Case T-279/02

Degussa AG

v

Commission of the European Communities

(Competition – Article 81 EC – Cartels – Methionine market – Single, continuous nature of the infringement – Fine – Guidelines on the method of setting fines – Gravity and duration of the infringement – Cooperation during the administrative procedure – Article 15(2) of Regulation No 17 – Presumption of innocence)

Summary of the Judgment

1. Community law – General principles of law – Legal certainty – Principle that penalties must have a proper legal basis

2. Competition – Fines – Amount – Determination

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

3. Competition – Fines

(Arts 81 EC, 82 EC, 83(1) and (2)(a) and (d) EC, 202, third indent, EC, and 211, first indent, EC; Council Regulation No 17)

4. Competition – Administrative procedure – Commission decision finding an infringement

5. Community law – Principles – Fundamental rights – Presumption of innocence

(Preamble to the Single European Act; Treaty on European Union, Art. 6(2); Charter of fundamental rights of the European Union, Art. 47)

6. Competition – Agreements, decisions and concerted practices – Concerted practice – Meaning

(Art. 81(1) EC)

7. Competition – Agreements, decisions and concerted practices – Not allowed – Infringements

(Art. 81(1) EC)

8. Competition – Fines – Decision imposing fines

(Art. 253 EC; Council Regulation No 17, Art. 15(2))

9. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringements

(Council Regulation No 17, Art. 15(2))

10. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringements

(Council Regulation No 17, Art. 15(2))

11. Competition – Fines – Amount – Determination – Criteria – Deterrent effect of the fine

(Council Regulation No 17, Art. 15(2); Commission communication 98/C 9/03, point 1 A, fourth, fifth and sixth paras)

12. Competition – Fines – Amount – Determination

(Council Regulation No 17, Art. 15(2); Commission communication 98/C 9/03, point 1 A, sixth para.)

13. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringements – Mitigating circumstances

(Council Regulation No 17, Art. 15)

14. Competition – Fines – Amount – Determination

(Art. 18(1) EC; Council Regulation No 17, Art. 15(2))

15. Competition – Fines – Amount – Determination – Waiver or reduction of the fine for cooperation of the undertaking concerned

(Council Regulation No 17, Art. 15(2); Commission communication 96/C 207/04, Title D, point 1)

16. Community law – General principles of law – Non-retroactivity of penal provisions

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

17. Competition – Administrative procedure – Professional secrecy

(Art. 287 CE)

1. The principle that penalties must have a proper legal basis is a corollary of the principle of legal certainty, which constitutes a general principle of Community law and requires, inter alia, that any Community legislation, in particular when it imposes or permits the imposition of sanctions, must be clear and precise so that the persons concerned may know without ambiguity what rights and obligations flow from it and may take steps accordingly. That principle, which forms part of the constitutional traditions common to the Member States and which has been enshrined in various international treaties, in particular in Article 7 of the European Convention on Human Rights, must be observed in regard both to provisions of a criminal nature and to specific administrative instruments imposing or permitting the imposition of administrative sanctions. It applies not only to the provisions which establish the ingredients of an offence, but also to those which define the consequences which flow from a contravention of the former. In that regard, it follows from Article 7(1) of that Convention that offences and the relevant penalties must be clearly defined by law. That requirement is satisfied where the individual can know from the wording of the relevant provision and, if need be, with the assistance of the courts’ interpretation of it, what acts and omissions will make him criminally liable.

The case-law of the European Court of Human Rights shows that, in order to satisfy the requirements of that provision, it is not necessary for the wording of the provisions pursuant to which those sanctions are imposed to be so precise that the consequences which may flow from an infringement of those provisions are foreseeable with absolute certainty. The existence of vague terms in the provision does not necessarily entail an infringement of Article 7 of the European Convention on Human Rights and the fact that a law confers a discretion is not in itself inconsistent with the requirement of foreseeability, provided that the scope of the discretion and the manner of its exercise are indicated with sufficient clarity, having regard to the legitimate aim in question, to give the individual adequate protection against arbitrary interference. In that connection, apart from the text of the law itself, the European Court of Human Rights takes account of whether the indeterminate notions used have been defined by consistent and published case-law. Moreover, taking into account the constitutional traditions common to the Member States does not mean giving a different interpretation to the general principle of Community law that penalties must have a proper legal basis.

(see paras 66-69, 71-73)

2. Even if Article 7(1) of the European Convention on Human Rights were to be regarded as applicable to sanctions imposed by the Commission in the event of infringement of Community competition rules, Article 15(2) of Regulation No 17 concerning the imposition of fines on undertakings for breach of Community competition rules does not contravene the principle that penalties must have a proper legal basis, for the following reasons:

– the Commission does not have unlimited discretion in setting fines, as it has to comply with the ceiling fixed by reference to the turnover of the undertakings in question and has to take account of the seriousness and duration of the infringement;

– the Commission is required, when setting fines, to comply with general principles of law, particularly the principles of equal treatment and proportionality;

– those same limits apply in relation to the exercise by the Commission of its power to assess whether or not a fine should be imposed;

– review by the Community judicature has in fact made it possible, through a consistent and published body of case-law, to define any indeterminate concepts contained in Article 15(2) of Regulation No 17;

– the Commission has developed a well-known and accessible administrative practice which, although not constituting a legal framework for fines, may nevertheless serve as a reference concerning compliance with the principle of equal treatment, it being understood that an increase in the level of fines, within the limits fixed by Article 15(2), always remains possible if the proper application of the competition rules so requires;

– the Commission has adopted guidelines for the fixing of fines, thus limiting itself in the exercise of its discretion and thereby contributing to ensuring legal certainty, and must comply with the principles of equal treatment and the protection of legitimate expectations;

– the Commission is required under Article 253 EC to state reasons for decisions imposing a fine.

(see paras 71, 74-84)

3. The power to impose fines for infringements of Articles 81 EC and 82 EC cannot be regarded as belonging originally to the Council which has transferred it or delegated its exercise to the Commission, as provided for in the third indent of Article 202 EC. In accordance with Article 83(1) and (2)(a) and (d) EC and the first indent of Article 211 EC, that power is part of the Commission’s role of ensuring the application of Community law, such role having been defined, set within a framework and formalised, as regards the application of Articles 81 EC and 82 EC, by Regulation No 17. The power to impose fines, which that regulation confers on the Commission, therefore stems from the provisions of the Treaty itself and is intended to facilitate the effective application of the prohibitions laid down in those articles.

(see paras 86-87)

4. The requirement of legal certainty, on which economic operators are entitled to rely, entails that when there is a dispute as to the existence of an infringement of the competition rules, it is incumbent on the Commission to prove the infringements found by it and to adduce evidence capable of demonstrating to the requisite legal standard the existence of the circumstances constituting the infringement. With 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 the 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.

(see paras 114, 153)

5. The principle of the presumption of innocence, as it results in particular from Article 6(2) of the European Convention on Human Rights, is one of the fundamental rights which, according to the case-law of the Court of Justice, reaffirmed by the preamble to the Single European Act, by Article 6(2) of the Treaty on European Union and by Article 47 of the Charter of Fundamental Rights of the European Union, are recognised in the Community legal order. Given the nature of the infringements in question and the nature and degree of severity of the ensuing penalties, the principle of the presumption of innocence applies inter alia to the procedures relating to infringements of the competition rules applicable to undertakings that may result in the imposition of fines or periodic penalties.

(see para. 115)

6. The concept of ‘concerted practices’ consists of a form of coordination between undertakings which, without having reached the stage where an agreement properly so-called has been concluded, knowingly substitutes practical cooperation between them for the risks of competition. The criteria of coordination and cooperation, far from requiring the elaboration of an actual ‘plan’, must be understood in the light of the concept inherent in the Treaty provisions relating to competition, according to which each economic operator must determine independently the policy which it intends to adopt on the common market. Although that requirement of independence does not deprive economic operators of the right to adapt themselves intelligently to the existing and anticipated conduct of their competitors, it strictly precludes any direct or indirect contact between such operators with the object or effect either of influencing the conduct on the market of an actual or potential competitor or of disclosing to such a competitor the course of conduct which they themselves have decided to adopt or contemplate adopting on the market.

Consequently, in order to prove that there has been a concerted practice, it is not necessary to show that the competitor in question has formally undertaken, in respect of one or several others, to adopt a particular course of conduct or that the competitors have colluded over their future conduct on the market. It is sufficient that, through its declaration of intention, the competitor has eliminated or, at the very least, substantially reduced the uncertainty as to the conduct to be expected from it on the market. In addition, whilst the mutual communication by the participants in a cartel of their intention to terminate it is not a condition of its cessation, the fact remains that, where an undertaking participates, even without taking an active part, in meetings between undertakings with an anti‑competitive purpose and does not publicly distance itself from what occurred at those meetings, thus giving the impression to the other participants that it subscribes to the results of the meetings and will act in conformity with them, it may be held as established that it participates in the cartel resulting from those meetings.

Moreover, although it is clear from the very terms of Article 81(1) EC that a concerted practice implies, besides undertakings’ concerting together, conduct on the market pursuant to those collusive practices, and a relationship of cause and effect between the two, there must be a presumption, subject to proof to the contrary, which it is for the economic operators concerned to adduce, that the undertakings participating in the concerted action and remaining active on the market take account of the information exchanged with their competitors when determining their conduct on that market. That is all the more true where the undertakings concert together on a regular basis over a long period.

(see paras 132-134, 136)

7. An infringement of Article 81(1) EC may result not only from an isolated act but also from a series of acts or from continuous conduct. That interpretation cannot be challenged on the ground that one or several elements of that series of acts or continuous conduct could also constitute in themselves and taken in isolation an infringement of that provision. When the different actions form part of an ‘overall plan’, because their identical object distorts competition within the common market, the Commission is entitled to impute responsibility for those actions on the basis of participation in the infringement considered as a whole.

(see para. 155)

8. As regards the calculation of the amount of fines imposed by the Commission for infringements of Community competition law, the essential procedural requirement to state reasons is satisfied where the Commission indicates in its decision the factors which enabled it to determine the gravity of the infringement and its duration. Furthermore, the scope of the obligation to state reasons must be determined in the light of the fact that the gravity of infringements must be determined by reference to numerous factors, no binding or exhaustive list of the criteria which must be applied having been drawn up. Nor does the obligation to state reasons require the Commission to set out in its decision the figures showing the method of calculating the fines, it being sufficient merely to indicate the factors which enabled it to determine the gravity of the infringement and its duration.

(see paras 193-194)

9. When determining the gravity of an infringement of the competition rules, account must be taken of, inter alia, the legislative background and economic context of the conduct to which exception is taken. In order to assess, as it is required to do each time it is possible, the actual impact of an infringement on the market, the Commission must refer to the competition which would normally have existed had it not been for the infringement. It follows that, in the case of price-fixing arrangements, the finding by the Commission that the agreements did in fact enable the undertakings concerned to achieve a higher level of transaction price than that which would have prevailed had there been no cartel allows the Commission to take into consideration, in determining the amount of the fine, the significance of the harmful effects of the infringement on the market and therefore to set the amount of the fine, in the light of the gravity of the infringement, at a higher level than it would have been set had it not been for such a finding. In that assessment, the Commission must take into account all objective conditions on the relevant market, having regard to the prevailing economic and, where necessary, legislative context. Account must be taken of the existence, where appropriate, of ‘objective economic factors’ showing that, in a context of ‘free play of competition’, the level of prices would not have evolved in an identical manner to the level of prices applied.

(see paras 216, 222-224)

10. The seriousness of an infringement of the competition rules may be established by reference to the nature and the object of the abusive conduct. Factors relating to the object of a course of conduct may be more significant for the purposes of setting the amount of the fine than those relating to its effects. The effect of an anti‑competitive practice is not a conclusive criterion for assessing the proper amount of a fine. Factors relating to the intentional aspect may be more significant than those relating to the effects, particularly where they relate to infringements which are intrinsically serious, such as price‑fixing and market‑sharing. Moreover, horizontal price agreements have always been regarded as among the most serious infringements under Community competition law.

(see paras 250-252)

11. In determining the amount of fines for infringements of competition law, the Commission must take into account not only the gravity of the infringement and the particular circumstances of the case but also the context in which the infringement was committed and must ensure that its action has the necessary deterrent effect, especially as regards those types of infringement which are particularly harmful to the attainment of the objectives of the Community.

In that regard, 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 provide, moreover, that, apart from the nature of the infringement, its impact on the market and the latter’s geographic size, it is necessary to take account of the effective economic capacity of offenders to cause significant damage to other operators, in particular consumers, and to set the fine at a level which ensures that it has a sufficiently deterrent effect (point 1.A, fourth paragraph). Account may also be taken of the fact that large undertakings are better able to recognise that their conduct constitutes an infringement and be aware of the consequences stemming from it (point 1.A, fifth paragraph).

As regards the first of those factors, the objective of deterrence which the Commission is entitled to pursue when setting the amount of a fine is intended to ensure compliance by undertakings with the competition rules laid down by the Treaty for the conduct of their activities within the Community or the European Economic Area. That objective can be properly achieved only if regard is had to the situation of the undertaking at the time when the fine is imposed. A distinction must be made between, on the one hand, the scale of the infringement on the market and the share of responsibility to be borne for it by each participant in the cartel (which is covered by point 1.A, fourth and sixth paragraphs, of the Guidelines) and, on the other, the deterrent effect which the imposition of the fine must have.

As regards the scale of the infringement on the market and the share of responsibility to be borne for it by each participant in the cartel, the proportion of the turnover accounted for by the goods in respect of which the infringement was committed gives a proper indication of the scale of the infringement on the relevant market. The turnover in the products which were the subject of a restrictive practice constitutes an objective criterion giving a proper measure of the harm which that practice does to normal competition.

However, the need to ensure that the fine has a sufficient deterrent effect, where it is not found to justify raising the general level of fines in the context of the implementation of a competition policy, requires that the amount of the fine be adjusted in order to take account of the desired impact on the undertaking on which it is imposed, so that the fine is not rendered negligible, or on the contrary excessive, in particular in the light of the financial capacity of the undertaking in question, in accordance with the requirements arising from, on the one hand, the need to ensure effectiveness of the fine and, on the other, compliance with the principle of proportionality. However, inter alia as a result of transactions bringing about transfers or concentrations, an undertaking’s overall resources may vary, decreasing or increasing significantly within a relatively short space of time, in particular between the end of the infringement and the adoption of the decision imposing the fine.

It follows that those resources must be valued, so as properly to achieve the objective of deterrence, in accordance with the principle of proportionality, at the time when the fine is imposed. In that regard, for the same reasons, under Article 15(2) of Regulation No 17, the upper limit of the fine set at 10% of the turnover of the undertaking concerned is to be determined according to the overall world turnover in the business year preceding the decision. Similarly, in determining any increase in the fine intended to ensure that it has a deterrent effect, it is important to take into account the undertaking’s financial capacity and actual resources at the time when the fine is imposed on it, and not the inherently notional pro forma valuation entered in its balance sheet, which results from the application of accounting rules imposed on itself by the undertaking concerned.

As regards the second factor, namely the legal and economic infrastructures available to the undertakings to enable them to recognise that their conduct constitutes an infringement, it is intended to punish large undertakings more severely since they are presumed to have sufficient knowledge and structural resources to be aware that their conduct constitutes an infringement and to assess the potential benefits of it. For that purpose, the turnover on the basis of which the Commission determines the size of the undertakings in question, and therefore their capacity to determine the character and consequences of their conduct, must relate to their situation at the time of the infringement.

(see paras 95-96, 272-274, 278-280, 283, 285, 289-290, 302)

12. The approach of dividing the cartel members into several categories, which has the consequence that a flat-rate starting amount is fixed for all the undertakings in the same category, although it effectively ignores the differences in size between undertakings in the same category, cannot in principle be condemned. The Commission is not required, when determining the amounts of fines, to ensure, where fines are imposed on a number of undertakings involved in the same infringement, that the final amounts of the fines reflect any distinction between the undertakings concerned in terms of their overall turnover.

The fact nevertheless remains that such a division into categories must comply with the principle of equal treatment under which comparable situations must not be treated differently and different situations must not be treated in the same way, unless such treatment is objectively justified. From the same perspective, 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 provide, in the sixth paragraph of point 1.A, that ‘considerable’ disparity between the sizes of the undertakings committing infringements of the same type is, inter alia, such as to justify a differentiation for the purposes of assessing the gravity of the infringement. Moreover, the amounts of fines must at least be proportionate in relation to the factors taken into account in assessing the gravity of the infringement. Consequently, where the Commission divides the undertakings concerned into categories for the purpose of setting the amount of the fines, the thresholds for each of the categories thus identified must be coherent and objectively justified.

Having regard to the objective which it pursues, namely adjustment of the amount of the fine having regard to the overall resources of the undertaking and its capacity to mobilise the funds necessary for the payment of that fine, the setting of the rate of increase of the basic amount in order to ensure that the fine has a sufficiently deterrent effect is intended more to ensure the effectiveness of the fine than to reflect the harmfulness of the infringement to normal competition and thus the gravity of the infringement. It follows that the requirement relating to the objectively justified nature of the method consisting in classifying the undertakings by category must be interpreted more strictly where that classification is made, not for the purpose of determining the amount of the fine according to the gravity of the infringement, but for that of determining the increase in the basic amount with a view to ensuring that the fine imposed has a sufficient deterrent effect.

In the context of determining the amount of the fine according to the gravity of the infringement, even if the effect of the division into groups is that certain applicants are allocated the same basic amount even though they differ in size, that difference in treatment is objectively justified by the importance attached to the nature of the infringement in comparison with the size of the undertakings in the assessment of the gravity of the infringement. However, that justification is not intended to apply to the determination of the rate of increase of the fine with a view to ensuring that it has a sufficient deterrent effect, given that that increase is essentially and objectively based on the size and resources of the undertakings, and not on the nature of the infringement.

(see paras 323-325, 328-331)

13. In determining the amount of a fine for breach of the competition rules, whilst it is important that the applicant took steps to prevent fresh infringements of Community competition law from being committed by members of its staff in the future, that circumstance does not alter the fact that an infringement was found to have been committed. It follows that the mere fact that in certain cases the Commission took the implementation of a compliance programme into consideration as a mitigating factor does not mean that it is obliged to act in the same manner in any given case. The Commission is therefore not required to take a circumstance such as that into account as a mitigating factor, provided that it adheres to the principle of equal treatment, which requires that it should not assess the matter differently for any undertaking addressed by the same decision.

In addition, mere adoption by an undertaking of a programme of compliance with the competition rules cannot constitute a valid and definite guarantee of future and continuing compliance by that undertaking with those rules, with the result that such a programme cannot require the Commission to reduce the fine on the ground that the objective of prevention pursued by it has already been at least partly achieved.

(see paras 350-351, 361)

14. Whilst the prohibition of general preventive grounds applies to the particular situation of measures derogating from the principle of freedom of movement for citizens of the Union enshrined in Article 18(1) EC and adopted by Member States on grounds of public policy, it is far from constituting a general principle, and therefore clearly cannot purely and simply be transposed to the context of fines imposed by the Commission on undertakings for infringements of Community competition law. On the contrary, it is open to the Commission to have regard to the fact that anti‑competitive practices, although they were established as being unlawful at the outset of Community competition policy, are still relatively frequent on account of the profit that certain of the undertakings concerned are able to derive from them and, consequently, it is open to the Commission to consider that it is appropriate to raise the level of fines so as to reinforce their deterrent effect, which reflects, at least in part, the need to confer on fines a deterrent character in relation to undertakings other than those on which the fines are imposed.

(see paras 359-360)

15. The reduction of fines where there is cooperation on the part of the undertakings participating in infringements of Community competition law is based on the consideration that such cooperation facilitates the Commission’s task.

However, an undertaking which simply refrains, during the administrative procedure, from expressing any view on the Commission’s factual allegations, and thus from acknowledging the correctness of those allegations, does not in fact further the Commission’s task. Similarly, it is not sufficient for an undertaking to state in general terms that it does not contest the facts alleged, in accordance with the Leniency Notice, if, in the circumstances of the case, that statement is not of any help to the Commission at all. Finally, a reduction under the Leniency Notice can be justified only where the information provided and, more generally, the conduct of the undertaking concerned might be considered to demonstrate genuine cooperation on its part. It is clear from the very concept of cooperation, as described in the Leniency Notice, and in particular in the introduction to and Section D(1) of that notice, that it is only where the conduct of the undertaking concerned reveals such a spirit of cooperation that a reduction may be granted on the basis of that notice.

(see paras 380-383)

16. Concerning the change in the Commission’s general competition policy in the matter of fines, resulting, inter alia, from 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, it is necessary, in order to ensure that the principle of non-retroactivity is observed, to examine whether that change was reasonably foreseeable at the time when the infringements concerned were committed.

In that regard, the principal innovation under the Guidelines consists in taking as a starting point for the calculation of the basic amount of the fine, determined on the basis of ranges provided for in that regard, those ranges reflecting the different degrees of gravity of the infringements, but which, as such, bear no relation to the relevant turnover. That method is thus based essentially on a standard scale of fines, albeit a relative and flexible one. It is therefore important to consider whether that new method of calculating fines, even if it had an aggravating effect on the level of the fines imposed, was reasonably foreseeable at the time when the infringements concerned were committed. The fact that the Commission has, in the past, imposed fines of a certain level for certain types of infringement does not mean that it is estopped from raising that level within the limits indicated in Regulation No 17 if that is necessary to ensure the implementation of Community competition policy, but that, on the contrary, the proper application of the Community competition rules requires that the Commission may at any time adjust the level of fines to the needs of that policy.

It follows that the undertakings involved in an administrative procedure which may give rise to a fine cannot acquire a legitimate expectation that the Commission will not exceed the level of fines imposed previously or that a particular method will be used to calculate such fines. Consequently, those undertakings must take account of the possibility that the Commission may, at any time, decide, in compliance with the rules governing its action, to raise the level of the amount of the fines compared with that applied in the past. That is true not only when the Commission raises the level of the amounts of fines which it imposes in individual decisions, but also when it raises them by the application, to particular cases, of rules of conduct having general application, such as the Guidelines. It is moreover clear from the case‑law of the European Court of Human Rights that a law may still satisfy the requirement of foreseeability even if the person concerned has to take appropriate legal advice to assess, to a degree that is reasonable in the circumstances, the consequences which a given action may entail. This is particularly true in relation to persons carrying on a professional activity, who are used to having to proceed with a high degree of caution when pursuing their occupation. They can therefore be expected to take special care in assessing the risks that such activity entails.

It must be concluded that the Guidelines and, in particular, the new method of calculating fines which they contain, even if it had an aggravating effect on the level of the fines imposed, were reasonably foreseeable for undertakings at the time when the infringement concerned was committed.

(see paras 388-396)

17. Article 287 EC requires the members, officials and other servants of the institutions of the Community ‘not to disclose information of the kind covered by the obligation of professional secrecy, in particular information about undertakings, their business relations or their cost components’. Although that provision refers primarily to information gathered from undertakings, the adverbial phrase ‘in particular’ shows that the principle in question is a general one which applies equally to other confidential information. In inter partes procedures which are liable to result in the imposition of a penalty, the nature and amount of the penalty proposed are by their very nature covered by business secrecy until the penalty has been finally approved and announced. That principle follows, in particular, from the need to have due regard for the reputation and standing of the person concerned during a period in which no penalty has been imposed on that person.

Consequently, the Commission’s duty not to disclose to the press information on the specific penalty envisaged is coterminous not only with its obligation to respect professional secrecy, but also with its duty of good administration. Finally, the principle of the presumption of innocence applies 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. That presumption is clearly not respected by the Commission where, prior to formally imposing a penalty on the undertaking charged, it informs the press of the proposed finding which has been submitted to the Advisory Committee and the college of Commissioners for deliberation.

However, the reality of an infringement which has actually been proved at the end of an administrative procedure cannot be called into question by evidence of the Commission’s premature display of its belief as to the existence of that infringement and of the amount of the fine which it therefore envisages imposing on an undertaking. Nor can it be claimed that disclosure by the Commission of the content of a decision at the end of the administrative procedure and just prior to its formal adoption is, on its own, sufficient to show that the Commission pre‑judged the case or lacked objectivity in its investigation.

Moreover, whilst an irregularity of that kind may lead to annulment of the decision in question, that is conditional upon it being established that the content of that decision would have been different if that irregularity had not occurred.

That latter condition cannot be regarded as an infringement of the right to effective judicial protection of the rights which individuals derive from the Community legal order, which is one of the general principles of law stemming from the constitutional traditions common to the Member States and has also been enshrined in Articles 6 and 13 of the European Convention on Human Rights. That principle must be reconciled with the principle of legal certainty and the presumption that acts of the Community institutions are lawful.

(see paras 409-411, 414-416, 421-423)

JUDGMENT OF THE COURT OF FIRST INSTANCE (Third Chamber)

5 April 2006 ( )

(Competition – Article 81 EC – Cartels – Methionine market – Single continuous nature of the infringement – Fine – Guidelines on the method of setting fines – Gravity and duration of the infringement – Cooperation during the administrative procedure – Article 15(2) of Regulation No 17 – Presumption of innocence)

In Case T-279/02,

Degussa AG, established in Düsseldorf (Germany), represented by R. Bechtold, M. Karl and C. Steinle, lawyers,

applicant,

v

Commission of the European Communities, represented by A. Bouquet and W. Mölls, acting as Agents, and H.‑J. Freund, lawyer, with an address for service in Luxembourg,

defendant,

supported by

Council of the European Union, represented by E. Karlsson and S. Marquardt, acting as Agents,

intervener,

APPLICATION, as the primary claim, for annulment of Commission Decision 2003/674/EC of 2 July 2002 relating to a proceeding pursuant to Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case C.37.519 – Methionine) (OJ 2003 L 255, p. 1), and, in the alternative, for reduction of the fine imposed on the applicant by that decision,

THE COURT OF FIRST INSTANCE

OF THE EUROPEAN COMMUNITIES (Third Chamber),

composed of M. Jaeger, President, V. Tiili and O. Czúcz, Judges,

Registrar: K. Andová, Administrator,

having regard to the written procedure and further to the hearing on 27 April 2005,

gives the following

Judgment

Facts

1 Degussa AG (Düsseldorf) is a German company formed in 2000 by the merger of SKW Trostberg and Degussa-Hüls, the latter having itself been formed by the merger in 1998 of the German chemical companies Degussa AG (Frankfurt am Main) and Hüls AG (Marl) (‘Degussa’ or ‘the applicant’). It operates inter alia in the animal feed sector and is the only undertaking producing all three most important essential amino acids: methionine, lysine and threonine.

2 Essential amino acids are amino acids which cannot be produced naturally by the body and must, therefore, be added to feeds. The first amino acid which, by its absence, interrupts protein synthesis of the other amino acids is called the ‘first limiting amino acid’. Methionine is an essential amino acid added to compound feeds and premixes for all animal species. Its main use is in poultry feed (for which it is the first limiting amino acid) and, increasingly, in pig feed and speciality animal feeds.

3 Methionine comes in two principal forms: DL-Methionine (‘DLM’) and methionine hydroxy analogue (‘MHA’). DLM is produced in crystallised form with virtually 100% active content. MHA, which was introduced in the 1980s by Monsanto, the predecessor of Novus International Inc., has a nominal 88% active content. In 2002, it accounted for approximately 50% of world methionine consumption.

4 At the material time, the world’s three leading producers of methionine were Rhône-Poulenc (now Aventis SA), whose subsidiary responsible for methionine production was Rhône-Poulenc Animal Nutrition (now Aventis Animal Nutrition SA), Degussa and Novus. Rhône-Poulenc produced methionine in both its forms whereas Degussa produced only DLM and Novus only MHA.

5 On 26 May 1999, Rhône-Poulenc submitted to the Commission a statement admitting its participation in a cartel to fix prices and allocate quotas for methionine and requesting application of the Commission notice on the non-imposition or reduction of fines in cartel cases (OJ 1996 C 207, p. 4; ‘the Leniency Notice’).

6 On 16 June 1999, Commission officials and officials of the Bundeskartellamt (German Federal Cartel Office) carried out an investigation under Article 14(3) of Regulation No 17 of the Council of 6 February 1962, First Regulation implementing Articles [81] and [82] of the Treaty (OJ, English Special Edition 1959-1962, p. 87), then in force, at the premises of Degussa-Hüls in Frankfurt am Main.

7 Following that investigation, on 27 July 1999, the Commission sent a request for information to Degussa-Hüls under Article 11 of Regulation No 17 regarding the documents obtained. Degussa-Hüls replied to the request on 9 September 1999.

8 The Commission also sent requests for information to Nippon Soda Co. Ltd (‘Nippon Soda’), Novus International Inc. (‘Novus’) and Sumitomo Chemical Co. Ltd (‘Sumitomo’) on 7 December 1999 and to Mitsui & Co. Ltd on 10 December 1999. The replies were received during February 2000 and Nippon Soda submitted a supplementary statement on 16 May 2000.

9 On 1 October 2001, the Commission adopted a statement of objections against five producers of methionine, including the applicant. The same statement of objections was sent to Aventis Animal Nutrition (‘AAN’), a wholly owned subsidiary of Aventis.

10 In its statement of objections, the Commission accused those companies of having participated from 1986 until, in the majority of cases, the beginning of 1999 in a continuous agreement contrary to Article 81 EC and Article 53 of the Agreement on the European Economic Area (‘the EEA Agreement’) covering the whole of the EEA. According to the Commission, the agreement in question involved the fixing of methionine prices, the implementation of a mechanism for implementing price increases, the allocation of national markets and market share quotas and a mechanism for monitoring and enforcing those agreements.

11 All the parties submitted written observations in response to the Commission’s statement of objections, although Aventis and AAN informed the Commission that they would submit only one response on behalf of both companies.

12 Replies were received by the Commission between 10 and 18 January 2002. Aventis, AAN (together ‘Aventis/AAN’) and Nippon Soda admitted the infringement and acknowledged the correctness of the facts as a whole. Degussa also admitted the infringement, but only in respect of the period from 1992 to 1997. On 25 January 2002, there was an oral hearing with the undertakings concerned.

13 At the end of the proceeding, considering that Aventis/AAN, Degussa and Nippon Soda had participated in a continuous agreement and/or concerted action covering the whole of the EEA, by which they agreed on price targets for the product, agreed on and implemented a mechanism for implementing price increases, exchanged information on sales volumes and market shares and monitored and enforced their agreements, the Commission adopted Decision 2003/674/EC of 2 July 2002 relating to a proceeding pursuant to Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case C.37.519 – Methionine) (OJ 2003 L 255, p. 1; ‘the Decision’).

14 In recitals 63 to 81 to the Decision, the Commission described the cartel as aimed at fixing price ranges and ‘rock-bottom prices’. The participants agreed that they needed to increase their prices and discussed what the market would accept. The price increases were then organised in several successive ‘campaigns’, the implementation of which was reviewed during subsequent cartel meetings. The participants also exchanged information on sales volumes and production capacity and exchanged their respective estimates of the total volume of the market.

15 As regards the implementation of target prices, the Commission found that sales were monitored by the participants, the figures exchanged being compiled and discussed at regular meetings, although no volume control scheme supported by a compensation scheme existed, despite the fact that Degussa had made a proposal to that effect. Regular multilateral (more than 25 between 1986 and 1999) and bilateral meetings were an essential element of the organisation of the cartel. They took the form of ‘summit’ meetings and more technical meetings at staff level.

16 Finally, the operation of the cartel went through three distinct periods. The first, during which prices were on an upward trend, extended from February 1986 to 1989 and ended with Sumitomo’s withdrawal from the arrangement and the entry into the market of Monsanto and MHA. During the second period, extending from 1989 to 1991, prices began to fall dramatically. The cartel members were then in doubt about how to react to this new situation (regain market shares or focus on prices?) and concluded, after holding several meetings in 1989 and 1990, that they needed to focus their efforts on increasing prices. During the third and last period, extending from 1991 to February 1999, the dramatic increase in sales of the MHA produced by Monsanto (Novus since 1991) led the participants in the arrangement to focus primarily on sustaining price levels.

17 The Decision includes inter alia the following provisions:

‘Article 1

Aventis … and [AAN], jointly liable, Degussa … and Nippon Soda … have infringed Article 81(1) of the Treaty and Article 53(1) of the EEA Agreement by participating, in the manner and to the extent set out in the reasoning, in a complex of agreements and concerted practices in the sector of methionine.

The duration of the infringement was as follows:

– from February 1986 until February 1999.

…

Article 3

The following fines are hereby imposed on the undertakings name[d] in Article 1 in respect of the infringement found [t]herein:

– Degussa …, a fine of EUR 118 125 000,

– Nippon Soda …, a fine of EUR 9 000 000

…’

18 For the purpose of calculating the fine, the Commission, without expressly referring to them, essentially applied the methodology 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 the Leniency Notice.

19 In setting the basic amount of the fine, the Commission took into consideration, firstly, the gravity of the infringement. It found that, taking into account the nature of the behaviour under scrutiny, its impact on the methionine market and the size of the relevant geographic market, the undertakings concerned by the Decision had committed a very serious infringement of Article 81(1) EC and Article 53(1) of the EEA Agreement (recitals 270 to 293).

20 Taking the view, moreover, that it was appropriate to apply differential treatment which took account of the effective economic capacity of the undertakings to cause significant damage to competition and to set the fine at a level which ensured that it had sufficient deterrent effect, the Commission considered that, in view of the considerable disparity in the size of the undertakings, it was necessary to take as a basis their respective shares of the world market for methionine and that accordingly Rhône-Poulenc and Degussa constituted a first category of undertakings and Nippon Soda a second category on its own. Consequently, the Commission set the basic amounts of the fines for Aventis/AAN and Degussa at EUR 35 million and the basic amount of the fine for Nippon Soda at EUR 8 million (recitals 294 to 302).

21 In order to ensure sufficient deterrent effect and to take account of the fact that large undertakings have legal and economic knowledge and infrastructures which enable them more easily to recognise that their conduct constitutes an infringement and be aware of the consequences stemming from it under competition law, the Commission took the view, finally, that the appropriate starting point for a fine, resulting from the criterion of the relative importance of the undertaking in the market concerned, required upward adjustment to take account of the size and overall resources of Aventis/AAN and Degussa respectively. The Commission therefore decided that the starting point for the fines imposed on Aventis/AAN and Degussa should be increased by 100% to EUR 70 million (recitals 303 to 305).

22 As regards, secondly, the duration of the infringement, the Commission considered that Aventis/AAN, Degussa and Nippon Soda had participated in the infringement continuously from February 1986 until February 1999, that is, for 12 years and 10 months. The basic amount of the fine was therefore set at EUR 157.5 million in the case of Aventis/AAN and Degussa, and at EUR 18 million in the case of Nippon Soda (recitals 306 to 312).

23 Thirdly, the Commission considered that no aggravating or attenuating circumstances were to be taken into account with regard to the undertakings which had participated in the infringement (recitals 313 to 331).

24 Fourthly and lastly, the Commission, by application of the Leniency Notice, reduced Aventis/AAN’s fine by 100% under Section B of that notice. By contrast, it considered that Nippon Soda and Degussa did not fulfil either the conditions for a very substantial reduction of the amount of the fine under Section B or those for a substantial reduction of the amount of the fine under Section C of the Leniency Notice. It nevertheless accepted that Nippon Soda fulfilled the conditions set out in the first and second indents of Section D(2) and that Degussa fulfilled the conditions set out in the first indent of Section D(2) of that notice and therefore reduced the amounts of the fines imposed on those undertakings by 50% and 25% respectively (recitals 332 to 355).

Procedure and forms of order sought by the parties

25 By application lodged at the Registry of the Court of First Instance on 16 September 2002, the applicant brought the present action.

26 On 13 December 2002, the Council applied for leave to intervene. By order of 13 February 2003, the President of the Fourth Chamber of the Court of First Instance granted the Council leave to intervene in support of the forms of order sought by the Commission.

27 By decision of the Court of First Instance, the Judge-Rapporteur was attached to the Third Chamber, to which this case was therefore assigned.

28 By way of measures of organisation of procedure provided for in Article 64 of its Rules of Procedure, the Court of First Instance asked the parties to reply to certain questions and to produce certain documents. The parties complied with those requests.

29 Following the report of the Judge-Rapporteur, the Court of First Instance (Third Chamber) decided to open the oral procedure. The parties presented oral argument and replied to oral questions put by the Court at the hearing on 27 April 2005.

30 The applicant claims that the Court should:

– annul the Decision;

– in the alternative, reduce the amount of the fine imposed on it;

– order the Commission to pay the costs.

31 The Commission contends that the Court should:

– dismiss the application;

– order the applicant to pay the costs.

32 The Council contends that the Court should:

– dismiss the application;

– make an appropriate order as to costs.

Law

33 The applicant puts forward essentially four pleas in support of its action. The first plea, in which the applicant raises an objection of illegality against Article 15(2) of Regulation No 17, alleges breach of the principle that penalties must have a proper legal basis. The second plea alleges error of assessment as to the single, continuous nature and as to the duration of the infringement in which the applicant participated. The third plea alleges errors of assessment, errors of law, errors as to the facts and breach of the principles of proportionality, non-retroactivity and equal treatment, and of the obligation to state reasons in setting the amount of the fine. Finally, the fourth plea alleges breach of the principles of ‘respect for professional secrecy’, sound administration and the presumption of innocence.

I – The first plea, alleging breach of the principle that penalties must have a proper legal basis

A – The objection of illegality raised against Article 15(2) of Regulation No 17

1. Arguments of the parties

34 The applicant raises an objection of illegality as provided for in Article 241 EC and submits that Article 15(2) of Regulation No 17, the provision which authorises the Commission to impose fines for infringements of Community competition law, infringes the principle that penalties must have a proper legal basis, as a corollary of the principle of legal certainty, a general principle of Community law, since that provision does not sufficiently predetermine the Commission’s decision-making practice.

35 As a preliminary point, the applicant recalls that the principle that penalties must have a proper legal basis is enshrined in Article 7(1) of the European Convention for the Protection of Human Rights and Fundamental Freedoms (‘the ECHR’) which provides that ‘[no] heavier penalty [shall] be imposed than the one that was applicable at the time the criminal offence was committed’. It adds that that same principle (nulla poena sine lege) is also enshrined in Article 49(1) of the Charter of Fundamental Rights of the European Union proclaimed at Nice on 7 December 2000 (OJ C 364, p. 1) (‘the Charter’) and forms an integral part of the constitutional traditions of the Member States (see, for example, Article 103(2) of the German Basic Law). According to the interpretation of the European Court of Human Rights, both the principle of non-retroactivity and the principle that penalties must have a proper legal basis stem from that principle (see, inter alia, Eur. Court HR, S.W. v. the United Kingdom, judgment of 22 November 1995, Series A no. 335‑B, § 35, and Joined Cases C‑74/95 and C‑129/95 X [1996] ECR I‑6609, paragraph 25). According to the case-law of the Court of Justice, the principle that penalties must have a legal basis stems from the principle of legal certainty, which is recognised as a general principle of Community law (Joined Cases 212/80 to 217/80 Salumi and Others [1981] ECR 2735, paragraph 10, and Case 70/83 Kloppenburg [1984] ECR 1075, paragraph 11) and requires inter alia that Community legislation be clear and foreseeable by individuals, and that certainty and foreseeability are requirements which must be observed all the more strictly in the case of rules liable to entail financial consequences in order that those concerned may know precisely the extent of the obligations which it imposes on them (see Case C‑30/89 Commission v France [1990] ECR I‑691, paragraph 23, and the case-law cited).

36 With regard to the criteria for determining whether a ‘law’ within the meaning of Article 7(1) of the ECHR is sufficiently certain and foreseeable, the applicant recalls that the European Court of Human Rights requires that it be accessible to the persons concerned and formulated with sufficient precision to enable them – if need be, with appropriate advice – to foresee, to a degree that is reasonable in the circumstances, the consequences which a given action may entail. However, according to the European Court of Human Rights, a law which confers a discretion is not in itself inconsistent with this requirement, provided that the scope of the discretion and the manner of its exercise are indicated with sufficient clarity, having regard to the legitimate aim in question, to give the individual adequate protection against arbitrary interference (Eur. Court HR, Margareta and Roger Andersson v. Sweden, judgment of 25 February 1992, Series A no. 226-A, § 75, and Malone v. the United Kingdom, judgment of 2 August 1984, Series A no. 82, § 66).

37 The applicant submits that the principle that penalties must have a proper legal basis is intended to apply both to criminal penalties and to penalties which are not strictly criminal in character, and therefore also to Article 15(2) of Regulation No 17, regardless of the legal nature of the fines imposed by the Commission under that provision. The Court of Justice has held that ‘a penalty, even of a non-criminal nature, cannot be imposed unless it rests on a clear and unambiguous legal basis’ (Case 117/83 Könecke [1984] ECR 3291, paragraph 11, and Case 137/85 Maizena [1987] ECR 4587, paragraph 15). The statement in Article 15(4) of Regulation No 17, that Commission decisions imposing fines for infringements of Community competition law ‘shall not be of a criminal law nature’, is immaterial in this regard, since the designation of a legal act is not decisive in its assessment (Eur. Court HR, Engel and Others v. the Netherlands, judgment of 8 June 1976, Series A no. 22, § 81). On the contrary, it follows from the severity of the fines imposed and from their punitive and preventive function that they are essentially of a quasi-criminal, or even, in the broad sense, criminal law nature.

38 That interpretation is also consistent with that given by the European Court of Human Rights as regards the concept of a criminal charge (Eur. Court HR, Belilos v. Switzerland, judgment of 29 April 1988, Series A no. 132, §§ 62 and 68; Öztürk v. Germany, judgment of 21 February 1984, Series A no. 73, § 46 et seq.; and Engel and Others v. the Netherlands, cited in paragraph 37 above, § 80 et seq.), according to which even small fines imposed by way of administrative procedures are criminal in nature. The applicant takes the view a fortiori that that is also the case with the fines imposed by the Commission for infringements of Community law, given the size of the amounts involved.

39 The applicant recalls that, according to the Court of Justice, the requirement of clarity is ‘indeed imperative in a sector in which any uncertainty may well lead to … the application of particularly serious sanctions’ (Case 32/79 Commission v United Kingdom [1980] ECR 2403, paragraph 46), which is the case with fines imposed under Article 15(2) of Regulation No 17.

40 In addition, the applicant points out that the effect of the division of powers between the Council and the Commission provided for in Articles 83 EC and 85 EC is that only the Council is competent to lay down the appropriate regulations or directives to give effect to the principles set out in Articles 81 EC and 82 EC. The requirements arising from the principle that penalties must have a proper legal basis therefore imply that the Council is not entitled to delegate the power to impose fines to the Commission in the absence of a sufficiently well-defined system.

41 The applicant maintains that the Commission concurrently enjoys powers of investigation, indictment and judgment. Such powers, which are not in keeping with the constitutional traditions of the Member States, should be set within a framework of clear, unequivocal rules. The applicant thus submits that the Council regulation implementing Articles 81 EC and 82 EC should define precisely the content, objective and severity of penalties. In addition, the principle that penalties must have a proper legal basis requires that a ceiling be specified, which must not be excessively high so that the fine does not acquire a criminal law character. If the fine can be unlimited, it is not, in the final analysis, determined in advance by the Council, but imposed by the Commission as the executive authority.

42 The applicant submits that Article 15(2) of Regulation No 17 does not fulfil the requirements arising from the principle that the penalties described above should have a proper legal basis.

43 Firstly, it maintains that Regulation No 17 does not prescribe the cases in which an infringement of Articles 81 EC and 82 EC must be the subject of a fine, leaving the Commission discretion to decide on the appropriateness of a fine. It recalls in that regard the judgment in Joined Cases 32/78, 36/78 to 82/78 BMW Belgium and Others v Commission [1979] ECR 2435, paragraph 53, according to which the Commission has complete freedom in the exercise of the discretion which it enjoys in regard to whether or not to impose a fine.

44 Secondly, the applicant submits that Article 15(2) of Regulation No 17 does not contain any limit expressed as a figure. The applicant thus takes the view that that framework is incompatible with the principle that penalties must have a legal basis and that it constitutes a transfer to the Commission of a power belonging, under the Treaty, to the Council. The amount of the fine is not, in reality, determined in advance by the regulation but exclusively by the Commission, in a manner which is neither foreseeable nor ascertainable (see Commission v France, cited in paragraph 35 above, paragraph 23, and the case-law cited). The need to ensure that the fine has a deterrent effect cannot justify that absence of an absolute ceiling since that requirement must be reconciled with the higher-ranking fundamental principle of Community law that penalties must have a proper legal basis (Kloppenburg, cited in paragraph 35 above, paragraph 11, and Salumi and Others, cited in paragraph 35 above, paragraph 10).

45 Thirdly, the applicant draws attention to the absence of any criteria laid down by the legislature for setting the fine, apart from the gravity and duration of the infringement. In practice, those two criteria have no restrictive effect on the Commission’s discretion. On the one hand, the Commission is not bound by any binding or exhaustive list of the criteria which must be applied (order of the Court of Justice in Case C‑137/95 P SPO and Others v Commission [1996] ECR I‑1611, paragraph 54; Case C‑219/95 P Ferriere Nord v Commission [1997] ECR I‑4411, paragraph 33; and Case T‑9/99 HFBand Others v Commission [2002] ECR II‑1487, paragraph 443) and, on the other hand, the Commission takes account of numerous aggravating or attenuating factors which individuals cannot know in advance.

46 Moreover, the requirements arising from observance of the principle of equal treatment do not make it possible to compensate for that vagueness since, according to the case-law, the Commission is not required to ensure that the final amounts of fines reflect any distinction between the undertakings concerned in terms of their turnover (Case T‑23/99 LR AF 1998 v Commission [2002] ECR II‑1705, paragraph 278).

47 The applicant’s view is confirmed by a judgment of the Bundesverfassungsgericht (German Federal Constitutional Court), according to which a criminal provision laying down as the upper limit of the penalty the value of the convicted person’s assets must be annulled as contrary to the principle that penalties must have a proper legal basis (judgment of 20 March 2002, BvR 794/95, NJW 2002, p. 1779). Contrary to the Council’s assertions, Paragraph 81(2) of the German Gesetz gegen Wettbewerbsbeschränkungen (Law against Restrictions on Competition; ‘the GWB’) does not contain any provision analogous to Article 15(2) of Regulation No 17, since the legislature deliberately dispensed with such a framework.

48 Fourthly, the applicant states that the Commission’s decision-making practice illustrates the validity of its view. That practice is marked by substantial differences between the amounts of fines imposed and by a recent dramatic increase in those amounts. It thus notes inter alia that eight of the ten largest fines were imposed after 1998 and that a record fine of EUR 855.23 million, including EUR 462 million imposed on a single undertaking, was imposed in 2001 in the ‘Vitamins’ case (Commission Decision C (2001) 3695 final of 21 November 2001, Case COMP/E‑1/37.512). The latter amount is 15 times higher than the average fine imposed between 1994 and 2000 and the second-highest fine (Commission Decision C (2001) 4573 final, Case COMP/E-1/36.212 – Carbonless paper) for 2001 is still equivalent to six times that average value.

49 Fifthly, the applicant submits that the existing system cannot be justified by the necessary deterrent effect which fines must have on undertakings. On the one hand, the applicant acknowledges that, while the exact amount of the fine does not have to be determinable in advance, the objective of deterrence does not authorise the Council to refrain from ‘indicating clearly the limits of the power conferred on the Commission’. On the other hand, it points out that the absence of a minimum of foreseeability of the fine has, in reality, had the effect of deterring undertakings from cooperating with the Commission. If it were possible to estimate, even only approximately, the potential consequences of a course of conduct, that would, by contrast, be a much better way of ensuring the intended effect of deterrence, as is the case with national criminal laws.

50 Sixthly, the applicant maintains that the Guidelines cannot be regarded as compensating for the unlawfulness of Article 15(2) of Regulation No 17. On the one hand, those guidelines cannot, in its view, constitute a legal act as referred to in Article 249 EC and, on the other hand, only the Council is entitled to adopt provisions on this question, in accordance with Article 83 EC. It submits that the onus of complying with the principle that penalties must have a proper legal basis therefore rests with the Council. For the same reasons, the unlimited jurisdiction conferred on the Court of Justice by Article 17 of Regulation No 17 cannot compensate for the unlawfulness of Article 15(2) of that regulation. The applicant points out that, despite that jurisdiction, it is primarily the task of the Commission to set the amount of the fine and to establish the facts during the administrative procedure. Moreover, the applicant points out that the vagueness of Article 15(2) of Regulation No 17 and the absence of review criteria render meaningless the unlimited jurisdiction conferred on the Community Courts. Finally, the applicant notes that individuals cannot be expected as a matter of course to bring proceedings before the courts on the ground that the legal framework for the imposition of fines is not sufficiently well defined. It adds that compensation by the Community judicature for the errors of the legislature would go beyond the tasks of the judiciary and would therefore be open to challenge under Article 7(1) EC.

51 The Commission submits that the applicant’s argument is unfounded.

52 It points out that Article 15(2) of Regulation No 17 constitutes a clear and unambiguous legal basis enabling undertakings to foresee the possible consequences of their actions with sufficient precision.

53 In addition, it points out that the discretion which it has must be exercised in compliance with the criteria of gravity and duration of the infringement laid down by that article, with the general principles of Community law, in particular the principles of proportionality and equal treatment, and with the case-law of the Court of Justice and the Court of First Instance. The Commission thus maintains that it must comply with those principles whenever it makes use of its discretion (see, with regard to compliance with the principle of equal treatment, Case T‑15/99 Brugg Rohrsysteme v Commission [2002] ECR II‑1613, paragraph 149 et seq., and Case T‑224/00 Archer Daniels Midland and Archer Daniels Midland Ingredients v Commission [2003] ECR II‑2597, paragraphs 69, 207, 281 and 308, and the Opinion of Advocate General Ruiz Jarabo Colomer in 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, I-133, point 96 et seq.).

54 Contrary to the applicant’s claims, it cannot be inferred in that regard from the judgment in BMW Belgium and Others v Commission, cited in paragraph 43 above, that those controls do not extend to the decision whether or not to impose a fine. In that case, the fact that the Court of Justice acknowledged that the Commission was entitled to impose a fine on resellers even though it had not done so in earlier cases does not mean that the Commission’s power to impose or not to impose a fine is unlimited, since that power must be exercised on the basis of objective reasons corresponding to the purpose of the provision conferring the power in question on the Commission.

55 The applicant is not justified in relying on the fact that the Decision is a ‘surprise decision’, since the deterrent function of the fine requires that it cannot be calculated in advance by the undertakings and compared with expected profits. The Commission points out that, in any event, the applicant had no basis for a legitimate expectation that it would not face a fine higher than the highest fines imposed during the course of the infringement (LR AF 1998 v Commission, cited in paragraph 46 above, paragraph 241, and Archer Daniels Midland and Archer Daniels Midland Ingredients v Commission, cited in paragraph 53 above, paragraphs 63 and 64).

56 Moreover, the unlimited jurisdiction of the Court of First Instance and the adoption in January 1998 of the Guidelines, which were declared compatible with Article 15(2) of Regulation No 17, contradict the applicant’s position that the determination of the fine is arbitrary and non-transparent.

57 Nor can the Council be accused of having transferred powers to the Commission in breach of the Treaty since Article 15(2) of Regulation No 17, by virtue of the criteria, as interpreted by the Community Courts, which it mentions and of the requirement of compliance with the general principles of Community law, constitutes a legal basis which is sufficiently well defined in the light of the objective pursued by the imposition of fines. The complaint that the Guidelines cannot compensate for the lack of definiteness of that provision is therefore to no purpose. Moreover, the Guidelines have improved the legal certainty and transparency of the decision-making procedure.

58 Finally, with regard to the increase in the amounts of fines over the last few years, the Commission points out, firstly, that the increase in the turnovers of undertakings since the 1960s in itself justifies the freedom of action left to the Commission by the contested provision and, secondly, that, according to settled case-law (Joined Cases 100/80 to 103/80 Musique Diffusion française and Others v Commission [1983] ECR 1825, paragraphs 108 and 109; LR AF 1998 v Commission, cited in paragraph 46 above, paragraph 237; and Joined Cases T‑202/98, T‑204/98 and T‑207/98 Tate & Lyle and Others v Commission [2001] ECR II‑2035, paragraphs 144 and 145), the Commission must be able to raise the level of fines in order to strengthen their deterrent effect. However, that discretion is not unlimited, since the Court of Justice and the Court of First Instance are to examine whether the increases decided upon by the Commission are justified by the alleged interest (Case T‑334/94 Sarrió v Commission [1998] ECR II‑1439, paragraphs 323 to 335, and Case T‑16/99 Lögstör Rör v Commission [2002] ECR II‑1633, paragraph 251). Finally, it notes that, despite that increase in the level of fines, manifest and serious infringements of long duration remain relatively frequent.

59 The Council, intervening, contends that the objection of illegality against Article 15 of Regulation No 17 should be rejected as unfounded. The Council acknowledges that a fine, even if it is a non-criminal sanction, must have a clear and unambiguous legal basis. However, it considers that Article 15 of Regulation No 17 fulfils that requirement. It also points out that the principle nulla poena sine lege is intended to apply to criminal sanctions, which is not the case with fines imposed pursuant to Article 15(2) of Regulation No 17, in accordance with paragraph 4 of that article. The requirements deriving from that principle may therefore not be applied in this case (Maizena, cited in paragraph 37 above, paragraph 14; Eur. Court HR, Welch v. the United Kingdom, judgment of 9 February 1995, Series A no. 307).

60 In addition, the Council takes the view that the level of the sanction is sufficiently well defined in so far as Article 15(2) of Regulation No 17 provides for an upper limit to the fine, based on the turnover of the undertaking concerned. An absolute ceiling would not be appropriate since the Commission’s decisions relate to particular cases. The Commission’s discretion, far from being absolute, is in fact limited by the obligation to take into account the criteria of duration and gravity of the infringement laid down in that article. The Commission is also required to comply with the principles of proportionality and non-discrimination.

61 The Council is of the opinion that it would be difficult to lay down a more restrictive framework making it possible to take account of the circumstances specific to the context of each infringement and to ensure a sufficient deterrent effect. Indeed, the Court has never cast doubt on the validity of Article 15(2) of Regulation No 17, but has rather confirmed it (Tate & Lyle and Others v Commission, cited in paragraph 58 above, paragraphs 98 to 101).

62 As regards the applicant’s complaint that the Commission’s practice is characterised by very substantial differences in the amounts of fines imposed and by a recent dramatic increase, the Council points out that those findings merely reflect the fact that the undertakings in question have different turnovers and that the size of the undertakings concerned is increasing.

63 It is also incorrect to claim that the Commission combines the functions of investigating authority, prosecutor and judge since it is subject to unlimited judicial review and therefore cannot be regarded as judge and party.

64 The same applies to the claim that the Council has delegated to the Commission its power to institute fines. The Council points out that the delegated authority enjoyed by the Commission concerns only the power to take decisions on the basis of Article 15(2) of Regulation No 17, which constitutes the expression of the Council’s power. That is consistent with the third indent of Article 202 EC.

65 Finally, the Council observes that, contrary to the applicant’s claims, comparable rules do exist at Member State level, in particular in Sweden and in Germany.

2. Findings of the Court

66 It should be remembered that it is clear from the case-law of the Court of Justice that the principle that penalties must have a proper legal basis is a corollary of the principle of legal certainty, which constitutes a general principle of Community law and requires, inter alia, that any Community legislation, in particular when it imposes or permits the imposition of sanctions, must be clear and precise so that the persons concerned may know without ambiguity what rights and obligations flow from it and may take steps accordingly (see, to that effect, Case 169/80 Gondrand Frères and Garancini [1981] ECR 1931, paragraph 17; Maizena, cited in paragraph 37 above, paragraph 15; Case C‑143/93 van Es Douane Agenten [1996] ECR I‑431, paragraph 27; and X, cited in paragraph 35 above, paragraph 25).

67 That principle, which forms part of the constitutional traditions common to the Member States and which has been enshrined in various international treaties, in particular in Article 7 of the ECHR, must be observed in regard both to provisions of a criminal nature and to specific administrative instruments imposing or permitting the imposition of administrative sanctions (see Maizena, cited in paragraph 37 above, paragraphs 14 and 15, and the case-law cited). It applies not only to the provisions which establish the ingredients of an offence, but also to those which define the consequences which flow from a contravention of the former (see, to that effect, X, cited in paragraph 35 above, paragraphs 22 and 25).

68 In that regard, it must be observed that, in the words of Article 7(1) of the ECHR:

‘No one shall be held guilty of any criminal offence on account of any act or omission which did not constitute a criminal offence under national or international law at the time when it was committed. Nor shall a heavier penalty be imposed than the one that was applicable at the time the criminal offence was committed.’

69 According to the European Court of Human Rights, it follows from that provision that offences and the relevant penalties must be clearly defined by law. That requirement is satisfied where the individual can know from the wording of the relevant provision and, if need be, with the assistance of the courts’ interpretation of it, what acts and omissions will make him criminally liable (Eur. Court HR, Coëme and Others v. Belgium, judgment of 22 June 2000, Reports of Judgments and Decisions 2000‑VII, § 145).

70 The Council maintains that the Court of First Instance must not be guided by Article 7(1) of the ECHR and the case-law of the European Court of Human Rights relating to that article in analysing the legality of Article 15(2) of Regulation No 17 since Article 15(4) of Regulation No 17 provides that decisions taken by the Commission pursuant, inter alia, to paragraph 2 of that provision are not of a criminal law nature.

71 Without there being any need to rule on the question whether, by reason inter alia of the nature and severity of the fines imposed by the Commission pursuant to Article 15(2) of Regulation No 17, Article 7(1) of the ECHR has authority to apply to such sanctions, it must be stated that, even if Article 7(1) of the ECHR were to be regarded as applicable to such sanctions, it is clear from the case-law of the European Court of Human Rights that, in order to satisfy the requirements of that provision, it is not necessary for the wording of the provisions pursuant to which those sanctions are imposed to be so precise that the consequences which may flow from an infringement of those provisions are foreseeable with absolute certainty.

72 According to the case-law of the European Court of Human Rights, the existence of vague terms in the provision does not necessarily entail an infringement of Article 7 of the ECHR and the fact that a law confers a discretion is not in itself inconsistent with the requirement of foreseeability, provided that the scope of the discretion and the manner of its exercise are indicated with sufficient clarity, having regard to the legitimate aim in question, to give the individual adequate protection against arbitrary interference (Eur. Court HR, Margareta and Roger Andersson v. Sweden, cited in paragraph 36 above, § 75). In that connection, apart from the text of the law itself, the European Court of Human Rights takes account of whether the indeterminate notions used have been defined by consistent and published case-law (Eur. Court HR, G. v. France, judgment of 27 September 1995, Series A no. 325-B, § 25).

73 Moreover, taking into account the constitutional traditions common to the Member States does not mean giving a different interpretation to the general principle of Community law that penalties must have a proper legal basis. With regard to the applicant’s arguments based on the judgment of the Bundesverfassungsgericht of 20 March 2002 (see paragraph 47 above), even if it should prove relevant in the context of fines imposed on undertakings for infringements of the competition rules, and on Paragraph 81(2) of the GWB, which apparently does not contain any provision similar to Article 15(2) of Regulation No 17, it must be pointed out that a constitutional tradition common to the Member States cannot be inferred from the legal situation in only one Member State. In that regard, it should be noted, on the contrary, as observed by the Council, which is not contradicted on this point by the applicant, that the relevant legislation of other Member States includes, for the issue of administrative sanctions such as those imposed for the infringement of national competition rules, upper limits comparable to that specified in Article 15(2) of Regulation No 17, and even criteria similar or identical to those laid down by that Community provision, the Council citing in that regard the example of the Kingdom of Sweden.

74 As regards the validity of Article 15(2) of Regulation No 17 in the light of the principle that penalties must have a proper legal basis, as that principle has been recognised by the Community judicature in accordance with the guidance provided by the ECHR and the constitutional traditions of the Member States, it must be stated that, contrary to what the applicant maintains, the Commission does not have unlimited discretion in setting fines for infringements of the competition rules.

75 Article 15(2) of Regulation No 17 itself limits the Commission’s discretion. Firstly, by specifying that ‘the Commission may by decision impose on undertakings or associations of undertakings fines of from [EUR] 1 000 to 1 000 000 …, or a sum in excess thereof but not exceeding 10% of the turnover in the preceding business year of each of the undertakings participating in the infringement’, it provides for a ceiling on fines, based on the turnover of the undertakings concerned, that is to say, based on an objective criterion. Thus, although, as the applicant states, there is no absolute ceiling applicable to all infringements of the competition rules, the fine which may be imposed is nevertheless subject to a quantifiable and absolute ceiling calculated by reference to each undertaking in respect of each infringement, so that the maximum amount of the fine which may be imposed on a given undertaking is determinable in advance. Secondly, that provision requires the Commission to fix fines in each individual case having ‘regard … both to the gravity and to the duration of the infringement’.

76 While it is true that those two criteria leave the Commission wide discretion, the fact remains that they are criteria which have been adopted by other legislatures for similar provisions, allowing the Commission to adopt sanctions taking account of the degree of illegality of the conduct in question. It must therefore be held, at this stage, that Article 15(2) of Regulation No 17, while leaving the Commission a certain discretion, lays down the criteria and limits to which it is subject in the exercise of its power in regard to fines.

77 In addition, it must be pointed out that, in setting fines pursuant to Article 15(2) of Regulation No 17, the Commission is bound to comply with the general principles of law, in particular the principles of equal treatment and proportionality, as developed by the case-law of the Court of Justice and the Court of First Instance.

78 Contrary to the applicant’s claims, the limits on the Commission’s discretion described above also apply to the decision whether or not to impose a fine, in particular when the Commission applies the Leniency Notice, the validity of which is, moreover, not disputed. In that regard, the fact that the Court of Justice acknowledged, in the judgment cited by the applicant (BMW Belgium and Others v Commission, cited in paragraph 43 above, paragraph 53), that the fact that in similar previous cases the Commission did not consider that there was reason to impose fines on certain economic operators did not deprive it of such a power, expressly granted to it by Regulation No 17, where the conditions required for the exercise of that power were satisfied, cannot mean that the Commission has discretion not to impose a fine without being required to comply, first, with the self-limitation on the exercise of its discretion resulting from the Guidelines and the Leniency Notice and, above all, secondly, with the general principles of law, in particular the principles of equality and proportionality, as well as, generally, with the effectiveness of Articles 81 EC and 82 EC and the principle of free competition resulting from Article 4(1) EC.

79 It should also be added that, under Article 229 EC and Article 17 of Regulation No 17, the Court of Justice and the Court of First Instance have unlimited jurisdiction to review decisions whereby the Commission has fixed fines and may thus not only annul the decisions taken by the Commission but also cancel, reduce or increase the fines imposed. Thus, the Commission’s administrative practice is subject to unlimited review by the Community judicature. Contrary to the applicant’s assertions, that review does not lead the Community judicature to exceed the limits of its powers in breach of Article 7(1) EC, since, on the one hand, such a review is expressly prescribed by the aforementioned provisions, the validity of which is not disputed, and since, on the other hand, the Community judicature carries it out in accordance with the criteria referred to in Article 15(2) of Regulation No 17. Consequently, review by the Community judicature has in fact made it possible, through a consistent and published body of case-law, to define any indeterminate concepts contained in Article 15(2) of Regulation No 17.

80 Moreover, on the basis of the criteria used in Article 15(2) of Regulation No 17 and defined in the case-law of the Court of Justice and the Court of First Instance, the Commission itself has developed a well-known and accessible administrative practice. Although the Commission’s decision-making practice does not in itself serve as a legal framework for fines in competition matters (see Case T‑241/01 Scandinavian Airlines System v Commission [2005] ECR II‑2917, paragraph 87, and the case-law cited), the fact remains that, under the principle of equal treatment, the Commission must not treat comparable situations differently and must not treat different situations in the same way, unless such treatment is objectively justified (Case 106/83 Sermide [1984] ECR 4209, paragraph 28, and Case T‑311/94 BPB de Eendracht v Commission [1998] ECR II‑1129, paragraph 309).

81 Furthermore, it is settled case-law that the Commission may at any time adjust the level of fines if the proper application of the Community competition rules so requires (Musique Diffusion française and Others v Commission, cited in paragraph 58 above, paragraph 109, and LR AF 1998 v Commission, cited in paragraph 46 above, paragraphs 236 and 237), since such an alteration of an administrative practice may then be regarded as objectively justified by the objective of general prevention of infringements of the Community competition rules. The recent increase in the level of fines, alleged and criticised by the applicant, cannot therefore, in itself, be regarded as unlawful under the principle that penalties must have a proper legal basis, since it remains within the statutory limits laid down by Article 15(2) of Regulation No 17, as interpreted by the Community Courts.

82 Moreover, it should be borne in mind that, for the sake of transparency and in order to increase legal certainty on the part of the undertakings concerned, the Commission has published the Guidelines in which it sets out the method of calculation which it undertakes to apply in each individual case. In that regard, the Court of Justice has also held that, in adopting such rules of conduct and announcing by publishing them that they will henceforth apply to the cases to which they relate, the Commission imposes a limit on the exercise of its discretion and cannot depart from those rules under pain of being found, where appropriate, to be in breach of the general principles of law, such as equal treatment or the protection of legitimate expectations. In addition, although the Guidelines do not constitute the legal basis of the Decision, they determine, generally and abstractly, the method which the Commission has bound itself to use in assessing the fines imposed by the Decision and, consequently, ensure legal certainty on the part of the undertakings (Joined Cases C‑189/02 P, C‑202/02 P, C‑205/02 P to C‑208/02 P and C‑213/02 P Dansk Rørindustri and Others v Commission [2005] ECR I‑5425, paragraphs 211 and 213). It follows that, contrary to the applicant’s assertions, the adoption by the Commission of the Guidelines, in so far as it fell within the statutory limits laid down by Article 15(2) of Regulation No 17, cannot be regarded as marred by lack of competence and merely contributed to defining the limits of the exercise of the discretion which the Commission already had under that provision.

83 Consequently, in view of the various considerations set out above, 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. The fact that that trader can, in advance, know 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, since, due to the gravity of the infringements which the Commission is required to penalise, the objectives of punishment and deterrence justify preventing undertakings from being in a position to assess the benefits which they would derive from their participation in an infringement by taking account, in advance, of the amount of the fine which would be imposed on them on account of that unlawful conduct.

84 In that regard, even if undertakings are not able, in advance, to know precisely the level of fines that the Commission will adopt in each individual case, it should be noted that, under Article 253 EC, in the decision imposing a fine, the Commission is required, despite the generally known context of the decision, to provide a statement of reasons inter alia for the amount of the fine imposed and for the method chosen in that regard. That statement of reasons must show clearly and unequivocally the reasoning followed by the Commission so as to enable those concerned to know the grounds justifying the measure taken in order to assess whether it is appropriate to bring the matter before the Community judicature and, if necessary, to enable the latter to carry out its review.

85 Finally, with regard to the argument that, by establishing the framework of the fine in Article 15(2) of Regulation No 17, the Council, in breach of Articles 83 EC and 229 EC, in fact transferred to the Commission a power appertaining to it, it is without foundation.

86 Firstly, as observed above, although Article 15(2) of Regulation No 17 leaves the Commission a wide discretion, it limits its exercise by laying down objective criteria by which the Commission must abide. Secondly, it should be noted, as the Council pointed out at the hearing, that Regulation No 17 was adopted on the basis of Article 83(1) EC which provides that ‘[t]he appropriate regulations or directives to give effect to the principles set out in Articles 81 and 82 shall be laid down by the Council … on a proposal from the Commission and after consulting the European Parliament’. The purpose of those regulations or directives, as stated in Article 83(2)(a) and (d) EC respectively, is to ‘ensure compliance with the prohibitions laid down in Article 81(1) [EC] and in Article 82 [EC] by making provision for fines and periodic penalty payments’ and to ‘define the respective functions of the Commission and of the Court of Justice in applying the provisions laid down in this paragraph’. It should be noted, moreover, that, under the first indent of Article 211 EC, the Commission is to ‘ensure that the provisions of this Treaty and the measures taken by the institutions pursuant thereto are applied’ and that, under the third indent of that article, it is to have ‘its own power of decision’.

87 It follows that the power to impose fines for infringements of Articles 81 EC and 82 EC cannot be regarded as belonging originally to the Council which has transferred it or delegated its exercise to the Commission, as provided for in the third indent of Article 202 EC. Under the provisions of the Treaty cited above, that power is part of the Commission’s role of ensuring the application of Community law, that role having been defined, set within a framework and formalised, as regards the application of Articles 81 EC and 82 EC, by Regulation No 17. The power to impose fines, which that regulation confers on the Commission, therefore stems from the provisions of the Treaty itself and is intended to facilitate the effective application of the prohibitions laid down in those articles (see, to that effect, Tate & Lyle and Others v Commission, cited in paragraph 58 above, paragraph 133). The applicant’s argument must therefore be rejected.

88 It follows from all those considerations that the objection of illegality raised with regard to Article 15(2) of Regulation No 17 must be rejected as unfounded.

B – Interpretation of Article 15(2) of Regulation No 17 in the light of the principle that penalties must have a proper legal basis

89 If the Court does not declare Article 15(2) of Regulation No 17 invalid, the applicant maintains in the alternative that that provision should be implemented and interpreted strictly in the light of the principle that penalties must have a proper legal basis, along the lines of the Commission’s decision-making practice and of the case-law relating to Articles 81 EC and 82 EC. It sets out, in that connection, certain proposals intended to ensure that the fine is sufficiently foreseeable and claims that the Decision should be annulled.

90 The Commission and the Council take the view that those arguments are unfounded.

91 It is sufficient in that regard to observe, first of all, that the applicant’s arguments set out in the second part, put forward in the alternative, of the plea alleging breach of the principle that penalties must have a proper legal basis merely reiterate, in part, some of the arguments already expanded in the first part of that same plea, directing them against the Commission’s decision-making practice resulting from the application of the Guidelines and against the Decision, in so far as it illustrates that practice. Apart from the fact that the Commission’s decision-making practice cannot form the subject of any action for annulment, it should be pointed out, as has been stated previously, that Article 15(2) of Regulation No 17 does not fail to have regard to the principle that penalties must have a proper legal basis and that the Commission’s decision-making practice and the Guidelines have in fact helped, under the supervision of the Community Courts, to increase legal certainty on the part of undertakings. The Decision cannot therefore be regarded as unlawful on the sole ground that it constitutes an application of the Commission’s allegedly unlawful decision-making practice in regard to fines. Those claims must therefore be rejected.

92 In addition, in so far as the applicant raises, in this part of the plea, arguments relating to the alleged failure to state reasons for the Decision as regards, in particular, the determination of the basic amount, the actual impact of the infringement on the market and the increase made in the amount of the fine in order to ensure that it had sufficient deterrent effect, those arguments are essentially covered by the third plea, which deals specifically with the question of the statement of reasons for the Decision and in the context of which they must be examined.

93 Finally, the applicant’s remaining arguments consist of general and theoretical considerations regarding the decision-making practice which the Commission should pursue, new provisions which the Council should adopt and developments in case-law upon which the Court of First Instance should embark and, consequently, do not raise any legal grounds of challenge against the Decision and must therefore be disregarded.

94 Moreover, in the reply and at the hearing, the applicant added that the turnover to which the maximum limit of the fine fixed at 10% of the turnover in the business year preceding the adoption of the decision imposing the fine relates should be taken to be the turnover on the relevant market and not the total turnover.

95 To the extent that it can be inferred from that claim that the applicant seeks to challenge the Decision in that it imposed on it a fine exceeding the amount of 10% of its turnover on the methionine market in the business year preceding the adoption of the Decision, without there even being any need to consider whether that argument is admissible under Article 48(2) of the Rules of Procedure, and in particular whether there is a close connection between that argument and one of the pleas in the application, it is sufficient to point out that neither Regulation No 17, nor the case-law, nor the Guidelines provide that the amount of fines must be fixed directly by reference to the size of the market concerned, that factor being only one of several relevant considerations. Under Regulation No 17, as interpreted by the case-law, the amount of the fine imposed on an undertaking for an infringement of competition law must be proportional to the infringement, seen as a whole, having regard, in particular, to the gravity thereof (see, to that effect, Case T‑83/91 Tetra Pak v Commission [1994] ECR II‑755, paragraph 240, and, by analogy, Case T‑229/94 Deutsche Bahn v Commission [1997] ECR II‑1689, paragraph 127). As the Court of Justice stated in paragraph 120 of its judgment in Musique Diffusion française and Others v Commission, cited in paragraph 58 above, in assessing the gravity of an infringement regard must be had to a large number of factors the nature and importance of which vary according to the type of infringement in question and the particular circumstances of the case (Joined Cases T‑67/00, T‑68/00, T‑71/00 and T‑78/00 JFE Engineering v Commission [2004] ECR II‑2501, paragraph 532).

96 It must also be noted in that connection that, according to settled case-law, the only express reference to the turnover of the undertaking in question, namely the limit of 10% of the turnover relied on for the purpose of determining fines in Article 15(2) of Regulation No 17, relates to the overall worldwide turnover of the undertaking (see, to that effect, Musique Diffusion française and Others v Commission, cited in paragraph 58 above, paragraph 119) and not the turnover achieved by it on the market affected by the anti-competitive conduct penalised. It is clear from the same paragraph of that judgment that that limit is designed to ensure that the fines are not disproportionate to the size of the undertaking as a whole (JFE Engineering v Commission, cited in paragraph 95 above, paragraph 533).

97 It follows that the second part of the first plea must be rejected.

98 Consequently, the first plea must be rejected in its entirety.

II – The second plea, alleging an error of assessment regarding the single and continuous nature and the duration of the infringement

99 The applicant denies, principally, having participated in a single continuous infringement between February 1986 and February 1999. It admits its participation in an infringement between 1986 and 1988 and after 1992 but claims, firstly, that the anti-competitive practice was interrupted between 1988 and 1992, and, secondly, that it ended definitively in 1997. In the alternative, it submits that the Commission should, in any event, have taken into account the fact that the agreements were, at the very least, suspended from 1988 to 1992 and after 1997.

A – Interruption of the infringement between 1988 and 1992

1. Arguments of the parties

100 According to the applicant, following the withdrawal from the cartel of Sumitomo, the ‘summit’ meetings and the anti-competitive agreements were interrupted in 1988 and resumed only in 1992.

101 Firstly, it submits that, by stating in recital 212 to the Decision that, since the participants in the cartel had not expressed their intention to modify the agreements or to withdraw from them, it could not be regarded as established that the cartel had ceased between 1988 and 1992, and by accepting in recital 251 et seq. to the Decision that, since the participants in the cartel had never informed one another of their intention to terminate the agreements, it was necessary to infer from this that there had been no formation of a new cartel but only t