraph 6 above).

112 It clearly follows that that derogation exempts the Member State concerned from the obligation to apply the main provisions of the Second Gas Directive which ensure that the various markets will be open to competition and which guarantee effective competition. It must therefore be concluded that, by virtue of that derogation, the gas markets concerned are not open to competition so long as the Member State concerned has not opened those markets.

B – First limb of the first plea, relating to failure to have regard to the derogation granted to the Portuguese Republic

113 By the first limb of its plea, the applicant claims that in assessing the effects of the concentration on markets not open to competition, the Commission infringed the Portuguese Republic’s right to restructure the gas sector during the period allowed under the derogation granted by Article 28 of the Second Gas Directive. The Commission on the other hand, contends first, that the concentration results solely from decisions taken by undertakings and that it must be examined primarily under the Merger Regulation. Second, it maintains that it ensured the necessary coherence between that regulation and the Second Gas Directive by not assessing the effects of the concentration during the period covered by the derogation. Third, it contends that that derogation does not give a Member State the right to favour a concentration which will significantly affect competition after the expiry of that derogation.

114 It is common ground that the Portuguese Republic benefits from the derogation provided for in Article 28(2) of the Second Gas Directive and that that derogation will come to an end in 2007, which means that the calendar for the gradual opening of the gas markets to competition will then become operative.

115 The Portuguese Republic has taken advantage of that derogation to establish a national gas industry operating as a monopoly in all sectors of the gas industry (transmission, storage, distribution, supply). It must be observed that the setting-up of those monopolies has not been challenged on competition grounds by the Commission. Similarly, in the present case, the Portuguese Government has not yet officially opened any of the markets concerned to competition. The Commission claims, in particular, that the opening of the market in the supply of gas to electricity producers had been envisaged for 2004 and was postponed to 2005 (recital 211 to the contested decision). However, no documentary evidence of the actual opening of that market has been adduced. Also, as the Commission itself acknowledges, that market was not open to competition on the date of adoption of the contested decision. The Commission relies, furthermore, on the fact that the Portuguese Republic is very seriously contemplating bringing forward the liberalisation of all the gas markets. However, even on the assumption that the liberalisation calendar in Portugal may be speeded up, before any actual liberalisation the gas markets concerned all continue to be covered by the derogation. Moreover, there is no indication that the Portuguese Republic would agree to bring forward the liberalisation calendar without the concentration being implemented.

116 It follows that the gas markets in Portugal were not open to competition on the date of adoption of the contested decision. That fact directly and inevitably affects the application of Article 2(3) of the Merger Regulation to those markets.

117 First, as regards the first criterion in Article 2(3) of the Merger Regulation, namely the creation or strengthening of a dominant position, that criterion cannot apply, since GDP currently has a monopoly on the markets for the supply of gas to electricity producers, LDCs and large customers (recital 475 to the contested decision). Indeed, on any market, a monopoly represents the ultimate dominant position, which for that reason cannot be strengthened on that market. The only market on which GDP’s dominant position could be strengthened is the market for the supply of gas by LDCs to small customers, since GDP owns only five of the six existing LDCs. None the less, it should be noted that each of those LDCs has a geographical monopoly which currently precludes any competition between them.

118 Second, as regards the second criterion in Article 2(3) of the Merger Regulation, namely a significant impediment to effective competition, which, as has been seen above, constitutes an autonomous criterion, it too cannot be satisfied in a non-competitive market. Indeed, in the total absence of competition, there was no competition that could be significantly impeded by the concentration on the date of adoption of the contested decision.

119 That analysis is fully corroborated by the general competition case-law. Thus, in respect of agreements and abuse of a dominant position, it has been held that, if national legislation creates a legal framework eliminating any possibility of competitive conduct on the part of undertakings, Articles 81 EC and 82 EC do not apply (Joined Cases 40/73 to 48/73, 50/73, 54/73 to 56/73, 111/73, 113/73 and 114/73 Suiker Unie and Others v Commission [1975] ECR 1663, paragraphs 71 and 72; Joined Cases C-359/95 P and C-379/95 P Commission and France v Ladbroke Racing [1997] ECR I-6265, paragraph 33; and Joined Cases T-191/98 and T-212/98 to T-214/98 Atlantic Container Line and Others v Commission [2003] ECR II-3275, paragraph 1130). Likewise, the Court of First Instance has held that ‘a system of aid established in a market that was initially closed to competition must, when that market is liberalised, be regarded as an existing aid system, since at the time of its establishment it did not come within the scope of Article 92(1) of the Treaty, which, having regard to the requirements set out in that provision regarding effect on trade between Member States and repercussions on competition, applies only to sectors open to competition’ (Joined Cases T‑298/97, T‑312/97, T‑313/97, T‑315/97, T‑600/97 to T‑607/97, T‑1/98, T‑3/98 to T‑6/98 and T‑23/98Alzetta and Others v Commission [2000] ECR II-2319, paragraph 143, indirectly upheld on appeal by judgment of the Court of Justice in Case C-298/00 P Italy v Commission [2004] ECR I-4087, paragraphs 66 to 68).

120 It must be pointed out that this consideration affects only the issue of whether the conditions laid down in Article 2(3) of the Merger Regulation are satisfied, and not the application of that article or the applicability of the entire regulation to the concentration. Where a concentration falls within the scope of that regulation, in accordance with Article 1 thereof, the transaction is subject to that regulation, but cannot be prohibited because of its effects on markets where there is no competition.

121 In that regard, the Commission claims to have respected the derogation by projecting its competitive analysis, in the contested decision, to a date when the gas markets should be open to competition, whether under the calendar envisaged by the Portuguese authorities or under the later but binding calendar of the derogation. By doing so, the Commission confirms, in part, the analysis made above of the impossibility of satisfying the criteria of Article 2(3) of the Merger Regulation in the case of markets not open to competition.

122 The Commission’s argument must be rejected. The fact of putting back the subject of the competitive analysis to a date after the date on which the derogation comes to an end does not mean that that derogation has been taken into account. By prohibiting the monopoly operator on the gas market from immediately conducting economic transactions leading to the modification of its competitive position, when the derogation recognised to the Portuguese Republic exempts it from the general rules on competition, the Commission disregarded the possibility that that State could freely structure its gas market while the derogation was in existence. In other words, the Commission prohibited the parties from benefiting from the effects of the concentration on the gas markets in the period during which the concentration could not be prohibited under the Merger Regulation and the Second Gas Directive.

123 Furthermore, by assessing only the future effects of the concentration on the gas markets as from the date on which they will be subject to the conditions of Article 2(3) of the Merger Regulation, namely when the markets will be open to competition, the Commission deliberately refrained from taking into account the immediate effects of the concentration on those markets.

124 Where, for the purposes of applying Article 2(3) of the Merger Regulation, the Commission examines a concentration, it must ascertain whether the concentration would have the direct and immediate effect of creating or strengthening a dominant position. In the absence of such an alteration to competition as it stands, the merger must be approved (Case T-342/99 Airtours v Commission [2002] ECR II-2585, paragraph 58). It is true that the Commission may, where appropriate, take into account the effects of a concentration in the near future (Case T-5/02 Tetra Laval v Commission [2002] ECR II-4381, paragraph 153), or indeed base its prohibition of a concentration on such future effects. However, that does not allow it to refrain from analysing the immediate effects of such a transaction if they exist and from taking them into account in its overall assessment of the transaction.

125 In the present case, the Commission did not examine the period between the date of the concentration and the date of the opening of the gas markets to competition, that is a period extending, depending on the markets, from three to six, or eight, years after the concentration. However, the concentration as modified by the commitments would have immediate significant effects on the gas markets, principally constituted by bringing forward the opening of those markets by approximately two to three years by reference to the calendar envisaged by the derogation. In fact, even if the legal opening of those markets to competition was to be brought about by the Portuguese Government in accordance with the assurances which it had given to that effect, the actual effectiveness of that opening would be ensured by the numerous commitments, particularly with regard to third-party access to gas capacity. That failure on the Commission’s part is by no means neutral from the point of view of competition, inasmuch as the anticipated transition from a monopoly situation to a situation in which the existence of competitors is made possible, in particular through non-discriminatory or less discriminatory third-party access to gas resources and the possibility for those third parties to operate in markets that were previously closed, cannot be completely overlooked.

126 In this respect, it is necessary to reject the Commission’s argument that the undertakings concerned are subject to the Merger Regulation alone, and cannot benefit from the derogation granted to the Member State concerned by the Second Gas Directive. It is the case that that regulation and that directive have different legal bases and are addressed to different persons. It must also be accepted that the concentration is the result of decisions by undertakings, even though it is clear from the file that the Portuguese State is a participant in that concentration in that it visibly anticipated, if not arranged, it (see paragraph 11 above). Contrary to the Commission’s premiss, however, the Merger Regulation and the Second Gas Directive cannot be analysed separately. As stated above, the absence of competition on the gas markets under the derogation granted in accordance with the Second Gas Directive precludes the application of Article 2(3) of the Merger Regulation. Undertakings cannot be criticised for significantly impeding effective competition where that competition does not exist as a result of national and Community legislation.

127 Certainly, as the Commission emphasises in the contested decision (recitals 210 to 214), if it is unable to assess the future competitive effects of the concentration on markets which at present are not yet open to competition, that wholly prevents it from assessing the effects of the concentration on the gas markets. In particular, when the markets in question must be open to competition according to a strict and binding calendar in accordance with the Second Gas Directive, the Commission is not able to assess whether the concentration prevents the introduction of effective competition within the timeframe of that calendar.

128 If the consequence of this analysis, as the Commission stresses, is indeed that undertakings are not wholly subject to the normal competition rules, including those promoted by the Second Gas Directive, immediately before the latter rules are applicable to them, that outcome is, in the present case, the consequence of the intention of the legislature as expressed in the derogation created by Article 28(2) of that directive.

129 Nor can the Commission rely on the fact that the parties notified the concentration to support the conclusion that they thus recognised that the Merger Regulation was applicable. On the one hand, it is not the applicability of the regulation in its entirety, but the application of its main prohibitory provision to a part of the concentration that is at issue here. Furthermore, that notification was still mandatory under Article 1 of that regulation. Besides, the applicability of the Merger Regulation cannot depend on the intention of the parties to a concentration.

130 It must therefore be held that, by basing the prohibition of the concentration on the strengthening of dominant positions having as their consequence a significant impediment to competition on gas markets not open to competition by virtue of the derogation granted by Article 28(2) of the Second Gas Directive, the Commission has disregarded the effects, and thus the scope, of that derogation.

131 None the less, the Commission’s error lies solely in the fact that it has considered that the conditions of the application of Article 2(3) of the Merger Regulation were satisfied in respect of markets not open to competition. On the other hand, its competitive assessments based on the Merger Regulation relating to the situation of the gas markets before the concentration, those relating to the situation of the gas markets at the foreseeable date of the opening of those markets and those relating to the electricity markets before and after the concentration are not affected by that error. The competitive situation existing on the date of adoption of the contested decision or on the date of the opening of the markets in question to competition is an objective fact which is not affected by the non-fulfilment of a legal criterion.

132 Furthermore, the impossibility of satisfying the conditions laid down by Article 2(3) of the Merger Regulation is limited solely to the sector in which competition is absent, and that article remains fully applicable to any other sectors concerned by the notified transaction. In that regard, it must be remembered that the Merger Regulation is directed to the analysis of one or more dominant positions on the market or markets affected by a concentration. It is quite possible, indeed frequent, that a concentration produces anti-competitive effects on only one, or some, of the markets concerned without having such effects on the other markets. Where that is so, the transaction must none the less be prohibited, in accordance with Article 2(3) of the Merger Regulation. Accordingly, the application of Article 2(3) of the Merger Regulation to the electricity markets is not affected by the error concerning the gas markets.

133 In the light of the foregoing, it must be held that the contested decision is vitiated by an error of law in so far as it concludes that there would be a strengthening of GDP’s pre-existing dominant positions on the markets for the supply of gas to electricity producers, to large customers and to small customers, with the consequence that effective competition would be significantly impeded.

C – Second limb of the first plea, relating to an excessive projection into the future

134 The applicant maintains that the Commission infringed Article 2(3) of the Merger Regulation by projecting its competitive analysis of the gas markets beyond five years after the concentration.

135 It must first of all be borne in mind that it has been held that the contested decision was vitiated by an error of law as regards the application of Article 2(3) of the Merger Regulation to the gas markets. Accordingly, there is no further need to adjudicate on the present limb of the present plea as regards the strengthening of GDP’s dominant positions on those markets.

136 However, the Commission relied, in its analysis of the electricity markets, on its competitive analysis of the gas markets, and that approach was not affected by the error of law found above. When asked to identify the interactions between the gas and electricity markets which had been set out in the contested decision, the applicant cited a number of recitals which all relate to the supply of gas to the CCGTs, either directly (recitals 336, 340, 365 and 506) or indirectly in the context of the non-horizontal effects of the concentration, namely the possibility that the merged entity will use its new position of strength in gas to harm competing electricity producers (recitals 367 to 429).

137 For this reason, there is no need to adjudicate on the present limb of the first plea as regards the Commission’s competitive analyses in respect of markets other than that in the supply of gas to the CCGTs, namely the markets for the supply of gas to LDCs, to large customers and to small customers.

138 According to Decisions No 63/2003 and No 68/2003 of the Portuguese Council of Ministers, the market for the supply of gas to CCGTs was to be opened to competition in 2004, but that opening was postponed until 2005 (recitals 203 and 505). That date was not disputed by the applicant. In any event, owing to the size and nature of that market, which currently represents almost half of total consumption in Portugal and is an industrial market, it would be one of the first markets subject to the requirement of being opened to competition in 2007 under the derogation, that is by no later than three years after the concentration.

139 However, the applicant’s criticism of the Commission is solely that it exceeded the maximum normal period of examination of between three and five years after the concentration.

140 Consequently, there is no need either to adjudicate on the present limb of the first plea as regards the market for the supply of gas to CCGTs.

141 In the light of the foregoing, there is no need to adjudicate on the present limb of the first plea.

IV – Fourth plea, relating to the existence of errors of assessment in regard to the commitments

A – Preliminary observations

142 At the outset, it must be borne in mind that the conditions laid down in Article 2(3) of the Merger Regulation could not be satisfied in respect of the gas markets. Accordingly, there is no further need to adjudicate on the second limb of the fourth plea, relating to possible errors of assessment in respect of the insufficiency of the commitments concerning the competition concerns identified in the gas sector.

143 The Commission claims that if only one of the competition concerns identified in the contested decision remains unresolved by one of the commitments of 26 November 2004, that is sufficient for the contested decision to be upheld.

144 According to settled case-law, in so far as certain grounds of a decision in themselves provide a sufficient legal basis for that decision, any errors in other grounds of the decision have no effect in any event on its operative part (see, by analogy, Joined Cases C-302/99 P and C-308/99 P Commission and France v TF1 [2001] ECR I-5603, paragraphs 26 to 29, and Case T-50/00 Dalmine v Commission [2004] ECR II-0000, paragraphs 134 and 146, under appeal).

145 In the case of a concentration, the Commission must prohibit a transaction provided that the criteria of Article 2(3) of the Merger Regulation are satisfied, even in respect of only one of the relevant markets.

146 Thus, according to settled case-law, it must be held that a decision in respect of a concentration finding the concentration incompatible with the common market can only be annulled if it is established that any grounds which are not vitiated by illegality, in particular those concerning any one of the relevant markets, are insufficient to justify its operative part (Case T-310/01 Schneider Electric v Commission [2002] ECR II-4071, paragraph 412).

147 None the less, this observation does not preclude that it may be necessary, when examining a particular market, also to examine the competitive situation on the other markets if the decision in question relies, either on a comprehensive assessment of the effects of the concentration on the various relevant markets, or on the mutual strengthening of certain competitive effects of the transaction on those various markets.

148 In the present case, in the contested decision the Commission concluded its analysis of each of the relevant markets with the consideration that the concentration would lead to the strengthening of the dominant position in question on that market, without referring to the other markets. However, as the Commission relied on the competitive situation on various electricity markets and on the competitive situation on various gas markets and then found competition concerns on one or other of the electricity markets, it is necessary to examine, to the extent necessary, the merits of all of those competitive assessments on the relevant markets. It must be borne in mind in that regard that, in accordance with paragraph 131 above, the assessment of the competitive situation on the gas markets is not in itself affected by the fact that the criteria of Article 2(3) of the Merger Regulation cannot be satisfied with regard to those markets.

149 In particular, the Commission’s claim, that the present plea should be rejected solely on the ground that the applicant did not seriously dispute that EDP’s dominant positions on the electricity markets in respect of balancing power or ancillary services and the retail markets would be strengthened, must itself be rejected on the grounds that, as the applicant submits, the reasoning in the contested decision in respect of those markets effectively relies, at least in part, on the competitive assessments relating to the wholesale electricity market, and that the invalidation of the assessment made in respect of that market could have the consequence that the assessment in respect of the markets in question must also be declared invalid.

150 The Commission’s argument that the applicant acknowledged that the commitments of 28 October and 17 November 2004 were not sufficient to resolve the competition concerns identified by the Commission must also be rejected. Although the applicant accepted in the application, for the purposes of the present plea, that the concentration as notified would strengthen GDP’s dominant positions and, in its reply for the hearing, that the concentration as notified would strengthen EDP’s dominant positions, it did not accept that the commitments proposed on either 28 October, 17 November or 26 November 2004 were insufficient to resolve the competition concerns identified.

151 According to settled case-law, review by the Community Courts of complex economic assessments made by the Commission in the exercise of the discretion conferred on it by the Merger Regulation must be limited to ensuring compliance with the rules of procedure and the statement of reasons, as well as the substantive accuracy of the facts, the absence of manifest errors of assessment and of any misuse of powers (see Petrolessence and SG2R v Commission, paragraph 63 above, paragraph 101, and the case-law cited, and, to that effect, Commission v Tetra Laval, paragraph 63 above, paragraph 38).

152 In that regard, in underlining the fact that the applicant never expressly claimed that there had been a manifest error of assessment, the Commission claims by implication that that omission renders the present plea inoperative. That argument must be rejected. Since the applicant invokes an error of analysis and since the case-law requires that such an error be manifest, it would be unreasonable to find in such a formal imprecision a ground for rejecting a plea essential to the present action and it must therefore be held that the applicant intended to invoke manifest errors of assessment. None the less, it is still the case that the errors invoked by the applicant must be manifest if the contested decision is to be annulled.

153 Last, the applicant makes numerous references in the application to an economic report prepared by Lexecon at its request (‘the Lexecon Report’), entitled ‘EDP-Eni/GDP: an economic assessment of the argument in favour of the prohibition of the concentration as modified’, dated February 2005.

154 In that regard, the Commission’s criticism that certain general references to the Lexecon Report must be declared inadmissible must be upheld.

155 According to settled case-law, in order to ensure legal certainty and the sound administration of justice, if an action is to be admissible, the essential facts and law on which it is based must be apparent from the text of the application itself, even if only stated briefly, provided the statement is coherent and comprehensible (see, to that effect, Joined Cases 19/60, 21/60, 2/61 and 3/61 Fives Lille Cail and Others v High Aut