Case T-214/06

Imperial Chemical Industries Ltd

v

European Commission

‛Competition — Agreements, decisions and concerted practices — Methacrylates market — Decision finding an infringement of Article 81 EC and Article 53 of the EEA Agreement — Participation in a part of the cartel — Rights of the defence — Fines — Duty to state reasons — Gravity of the infringement — Deterrent effect — Equal treatment — Proportionality — Principle of sound administration — Cooperation during the administrative procedure — Duration of procedure — Reasonable time’

Summary of the Judgment

Competition — Administrative procedure — Obligation on the Commission to comply with the principles of sound administration and equal treatment — Late submission of a leniency application owing to the absence of any information that an investigation was in progress — Exchange of correspondence between the Commission and another undertaking suggesting reluctance as regards the communication of such information — No comments discriminating against the first undertaking — No infringement of the principles of sound administration and equal treatment

Competition — Fines — Amount — Determination — Non-imposition or reduction of the fine in return for the cooperation of the undertaking concerned — Undertaking informed late that an investigation was in progress based on objective factors — Commission not responsible for that undertaking’s late submission of a leniency application

Competition — Fines — Amount — Determination — Non-imposition or reduction of the fine in return for the cooperation of the undertaking concerned — Commission decision refusing a reduction of the fine — Evidential obligations of undertakings contesting that decision

Competition — Fines — Amount — Determination — Criteria — Deterrent effect of the fine — Application of a multiplier — No need to differentiate between undertakings involved in the same infringement by reference to their turnover — No infringement of the principles of equal treatment and proportionality

Competition — Fines — Amount — Determination — Criteria — Deterrent effect of the fine — Criteria for evaluating the deterrence factor — Taking into account of the size and global resources of the undertaking concerned — Turnover which may be taken into account

Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — No obligation to take account of the actual impact on the market — Calculation of the starting amount of the fine — No obligation to apportion that amount between the successive owners of a company which committed an infringement

Competition — Fines — Decision imposing fines — Duty to state reasons — Scope — Indication of the factors which led the Commission to assess the gravity and the duration of the infringement — Sufficient indication — No obligation on the Commission to set out the figures relating to the method of calculating the fines

Competition — Administrative procedure — Commission decision finding an infringement — Use as evidence of statements of other undertakings which participated in the infringement — Lawfulness — Probative value of evidence provided voluntarily by the main participants in an unlawful agreement in order to benefit from the application of the Leniency Notice

Agreements, decisions and concerted practices — Participation in meetings having an anti-competitive object — Circumstances from which, where the undertaking concerned has not distanced itself from the decisions adopted, it may be concluded that it participated in the ensuing cartel

Competition — Administrative procedure — Commission decision finding an infringement — Means of proof — Reliance on a body of evidence — Degree of probative value necessary as regards items of evidence viewed in isolation

See the text of the decision. (see paras 53-56)

See the text of the decision. (see paras 57, 66)

See the text of the decision. (see paras 58-62, 69)

See the text of the decision. (see paras 63, 64)

See the text of the decision. (see paras 84-86)

See the text of the decision. (see paras 97, 100)

There is no basis for considering that the assessment of the gravity of an infringement of the competition rules of the European Union must be strictly related to the impact on competition or the harm thereto and that, consequently, successive owners of a single set of assets employed in such an infringement contribute to a ‘single gravity’ of the infringement. The effect of an anti-competitive practice is not, in itself, the conclusive criterion for assessing the proper amount of a fine. Moreover, 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 clearly place the emphasis on the nature of the infringement as a decisive factor for assessing its gravity, in the context of setting the starting amount of the fine. Regarding the actual effect of the infringement, the Guidelines provide for the criterion of the actual impact on the market, which relates to the infringement as a whole and not to the effects of each undertaking’s conduct, whilst specifying that that impact will be taken into account only where it can be measured. Furthermore, the Commission may classify horizontal price or market sharing agreements as very serious infringements solely on account of their nature, without being required inter alia to demonstrate an actual impact of the infringement on the market. Lastly, the criterion of the real impact of the offending conduct of each undertaking on competition mentioned in the penultimate subparagraph of Section 1 A of the Guidelines is an optional criterion which allows the starting amount of the fine to be adjusted, where an infringement involves several undertakings, and is not a decisive criterion for the setting of that amount. Moreover, that criterion does not concern the quantification of the anti-competitive effects of the conduct of each undertaking participating in a given infringement, but rather the taking account, for the purpose of determining the starting amount of the fine, of objective differences which may be present between them, such as, inter alia, considerable disparity between their sizes. It follows that, even if a change of ownership of the set of assets employed in an infringement did not result in any additional harm to competition, that would not permit the conclusion that the successive owners contributed to a ‘single gravity’ of the infringement and that the starting amount of the fine must therefore be apportioned between them in order to avoid the double-counting of the impact of the offending conduct of each of them on competition. (see paras 103, 110, 112, 114, 116-118)

In competition matters, the total turnover of an undertaking gives an indication, albeit approximate and imperfect, of the size of the undertaking and of its economic power. Accordingly, in order to determine the amount of the fine for infringement of the competition rules at a level which ensures that it has a sufficiently deterrent effect, the Commission is entitled to have regard to the total turnover of the undertaking concerned. Thus, although the total turnover of the undertaking gives an indication of its size and its economic power which may be imperfect and approximate, at the same time that criterion may be used in the context of determining the increase of the fine for deterrence. That approach has the indisputable merit of enabling the Commission to use an objective criterion when determining the amount of fines and to apply it without distinction to all the undertakings concerned. It follows that the claim that the turnover of an undertaking reflects its economic power only imperfectly or approximately does not suffice, in itself, to render that criterion irrelevant in the context of determining the increase of the fine for deterrence. It is true that one should not lose sight of the objective pursued by that increase, namely the adjustment of the fine so that it is not rendered negligible, or excessive, notably by reference to the financial capacity of the undertaking in question. However, it is for the undertaking putting forward such arguments to adduce evidence establishing that the turnover taken into account by the Commission gives such a misleading picture of its financial capacity that there is a failure to have regard to that objective in the circumstances. (see paras 145-149)

In view of the Commission’s discretion in setting the amounts of fines for infringement of the European Union competition rules, the Commission cannot be required, on the basis of the principles of equal treatment and proportionality, to ensure that the differences between the levels of deterrent increases imposed on different undertakings reflect precisely any distinction between them regarding their turnover. Although turnover is a relevant criterion in the setting of the fine at a level which ensures sufficient deterrent effect, the fixing of an appropriate fine cannot however necessarily be the result of a simple arithmetical calculation based on turnover. (see para. 174)

In competition matters, in order to justify a reduction of the fine based on the Notice on immunity from fines and reduction of fines in cartel cases, it is necessary that the information provided by an undertaking to the Commission can be regarded as demonstrating genuine cooperation, given that the aim of reducing a fine is to reward an undertaking for making a contribution in the administrative procedure that enabled the Commission to establish an infringement with less difficulty. Thus, the conduct of an undertaking must facilitate the Commission’s task of finding and bringing to an end infringements of the European Union competition rules and reveal a true spirit of cooperation. In view of the rationale for the reduction, the Commission cannot disregard the usefulness of the information provided, which inevitably depends on the evidence already in its possession. In particular, it has been held that a statement which merely corroborates to a certain degree a statement which the Commission already had at its disposal does not facilitate the Commission’s task significantly and that it is not sufficient to justify a reduction in the fine for cooperation. It follows that the mere fact that a document is to some extent useful for the Commission and that it relies on it in its decision does not justify a reduction of the fine for cooperation. (see paras 182, 183, 201)

Whilst the Commission is required to state the reasons for which it considers that information provided by undertakings under the Notice on immunity from fines and reduction of fines in cartel cases constitutes a contribution which does or does not justify a reduction of the fine, it is incumbent on undertakings wishing to contest the Commission’s decision in that regard to show that, in the absence of such information provided voluntarily by the undertakings, the Commission would not have been in a position to prove the essential elements of the infringement and therefore adopt a decision imposing fines. (see para. 184)

See the text of the decision. (see paras 208-217)

See the text of the decision. (see paras 222-223, 235, 241, 244-246)

The application of Section 3, sixth indent, of 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, which includes as a mitigating circumstance effective cooperation by the undertaking in the proceedings outside of the scope of the Notice on immunity from fines and reduction of fines in cartel cases must be exceptional. The application of Section 3, sixth indent, of those guidelines cannot lead to the Leniency Notice being deprived of its useful effect. It is clear from that notice that it defines the framework for rewarding undertakings which are or were parties to secret cartels affecting the European Union for their cooperation in Commission investigations. It follows that undertakings may, as a rule, obtain a reduction in the amount of the fine in return for their cooperation only when they satisfy the conditions laid down in that notice. Moreover, a reduction of the fine cannot be justified merely because an undertaking communicates information going beyond that whose production the Commission could request pursuant to Article 18 of Regulation No 1/2003, such as, in particular, inculpatory materials. It is true that the cooperation of an undertaking in the investigation does not entitle it to a reduction in its fine where that cooperation went no further than the cooperation incumbent upon it under Article 18 of Regulation No 1/2003. However, the reverse is not necessarily true. Even inculpatory material may be of only limited use to the Commission, in particular by reference to earlier submissions by other undertakings. It is the usefulness of information which is the decisive factor in the assessment of the application for a reduction of the fine for cooperation with the Commission. (see paras 252, 258, 260-262)

See the text of the decision. (see paras 282-285)