Keywords

Summary



Keywords

1. Competition – Administrative procedure – Statement of objections – Necessary content – Observance of the rights of the defence

(Council Regulation No 1/2003, Art. 27)

2. Competition – Fines – Amount – Determination – Rights of the defence – Judicial review – Unlimited jurisdiction of the European Union judicature

(Council Regulation No 1/2003, Art. 31)

3. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Aggravating circumstances

(Council Regulation No 1/2003, Art. 23(2) and (3))

4. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement

(Council Regulation No 1/2003, Art. 23(2) and (3))

5. Competition – Fines – Amount – Determination – Criteria – Discretion of the Commission – Taking into consideration specific characteristics of a repeated infringement – Included – No setting of a limitation period

(Council Regulation No 1/2003, Art. 23(2) and (3))

6. Competition – Administrative procedure – Decision finding an infringement and imposing a fine – Taking into account, for the purposes of establishing the conduct of an undertaking constituting repeated infringement, of earlier infringements committed by the same undertaking and already penalised by the Commission

(Charter of Fundamental Rights of the European Union, Art. 50)

7. Competition – Administrative procedure – Commission decision finding an infringement adopted after another Commission decision referring to the same undertaking – New increase in the fine for repeated infringement

(Council Regulation No 1/2003, Art. 23(2) and (3))

8. Competition – Fines – Amount – Determination – Criteria – Gravity and duration of the infringement – Possibility of raising the level of fines in order to increase their deterrent effect

(Council Regulation No 1/2003, Art. 23(2) and (3))

9. Competition – Fines – Amount – Determination – Principle of equal treatment

(Council Regulation No 1/2003, Art. 23(2) and (3))

10. Competition – Fines – Amount – Determination – Criteria – Discretion of the Commission

(Council Regulation No 1/2003, Art. 23(2) and (3))

11. Competition – Fines – Amount – Determination – Non-imposition or reduction of the fine for cooperation by the undertaking concerned – Need for conduct which facilitated the Commission’s finding of an infringement

(Council Regulation No 1/2003, Art. 18; Commission Notice 2002/C 45/03)

12. Competition – Fines – Amount – Determination – Guidelines on the method of setting fines for infringements of the competition rules – Reduction of the fine for cooperation by the undertaking concerned, outside the scope of the Leniency Notice – Conditions

(Commission Notices 2002/C 45/03, Section 1, and 2006/C 210/02, Section 29, fourth indent)

13. Competition – Fines – Amount – Determination – Reduction of the fine for cooperation by the undertaking concerned – Conditions

(Commission Notices 2002/C 45/03, Section 21, 2006/C 210/02, Section 29, fourth indent, and 2008/C 167/01, Section 5)

14. Competition – Fines – Amount – Determination – Judicial review – Unlimited jurisdiction of the European Union judicature

(Art. 229 EC; Council Regulation No 1/2003, Art. 31)

Summary

1. Where the Commission expressly states in its statement of objections that it will consider whether it is appropriate to impose fines on the undertakings concerned and it also indicates the main factual and legal criteria capable of giving rise to the imposition of a fine, such as the gravity and the duration of the alleged infringement and whether that infringement was committed intentionally or negligently, it fulfils its obligation to respect the undertakings’ right to be heard. In doing so, it provides them with the necessary means to defend themselves not only against the finding of an infringement but also against the imposition of fines.

(see para. 54)

2. So far as the setting of the amounts of the fines imposed for breach of the competition rules is concerned, the rights of defence of the undertakings to which the statement of objections relates are guaranteed before the Commission by virtue of the fact that they have the opportunity to make submissions on the duration, the gravity and the foreseeability of the anti-competitive nature of the infringement. Moreover, undertakings have an additional guarantee, as regards the setting of the amount of the fine, in that the Court has unlimited jurisdiction and may in particular cancel or reduce the fine pursuant to Article 31 of Regulation No 1/2003.

(see para. 55)

3. As regards the aggravating circumstance consisting in repeated infringement, the mere fact that the Commission considered, in its previous practice in taking decisions, that certain factors did not constitute an aggravating factor for the purpose of determining the amount of the fine does not imply that it must make the same assessment in a subsequent decision. The opportunity afforded to an undertaking in another case to make known its views on the intention to make a finding of repeated infringement on its part does not mean that the Commission is obliged to do the same in all cases, or that, where such a possibility is not afforded, the undertaking concerned is prevented from fully exercising its right to be heard.

(see para. 56)

4. The principle of proportionality requires that the measures adopted by European Union institutions must not exceed what is appropriate and necessary for attaining the objective pursued. When it comes to the calculation of fines, the gravity of infringements has to be determined by reference to numerous factors and it is important not to confer on one or other of those factors an importance which is disproportionate in relation to other factors. In this context, the principle of proportionality requires the Commission to set the fine proportionately to the factors taken into account for the purposes of assessing the gravity of the infringement and also to apply those factors in a way which is consistent and objectively justified.

(see para. 63)

5. The Commission has a discretion as regards the choice of factors to be taken into account for the purpose of determining the amount of fines, such as, inter alia, the particular circumstances of the case, its context and the deterrent effect of fines, without the need to refer to a binding or exhaustive list of the criteria which must be taken into account.

The finding and the appraisal of the specific characteristics of a repeated infringement come within the Commission’s discretion and the Commission cannot be bound by any limitation period when making such a finding.

Repeated infringement is an important factor which the Commission must appraise, since the purpose of taking repeated infringement into account is to induce undertakings which have demonstrated a tendency towards infringing the competition rules to change their conduct. The Commission may therefore, in each individual case, take into consideration the indicia which confirm such a tendency, including the time that has elapsed between the infringements in question. However, while no limitation period precludes a finding by the Commission of repeated infringement, the fact none the less remains that, in accordance with the principle of proportionality, the Commission cannot take one or more previous decisions penalising an undertaking into account without limitation in time.

(see paras 64-66, 68)

6. The principle non bis in idem is a fundamental principle of European Union law which precludes, in competition matters, an undertaking from being found guilty or proceedings from being brought against it a second time on the grounds of anti-competitive conduct in respect of which it has been penalised or declared not liable by a previous unappealable decision. The application of the principle non bis in idem is subject to the threefold condition of identity of the facts, unity of offender and unity of the legal interest protected.

The fact that the Commission took into consideration, in a decision finding that an undertaking had participated in agreements of an anti-competitive nature and imposing on that undertaking a fine, a number of earlier infringements committed by the same undertaking and penalised by the Commission, does not amount to a breach of the principle non bis in idem in so far as the Commission, in taking those earlier infringements into consideration, did not seek to punish those infringements again but only to prove that the undertaking concerned had carried out repeated infringements, with a view to establishing the amount of the fine penalising the new infringement.

Secondly, and in any event, the abovementioned cumulative conditions of the applicability of the principle non bis in idem are not satisfied, since the condition of identity of the facts is absent.

(see paras 80-84)

7. It would be contrary to the deterrent objective of the fine if the fact that the Commission took a first infringement into consideration in a previous decision for the purpose of establishing repeated infringement were to be taken into account as a ground for precluding it from increasing the basic amount of the fine imposed in a subsequent decision on the basis of that infringement. Such a solution would lead to the situation, which would be counterproductive from the aspect of the deterrent objective of the fine, in which an undertaking responsible for a large number of repeated infringements did not have the amount of the fine imposed on it gradually increased according to the number of infringements which it has committed, but in which, on the contrary, the marginal amount of the fine that could be imposed on it reduced gradually according to the increasing number of decisions penalising it.

Moreover, it has no bearing that earlier decisions penalising the undertaking at issue relate to facts concomitant with those to which the contested decision relates, since the Commission relied exclusively on other earlier decisions, adopted before the beginning of the infringement penalised, in order to establish in the contested decision that that undertaking’s conduct constituted repeated infringement.

(see paras 88-89)

8. Under Article 23(2) and (3) of Regulation No 1/2003 the Commission may by decision impose fines on undertakings which have infringed Article 81 EC and have regard, in that context, to the gravity and duration of the infringement. Those provisions constitute the relevant legal basis for taking repeated infringement into consideration in calculating the fine.

Furthermore, the Guidelines which the Commission adopts for the purpose of setting fines ensure legal certainty on the part of undertakings, since they determine the method which the Commission has bound itself to use for the purpose of setting fines. The administration may not depart from the Guidelines in an individual case without giving reasons that are compatible with the principle of equal treatment.

Moreover, the Commission’s practice in previous decisions does not serve as a legal framework for the fines imposed in competition matters. In that regard, the Commission enjoys a wide discretion in setting the amount of fines. It is not bound by assessments made by it in the past and it is not required to apply specific mathematical formulae.

That wide discretion enables it to direct the conduct of undertakings towards compliance with the competition rules.

In that context, the fact that the Commission, in the past, imposed fines of a certain level for particular types of infringement does not mean that it is stopped from raising that level within the limits indicated in Regulation No 1/2003, if that is necessary to ensure the implementation of Community competition policy.

The proper application of the competition rules in fact requires that the Commission may at any time adjust the level of fines to the needs of that policy. Thus, an increase of a certain level applied to an undertaking can be justified by the additional need to deter that undertaking, on account of its tendency towards infringing the competition rules, while an increase of a different level applied to another undertaking can be justified by the need to ensure that the fine imposed on that undertaking has a deterrent effect, in view of the fact that, because its global turnover is much larger than that of the other members of the cartel, it is more readily able to raise the necessary funds to pay its fine.

(see paras 96, 98-101, 106)

9. The principle of equality 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.

The sole fact that the Commission, in its previous practice in adopting decisions, applied a certain rate of increase of the basic amount of the fine imposed on an undertaking for infringement of the competition rules does not mean that, in another decision, it is deprived of the power to increase that rate within the limits which it has set itself in the Guidelines, in order to encourage the undertaking concerned to alter its anti-competitive conduct.

(see paras 108-109)

10. In cases where the European Union institutions have a power of appraisal in order to be able to fulfil their tasks, respect for the rights guaranteed by the European Union legal order in administrative procedures is of even more fundamental importance; those guarantees include, in particular, the duty of the competent institution to examine carefully and impartially all the relevant aspects of the individual case.

(see para. 111)

11. The Commission has a wide discretion as regards the method of calculating fines and it may, in that regard, take account of numerous factors, including the cooperation provided by the undertakings concerned during the investigation conducted by its departments. In that context, the Commission is required to make complex assessments of fact, such as those relating to the cooperation provided by the individual undertakings concerned.

In assessing the cooperation given by members of a cartel, only a manifest error of assessment by the Commission is open to censure, since the Commission enjoys a wide discretion in assessing the quality and usefulness of the cooperation provided by an undertaking, in particular by reference to the contributions made by other undertakings.

The reduction of fines in cases where the undertakings which participated in infringements of competition law have offered cooperation is justified only where it is considered that the cooperation made it easier for the Commission to establish an infringement and, as the case may be, to put an end to it. 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.

Whilst the Commission is required to state the reasons for which it considers that information provided by undertakings under a Leniency Notice const itutes 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.

Where an undertaking providing cooperation does no more than confirm, in a less precise and explicit manner, certain information that has already been provided by another undertaking by way of cooperation, the extent of the cooperation provided by the former undertaking, while possibly of some benefit to the Commission, cannot be treated as comparable with that provided by the undertaking which was the first to provide that information. 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. Accordingly, it cannot be sufficient to justify a reduction of the fine for cooperation. Last, the cooperation of an undertaking in the investigation does not entitle it to a reduction of its fine where that cooperation went no further than the cooperation incumbent upon it under Article 18 of Regulation No 1/2003.

(see paras 134-138)

12. At the fourth indent of point 29 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003, the Commission undertook, within the framework of its discretion regarding the attenuating circumstances which it is required to take into account when setting fines, to grant a reduction of the fine when an undertaking has effectively cooperated with the Commission outside the scope of the Notice on immunity from fines and reduction of fines in cartel cases and beyond its legal obligation to do so.

However, the application of the fourth indent of point 29 of the Guidelines cannot have the consequence of depriving the Leniency Notice of its practical effect.

Section 1 of the Leniency Notice provides that that notice ‘sets out the framework for rewarding cooperation in the Commission investigation by undertakings which are or have been party to secret cartels affecting the Community’. It therefore follows from the wording and the structure of that notice that undertakings can, in principle, obtain a reduction of the fine for cooperation only where they satisfy the strict conditions laid down in that notice.

Therefore, in order to maintain the practical effect of the Leniency Notice, it can only be in exceptional situations that the Commission is required to grant a reduction of the fine to an undertaking on the basis of the fourth indent of point 29 of the Guidelines. That is the case, in particular, where cooperation provided by an undertaking, which goes beyond its legal obligation to cooperate, but does not give rise to the right to a reduction of the fine under the Leniency Notice, is of objective use to the Commission. It must be found to be of such use where the Commission relies in its final decision on evidence which an undertaking has submitted to it in the context of its cooperation, without which the Commission would not have been in a position to penalise the infringement concerned in whole or in part.

(see paras 168-170)

13. By replacing the 1996 Notice on the non-imposition or reduction of fines in cartel cases by the 2002 Notice on immunity from fines and reduction of fines in cartel cases, which makes no provision for a reduction of the fine in a simple case of non-contestation of the facts, the Commission unambiguously precluded the grant of a reduction of the fine on that basis in the context of the 2002 Leniency Notice or of the fourth indent of point 29 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003. Only where an undertaking supplies either evidence having significant added value, within the meaning of point 21 of the 2002 Leniency Notice, or evidence in the absence of which the Commission would not have been able to penalise the infringement in question in whole or in part in its final decision, is the Commission required to grant it a reduction of the fine. Thus, the grant of a reduction of the fine depends on the objective usefulness which the Commission derives from an undertaking’s cooperation.

In any event, according to point 5 of the Notice on the conduct of settlement procedures in view of the adoption of decisions pursuant to Article 7 and Article 23 of Regulation No 1/2003 in cartel cases, the Commission has a broad margin of discretion to determine which cases may be suitable to explore the parties’ interest to engage in settlement discussions and it is only where the participating undertakings satisfy the conditions of that notice that they are granted a 10% reduction of the fine.

Accordingly, under the settlements notice, it is for the Commission alone, and not for the undertakings, to decide, in the light of the circumstances of each particular case, whether the use of that procedure may make it easier to penalise the infringement in question and, in that context, to grant a 10% reduction of the fine to an undertaking which satisfies its conditions.

Lastly, even if the national competition law of a number of Member States of the European Union provides that non-contestation of the facts gives entitlement to a reduction of the fine, those rules, which are not binding on the Commission, do not constitute the relevant legal framework for examining whether the Commission breached the principle of proportionality by not granting an undertaking any reduction of its fine for its cooperation.

(see paras 189-192)

14. As regards the review carried out by the European Union judicature in respect of Commission decisions on competition matters, more than a simple review of legality, which merely permits dismissal of the action for annulment or annulment of the contested measure, the unlimited jurisdiction conferred on the General Court by Article 31 of Regulation No 1/2003 in accordance with Article 229 EC authorises the Court to vary the contested measure, even without annulling it, by taking into account all of the factual circumstances, so as to amend, for example, the amount of the fine.

In this connection, it is not necessary to vary either the rate of increase of 90% of the basic amount of a fine imposed by the Commission on an undertaking, on account of that undertaking’s participation in agreements of an anti-competitive nature, taking into account that undertaking’s strong tendency towards infringing the competition rules, or the amount of the fine imposed, in so far as that undertaking’s cooperation was not such as to enable the Commission to penalise the cartel in whole or in part.

(see paras 203-205)