Case T-133/07

Mitsubishi Electric Corp.

v

European Commission

(Competition – Agreements, decisions and concerted practices – Market in gas insulated switchgear projects – Decision finding an infringement of Article 81 EC and Article 53 of the EEA Agreement – Market-sharing – Rights of the defence – Proof of the infringement – Duration of the infringement – Fines – Starting amount – Reference year – Equal treatment)

Summary of the Judgment

1. Competition – Administrative procedure – Observance of the rights of the defence – Access to the file – Scope – Failure to communicate a document – Consequences

(Art. 81(1) EC; EEA Agreement, Art. 53(1))

2. Competition – Administrative procedure – Observance of the rights of the defence – Communication of responses to the statement of objections – Conditions – Limits

(Art. 81(1) EC; EEA Agreement, Art. 53(1))

3. Competition – Agreements, decisions and concerted practices – Agreements between undertakings – Evidence of the infringement – Written witness statements of employees of a company involved in an infringement – Probative value – Assessment

(Art. 81(1) EC)

4. Competition – Administrative procedure – Statement of objections – Provisional nature – Necessary content – Limits

(Art. 81 EC)

5. Community law – Principles – Fundamental rights – Presumption of innocence – Procedure in competition matters

(Art. 6(2) EU; Art. 81(1) EC; EEA Agreement, Art. 53(1))

6. Competition – Administrative procedure – Commission decision finding an infringement – Means of proof – Reliance on a body of evidence

(Art. 81(1) EC)

7. Competition – Agreements, decisions and concerted practices – Agreements between undertakings – Evidence of the infringement – Assessment of the probative value of various items of evidence – Criteria

(Art. 81(1) EC; EEA Agreement, Art. 53(1))

8. Competition – Administrative procedure – Commission decision finding an infringement – Burden on the Commission of proving the infringement and its duration

(Art. 81(1) EC; Commission Notice 2002/C 45/03)

9. Competition – Agreements, decisions and concerted practices – Agreements between undertakings – Adverse effect on competition – Criteria for assessment – Anti-competitive purpose – Sufficient finding

(Art. 81(1) EC; EEA Agreement, Art. 53(1))

10. Competition – Administrative procedure – Commission decision finding an infringement – Burden on the Commission of proving the infringement and its duration – Extent of the burden of proof

(Art. 81(1) EC; EEA Agreement, Art. 53(1))

11. Competition – Fines – Amount – Determination – Criteria – Gravity and duration of the infringement – Discretion of the Commission

(Article 81(1) EC; Council Regulation No 1/2003, Art. 23(2) and (3))

12. Competition – Fines – Amount – Determination – Compliance with the principles of equal treatment and proportionality

(Council Regulation No 1/2003, Art. 23(2); Commission Notice 98/C 9/03, Section 1A)

1. A corollary of the principle of respect for the rights of the defence, the right of access to the file means that, in administrative proceedings concerning the application of the competition rules, the Commission must give the undertaking concerned the opportunity to examine all the documents in the investigation file which may be relevant for its defence. Those documents include both incriminating and exculpatory evidence, save where the business secrets of other undertakings, the internal documents of the Commission or other confidential information are involved.

The failure to communicate a document on which the Commission based its decision to inculpate an undertaking constitutes a breach of the rights of the defence only if the undertaking concerned shows that the result at which the Commission arrived in its decision would have been different if the document which was not communicated had to be disallowed as incriminating evidence.

Where an exculpatory document has not been communicated, the undertaking concerned must only establish that its non-disclosure was able to influence, to its disadvantage, the course of the proceedings and the content of the decision of the Commission. It is sufficient for the undertaking to show that it would have been able to use the exculpatory document for its defence, in the sense that, had it been able to rely on it during the administrative procedure, it would have been able to invoke evidence which was not consistent with the inferences made at that stage by the Commission and therefore could have had an influence, in any way at all, on the assessments made by the Commission in the decision, at least as regards the gravity and duration of the conduct in which the undertaking was found to have engaged and, accordingly, the level of the fine.

(see paras 40, 45-46)

2. In the context of proceedings brought for infringement of the competition rules, it is not until the beginning of the inter partes administrative stage that the undertaking concerned is informed, by means of the notification of the statement of objections, of all the essential evidence on which the Commission relies at that stage of the procedure and that that undertaking has a right of access to the file in order to ensure that its rights of defence are effectively exercised. Consequently, the replies to the statement of objections of the other undertakings alleged to have participated in the cartel are not, in principle, included in the documents of the investigation file that the parties may consult.

However, if the Commission wishes to rely on a passage in a reply to a statement of objections or on a document annexed to such a reply in order to prove the existence of an infringement in a proceeding under Article 81(1) EC, the other undertakings involved in that proceeding must be placed in a position in which they can express their views on such evidence. In such circumstances the passage in question from a reply to the statement of objections or the document annexed thereto constitutes incriminating evidence against the various undertakings alleged to have participated in the infringement.

By analogy, if a passage in a reply to a statement of objections or in a document annexed to such a reply may be relevant for the defence of an undertaking in that it enables that company to invoke evidence which is not consistent with the inferences made at that stage by the Commission, it constitutes exculpatory evidence. In that case, the undertaking concerned must be authorised to examine the passage or the document concerned and to give its view thereon.

(see paras 41-43)

3. The written witness statements of the employees of a company, drawn up under the supervision of that company and submitted by it in its defence in the administrative procedure for infringement of the competition rules carried out by the Commission cannot, in principle, be classed as evidence which is both different from, and independent of, the statements made by that same company. Generally speaking, the position of a company as to the truth of the facts set out against it by the Commission is based, primarily, on the knowledge and opinions of its employees and management.

(see para. 59)

4. In the context of administrative proceedings in competition cases, the statement of objections must set forth clearly all the essential facts upon which the Commission is relying at that stage of the procedure. However, that may be done summarily and the decision is not necessarily required to be a replica of the Commission’s statement of objections, since the statement of objections is a preparatory document containing assessments of fact and of law which are purely provisional in nature. Thus, although the Commission cannot allege that the persons concerned have committed infringements other than those referred to in the statement of objections and may take into consideration only facts on which the persons concerned have had the opportunity of making known their views, it must however take into account the factors emerging from the administrative procedure in order either to abandon such complaints as have been shown to be unfounded or to supplement and redraft its arguments both in fact and in law in support of the complaints which it maintains.

(see para. 66)

5. Any doubt in the mind of the Court must operate to the advantage of the undertaking to which the decision finding an infringement of Article 81(1) EC was addressed. The Court cannot therefore conclude that the Commission has established the infringement at issue to the requisite legal standard if it still entertains any doubts on that point, in particular in proceedings for annulment of a decision imposing a fine.

In the latter situation, it is necessary to take account of the principle of the presumption of innocence resulting in particular from Article 6(2) of the European Convention of Human Rights, which is one of the fundamental rights which are general principles of Community law. Given the nature of the infringements in question and the nature and degree of gravity of the ensuing penalties, the principle of the presumption of innocence applies in particular to the procedures relating to infringements of the competition rules applicable to undertakings that may result in the imposition of fines or periodic penalty payments.

(see paras 73-74)

6. As regards competition, the Commission must show precise and consistent evidence in order to establish the existence of the infringement. However, it is not necessary for every item of evidence produced by the Commission to satisfy those criteria in relation to every aspect of the infringement. It is sufficient if the body of evidence relied on by the institution, viewed as a whole, meets that requirement.

In addition, as anti-competitive agreements are known to be prohibited, the Commission cannot be required to produce documents expressly attesting to contacts between the traders concerned. The fragmentary and sporadic items of evidence which may be available to the Commission should, in any event, be capable of being supplemented by inferences which allow the relevant circumstances to be reconstituted. The existence of an anti-competitive practice or agreement may therefore be inferred from a number of coincidences and indicia which, taken together, can, in the absence of another plausible explanation, constitute evidence of an infringement of the competition rules.

Moreover, where the Commission bases its decision solely on the conduct of the undertakings at issue on the market to conclude that there was an infringement of Article 81(1) EC, it is sufficient for those undertakings to prove the existence of circumstances which cast the facts established by the Commission in a different light and thus allow another, plausible explanation of those facts to be substituted for the one adopted by the Commission in concluding that the Community competition rules had been infringed.

That rule does not apply to all cases in which the infringement is established solely on the basis of non‑documentary evidence. As regards the evidence which may be relied on to establish an infringement of Article 81 EC, the prevailing principle of Community law is the unfettered evaluation of evidence.

Consequently, even if the lack of documentary evidence may be relevant in the global assessment of the set of indicia relied on by the Commission, it does not, in itself, enable the undertaking concerned to call the Commission’s claims into question by submitting an alternative explanation of the facts. That is only the case where the evidence submitted by the Commission does not enable the existence of the infringement to be established unequivocally and without the need for interpretation.

(see paras 75-76, 79-82)

7. In the context of proceedings concerning infringement of Article 81(1) EC, the sole criterion relevant in evaluating the different items of evidence is their reliability. According to the general rules regarding evidence, the reliability and, thus, the probative value of a document depends on its origin, the circumstances in which it was drawn up, the person to whom it is addressed and its content.

As regards statements made by undertakings, particularly high probative value may be attached to those which, first, are reliable, second, are made on behalf of an undertaking, third, are made by a person under a professional obligation to act in the interests of that undertaking, fourth, go against the interests of the person making the statement, fifth, are made by a direct witness of the circumstances to which they relate and, sixth, were provided in writing deliberately and after mature reflection.

However, a statement by one undertaking accused of having participated in a cartel, the accuracy of which is contested by several other undertakings similarly accused, cannot be regarded as constituting adequate proof of an infringement committed by the latter unless it is supported by other evidence, though the degree of corroboration required may be less in view of the reliability of the statements at issue.

(see paras 84-87)

8. Even if some caution as to the evidence provided voluntarily by the main participants in an unlawful cartel is generally called for, considering the possibility that those participants have a tendency to provide most of the incriminating evidence in relation to the activity of their competitors, the fact remains that seeking to benefit from the application of the Commission notice on immunity from fines and reductions of fines in cartel cases in order to obtain immunity from, or a reduction of, the fine does not necessarily create an incentive to submit distorted evidence in relation to the participation of the other members of the cartel. Indeed, any attempt to mislead the Commission could call into question the sincerity and the completeness of the cooperation of the person seeking leniency, and thereby jeopardise its chances of benefiting fully under the Leniency Notice.

As regards the particular case of witness statements, it is indeed possible that the employees of an undertaking which has sought leniency, who are required to act in the interests of the undertaking, have a common desire to submit as much incriminating evidence as possible since their cooperation in the procedure may also have a positive impact on their future career. However, if that is the case, the employees at issue will also be aware of the possible negative consequences of submitting inaccurate evidence, which are more sensitive given the requirement for corroboration.

(see paras 88,107)

9. In order for there to be an agreement within the meaning of Article 81(1) EC and Article 53(1) of the Agreement on the European Economic Area (EEA), it is sufficient that the undertakings in question expressed their joint intention to conduct themselves on the market in a specific way. There is no need to take account of the concrete effects of an agreement when it is apparent that it has as its object the prevention, restriction or distortion of competition. In that regard, the existence of a mutual agreement necessarily implies the existence of a meeting of minds, even if there is no evidence which makes it possible to determine with precision the exact point in time that meeting of minds was manifested or which formalised its expression.

(see paras 230-231)

10. When there is a dispute concerning the existence of an infringement, the requirement of legal certainty, on which economic operators are entitled to rely, means that the Commission, which bears the burden of proving infringements which it finds, must adduce evidence which will sufficiently establish the existence of the facts constituting the infringement. With specific regard to the alleged duration of an infringement, the same principle of legal certainty requires that, if there is no evidence directly establishing the duration of an infringement, the Commission should adduce at least evidence of facts sufficiently proximate in time for it to be reasonable to accept that that infringement continued uninterruptedly between two specific dates.

In addition, the fact that the evidence of the existence of a continuous infringement was not adduced for certain specific periods does not preclude the infringement from being regarded as having been established during a more extensive overall period than those periods, provided that such a finding is based on objective and consistent indicia. In the context of an infringement extending over a number of years, the fact that a cartel reveals itself at different periods, which may be separated by more or less lengthy intervals, has no impact on the existence of that cartel, provided that the various actions which form part of the infringement pursue a single aim and come within the framework of a single and continuous infringement.

(see paras 241-242)

11. In the context of proceedings concerning infringement of Article 81(1) EC, the Commission has a margin of discretion when fixing the amount of fines, in order that it may direct the conduct of undertakings towards compliance with the competition rules.

The amount of the fine is set by the Commission according to the gravity of the infringement and, where appropriate, to its duration. The gravity of an infringement has to be determined by reference to criteria such as the particular circumstances of the case, its context and the dissuasive effect of the fines. Objective factors such as the content and duration of the anti-competitive conduct, the number of incidents and their intensity, the extent of the market affected and the damage to the economic public order must be taken into account. The analysis must also take into consideration the relative importance and market share of the undertakings responsible and also any repeated infringements.

(see paras 264-265)

12. Each time the Commission decides to impose fines pursuant to competition law, it must observe general principles of law, which include the principles of equal treatment and proportionality as interpreted by the Community Courts.

The principle of equal treatment or non‑discrimination requires that comparable situations must not be treated differently and that different situations must not be treated in the same way unless such treatment is objectively justified.

Thus, to the extent to which reliance is to be placed on the turnover of undertakings involved in the same infringement for the purpose of determining the proportions between the fines to be imposed, the period to be taken into consideration must be ascertained in such a way that the resulting turnovers are as comparable as possible.

The principle of proportionality, for its part, requires that measures adopted by Community institutions do not exceed the limits of what is appropriate and necessary in order to attain the objectives legitimately pursued by the legislation in question; when there is a choice between several appropriate measures recourse must be had to the least onerous, and the disadvantages caused must not be disproportionate to the aims pursued.

Thus, when the Commission relies on different years to determine the value of the worldwide sales of certain undertakings and calculates the starting amount of the fines to be imposed on them for the period of their participation in a cartel as individual undertakings on the basis of their turnover made in different years, it does not treat those undertakings equally. Although the objective referred to by the Commission is legitimate since it makes it possible to compare the capacity of the shareholders of a joint venture to harm competition during the period prior to the creation of the joint venture, it does not justify, however, such unequal treatment where it is evident that the Commission could have used other methods to achieve its objective without treating the undertakings unequally in its choice of reference year.

(see paras 266-269, 271-272, 275-276)

JUDGMENT OF THE GENERAL COURT (Second Chamber)

12 July 2011 ( )

(Competition – Agreements, decisions and concerted practices – Market in gas insulated switchgear projects – Decision finding an infringement of Article 81 EC and Article 53 of the EEA Agreement – Market-sharing – Rights of the defence – Proof of the infringement – Duration of the infringement – Fines – Starting amount – Reference year – Equal treatment)

In Case T-133/07,

Mitsubishi Electric Corp., established in Tokyo (Japan), represented by R. Denton, Solicitor, and K. Haegeman, lawyer,

applicant,

v

European Commission, represented initially by F. Arbault and J. Samnadda, then by X. Lewis, and subsequently by P. Van Nuffel and J. Bourke, and finally by P. Van Nuffel and N. Khan, acting as Agents,

defendant,

APPLICATION, primarily, for the annulment of Commission Decision C (2006) 6762 final of 24 January 2007 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement (Case COMP/F/38.899 – Gas insulated switchgear) to the extent to which it concerns the applicant and TM T & D, in the alternative, for the annulment of Article 2(g) of that decision and Article 2(h) thereof, to the extent to which it concerns the applicant and, in the further alternative, amendment of Article 2 of that decision so as to cancel or, failing which, reduce the fine imposed on the applicant,

THE GENERAL COURT (Second Chamber),

composed of I. Pelikánová (Rapporteur), President, K. Jürimäe and S. Soldevila Fragoso, Judges,

Registrar: C. Kantza, Administrator,

having regard to the written procedure and further to the hearing on 11 December 2009,

gives the following

Judgment

Background to the dispute

1. Applicant

1 The applicant, Mitsubishi Electric Corp., is a Japanese company active in various sectors, in particular the sector for gas-insulated switchgear (‘GIS’). Between October 2002 and April 2005, its GIS business was carried on within a joint venture, TM T & D Corp., jointly owned in equal shares with Toshiba Corp. and dissolved in 2005.

2. Goods

2 GIS is used to control energy flow in electricity grids. It is heavy electrical equipment, used as a major component for power sub-stations. GIS is sold across the world either as part of turnkey power substations or as separate equipment which has to be integrated into a turnkey power substation.

3. Administrative procedure

3 On 3 March 2004, ABB Ltd informed the Commission of the European Communities (now ‘the European Commission’) of anti‑competitive practices in the GIS sector in connection with an oral application for immunity from fines pursuant to the Commission Notice of 19 February 2002 on immunity from fines and reduction of fines in cartel cases (OJ 2002 C 45, p. 3) (‘the Leniency Notice’).

4 ABB’s request for immunity was supplemented by oral observations and documentary evidence. It gave rise, on 24 April 2004, to a Commission decision granting conditional immunity to ABB.

5 On the basis of ABB’s statements, the Commission initiated an investigation and, on 11 and 12 May 2004, it carried out inspections at the premises of various companies active in the GIS sector.

6 On 20 April 2006, the Commission adopted a statement of objections which was notified to 20 companies including the applicant. The Commission held hearings on 18 and 19 July 2006 for the companies to which the statement of objections had been sent.

4. Contested decision

7 On 24 January 2007, the Commission adopted Decision C(2006) 6762 final relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement (Case COMP/F/38.899 – Gas-insulated switchgear) (‘the contested decision’).

8 In recitals 113 to 123 of the contested decision, the Commission stated that the various undertakings which participated in the cartel had coordinated the allocation of GIS projects worldwide – except for specific markets – according to agreed rules in order to maintain quotas largely reflecting estimated historic market shares. It pointed out that the allocation of GIS projects had been carried out on the basis of a joint ‘Japanese’ quota and a joint ‘European’ quota, which the Japanese and European producers then had to distribute among themselves. An agreement signed in Vienna on 15 April 1988 (‘the GQ Agreement’) established rules allowing the allocation of GIS projects to either Japanese producers or to European producers and to set their value against the corresponding quota. In addition, in recitals 124 to 132 of the contested decision, the Commission stated that the various undertakings which participated in the cartel had entered into an unwritten agreement (‘common understanding’), under which GIS projects in Japan, on the one hand, and in the countries of European members of the cartel, on the other – together described as the ‘home countries’ for GIS projects – were reserved to Japanese members and European members of the cartel respectively. GIS projects located in the ‘home countries’ were not the subject of information exchanges between the two groups and were not charged to their respective quotas.

9 The GQ Agreement also contained rules relating to the exchange of information necessary for operation of the cartel between the two groups of producers, carried out in particular by their respective secretaries, and to the manipulation of the bidding procedures concerned and the fixing of prices for GIS projects which could not be allocated. Under the terms of Annex 2 to the GQ Agreement, the agreement applied worldwide, except in the United States, Canada, Japan and 17 Western European countries. Furthermore, under the common understanding, GIS projects in European countries, other than the ‘home countries’, were also reserved for the European group, as the Japanese producers had undertaken not to submit bids for GIS projects in Europe.

10 According to the Commission, the sharing of GIS projects between the European producers was governed by an agreement also signed in Vienna on 15 April 1988, entitled ‘E-Group Operation Agreement for GQ Agreement’) (‘the EQ Agreement’). It indicated that the distribution of GIS projects in Europe followed the same rules and procedures as those governing the distribution of GIS projects in other countries. In particular, GIS projects in Europe also had to be notified, recorded, allocated, arranged or have received a minimum price.

11 On the basis of the findings of fact and legal assessments made in the contested decision, the Commission found that the undertakings implicated had infringed Article 81 EC and Article 53 of the Agreement on the European Economic Area (‘EEA Agreement’) and imposed on them fines calculated in accordance with the methods set out 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 (OJ 1998 C 9, p. 3) (‘the guidelines’), and in the Leniency Notice.

12 In Article 1 of the contested decision, the Commission found that the applicant had participated in the infringement from 15 April 1988 to 11 May 2004.

13 For the infringement found in Article 1 of the contested decision, the applicant was fined, in Article 2 of the contested decision, EUR 118 575 000, of which EUR 4 650 000, corresponding to the infringement committed by TM T & D, to be paid jointly and severally with Toshiba.

Procedure and forms of order sought

14 By application lodged at the Court Registry on 18 April 2007, the applicant brought the present action. On 6 June 2007, the applicant applied for the adoption of measures of organisation of procedure concerning the disclosure by the Commission of the turnover figures of the various addressees of the contested decision.

15 The defence was lodged on 21 August 2007.

16 By a document lodged at the Court Registry on 1 November 2007, the applicant requested that judgment should be given in its favour by default, under Article 122 of the Rules of Procedure of the General Court. It lodged a reply on 5 November 2007.

17 By decision of the Court (Second Chamber) of 29 January 2008, the request that judgment be given by default was rejected.

18 The written procedure closed with the lodging of the rejoinder on 18 March 2008.

19 Upon hearing the report of the Judge-Rapporteur, the Court (Second Chamber) decided, on 22 September 2009, to open the oral procedure. By way of measures of organisation of procedure provided for in Article 64 of the Rules of Procedure, it invited the Commission to submit certain documents and requested the parties to express their views on the relevance of those documents in relation to the arguments alleging infringement of the right of access to the file. The Court also put questions to the parties in writing, inviting them to give their reply at the hearing.

20 In response to the Court’s request, the Commission forwarded the documents concerned on 26 October 2009. The applicant submitted its observations on those documents on 19 November 2009. On 2 December 2009, the Commission submitted an additional document and on 3 December 2009, it replied to the applicant’s observations.

21 The parties presented oral argument and submitted their replies to the Court’s written and oral questions at the hearing on 11 December 2009.

22 The applicant claims that the Court should:

– primarily, annul the contested decision to the extent to which it applies to it and to TM T & D;

– in the alternative, annul Article 2(g) and (h) of the contested decision to the extent to which it applies to it;

– in the further alternative, modify Article 2 of the contested decision to the extent to which it applies to it so as to annul or, failing that, reduce the fine imposed on it;

– in any event, order the Commission to pay the costs.

23 The Commission contends that the Court should:

– dismiss the action as unfounded;

– order the applicant to pay the costs of the proceedings.

Law

24 First of all, the applicant disputes the admissibility of the defence and submits that it is incoherent and fails to respond to the pleas set out in the application.

25 In that regard, the Court points out that, pursuant to Article 46(1)(b) of the Rules of Procedure, the defence must contain the arguments of fact and law relied on by the defendant.

26 The defence submitted in this case meets that requirement, irrespective of the separate issue as to whether the arguments relied on by the Commission are relevant or well founded. Accordingly, the applicant’s argument alleging that the defence is inadmissible must be rejected.

27 As regards the substance, the applicant puts forward fifteen pleas. By its first plea it alleges that the Commission did not establish that the applicant infringed Article 81 EC and Article 53 of the EEA Agreement by participating in a cartel having as its object or effect the restriction of competition in the European Economic Area (‘the EEA’). By its second plea the applicant alleges that the Commission failed to establish the existence of an agreement infringing Article 81 EC and Article 53 of the EEA Agreement to which the applicant was a party. By its third plea it argues that the Commission committed an error in disregarding the evidence explaining its lack of presence in, and proving its difficulty entering, the European market. By its fourth plea the applicant alleges that the Commission infringed the rules of evidence in reversing the burden of proof and infringed the principle of the presumption of innocence. By its fifth plea the applicant claims that the Commission infringed the principles of equal treatment and proportionality in calculating the starting amount of the fine imposed on it on the basis of its 2001 turnover. By its sixth plea the applicant submits that the Commission infringed its duty to state reasons in choosing to calculate the fine on the basis of its 2001 turnover. By its seventh plea the applicant alleges that the Commission erred in defining the worldwide GIS market and the applicant’s share of it, thereby infringing the principles of equal treatment and proportionality. By its eighth plea the applicant claims that the Commission infringed its duty to state reasons in finding that the applicant controlled between 15 and 20% of the worldwide market. By its ninth plea the applicant submits that the Commission infringed the principle of sound administration in estimating the worldwide market value. By its tenth plea the applicant claims that the Commission infringed the principles of equal treatment and proportionality in calculating the deterrent factor applicable to it. By its eleventh plea the applicant maintains that the Commission infringed the principle of proportionality in calculating its fine by the same method as that employed to calculate the fines imposed on the European producers. By its twelfth plea the applicant claims that the Commission failed to take account of relevant economic and technical evidence in calculating its fine. By its thirteenth plea the applicant argues that the Commission erred in determining the duration of the cartel. By its fourteenth plea the applicant maintains that the Commission infringed its rights of defence and its right to a fair hearing by not granting it access to incriminating and exculpatory evidence. By its fifteenth plea the applicant submits that the Commission infringed its rights of defence by not putting forward to it its conclusions on the theory of compensation inherent in the common understanding.

28 The Commission considers that the applicant’s pleas are unfounded.

29 It should be noted, at the outset, that the applicant has not specified which of its pleas support the various claims which it has made. In that regard, it should be considered, first of all, that pleas one to four and pleas thirteen to fifteen have been raised by the applicant in support of its main claim. If one of those pleas is upheld, it will be necessary to annul, at least in part, both Article 1 and Article 2 of the contested decision in so far as they concern the applicant. Next, it must be considered that pleas five to twelve concern the calculation of the fine imposed on the applicant and have thus been raised by the applicant in support of its application in the alternative seeking the annulment of Article 2(g) and (h) of the contested decision in so far as it applies to it. Finally, the Court notes that no autonomous plea has been raised by the applicant in support of its claim in the further alternative.

1. The main application, seeking the annulment of the contested decision to the extent to which it applies to the applicant and TM T & D

30 In so far as the annulment of the contested decision for infringement of the applicant’s rights of defence would render the examination of the substance of the decision devoid of purpose, the fourteenth and fifteenth pleas will be addressed first of all. Secondly, the first, third and fourth pleas will be addressed together as they are all related to proof of the common understanding. Thirdly, the second plea, concerning the classification of that understanding as an infringement of Article 81 EC and Article 53 of the EEA Agreement, will be examined. Fourthly, the thirteenth plea, relating to the duration of the alleged cartel, will be examined.

The fourteenth plea, alleging that the Commission infringed the applicant’s right of defence and its right to a fair hearing by not granting it access to incriminating and exculpatory evidence

Arguments of the parties

31 The applicant considers that it did not have access to certain items of incriminating and exculpatory evidence in the Commission’s file, contrary to the principle of the respect for the rights of the defence and of the right to a fair hearing.

32 As regards incriminating evidence, the applicant maintains that the contested decision discloses evidence of which it had no knowledge and on which it was consequently unable to express its views. First, the applicant was unable to consult the evidence provided by Fuji on 21 November 2006, according to which the GQ Agreement could not have operated without the common understanding.

33 Second, the applicant claims that the evidence provided in November 2006, from which it results that Alstom and Areva did not contest the existence of the common understanding, was likewise not disclosed.

34 As regards exculpatory evidence, the applicant submits, first, that it provided the Commission on 8 November 2006 with exculpatory witness statements in respect of several other undertakings, but they were not disclosed to the other parties.

35 Second, Hitachi’s supplementary reply to the statement of objections, in which Hitachi challenged the Commission’s interpretation of certain statements in the initial reply relating to the notification and project loading mechanism, was not disclosed.

36 Third, the applicant complains that it did not have access to the evidence calling into question the existence of the common understanding and reaffirming the existence of obstacles to entry on to the GIS market in the EEA, submitted by Siemens, the undertaking belonging to the group of which VA TECH Transmission & Distribution GmbH & Co KEG (‘VA TECH’) formed part, Hitachi and Toshiba, and in particular to statements and economic or technical reports submitted by Hitachi and Toshiba, to witness statements of employees of Siemens and Hitachi and VA TECH’s reply to the statement of objections. It affirms that, in finding in recital 130 of the contested decision that VA TECH did not openly dispute the existence of the common understanding, the Commission distorted VA TECH’s position.

37 Fourth, the applicant argues that it did not have access to Mr S’s statements, submitted on behalf of Alstom, concerning termination of the cartel in 1999.

38 The Commission considers the applicant’s arguments to be unfounded.

Findings of the Court

39 Respect for the rights of the defence requires that the person concerned must have been afforded the opportunity, during the administrative procedure, to make known his views on the truth and relevance of the facts and circumstances alleged and on the documents used by the Commission to support its claim that there has been an infringement of the Treaty (Joined Cases C-204/00 P, C-205/00 P, C 211/00 P, C‑213/00 P, C-217/00 P and C-219/00 P Aalborg Portland and Others v Commission [2004] ECR I‑123, paragraph 66).

40 A corollary of the principle of respect for the rights of the defence, the right of access to the file means that the Commission must give the undertaking concerned the opportunity to examine all the documents in the investigation file which may be relevant for its defence. Those documents include both incriminating and exculpatory evidence, save where the business secrets of other undertakings, the internal documents of the Commission or other confidential information are involved (Aalborg Portland and Others v Commission, paragraph 39 above, paragraph 68).

41 In this respect, it should be recalled that it is not until the beginning of the inter partes administrative stage that the undertaking concerned is informed, by means of the notification of the statement of objections, of all the essential evidence on which the Commission relies at that stage of the procedure and that that undertaking has a right of access to the file in order to ensure that its rights of defence are effectively exercised. Consequently, the replies to the statement of objections of the other undertakings alleged to have participated in the cartel are not, in principle, included in the documents of the investigation file that the parties may consult (Case T‑161/05 Hoechst v Commission [2009] ECR II‑3555, paragraph 163).

42 However, if the Commission wishes to rely on a passage in a reply to a statement of objections or on a document annexed to such a reply in order to prove the existence of an infringement in a proceeding under Article 81(1) EC, the other undertakings involved in that proceeding must be placed in a position in which they can express their views on such evidence. In such circumstances the passage in question from a reply to the statement of objections or the document annexed thereto constitutes incriminating evidence against the various undertakings alleged to have participated in the infringement (see Hoechst v Commission, paragraph 41 above, paragraph 164, and the case‑law cited). That case‑law is applicable, by analogy, to Article 53(1) of the EEA Agreement.

43 By analogy, if a passage in a reply to a statement of objections or in a document annexed to such a reply may be relevant for the defence of an undertaking in that it enables that company to invoke evidence which is not consistent with the inferences made at that stage by the Commission, it constitutes exculpatory evidence. In that case, the undertaking concerned must be authorised to examine the passage or the document concerned and to give its view thereon.

44 However, the mere fact that other undertakings put forward the same arguments as the undertaking concerned and that they may have used more resources for their defence is not sufficient for those arguments to be regarded as exculpatory evidence (see, to that effect, Case T‑43/02 Jungbunzlauer v Commission [2006] ECR II‑3435, paragraphs 353 and 355).

45 As regards the consequences of granting access to the file contrary to those rules, the failure to communicate a document on which the Commission based its decision to inculpate an undertaking constitutes a breach of the rights of the defence only if the undertaking concerned shows that the result at which the Commission arrived in its decision would have been different if the document which was not communicated had to be disallowed as incriminating evidence (Aalborg Portland and Others v Commission, paragraph 39 above, paragraphs 71 and 73).

46 Where an exculpatory document has not been communicated, the undertaking concerned must only establish that its non-disclosure was able to influence, to its disadvantage, the course of the proceedings and the content of the decision of the Commission. It is sufficient for the undertaking to show that it would have been able to use the exculpatory document for its defence, in the sense that, had it been able to rely on it during the administrative procedure, it would have been able to invoke evidence which was not consistent with the inferences made at that stage by the Commission and therefore could have had an influence, in any way at all, on the assessments made by the Commission in the decision, at least as regards the gravity and duration of the conduct in which the undertaking was found to have engaged and, accordingly, the level of the fine (Aalborg Portland and Others v Commission, paragraph 39 above, paragraphs 74 and 75).

47 The possibility that a document which was not disclosed might have influenced the course of the proceedings and the content of the Commission’s decision can be established only if a provisional examination of certain evidence shows that the documents not disclosed might – in the light of that evidence – have had a significance which ought not to have been disregarded (Aalborg Portland and Others v Commission, paragraph 39 above, paragraph 76).

48 In the present case, as regards the incriminating evidence, the Commission admits, firstly, that it was not able to rely on Fuji’s observations which were not disclosed to the applicant in support of the grounds of complaint raised against the latter in the contested decision, but disputes actually having used them as incriminating evidence. It must be noted, none the less, that, in recitals 125 and 255 of the contested decision, the Commission referred to Fuji’s supplementary observations, in particular those of 21 November 2006, to corroborate the existence of a common understanding.

49 Second, the Commission submits that it did not rely on the alleged neutral position of Alstom and Areva in concluding that the common understanding existed, but merely noted their position. Although that interpretation is confirmed by the wording of recital 125 of the contested decision, in which no corroborative value is accorded to the position of Alstom, Areva and VA TECH, unlike Fuji’s statements confirming the existence of the common understanding, it is called into question in recital 255 of that decision, in which the Commission refers to the implicit acknowledgement of the existence of the common understanding by certain European producers.

50 In any event, the neutral position of Alstom and Areva cannot be interpreted as evidence of the existence of the common understanding. Given that the burden of proof is on the Commission in proceedings under Article 81 EC and Article 53 of the EEA Agreement, an undertaking’s failure to challenge a fact does not mean that the fact in question is established. Consequently, irrespective of whether the rights of the defence were respected, the Commission was not able to rely on the position of Alstom and Areva as incriminating evidence.

51 Accordingly, the outcome of the applicant’s arguments concerning the incriminating evidence depends on the result of the examination of the first plea relating to proof of the existence of a common understanding. If the existence of such an understanding is established to the requisite legal standard even after disallowing Fuji’s observations and the alleged neutral position of Alstom and Areva as incriminating evidence, it will be necessary to reject this part of the plea. By contrast, if it is found that that evidence constitutes necessary evidence in support of the findings made in the contested decision in relation to the existence of a common understanding, it will be necessary to uphold the applicant’s argument and, consequently, to annul the contested decision in so far as it concerns it.

52 As regards the exculpatory evidence, the applicant’s argument, alleging that some of the evidence submitted by it was not disclosed to the other addressees of the statement of objections, must be rejected from the outset. Even supposing that that evidence was not disclosed to the other addresses, that could affect the defence of those addressees at the most, but not that of the applicant.

53 Moreover, the Court requested the Commission to produce all the documents which the applicant identified with a modicum of precision.

54 First, it should be noted, that, contrary to the applicant’s claim, Hitachi’s supplementary reply to the statement of objections does not call into question the factual content of the latter’s statements concerning the notification and project loading mechanism. In that supplementary reply, Hitachi merely disputed the Commission’s interpretation of those statements, in particular in relation to their relevance as evidence of the common understanding and of the existence of a single infringement involving both the common understanding and the GQ Agreement. Hitachi had already raised those same arguments in the extract from its first reply to the statement of objections, which the Commission sent to the applicant. Consequently, Hitachi’s supplementary reply to the statement of objections cannot be regarded as exculpatory evidence whose communication could have influenced the course of the proceedings and the content of the contested decision.

55 Second, as the applicant claims, VA TECH explicitly contested the existence of the common understanding in its reply to the statement of objections. However, although that circumstance has to be taken into account during the examination of the first plea concerning proof of the existence of the common understanding, it does not show, in itself, that the applicant’s rights of defence were infringed, given that the applicant does not state the extent to which the misinterpretation of VA TECH’s position made its defence more difficult.

56 Moreover, in their statements, VA TECH, Hitachi, Toshiba and Siemens disputed the existence of a common understanding and described the existence of barriers to entry to the European market. Furthermore, Hitachi and Toshiba submitted expert reports to support their positions in that regard.

57 During the administrative procedure, the applicant itself disputed the existence of a common understanding and of discussions relating thereto, referred to the existence of ‘high’ barriers to entry on the European market, and submitted expert reports concerning the latter, similar to the reports submitted by Hitachi and Toshiba. Accordingly, the statements and reports from other addressees of the statement of objections cannot be regarded as exculpatory evidence.

58 In so far as concerns the witness statements of the employees of Hitachi and Siemens, those employees stated that the GQ Agreement did not apply to GIS projects in Europe, disputed the existence of a common understanding and of discussions relating thereto and referred to the existence of ‘high’ barriers to entry on the EEA market. In addition, Hitachi’s witnesses gave details of a proposal made by Alstom in July 2002 relating to an understanding between European and Japanese producers and of Hitachi’s rejection of that proposal.

59 In that regard, it should be noted, first, that the written witness statements of the employees of a company, drawn up under the supervision of that company and submitted by it in its defence in the administrative procedure carried out by the Commission cannot, in principle, be classed as evidence which is both different from, and independent of, the statements made by that same company. Generally speaking, the position of a company as to the truth of the facts set out against it by the Commission is based, primarily, on the knowledge and opinions of its employees and management.

60 Second, as noted in paragraph 57 above, during the administrative procedure, the applicant itself disputed the existence of a common understanding and of discussions relating thereto and referred to the existence of ‘high’ barriers to entry on the European market. It also asserted that the GQ Agreement did not concern EEA territory. Consequently, the fact that other undertakings raised those arguments cannot be regarded as exculpatory evidence.

61 Also, the details of Alstom’s proposal of July 2002 were disclosed in the statement of objections. Consequently, that evidence does not constitute exculpatory evidence.

62 Third, after gaining access to Mr S’s statements, the applicant did not identify within those statements any evidence which might have been useful for its defence. Therefore, the general claim that those statements constitute exculpatory evidence must be rejected as unsubstantiated.

63 In the light of all of the foregoing, the applicant’s arguments relating to access to the exculpatory evidence must be rejected. However, as is apparent from paragraph 51 above, the outcome of this plea depends on the result of the examination of the first plea.

The fifteenth plea, alleging that the Commission infringed the applicant’s rights of defence by not putting forward to it its conclusions on the theory of compensation inherent in the common understanding

Arguments of the parties

64 The applicant submits that the Commission did not indicate in the statement of objections that the compensation granted to the Japanese producers by the European producers under the common understanding, by means of the notification and project loading mechanism, constituted evidence of the existence of that understanding. In its view, that theory is mentioned for the first time in the contested decision. Therefore, the Commission infringed the obligation to give interested parties the opportunity to express their views on the evidence on which it based its decision.

65 The Commission considers the applicant’s arguments to be unfounded.

Findings of the Court

66 According to the case‑law, the statement of objections must set forth clearly all the essential facts upon which the Commission is relying at that stage of the procedure. However, that may be done summarily and the decision is not necessarily required to be a replica of the Commission’s statement of objections, since the statement of objections is a preparatory document containing assessments of fact and of law which are purely provisional in nature (Aalborg Portland and Others v Commission, paragraph 39 above, paragraph 67). Thus, although the Commission cannot allege that the persons concerned have committed infringements other than those referred to in the statement of objections and may take into consideration only facts on which the persons concerned have had the opportunity of making known their views, it must however take into account the factors emerging from the administrative procedure in order either to abandon such complaints as have been shown to be unfounded or to supplement and redraft its arguments both in fact and in law in support of the complaints which it maintains (see, to that effect, Case 41/69 ACF Chemiefarma v Commission [1970] ECR 661, paragraphs 92 to 94).

67 In the present case, it must be conceded that, in the statement of objections, the Commission did not state explicitly that the notification and project loading mechanism constituted compensation offered by the European producers to the Japanese producers, which were viewed as potential credible competitors, in return for compliance with the common understanding.

68 However, first, the statement of objections describes the facts on which that theory is based. The common understanding and the project loading mechanism are summarised in paragraphs 100, 106 and 110 of the statement of objections and described in detail subsequently in that document. Similarly, it is apparent from paragraph 120 of the statement of objections that, in the Commission’s view, the Japanese producers were potential credible competitors in respect of GIS projects in the EEA.

69 Second, in point 59 of its reply to the statement of objections, the applicant noted that the Commission referred to the notification and project loading mechanism as evidence of the existence of the common understanding. It must therefore be found that the applicant had understood, on the basis of the statement of objections, the importance which the Commission gave to the notification and project loading mechanism as regards evidence of the alleged infringement. Similarly, in paragraphs 59 to 64 of its reply to the statement of objections, the applicant expressed its point of view in detail regarding the evidence of that mechanism and its relevance to the alleged common understanding.

70 Therefore, it must be found that the content of the statement of objections enabled the applicant to express its view on the facts on which the Commission based its complaint in that statement and in the contested decision.

71 Consequently, the fifteenth plea must be dismissed.

The first, third and fourth pleas, alleging that the Commission has not established that the applicant participated in the alleged cartel, that the Commission erred in dismissing the evidence explaining the applicant’s absence from the European market and the impossibility of entering that market, and that the Commission infringed the rules governing evidence by reversing the burden of proof, thereby infringing the presumption of innocence

72 According to the case‑law, the Commission must prove the infringements which it has found and adduce evidence capable of demonstrating to the requisite legal standard the existence of the facts constituting an infringement (see Joined Cases T-44/02 OP, T-54/02 OP, T 56/02 OP, T-60/02 OP and T-61/02 OP Dresdner Bank and Others v Commission [2006] ECR II‑3567, paragraph 59, and the case‑law cited).

73 In that regard, any doubt in the mind of the Court must operate to the advantage of the undertaking to which the decision finding an infringement was addressed. The Court cannot therefore conclude that the Commission has established the infringement at issue to the requisite legal standard if it still entertains any doubts on that point, in particular in proceedings for annulment of a decision imposing a fine (Dresdner Bank and Others v Commission, paragraph 72 above, paragraph 60).

74 In the latter situation, it is necessary to take account of the principle of the presumption of innocence resulting in particular from Article 6(2) of the European Convention for the Protection of Human Rights and Fundamental Freedoms, signed in Rome on 4 November 1950, which is one of the fundamental rights which are general principles of Community law. Given the nature of the infringements in question and the nature and degree of gravity of the ensuing penalties, the principle of the presumption of innocence applies in particular to the procedures relating to infringements of the competition rules applicable to undertakings that may result in the imposition of fines or periodic penalty payments (see, to that effect, Dresdner Bank and Others v Commission, paragraph 72 above, paragraph 61, and the case-law cited).

75 Thus, the Commission must show precise and consistent evidence in order to establish the existence of the infringement. However, it is important to emphasise that it is not necessary for every item of evidence produced by the Commission to satisfy those criteria in relation to every aspect of the infringement. It is sufficient if the body of evidence relied on by the institution, viewed as a whole, meets that requirement (see Dresdner Bank and Others v Commission, paragraph 72 above, paragraphs 62 and 63, and the case‑law cited).

76 In addition, as anti-competitive agreements are known to be prohibited, the Commission cannot be required to produce documents expressly attesting to contacts between the traders concerned. The fragmentary and sporadic items of evidence which may be available to the Commission should, in any event, be capable of being supplemented by inferences which allow the relevant circumstances to be reconstituted. The existence of an anti-competitive practice or agreement may therefore be inferred from a number of coincidences and indicia which, taken together, can, in the absence of another plausible explanation, constitute evidence of an infringement of the competition rules (see Dresdner Bank and Others v Commission, paragraph 72 above, paragraphs 64 and 65, and the case‑law cited).

77 The applicant submits, in that regard, that there is no longer any justification for applying a more lenient evidential standard because of the difficulties faced by the Commission when trying to prove an infringement. In its view, first, fines imposed in cartel cases have constantly increased in recent years, which must affect the intensity with which the Commission’s decisions are reviewed. Second, given the existence of the Leniency Notice and the parties’ cooperation obtained pursuant thereto, it is no longer necessary to grant the Commission a broad discretion when assessing evidence. Third, in the present case, the Commission seeks to rely on a document attesting the existence of a cartel outside of the European Union, namely the GQ Agreement, to find an infringement of Article 81 EC and Article 53 of the EEA Agreement.

78 However, those arguments of the applicant cannot be upheld. First, it is true that the increase in the amounts of fines may have more serious consequences for the parties on which such fines are imposed. However, since the Commission’s initiative in that regard is generally well known, the result is that, if undertakings make themselves liable for an infringement, they will make an even greater effort to limit as far as possible the number of items which may serve as evidence, thereby making the Commission’s task more difficult. Second, in order for the Commission to validly rely on it as evidence of an infringement, the evidence received from interested undertakings must, in any event, satisfy the applicable criteria in the case‑­law. Thus, the existence of the leniency programme per se does not simplify the Commission’s role. Third, the fact that the GQ Agreement did not concern the territory of the European Union is relevant in assessing the probative value of that element. By contrast, that fact cannot influence the assessment of the other evidence put forward by the Commission.

79 Moreover, where the Commission bases its decision solely on the conduct of the undertakings at issue on the market to conclude that there was an infringement, it is sufficient for those undertakings to prove the existence of circumstances which cast the facts established by the Commission in a different light and thus allow another, plausible explanation of those facts to be substituted for the one adopted by the Commission in concluding that the Community competition rules had been infringed (see, to that effect, Joined Cases T-67/00, T-68/00, T-71/00 and T-78/00 JFE Engineering and Others v Commission [2004] ECR II‑2501, paragraph 186, and the case‑law cited).

80 Contrary to what the applicant claims, that rule does not apply to all cases in which the infringement is established solely on the basis of non‑documentary evidence.

81 As regards the evidence which may be relied on to establish an infringement of Article 81 EC, the prevailing principle of Community law is the unfettered evaluation of evidence (Case T‑50/00 Dalmine v Commission [2004] ECR II‑2395, paragraph 72). That case-law is applicable, by analogy, to Article 53 of the EEA Agreement.

82 Consequently, even if the lack of documentary evidence may be relevant in the global assessment of the set of indicia relied on by the Commission, it does not, in itself, enable the undertaking concerned to call the Commission’s claims into question by submitting an alternative explanation of the facts. That is only the case where the evidence submitted by the Commission does not enable the existence of the infringement to be established unequivocally and without the need for interpretation (see, to that effect, the judgment of 12 September 2007 in Case T 36/05 Coats Holdings and Coats v Commission, not published in the ECR, paragraph 74).

83 In addition, no provision or any general principle of Community law prohibits the Commission from relying, as against an undertaking, on statements made by other undertakings accused of having participated in the cartel. If that were not the case, the burden of proving conduct contrary to Article 81 EC, which is borne by the Commission, would be unsustainable and incompatible with the task of supervising the proper application of those provisions (JFE Engineering and Others v Commission, paragraph 79 above, paragraph 192). That case-law is applicable, by analogy, to Article 53 of the EEA Agreement.

84 However, a statement by one undertaking accused of having participated in a cartel, the accuracy of which is contested by several other undertakings similarly accused, cannot be regarded as constituting adequate proof of an infringement committed by the latter unless it is supported by other evidence, though the degree of corroboration required may be less in view of the reliability of the statements at issue (JFE Engineering and Others v Commission, paragraph 79 above, paragraphs 219 and 220).

85 As regards the probative value of the various items of evidence, the sole criterion relevant in evaluating the evidence adduced is its reliability (Dalmine v Commission, paragraph 81 above, paragraph 72).

86 According to the general rules regarding evidence, the reliability and, thus, the probative value of a document depends on its origin, the circumstances in which it was drawn up, the person to whom it is addressed and its content (Joined Cases T‑25/95, T-26/95, T-30/95, T-31/95, T-32/95, T-34/95, T-35/95, T-36/95, T‑37/95, T-38/95, T-39/95, T-42/95, T-43/95, T-44/95, T-45/95, T-46/95, T‑48/95, T-50/95, T-51/95, T-52/95, T-53/95, T-54/95, T-55/95, T-56/95, T‑57/95, T-58/95, T-59/95, T-60/95, T-61/95, T-62/95, T-63/95, T-64/95, T‑65/95, T-68/95, T-69/95, T-70/95, T-71/95, T-87/95, T-88/95, T-103/95 and T‑104/95 Cimenteries CBR and Others v Commission [2000] ECR II-491, paragraphs 1053 and 1838).

87 As regards statements, particularly high probative value may be attached to those which, first, are reliable, second, are made on behalf of an undertaking, third, are made by a person under a professional obligation to act in the interests of that undertaking, fourth, go against the interests of the person making the statement, fifth, are made by a direct witness of the circumstances to which they relate and, sixth, were provided in writing deliberately and after mature reflection (see, to that effect, JFE Engineering and Others v Commission, paragraph 79 above, paragraphs 205 to 210).

88 In addition, even if some caution as to the evidence provided voluntarily by the main participants in an unlawful cartel is generally called for, considering the possibility, referred to by the applicant, that those participants have a tendency to provide most of the incriminating evidence in relation to the activity of their competitors, the fact remains that seeking to benefit from the application of the Leniency Notice in order to obtain immunity from, or a reduction of, the fine does not necessarily create an incentive to submit distorted evidence in relation to the participation of the other members of the cartel under investigation. Indeed, any attempt to mislead the Commission could call into question the sincerity and the completeness of the cooperation of the person seeking to benefit from the Leniency Notice, and thereby jeopardise its chances of benefiting fully under it (see, to that effect, Case T‑120/04 Peróxidos Orgánicos v Commission [2006] ECR II‑4441, paragraph 70).

89 It must also be noted, in that regard, that the potential consequences of the submission of distorted evidence are even more serious since, as is apparent from paragraph 84 above, a statement of an undertaking that is disputed must be corroborated by other evidence. That being so, the likelihood of the Commission and the other undertakings involved of detecting the inaccurate nature of those statements is increased.

90 As regards the application of those rules to the present case, it should be noted, at the outset, that, according to the findings made in the contested decision, the common understanding was an unwritten understanding which encompassed, first, the commitment of the Japanese undertakings not to enter the market for GIS projects in the EEA, second, the commitment of the European undertakings not to enter the Japanese market for GIS projects and, third, the commitment of the European undertakings to notify the Japanese undertakings of the GIS projects in the European countries other than the home countries and to load those projects in the joint ‘European’ quota laid down in the GQ Agreement. According to the Commission, the purpose of the notification and project loading mechanism was to offer compensation to the Japanese undertakings, viewed by the European undertakings as potential competitors on the EEA market.

91 Among the various components of the common understanding listed in paragraph 90 above, it is the alleged commitment of the Japanese undertakings not to enter the EEA market which constitutes the basis of the Commission’s complaint against the applicant. Consequently, it is the existence of that commitment which needs to be established to the requisite legal standard. However, the other components of the common understanding, if proven, may also serve as indirect evidence from which the existence of the corresponding commitment on the part of the Japanese undertakings may be inferred.

92 The applicant disputes, in the context of the first plea, the existence of a common understanding and its participation therein. It criticises the probative value of the various items of evidence relied on by the Commission in the contested decision and refers to other evidence which, in its view, suggests that there was no common understanding. The applicant infers from this that, in adopting the contested decision, the Commission went beyond the limits of its powers. It adds, in the context of the third plea, that, in those circumstances, the Commission was required to accept the alternative explanation for the absence of Japanese producers on the GIS market in the EEA, related to the existence of legal, technical and commercial barriers to entry on that market. In the context of the fourth plea, the applicant submits that, by failing to establish the existence of the common understanding to the requisite legal standard, the Commission reversed the burden of proof and infringed the principle of the presumption of innocence.

93 The Commission submits that the existence of a common understanding, and in particular the commitment of the Japanese undertakings not to enter the EEA market, is established to the requisite legal standard by a body of evidence comprising documentary evidence, statements from undertakings, witness statements and evidence relating to the actual operation of the cartel. Therefore, the Commission considers, first, that the alternative explanation proposed by the applicant is irrelevant and, second, that it bore the burden of proof incumbent upon it and, consequently, respected the principle of the presumption of innocence.

94 It is therefore necessary to assess the reliability and the content of the various items of evidence concerned in order to assess whether, taken as a whole, the evidence relied on by the Commission establishes a firm conviction that a common understanding existed which is not able to be called into question by the evidence adduced by the applicant.

95 The applicant’s complaint alleging that the Commission went beyond its powers and the third and fourth pleas are based on the premiss that the Commission did not prove that a common understanding existed and that the applicant participated therein. Consequently, if the applicant’s arguments relating to the evidence of the existence of the infringement and of the applicant’s participation therein must be rejected, that necessarily implies, first, that the Commission is competent to penalise the infringement found, second, that the alternative explanation provided by the applicant is irrelevant in the light of what has been set out in paragraphs 79 to 82 above and, finally, that the Commission bore the burden of proof incumbent upon it and thus respected the principle of the presumption of innocence. By contrast, if it is concluded that the applicant’s participation in the alleged infringement has not been shown in the contested decision, that finding would justify, in itself, the annulment of that decision in so far as it concerns the applicant.

The evidence furnished by ABB

– Arguments of the parties

96 The applicant submits that Mr M’s witness statement submitted on behalf of ABB is not reliable and does not make it possible to conclude that the common understanding existed.

97 First, as a beneficiary of conditional immunity, ABB would have had an incentive to furnish incriminating evidence. In addition, Mr M was aware of the fact that ABB had an interest in him not contesting the existence of the common understanding. By contrast, he was aware that he was not liable to civil proceedings as a result of his statements and was sure that his witness statement would not be subject to cross-examination. Similarly, it was evident that Mr M’s statements were not going to produce additional harmful effects for ABB, since that undertaking’s liability had been established by other evidence.

98 ABB’s wish to submit incriminating evidence was manifested at the interview with Mr M, by the interventions of ABB’s representative, who interjected to correct and clarify Mr M’s statements, and at one point even answered the Commission’s questions himself.

99 Second, Mr M’s witness statement was submitted more than 18 months after ABB applied for immunity from fines.

100 Third, Mr M’s witness statement is merely a witness statement from a former ABB employee, rather than a statement made on ABB’s behalf. According to the applicant, at the time of the interview concerned, Mr M had gone into retirement and was not required to act in ABB’s interests.

101 Fourth, the oral witness statement of Mr M does not result from studied reflection. Similarly, in so far as Mr M made several statements during the administrative procedure, the evidence provided should be regarded as a series of constantly changing statements, rather than as one single statement, revised upon reflection. In addition, the fact that the earlier statements made by that witness were not provided to the applicant implies that they contain no evidence of the common understanding, which detracts from the reliability of the later statements made by that witness.

102 Fifth, even if Mr M was a direct witness to certain aspects of the alleged cartel, he did not take part in any discussion concerning the common understanding and in particular was not present at its inception, which implies that he was not a direct witness in that regard.

103 Sixth, Mr M’s witness statement is vague regarding the formation, content and implementation of the common understanding and does not mention any meeting or discussion. In the applicant’s view, Mr M’s statements regarding that understanding amount to a personal feeling rather than a complete and coherent account of the facts concerning an agreement.

104 Seventh, Mr M’s witness statement is not corroborated by contemporaneous written evidence, but is contradicted both by the GQ and EQ Agreements and by other witness statements. Moreover, Mr M’s statements are inconsistent with other statements made by ABB and conflict with evidence furnished by other cartel participants.

105 In particular, the applicant submits that ABB’s immunity application of 11 March 2004 did not contain any description of the common understanding as presented in the contested decision, since ABB’s statements did not give the impression that the applicant had undertaken not to enter the European market. Similarly, Mr V.‑A., another ABB employee, stated that he had been informed by Mr M that Europe and North America were excluded from the scope of the cartel.

106 The Commission considers the applicant’s arguments to be unfounded.

– Findings of the Court

107 First, it is apparent from paragraphs 88 and 89 above that it is not necessary to treat automatically with caution evidence furnished by an undertaking which has sought to benefit from immunity from fines. As regards the particular case of witness statements, it is indeed possible that the employees of such an undertaking, who are required to act in the interests of the undertaking, have a common desire to submit as much incriminating evidence as possible since their cooperation in the procedure may also have a positive impact on their future career. However, if that is the case, the employees at issue will also be aware of the possible negative consequences of submitting inaccurate evidence, which are more sensitive given the requirement for corroboration.

108 In addition, it cannot be considered that the evidence furnished by ABB was not capable of damaging that undertaking. Since that evidence was furnished before the statement of objections was sent, neither ABB, nor its employees nor its former employee could be certain of the extent and exact content of the objections which were going to be raised against ABB.

109 As regards Mr M, the applicant rightly submits that a former employee is no longer required, in principle, to act in the interests of his former employer when it comes to voluntary cooperation in administrative proceedings. However, that also implies that, in principle, he has no interest in providing inaccurate evidence in that respect, irrespective of whether he was liable to civil proceedings as a result and whether he knew that his statements were not going to be subject to cross‑examination.

110 It is also true that ABB’s outside counsel intervened at one point during Mr M’s interview in order to suggest to him that it could be beneficial for the Japanese producers to enter the European market, of which Mr M did not appear to be convinced. Consequently, it should be held that Mr M expressed doubts as to the commercial interest of such a step and account needs to be taken of that fact when assessing the content of his witness statement. However, the applicant does not explain how the intervention of ABB’s outside counsel affects the reliability of Mr M’s witness statement in other respects.

111 Second, the fact that a period of time elapsed between the submission of the application for immunity by ABB and Mr M’s interview does not call into question, as such, the probative value of that witness statement. It is justified for the Commission to obtain additional evidence during its investigation, in order to have at its disposal all the information necessary to assess whether there was an infringement, in particular in the light of the observations of the undertakings concerned. By contrast, the period of time which elapsed between the submission of the witness statement and the facts to which it relates may be relevant in the assessment of its reliability, given that witnesses may provide, as a general rule, more detailed and more reliable evidence in respect of recent events. However, in the present case, the period of three years and three months time which elapsed between the end of Mr M’s involvement in the cartel and the submission of his witness statement is not sufficiently long to influence its reliability.

112 Third, it is not apparent that Mr M made his statement as an official representative of ABB. First of all, that role appears to have been assumed, for the main part, by ABB’s outside counsel. Next, as noted in paragraph 109 above, when giving his witness statement Mr M was no longer required, a priori, to act in the interests of his former employer and there is also no indication that he systematically prepared for the interview by consulting other employees of ABB and documents held by that company. Finally, the questions put by the Commission at the interviews did not concern ABB’s official position on the subjects addressed, but rather the individual knowledge of Mr M.

113 Fourth, the applicant rightly submits that Mr M’s witness statement does not appear to result from studied reflection and that it was also not revised after reflection and additional verifications. The witness statement was made orally and there are no indications that written questions were put beforehand to Mr M by the Commission nor that the statements relating to the common understanding and the barriers to entry on the EEA market were subsequently verified and revised by Mr M.

114 By contrast, the fact that Mr M made several successive statements which were not all put forward by the Commission does not call the reliability of his witness statement into question. It is normal, first, for a witness to make subsequent comments on different aspects and details of a subject and, second, for some of those statements not to be relevant to the Commission’s investigation or to relate to facts which are established more convincingly by other evidence.

115 Fifth, the applicant’s claim that Mr M was not a direct witness of the events at issue must be dismissed. Mr M was one of ABB’s representatives in the cartel between 1988 and 2002, that is during almost its entire duration, at which time ABB itself was one of the main operators. Mr M was thus a direct and privileged witness of the facts which he disclosed.

116 In that regard, it must be conceded that, in his witness statement, Mr M confirmed that he was not present when the common understanding was concluded. Similarly, when asked whether the issue of the common understanding had been raised at meetings which he had attended, Mr M responded that it was not necessary to refer to it since the common understanding went without saying. However, this does not call into question the probative value of Mr M’s witness statement. First, a witness is perfectly able to furnish evidence of a long-standing phenomenon even if he was not present at its inception. Second, although Mr M stated that the issue of the common understanding had not been referred to explicitly at the meetings which he had attended, it is apparent from his witness statement that, in his view, this was so because the content of the common understanding was understood, accepted and implemented by the participants to the cartel without the need for an explicit discussion.

117 Sixth, as regards the content of his witness statement, Mr M stated that an understanding relating to the mutual protection of domestic markets, predating the GQ Agreement, existed between the Japanese and European producers, that that understanding was a prerequisite for the conclusion of agreements relating to other regions and that compliance with its rules implied that the Japanese producers were not to enter the domestic market of the European producers, even though they would have been able to do so at a technical level. Mr M also explained, in that context, the notification and project loading mechanism and the fact that the GIS projects in the home countries were not discussed between the two groups of producers and were not charged to the quotas set under the GQ Agreement.

118 Thus, the statements made by Mr M confirm the existence of the common understanding alleged by the Commission and cannot be regarded as a vague personal feeling since they provide information on the duration of that understanding, its content and its participants. The lack of information on the implementation of that understanding is hardly surprising given that the essential commitment of the parties was not to be active on certain markets. Moreover, Mr M described the part of the common understanding which required implementation measures, namely the notification and project loading mechanism.

119 Seventh, the question whether Mr M’s witness statement is corroborated, in accordance with the case‑law set out in paragraph 84 above, and whether it is called into question by evidence from other undertakings or by the GQ and EQ Agreements, will be addressed in paragraphs 129 to 195 below.

120 As regards the alleged incoherencies between Mr M’s witness statement and the other evidence furnished by ABB, the latter explicitly referred in its observations of 11 March 2004 to the existence of a common understanding, pursuant to which the two Japanese companies would not bid for European projects and the European companies would not bid for Japanese projects.

121 In that respect, it is normal that ABB referred to two Japanese companies, namely Japan AE Power Systems Corp. and TM T & D, since, at the time when it submitted its statements, the GIS activities of Fuji, Hitachi, the applicant and Toshiba were grouped within those joint ventures. None the less, the Commission was entitled to interpret that statement as indicating that those undertakings themselves participated in the common understanding. In its initial application for leniency for immunity from fines of 3 March 2004, ABB had already stated that, to its knowledge, the cartel had been in existence for over 10 years, which implies that it came into being well before Japan AE Power Systems and TM T & D were created.

122 As regards the witness statements of ABB’s employees, Mr Wi stated that the absence of Japanese undertakings on the European market was the result of a system in place to protect the Japanese and European markets, motivated by the fact that neither of the two groups of producers wanted the other group to enter its domestic market. Similarly, Mr P referred to a common understanding with the Japanese undertakings pursuant to which the latter undertook not to participate in the European market and the European undertakings undertook not to participate in the Japanese market. Thus, Mr Wi’s and Mr P’s witness statements confirm the existence of the common understanding.

123 The same finding is applicable to the witness statement provided by Mr V.-A. When asked whether there was any form of arrangement between Japanese and European producers, Mr V.-A referred to an understanding between Japanese and European producers pursuant to which the European undertakings agreed not to ‘attack’ the Japanese undertakings on the Japanese market and vice versa. Moreover, Mr V.‑A stated that he had participated in a discussion between the European undertakings and the representative of a Japanese undertaking specifically regarding compliance with that understanding which was brought about by attempts on the part of the Japanese undertakings to enter the European market.

124 As regards the alleged exclusion of certain territories from the scope of the worldwide cartel, Mr V.-A stated, first, that North America was excluded for a specific reason, namely the risk of the penalties if the cartel were to be discovered. Second, he explained that the exclusion of Western European countries meant that the GIS projects concerned were not discussed by the European producers at meetings at which he was present, that is to say the meetings of the worldwide cartel previously governed by the GQ and EQ Agreements, but on another occasion. Those statements are fully in line with Mr M’s witness statement.

125 It must be conceded, however, that, as noted in paragraph 110 above, Mr M was not convinced of the commercial interest for the Japanese undertakings in entering the European GIS market. None the less, the position of Mr M, which was shared by Mr P, does not affect the fact that, according to both ABB’s four witnesses and ABB itself, the Japanese undertakings were committed to not entering the EEA market even though they were capable of doing so at a technical level.

126 In conclusion, it must be found that the evidence furnished by ABB is capable of proving the existence of the common understanding. Similarly, that evidence is coherent in respect of the existence and fundamental content of the common understanding.

127 Furthermore, ABB’s statements were provided on behalf of an undertaking and it is apparent from their content that they are founded on internal research and on discussions with employees of that undertaking. Consequently, a certain degree of probative value must be attributed to them.

128 The statements made by the four witnesses concerned are credible since they were made by direct witnesses of the events to which they refer and it is not apparent from the circumstances of the case that those witnesses were encouraged to make inaccurate statements. Thus, they must be regarded as being of high probative value.

The corroboration of the evidence furnished by ABB

– Arguments of the parties

129 The applicant disputes that the evidence furnished by ABB has been sufficiently corroborated in the present case.

130 First, the statements made by Fuji in its reply to the statement of objections are not directly contrary to its interests, and can thus not serve to corroborate the existence of the common understanding. In addition, Fuji stated that its absence from the European GIS market was due to economic and technical obstacles. Similarly, since Fuji did not participate in all the meetings on the GQ Agreement, it could have a different perception from that of the other parties which consider that the common understanding did not exist.

131 Second, the rejection by Hitachi of the proposal made by Alstom in July 2002 to conclude an understanding covering GIS projects in Europe and covering Central and Eastern Europe does not constitute evidence of the existence of the common understanding. According to the applicant, the Commission failed to take account of Hitachi’s reference to commercial obstacles limiting the presence of Japanese producers on the European market. In addition, supposing that the common understanding was essential for the functioning of the GQ Agreement, the refusal to ring-fence the European market should have led to the collapse of the entire arrangement; but that did not happen.

132 Third, the fact that Areva and Alstom did not contest the existence of the common understanding is irrelevant in the present case.

133 The Commission considers the applicant’s arguments to be unfounded.

– Findings of the Court

134 First, in its reply to the statement of objections, Fuji stated that it was aware of the common understanding, pursuant to which the Japanese producers would not attempt to enter the European market, while stating that the main reason for Fuji’s absence from the EEA market was that it was not a credible significant GIS supplier in Europe.

135 In so far as Fuji admitted, at least indirectly, that its absence from the European market was in part due to the common understanding, it acknowledged a fact which could have been held against it by the Commission. Consequently, contrary to what the applicant claims, Fuji’s statement goes against its interests given that it implicitly acknowledged that it participated in an infringement.

136 It is true that Fuji’s statement is relatively vague since that undertaking merely refers to the commitment of the Japanese producers not to enter the European market. However, in doing so, Fuji corroborated the key element resulting from the evidence submitted by ABB and imputed to the Japanese producers by the Commission. Thus, that statement is not irrelevant in this case.

137 The Court also notes that Fuji played a secondary role within the cartel, as the applicant essentially submits. In particular, as is apparent from recital 150 of the contested decision, Fuji was the only Japanese undertaking which was not a member of the committee of the group of Japanese producers responsible, in particular, for the coordination of the two groups of producers within the context of the GQ Agreement. However, in principle, an undertaking which plays a secondary role within a cartel is aware of the main content of the agreements encompassed by that cartel, even if that undertaking is not aware of its detailed operation and all the information exchanged within it.

138 In addition, it is true that, in its statement, Fuji referred to the existence of technical and commercial obstacles to entry to the EEA market. However, those obstacles were not referred to as being the sole reason for Fuji’s absence from that market, but merely as being the main reason. Furthermore, when Fuji listed the various obstacles at issue, it referred to its small share of the worldwide market which placed it at a disadvantage compared with its larger competitors, both European and Japanese. Therefore, it is not apparent that its arguments in that regard can be transposed to those of the other Japanese producers.

139 In the light of the above, it must be concluded that the statement made by Fuji in its reply to the statement of objections tends to corroborate the evidence furnished by ABB, although its probative value is limited.

140 It is apparent from recital 127 of the contested decision that, at the meeting of 10 July 2002 during which there was discussion of the development of the modes of operation of the cartel after Siemens and Hitachi had withdrawn from it, Alstom proposed that the European producers should stay in Europe and the Japanese producers should stay in Japan and not attempt to enter the European market. In addition, it is stated in that recital that, at the following meeting on 15 July 2002, Hitachi’s representative had stated that Hitachi rejected that proposal, that the European producers had reacted by stating that Europe, including Central and Eastern Europe, was their market and that they wanted to maintain the prices they were currently charging in Western Europe and had also said that the issue was to be raised again, even though that was not the case.

141 It must be admitted that, at first sight, that summary of the meetings of 10 and 15 July 2002, based on the evidence furnished by Hitachi, suggests that Alstom actually proposed that a new understanding be concluded, which was rejected by Hitachi and was not discussed subsequently, which implies that, at least as of July 2002, there was no understanding in existence relating to the conduct of the Japanese producers on the EEA market.

142 However, the summary of the meeting of 15 July 2002 shows, first, that Hitachi did not reject the very idea of allocating markets, but only Alstom’s concrete proposal. Second, it is stated in that summary that Hitachi had pointed out that the claims made by the European producers included Central and Eastern Europe, which suggests that its opposition was related to that specific aspect, but not to the situation in Western Europe.

143 It should also be noted that Alstom’s presentation of the proposal at issue calls into question the applicant’s and Hitachi’s arguments in relation to competition on the EEA market. If, as claimed by the applicant and Hitachi, the Japanese producers were not perceived as credible competitors on the EEA market because of the existence of insurmountable barriers to entry, an understanding relating to that very market would indeed not have served any purpose. In such a situation, the European producers, aware of that fact as a result of their privileged position in Europe, would have had no reason to propose such an understanding. However, it is apparent from the summary provided by Hitachi that Alstom’s proposal concerned the EEA market as well as the Central and Eastern European market.

144 Accordingly, it is necessary to uphold the interpretation that, at the meeting of 10 July 2002, Alstom proposed extending the common understanding, as alleged by the Commission, to include Central and Eastern European countries.

145 First, that interpretation implies that Alstom’s proposal constitutes proof that the common understanding existed at the time that it was made. Second, the rejection of that proposal by Hitachi does not amount to a rejection of the common understanding as such, but represents merely a refusal to extend it. Consequently, the applicant’s claim that the GQ Agreement should have ‘collapsed’ following the meeting of 15 July 2002 is based on a false premiss.

146 In the light of all of the above, it must be found that the proposal made by Alstom at the meeting of 10 July 2002 corroborates the evidence furnished by ABB.

147 Third, as has been noted in paragraph 50 above, the alleged neutral position of Alstom and Areva cannot be interpreted as proof of the existence of the common understanding. Consequently, that factor cannot corroborate the evidence furnished by ABB.

The notification and project loading mechanism

– Arguments of the parties

148 The applicant submits that the existence of the notification and project loading mechanism is implausible and has not been established.

149 First, the Japanese producers were not perceived to be a competitive threat on the European market, so that it would not have been necessary to offer them compensation via that mechanism. In the applicant’s view, if notifications had been made for the purpose of project loading, the European producers would not have had any incentive to notify.

150 Second, given the precise nature of the GQ Agreement, it is unrealistic that the agreement itself or subsequent documents would not mention the notification and project loading mechanism.

151 Third, the theory put forward by the Commission is based on mandatory and systematic notification, since only a mechanism covering at least a significant proportion of the GIS projects concerned could enable the Japanese producers to monitor and verify the loading procedure. In the present case, the Commission has not established to the requisite legal standard the existence of the notification and project loading mechanism nor the systematic nature of that mechanism.

152 In that regard, in their witness statements, Mr M and Mr P indicated that the lists of European GIS projects and the allocation of them were not discussed with the Japanese undertakings. Moreover, the lists at issue cannot establish the existence of systematic notification.

153 The statements made by Hitachi in its leniency application and in its reply to the statement of objections are merely an interpretation of the facts by that undertaking. In any event, such statements did not relate to the period subsequent to Hitachi’s withdrawal from the cartel in 1999. Moreover, Hitachi provided a supplementary reply to the statement of objections, which detracts from the value of the statements in question. Similarly, given the detail of Hitachi’s leniency application, the statements in question, which were submitted later, lack any credibility.

154 Furthermore, the Commission itself acknowledged, in recitals 148 and 162 of the contested decision, that notification could not have been carried out on a regular basis. Fuji confirmed this in its response to the statement of objections and Hitachi did not dispute it in its statements concerning notification and loading. As regards the content of the EQ Agreement, the applicant states, first, that it was unaware of the existence of that document and the latter is therefore not relevant so far as it is concerned. Second, according to Annex 2 to the said agreement, the notification of European GIS projects to Japanese producers was voluntary and not mandatory.

155 The Commission considers the applicant’s arguments to be unfounded.

– Findings of the Court

156 The Court notes, first, that the Commission’s claims relating to the notification and project loading mechanism are not based exclusively on the assumption that the Japanese producers were perceived as credible competitors on the EEA market. The Commission considers that it gathered positive evidence of the existence of that mechanism. Accordingly, the probative value of the evidence put forward by the Commission must be examined in order to assess whether it establishes, to the requisite legal standard, the existence of the notification and project loading mechanism.

157 In that regard, the applicant’s argument that, if notification aimed to enable project loading, the European producers would not have had any incentive to notify is not substantiated. That argument is based solely on an assessment of the notification and project loading mechanism as an isolated element. However, that approach is not in line with the Commission’s position, as resumed in paragraph 90 above, that that mechanism formed part of the general context of the common understanding.

158 Second, although the notification and project loading mechanism required certain measures for its implementation, those measures were not particularly complicated, since they essentially consisted in the disclosure of certain information by the European group to the Japanese group, a disclosure which, in addition, took place in parallel with the information disclosed under the GQ Agreement concerning GIS projects outside of the EEA. Consequently, it is not apparent that those measures or the notification and project loading mechanism itself necessarily required written rules, also given the will of parties to the cartel, attested by the organisational and technical precautions referred to in recitals 170 to 176 of the contested decision, to reduce the risk of that agreement being discovered.

159 Third, in his witness statement, Mr M explicitly affirmed the existence of the notification and project loadi