Keywords

Summary



Keywords

1. Community law — Principles — Rights of the defence — Compliance during administrative procedure — (Council Regulations Nos 17, Art. 14, and 4056/86, Art. 18)

2. Competition — Administrative procedure — Powers of the Commission in investigations — Limits — Protection against arbitrary or disproportionate intervention by the public authority — (Council Regulations Nos 17, Art. 14, and 4056/86, Art. 18)

3. Competition — Administrative procedure — Powers of the Commission in investigations — Scope — Access to the premises of undertakings — Limits — Indication of the subject-matter and purpose of the investigation — Right to bring an action before the Community judicature — (Council Regulations Nos 17, Art. 14, and 4056/86, Art. 18)

4. Competition — Administrative procedure — Powers of the Commission in investigations — Access to premises of undertakings — Undertaking not referred to in the investigation decision — Conditions for access — (Council Regulation No 4056/86, Art. 18)

5. Competition — Administrative procedure — Powers of the Commission in investigations — Voluntary cooperation of an undertaking — Consequences for the possibility of arguing undue interference by a public authority — (Council Regulation No 4056/86, Art. 18)

6. Competition — Agreements, decisions and concerted practices — Undertaking — Definition — Economic unit — Attribution of the infringements — (EC Treaty, Art. 85(1) (now Art. 81(1) EC))

7. Competition — Agreements, decisions and concerted practices — Dominant position — Undertaking — Definition — Economic unit — Undertakings having a vertical relationship — Criteria — (EC Treaty, Arts 85 and 86 (now Arts 81 EC and 82 EC))

8. Competition — Community rules — Scope ratione materiae — Conduct imposed by State measures — Excluded — Conditions — (EC Treaty, Arts 85 and 86 (now Arts 81 EC and 82 EC))

9. Competition — Agreements, decisions and concerted practices — Definition — Gentlemen ' s agreement concerning conduct in the market — (EC Treaty, Art. 85(1) (now Art. 81(1) EC))

10. Competition — Agreements, decisions and concerted practices — Participation in meetings held by undertakings for an anti-competitive purpose — Conduct constituting an infringement in itself — (EC Treaty, Art. 85(1) (now Art. 81(1) EC))

11. Competition — Fines — Amount — Determination — Criteria defined in the Commission Guidelines — Applicability to infringements of the competition rules in the maritime transport sector — (ECSC Treaty, Art. 65(5); Council Regulations No 17, Art, 15(2) and 4056/86, Art. 19(2))

12. Competition — Fines — Amount — Reduction in fine in exchange for cooperation — Actions for annulment — Fresh review of the size of the reduction — Excluded — (Council Regulation No 17, Art. 15)

Summary

1. In all procedures involving application of the competition rules laid down in the Treaty, the rights of the defence must be observed by the Commission during administrative procedures which may lead to the imposition of penalties and also during preliminary inquiry procedures because it is necessary to prevent those rights from being irremediably impaired during preliminary inquiry procedures including, in particular, investigations which may be decisive in providing evidence of the unlawful nature of conduct engaged in by undertakings for which they may be liable.

see paras 47-48

2. As regards the powers accorded the Commission by Article 14 of Regulation No 17 and the extent to which the rights of the defence may restrict them, the need for protection against arbitrary or disproportionate intervention by public authorities in the sphere of the private activities of any person, whether natural or legal, constitutes a general principle of Community law. In all the legal systems of the Member States, any intervention by the public authorities in the sphere of private activities of any person, whether natural or legal, must have a legal basis and be justified on the grounds laid down by law and, consequently, those systems provide, albeit in different forms, protection against arbitrary or disproportionate intervention.

see para. 49

3. It is apparent both from the purpose of Regulation No 17 and from the list of powers conferred on the Commission ' s officials by Article 14 thereof that the scope of investigations may be very wide. The exercise of those broad powers is however subject to conditions capable of ensuring respect for the rights of the undertakings concerned.

In that regard, the obligation for the Commission to state the subject-matter and purpose of an investigation constitutes a fundamental requirement, designed not merely to show that the proposed entry onto the premises of the undertakings concerned is justified but also to enable the undertakings to assess the scope of their duty to cooperate whilst safeguarding their rights of defence.

The Commission is likewise obliged to state in the decision ordering an investigation, as precisely as possible, what it is looking for and the matters to which the investigation must relate. That requirement is intended to protect the rights of defence of the undertakings concerned, which would be seriously compromised if the Commission could rely on evidence against undertakings which was obtained during an investigation but was not related to the subject-matter or purpose thereof.

Finally, the undertaking to which the decision is addressed may bring an action for annulment of that decision before the Community judicature; if that action is granted, the Commission will be prevented from making use of any documents or evidence obtained in the course of the investigation in question.

see paras 51, 54-56

4. The Commission must, in all its investigatory work, ensure compliance with the principle that the actions of the Community institutions must have a legal basis and with the principle of protection against arbitrary intervention by the public authorities in the sphere of private activities of any person, whether natural or legal. It would be excessive and contrary to the provisions of Regulation No 4056/86 laying down detailed rules for the application of Articles 85 and 86 of the Treaty to maritime transport, and to fundamental principles of law to allow the Commission a general right of access, based on an investigation decision addressed to one legal entity, to inspect premises belonging to another legal entity simply on the pretext that the latter is closely connected with the addressee of the investigation decision or that the Commission believes it will find there documents belonging to the addressee of the decision.

However, the Commission does not exceed its investigatory powers where it acts diligently and amply fulfils its duty to make as sure as possible, before the investigation begins, that the premises which it proposes to inspect indeed belong to the legal entity which it wishes to investigate. The Commission continues to act lawfully where, having realised that the premises being investigated are not those of the undertaking referred to in the decision, it takes the view that those premises are none the less used by the undertaking initially referred to in the decision for the conduct of its business, given that the company which is based there, whilst being legally distinct from the company to which the decision is addressed, is its representative and sole manager of the affairs to which the investigation related. The right to enter any premises, land or means of transport of undertakings is of particular importance inasmuch as it is intended to permit the Commission to obtain evidence of infringements of the competition rules in the places in which such evidence is normally to be found, that is to say, on the business premises of undertakings. It follows that the Commission is entitled to take into account in its reasoning the fact that its chances of finding proof of the supposed infringement would be higher if it were to investigate the premises from which the target company in fact conducts its business as a matter of practice.

see paras 76-77, 83-84, 88

5. There can be no question of undue interference by the public authority in the sphere of activity of an undertaking, where an investigation is carried out with the cooperation of the undertaking concerned and where there is no evidence that the Commission went beyond the cooperation offered by the employees of the undertaking being investigated.

see para. 94

6. The term " undertaking" within the meaning of Article 85(1) of the Treaty (now Article 81(1) EC) must be understood as designating an economic unit for the purpose of the subject-matter of the agreement in question even if in law that economic unit consists of several persons, natural or legal. Such an economic unit is one that consists in a unitary organisation of personal, tangible and intangible elements which pursues a specific economic aim on a long-term basis and can contribute to the commission of an infringement of the kind referred to in that provision. Where a group of companies constitutes one and the same undertaking the Commission is entitled to impute liability for an infringement committed by the undertaking and to impose a fine on the company responsible for the actions of the group in the context of the infringement.

see paras 121-122

7. The situation in which two companies that have distinct legal identities form, or fall within, one and the same undertaking or economic entity adopting the same course of conduct on the market arises not only in cases where the relationship between the companies in question is that of parent and subsidiary. It may also occur, in certain circumstances, in relationships between a company and its commercial representative or between a principal and his agent. In so far as application of Articles 85 and 86 of the Treaty (now Articles 81 EC and 82 EC) is concerned, the question whether a principal and his agent or " commercial representative" form a single economic entity, the agent being an auxiliary body forming part of the principal ' s undertaking, is an important one for the purposes of establishing whether given conduct falls within the scope of one or other of those provisions. In that respect, in the case of companies having a vertical relationship, such as a principal and its agent or intermediary, two factors are taken to be the main parameters for determining whether there is a single economic unit: first, whether the intermediary takes on any economic risk and, secondly, whether the services provided by the intermediary are exclusive.

In so far as concerns the assumption of economic risk, an agent may not be regarded as an auxiliary body forming part of its principal ' s business where the agreement entered into with the principal confers upon the agent or allows it to perform duties which from an economic point of view are approximately the same as those carried out by an independent dealer, because they provide for the said agent accepting the financial risks of selling or of the performance of the contracts entered into with third parties.

In so far as concerns the question whether the services provided by the agent are exclusive, if, at the same time as it conducts business for the account of its principal, an agent undertakes, as an independent dealer, a very considerable amount of business for its own account on the market for the product or service in question, that tends not to suggest economic unity.

see paras 124-128

8. Articles 85 and 86 of the EC Treaty (now Articles 81 EC and 82 EC) apply only to anti-competitive conduct engaged in by undertakings on their own initiative. If anti-competitive conduct is required of undertakings by national legislation or if the latter creates a legal framework which itself eliminates any possibility of competitive activity on their part, Articles 85 and 86 do not apply. In such a situation, the restriction on competition is not attributable, as those provisions implicitly require, to the autonomous conduct of the undertakings.

Articles 85 and 86 may apply, however, if it is found that the national legislation does not preclude undertakings from engaging in autonomous conduct which prevents, restricts or distorts competition. Moreover, the possibility of excluding specific anti-competitive conduct from the scope of Article 85(1), on the ground that it was required of the undertakings in question by existing national legislation or that any possibility of competitive activity on their part has been eliminated, has been applied restrictively by the Community judicature.

It follows that, in the absence of any binding regulatory provision imposing anti-competitive conduct, the Commission is entitled to conclude that the operators in question enjoyed no autonomy only if it appears on the basis of objective, relevant and consistent evidence that that conduct was unilaterally imposed upon them by the national authorities through the exercise of irresistible pressure, such as, for example, the threat to adopt State measures likely to cause them to sustain substantial losses.

see paras 176-179

9. For there to be an agreement within the meaning of Article 85(1) of the Treaty (now Article 81(1) EC) it is sufficient that the undertakings in question should have expressed their joint intention to conduct themselves on the market in a specific way. That is the case with a " gentleman ' s agreement" .

see para. 207

10. The fact that an agreement to restrict competition is not implemented or followed is not sufficient to place it outside the scope of the prohibition laid down in Article 85(1) of the Treaty (now Article 81(1) EC), since it is participation in negotiations aimed at restricting competition that constitutes an infringement, even if the agreement is not performed.

see para. 208

11. The general method for setting fines described in the Guidelines on the method of setting fines imposed pursuant to Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty applies equally to fines imposed pursuant to Article 19(2) of Regulation No 4056/86 laying down detailed rules for the application of Articles 85 and 86 of the Treaty to maritime transport.

Since, under that method, fines are calculated according to the two criteria referred to in Article 19(2) of Regulation No 4056/86, namely the gravity of the infringement and its duration, and the maximum percentage of turnover of each undertaking as laid down in that provision is observed, the Guidelines do not go beyond the legal framework of the fines set out in that provision.

see paras 270, 279

12. The risk that an undertaking which has been granted a reduction in its fine in recognition of its cooperation will subsequently seek annulment of the decision finding the infringement of the competition rules and imposing a penalty on the undertaking responsible for the infringement, and will succeed before the Court of First Instance or before the Court of Justice on appeal, is a normal consequence of the exercise of the remedies provided for in the Treaty and the Statute of the Court. Accordingly, the mere fact that an undertaking which has cooperated with the Commission and which for that reason has been given a reduction in the amount of its fine has successfully challenged the Decision before the Community judicature cannot justify a fresh review of the size of the reduction granted to it.

see para. 358