Keywords

Summary



Keywords

1. Appeals – Grounds – Mistaken assessment of the facts – Inadmissibility – Review by the Court of Justice of the assessment of the evidence – Possible only where the clear sense of the evidence has been distorted – Ground of appeal alleging distortion of the clear sense of the evidence

(Arts 81(1) EC and 225 EC; Statute of the Court of Justice, Art. 51, first para.; Rules of Procedure of the Court, Art. 112(1)(c))

2. Competition – Agreements, decisions and concerted practices – Concerted practice – Evidence of the infringement – Burden of proof

(Art. 81(1) EC)

3. Appeals – Grounds – Plea in law submitted for the first time on appeal – Inadmissibility

4. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Aggravating circumstances – Repeated infringement – Legal basis

(Arts 81 EC and 82 EC; Council Regulation No 17, Art. 15(2))

5. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Aggravating circumstances – Repeated infringement – Concept

(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03)

6. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Aggravating circumstances – Repeated infringement – Concept – Infringement found by a decision subject to judicial review – Included – Decision subsequently annulled – Consequences

(Arts 233 EC and 242 EC; Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03, Section 2)

7. Competition – Fines – Amount – Determination – Margin of discretion conferred on the Commission by Article 15(2) of Regulation No 17 – Not a breach of the principle that penalties must have a proper legal basis

(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03)

8. Competition – Fines – Amount – Determination – Deterrent – Taking into account of the size and global resources of the undertaking fined – Relevance

(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03, Section 1A)

Summary

1. Where an appellant alleges, in an appeal, distortion of the evidence by the General Court, he must, pursuant to Article 225 EC, the first paragraph of Article 51 of the Statute of the Court of Justice and Article 112(1)(c) of its Rules of Procedure, indicate precisely the evidence alleged to have been distorted and show the errors of appraisal that, in his view, led to such distortion.

Such distortion exists when, without recourse to new evidence, the assessment of the existing evidence is manifestly incorrect.

In a case concerning the application of Article 81(1) EC, the question whether the clear sense of the evidence has been distorted must be examined in light of the fact that it is normal, given that the prohibition on participating in anti‑competitive practices and agreements and the penalties which offenders may incur are well known, that the activities which those practices and agreements entail take place in a clandestine fashion, for meetings to be held in secret, very often in a non‑member country, and for the associated documentation to be reduced to a minimum. Even if the Commission discovers evidence explicitly showing unlawful contact between traders, such as the minutes of a meeting, it will normally be only fragmentary and sparse, so that it is often necessary to reconstitute certain details by deduction. In most cases, the existence of an anti-competitive practice or agreement must be inferred from a number of coincidences and indicia which, taken together, may, in the absence of another plausible explanation, constitute evidence of an infringement of the competition rules.

(see paras 16-17, 22)

2. It is for the party or the authority alleging an infringement of the competition rules to prove it and it is for the undertaking or association of undertakings raising a defence against a finding of an infringement of those rules to demonstrate that the conditions for applying the rule on which such defence is based are satisfied, so that the authority will then have to resort to other evidence.

Even if the burden of proof rests, according to those principles, on the Commission or on the undertaking or association concerned, the factual evidence on which a party relies may be of such a kind as to require the other party to provide an explanation or justification, failing which it is permissible to conclude that the rules on the burden of proof have been satisfied.

(see paras 29-30)

3. To allow a party to put forward for the first time before the Court of Justice a plea in law and arguments which it has not raised before the General Court would be to authorise it to bring before the Court of Justice, whose jurisdiction in appeals is limited, a case of wider ambit than that which came before the General Court. In an appeal, the jurisdiction of the Court of Justice is thus confined to review of the findings of law on the pleas argued before the court below.

(see para. 52)

4. Article 15(2) of Regulation No 17 empowers the Commission to impose fines on undertakings and associations of undertakings for infringements of Articles 81 EC and 82 EC. Under that provision, in determining the amount of the fine, the duration and the gravity of the infringement in question must be taken into consideration. In that regard, any repeated infringement is among the factors to be taken into consideration in the analysis of the gravity of the infringement in question. It follows that Article 15(2) of Regulation No 17 constitutes the relevant legal basis for taking repeated infringement into consideration in the calculation of the fine.

By upholding the Commission’s finding that there had been repeated infringement by an undertaking and the characterisation of that repeated infringement as an aggravating circumstance, the General Court does not therefore breach the principle nulla poena sine lege .

(see paras 62-65)

5. The principle of legal certainty is not infringed by the fact that no period is prescribed within which repeated infringement may be taken into account. While neither Regulation No 17 nor the Commission’s 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 lay down a maximum period outside which repeated infringement cannot be taken into account, it is not possible for the Commission to increase a fine for repeated infringement with no limitation in time for doing so.

The Commission may, in each case, take into consideration the indicia confirming an undertaking’s tendency to infringe competition rules, including, for example, the time that has elapsed between the infringements in question. Moreover, the principle of proportionality requires the time elapsed between the infringement in question and a previous breach of the competition rules to be taken into account in assessing the undertaking’s tendency to infringe those rules.

For the purposes of judicial review of the Commission’s measures in matters of competition law, the General Court and, where appropriate, the Court of Justice may therefore be called upon to scrutinise whether the Commission observed that principle when it increased, for repeated infringement, the fine imposed, and, in particular, whether such increase was imposed in the light of, among other things, the time elapsed between the infringement in question and the previous breach of the competition rules.

(see paras 66-70, 72-73)

6. Decisions of the Commission are presumed to be lawful until such time as they are annulled or withdrawn. Moreover, as Article 242 EC expressly provides, actions before the Court of Justice do not have suspensory effect. It follows that, even if a Commission decision is still subject to judicial review, it continues to be of full effect, unless the General Court or the Court of Justice decides otherwise.

The argument that the bringing of an action for annulment of a Commission decision in a competition matter entails the suspension of that decision’s application during the legal proceedings, at least so far as concerns the consequences arising from the finding, in a later decision, of any repeated infringement, therefore has no legal basis, but, on the contrary, is inconsistent with, in particular, the wording of Article 242 EC.

In addition, if that argument were to be accepted, infringers would be encouraged to bring purely dilatory actions, with the sole aim of avoiding the consequences of repeated infringement whilst proceedings were pending before the General Court and the Court of Justice.

The conclusion is therefore correct in law that it is sufficient that the undertaking has previously been found guilty of an infringement of the same type, even if the decision is still subject to review by the courts, for the Commission to be entitled to take account of repeated infringement.

That conclusion is not shaken if the decision on the basis of which the fine for another infringement was increased in a later decision is annulled by the Courts of the European Union after the adoption of the latter decision. In such a case, the Commission is required, under Article 233 EC, to take the measures necessary to comply with the judgment of the Court, by amending, as appropriate, the later decision in so far as it includes an increase of the fine for repeated infringement.

That system is consistent with the general principles of sound administration of justice and procedural economy, inasmuch as, first, it requires the institution from which the measure in question emanates to take the necessary measures to comply with the judgment of the Court even in the absence of a request to do so from the undertaking concerned and, second, it prevents purely dilatory actions.

(see paras 81-89)

7. Although Article 15(2) of Regulation No 17 leaves the Commission a wide margin of discretion, it nevertheless limits the exercise of that discretion by establishing objective criteria to which the Commission must adhere. Thus, first, the amount of the fine that may be imposed is subject to a quantifiable and absolute ceiling, so that the maximum amount of the fine that can be imposed on a given undertaking can be determined in advance. Second, the exercise of that discretion is also limited by rules of conduct which the Commission has imposed upon itself in its Notice on the non-imposition or reduction of fines in cartel cases and 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. In addition, the Commission’s known and accessible administrative practice is fully subject to review by the Courts of the European Union, the settled and published case-law of which specifies the undefined concepts which Article 15(2) of Regulation No 17 could contain. A prudent trader, if need be by taking legal advice, can foresee in a sufficiently precise manner the method and order of magnitude of the fines which he incurs for a given line of conduct, and the fact that that trader cannot know in advance precisely the level of the fines which the Commission will impose in each individual case cannot constitute a breach of the principle that penalties must have a proper legal basis.

(see para. 95)

8. Deterrence is one of the factors to be taken into account in calculating the amount of the fine to be imposed for infringement of the competition rules. The link between, first, undertakings’ size and global resources and, second, the need to ensure that a fine has deterrent effect cannot be denied. When the Commission calculates the amount of the fine it may take into consideration, inter alia, the size and the economic power of the undertaking concerned. Thus, for example, an undertaking, owing to its ‘enormous’ worldwide turnover by comparison with the turnovers of the other members of the cartel, could more readily raise the necessary funds to pay its fine, which, if the fine is to have a sufficiently deterrent effect, justifies the application of a multiplier.

The deterrence factor which the calculation of the fine imposed on an undertaking may include is assessed by taking into account a large number of matters and not merely the particular situation of the undertaking concerned. It cannot therefore be excluded that the stage of the calculation at which the deterrence factor is taken into consideration could be relevant in the light of the matters taken into account for assessing that factor other than the size and global resources of the undertaking concerned.

(see paras 102-105, 109)