Keywords

Summary



Keywords

1. EU law — Principles — Fundamental rights — Compliance ensured by the EU judicature — Right of all persons to a fair hearing — Guaranteed by the European Convention on Human Rights — Guaranteed by the Charter of Fundamental Rights of the European Union — Administrative and judicial proceedings in competition matters — Applicability — Scope

(Arts 81 EC, 82 EC and 230 EC; Charter of Fundamental Rights of the European Union, Art. 47, second para.; Council Regulation No 1/2003, Art. 23(5))

2. EU law — Principles — Right to effective judicial protection — Guaranteed by the Charter of Fundamental Rights of the European Union — Judicial review of decisions adopted by the Commission in competition matters — Review of legality and unlimited jurisdiction, in law and in fact — Infringement — None

(Arts 81 EC, 82 EC and 230 EC; Charter of Fundamental Rights of the European Union, Art. 47, second para.; Council Regulation No 1/2003, Art. 31)

3. EU law — Principles — Fundamental rights — Presumption of innocence — Procedures in competition matters — Applicability — Scope — Implementation of penalties before they have become final — Lawfulness

(Art. 81(1) EC; Art. 6(2) TEU; Charter of Fundamental Rights of the European Union, Art. 48(1); Council Regulation No 1/2003, Art. 2; Commission Regulation No 773/2004)

4. Competition — Administrative procedure — Statement of objections — Necessary content — Observance of the rights of the defence — Indication of the criteria for calculating the fine envisaged — Premature indication — No obligation to indicate a possible change of policy concerning the level of the amount of fines

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 27)

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

(Arts 81 EC, 82 EC and 253 EC; Council Regulation No 1/2003, Art. 23(2))

6. Competition — EU rules — Infringements — Attribution — Parent company and subsidiaries — Economic unit — Criteria for assessment — Presumption that a parent company exerts a decisive influence over its wholly-owned subsidiaries — Rebuttable — Elements capable of rebutting that presumption — Subsidiary held by a holding company — Not sufficient to rebut the presumption

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2))

7. Competition — EU rules — Infringements — Attribution — Parent company and subsidiaries — Economic unit — Criteria for assessment — Presumption that a parent company exerts a decisive influence over its wholly-owned subsidiaries — Rebuttable — Account to be taken in compliance with the principles of the presumption of innocence, that penalties must be specific to the offender, of legal certainty and equality of arms

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2))

8. Competition — EU rules — Infringements — Attribution — Parent company and subsidiaries — Economic unit — Criteria for assessment — Presumption that a parent company exerts a decisive influence over its wholly-owned subsidiaries — Evidential obligations of the company seeking to rebut that presumption — Rebuttable

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2))

9. EU law — Principles — Non-retroactivity of penal provisions — Scope — Fines imposed for breach of the competition rules — Included — No infringement by reason of the application of guidelines for the calculation of fines in relation to an infringement prior to their introduction

(Arts 81 EC and 82 EC; Charter of Fundamental Rights of the European Union, Art. 49; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notices 98/C 9/03 and 2006/C 210/02)

10. Competition — Fines — Amount — Determination — Application of the Guidelines on the method of setting fines — No breach of the principle of non-retroactivity — No breach of the principle of the protection of legitimate expectations

(Arts 81 EC and 82 EC; Charter of Fundamental Rights of the European Union, Art. 49; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notices 98/C 9/03 and 2006/C 210/02)

11. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Aggravating circumstances — Repeated infringement — Similar infringements committed in succession by undertakings belonging to the same economic unit — Inclusion — Conditions — Burden of proof on the Commission

(Arts 81(1) EC and Art. 82 EC; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, point 28, first indent)

12. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Aggravating circumstances — Repeated infringement — Concept — Undertaking not having been penalised by a previous decision of the Commission or been the addressee of a statement of objections — Not included

(Art. 81(1) EC; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, point 28, first indent)

13. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Aggravating circumstances — Repeated infringement — Concept — No time limit — Discretion of the Commission — Principle of proportionality — Account to be taken of time having elapsed since the previous infringement

(Art. 81(1) EC; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, point 28, first indent)

14. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Determination of the fine proportionately to the assessment factors for the gravity of the infringement — Fine exceeding the amount of the benefit derived from the cartel — Irrelevant

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02)

15. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Discretion of the Commission — Assessment according to the nature of the infringement — Very serious infringements — No requirement to determine their impact and their geographical extent

(Art. 81(1) EC; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, points 21 and 23)

16. Competition — Fines — Amount — Determination — Criteria — Deterrent effect — General requirement having to guide the Commission throughout the calculation of fines — Specific stage for an overall assessment of all relevant circumstances not imperative

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, points 19 to 26)

17. Competition — Fines — Amount — Determination — Criteria — No obligation to take account of the financial situation of the undertaking concerned — No obligation to take account of an exceptional economic crisis

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 35)

18. Competition — Fines — Amount — Determination — Criteria — Reduction in the amount of the fine in return for cooperation of the undertaking concerned — Conditions — Introduction of an application for leniency — Discretion of the Commission — Account taken of the fact that the undertaking concerned did not challenge the facts — Limits

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23; Commission Notice 2002/C 45/03, points 20 to 25)

19. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Mitigating circumstances — Cooperation of the undertaking concerned outside the scope of the Leniency Notice — Criteria for assessment — Account taken of the fact that the undertaking concerned did not challenge the facts — Limits

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art 23(2) and (3); Commission Notice 2006/C 210/02, point 29)

20. Competition — Fines — Amount — Determination — Maximum amount — Calculation — Turnover to be taken into consideration — Cumulative turnover of all the companies forming an economic entity acting as an undertaking — Group of undertakings active in various economic sectors — Commission decision concerning only one of those sectors — Irrelevant

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2))

21. Competition — Fines — Amount — Exercise by the General Court of its unlimited jurisdiction — Increase of a fine for repeated infringement — Error of law as to the authors of the repeated infringement — Reduction of the increase

(Art. 81(1) EC; Council Regulation No 1/2003, Arts 23(2), and 31)

22. EU law — Principles — Fundamental rights — Right to fair legal process — Duty to act within a reasonable time — Administrative and court procedures in competition law matters — Applicability

(Arts 81 EC and 82 EC; Charter of Fundamental Rights of the European Union, Arts 41(1), and 47, second para.)

23. Judicial proceedings — Duration of the procedure before the General Court — Reasonable time — Dispute concerning the existence of an infringement of the competition rules — Reasonable period not complied with — Consequences — Actions for damages — Autonomy in relation to the action for annulment

(Arts 81 EC and 82 EC; Charter of Fundamental Rights of the European Union, Art. 47, second para.)

24. EU law — Principles — Fundamental rights — Compliance ensured by the EU judicature — Taking into consideration the European Convention on Human Rights — Right of all persons to a fair hearing — Formation of the General Court asked to rule on an unjustified delay caused by itself — Lack of impartiality — Inadmissibility of the plea

(Charter of Fundamental Rights of the European Union, Art. 47, second para.)

Summary

1. The right to a fair hearing, guaranteed in Article 6(1) of the European Convention on Human Rights (ECHR), is a general principle of EU law, now enshrined in the second paragraph of Article 47 of the Charter of Fundamental Rights of the European Union.

Furthermore, in EU competition law, the Commission is not a ‘tribunal’ within the meaning of Article 6 of the ECHR or within the meaning of the second paragraph of Article 47 of the Charter of Fundamental Rights. In addition, Article 23(5) of Regulation No 1/2003 expressly states that Commission decisions imposing fines for infringements of competition law are not to be of a criminal law nature.

However, given the nature of the infringements in question and the nature and degree of severity of the ensuing penalties, the right to a fair hearing applies in particular to the procedures relating to infringements of the competition rules applicable to undertakings that may result in the imposition of fines or periodic penalty payments.

Thus, the European Court of Human Rights has had occasion to state that compliance with Article 6(1) of the ECHR does not preclude a ‘penalty’ from being imposed by an administrative authority with the power to impose penalties in competition law matters, provided that the decision adopted by that authority is amenable to subsequent review by a judicial body exercising unlimited jurisdiction. Among the characteristics of a judicial body of that type is the power to vary in all respects, in fact and in law, the decision taken by the body below. Thus, review by the court or tribunal, in such cases, cannot be limited to verifying the ‘procedural’ legality of the decision for review, as it must be in a position to assess the proportionality of the choices of the competition authority and to verify its technical assessments.

Judicial review by this Court of decisions whereby the Commission imposes infringements in the event of infringement of EU competition law satisfies those requirements.

(see paras 76-80)

2. Judicial review by the General Court of decisions whereby the Commission imposes infringements in the event of infringement of EU competition law satisfies the requirement of effective judicial review for the purposes of Article 6 of the ECHR and Article 47 of the Charter of Fundamental Rights of the European Union.

First of all, that EU law confers on the Commission a supervisory role which includes the task of investigating infringements of Article 81(1) EC and Article 82 EC, while the Commission is required, in the context of that administrative procedure, to observe the procedural guarantees provided for by EU law. Furthermore, Regulation No 1/2003 empowers the Commission to impose, by decision, fines on undertakings and associations of undertakings which have infringed those provisions either intentionally or negligently.

In addition, the requirement for effective judicial review of any Commission decision that finds and punishes an infringement of the competition rules is a general principle of EU law which follows from the common constitutional traditions of the Member States. That principle is now enshrined in Art icle 47 of the Charter of Fundamental Rights of the European Union.

The judicial review of the decisions adopted by the Commission in order to penalise infringements of competition law that is provided for in the Treaties and supplemented by Regulation No 1/2003 is consistent with that principle.

In the first place, the General Court is an independent and impartial court, which was established in order particularly to improve the judicial protection of individual interests in respect of actions requiring close examination of complex facts.

In the second place, the review of legality, in the context of actions based on Article 230 EC, of a Commission decision finding an infringement of the competition rules and imposing a fine in that respect on the natural or legal person concerned must be regarded as effective judicial review of the measure in question. The pleas on which the natural or legal person concerned may rely in support of his application for annulment are of such a nature as to allow the General Court to assess the correctness in law and in fact of any accusation made by the Commission in competition proceedings.

In the third place, in accordance with Article 31 of Regulation No 1/2003, the review of legality provided for in Article 230 EC is supplemented by unlimited jurisdiction to review decisions, which enables the Courts, in addition to reviewing the legality of the penalty, to substitute their assessment for the Commission’s and, consequently, to cancel, reduce or increase the fine or periodic penalty payment imposed.

(see paras 80-86)

3. The principle of the presumption of innocence, now enshrined in Article 48(1) of the Charter of Fundamental Rights, 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 penalty payments.

It follows from the obligation on the Commission to produce precise and consistent evidence to support the conviction that the infringement was committed, and from the fact that, when the EU judicature is required to review decisions whereby the Commission finds an infringement of Article 81 EC, any doubt on the Court’s part must benefit the undertaking to which the decision finding an infringement was addressed, that the principle of the presumption of innocence does not preclude the liability of a person accused of a given infringement of EU competition law being established following a procedure carried out wholly in accordance with the procedures laid down in the provisions arising from Article 81 EC, Regulation No 1/2003 and also Commission Regulation No 773/2004 relating to the conduct of proceedings by the Commission pursuant to Articles 81 EC and 82 EC and in the context of which the rights of the defence could thus be fully exercised.

In any event, the right to the presumption of innocence does not preclude, in principle, penalties of a criminal nature adopted by an administrative authority being enforceable before they had become final following an appeal before a court, provided that such enforcement remains within reasonable limits that strike a fair balance between the interests involved and that the person on whom the penalty is imposed can be reinstated in his initial situation where his appeal is successful.

(see paras 97, 100-102, 104)

4. See the text of the decision.

(see paras 116-120, 124)

5. See the text of the decision.

(see paras 144-151)

6. See the text of the decision.

(see paras 206-212, 232, 240)

7. See the text of the decision.

(see paras 213, 215-218, 243)

8. See the text of the decision.

(see paras 213-218, 243)

9. See the text of the decision.

(see paras 266-277)

10. See the text of the decision.

(see paras 280-282)

11. In EU competition law, where two subsidiaries are directly or indirectly 100% or almost 100% owned by the same parent company, the previous infringement committed by one of the subsidiaries in the group may be taken into account for the purpose of establishing the aggravating circumstance of repeated infringement vis-à-vis another subsidiary in the group.

However, the unlawful conduct of such a subsidiary, 100% or almost 100% owned by its parent company, cannot be imputed to the parent company, and the Commission will be unable to regard the parent company as jointly and severally liable for payment of the fine imposed on its subsidiary, unless the parent company does not rebut the rebuttable presumption that it effectively exercises decisive influence over the commercial policy of that subsidiary.

It follows that, in a procedure under Article 81 EC, the Commission cannot merely find that an undertaking was able to exercise decisive influence over the commercial policy another undertaking, without being required to check whether that influence was actually exercised. On the contrary, it is, as a rule, for the Commission to demonstrate such decisive influence on the basis of factual evidence including, in particular, any management power one of the undertakings may have over the other.

In addition, for the purposes of applying and enforcing decisions adopted pursuant to Article 81(1) EC, it is necessary to identify an entity possessing legal personality to be the addressee of the measure. Thus, where an infringement of the EU competition rules has been established, it is necessary to determine the natural or legal person who was responsible for the operation of the undertaking at the time when the infringement was committed so that he can answer for it. When the Commission adopts a decision pursuant to Article 81(1) EC, it must therefore identify the natural or legal person or persons who may be held liable for the conduct of the undertaking in question and who may be penalised on that basis, to whom the decision will be addressed.

Moreover, the mere fact that the share capital of two separate commercial companies is held by the same person or the same family is insufficient, in itself, to establish that those two companies are an economic unit with the result that, under EU competition law, the actions of one company can be attributed to the other and that one can be held liable to pay a fine for the other.

Accordingly, it cannot be accepted that the Commission can consider, when establishing the aggravating circumstance of repeated infringement that those undertakings can be held liable for a previous infringement when they were not penalised in respect of that infringement by a Commission decision and when during the procedure carried out with a view to establishing that infringement they were not the addressees of a statement of objections, so that they were not put in a position to submit their arguments for the purpose of disputing that they formed part of an economic unit with any company to which the previous decision was addressed.

(see paras 309-314)

12. It cannot be accepted that the Commission is entitled to decide, when establishing the aggravating circumstance of repeated infringement, that an undertaking should be held liable for a previous infringement in relation to which it was not penalised by a Commission decision and in the establishment of which it was not an addressee of a statement of objections, with the result that such an undertaking was not given an opportunity, in the procedure leading to the adoption of the decision establishing the previous infringement, to make representations with a view to disputing that it formed an economic entity with other undertakings.

That conclusion appears all the more valid since, whilst it is true that the principle of proportionality requires that the time that has elapsed between the infringement at issue and a previous breach of the competition rules be taken into account in assessing the undertaking’s tendency to infringe those rules, the Commission cannot be bound by any limitation period when reaching a finding of repeated infringement.

Similarly, whilst it would be reasonable to assume that a parent company would actually have knowledge of a previous Commission decision addressed to a subsidiary of which it owns almost the entire share capital, such knowledge cannot remedy the absence in the previous decision of any finding that the parent company and the subsidiary form an economic unit reached for the purpose of imputing to the parent company liability for the previous infringement and increasing the fines imposed on the parent company for repeated infringement.

(see paras 318-320, 328)

13. In an administrative proceeding under EU competition law, the finding and the appraisal of the specific characteristics of a repeated infringement come within the Commission’s discretion as regards the choice of factors to be taken into account for the purposes of determining the amount of a fine, and the Commission cannot be bound by any limitation period when making such a finding.

Thus, repeated infringement is an important factor which the Commission must appraise, since the purpose of taking repeated infringement into account is to induce undertakings which have demonstrated a tendency towards infringing the competition rules to change their conduct. The Commission may therefore, in each individual case, take into consideration the indicia which confirm such a tendency, including the time that has elapsed between the infringements in question.

The principle of proportionality requires that the time which has elapsed between the infringement in question and a previous breach of the competition rules be taken into account in assessing an undertaking’s tendency to infringe those rules. For the purposes of judicial review of the Commission’s measures in matters of competition law, the Court may therefore be called upon to scrutinise whether the Commission complied with that principle when it increased, on grounds of repeated infringement, the fine imposed, and, in particular, whether such increase was imposed in the light of, among other things, the time which had elapsed between the infringement in question and the previous breach of the competition rules.

In that context, the elapsing of a period of approximately 13 years and 8 months between the adoption of a decision finding an infringement of the competition rules by a group of companies, and fining the companies in that group, and the time of commencement of the infringement committed by the same companies and penalised in the context of a new procedure, does not mean that the Commission is estopped from finding, without being in breach of the principle of proportionality, that the undertaking formed by the applicants had a propensity to disregard the competition rules, where the same area of activity is at issue as that within which the addressee companies of the Commission’s decision fall and, moreover, the cartel covered by the previous decision had characteristics very close to that penalised in the new decision.

(see paras 326-328, 330, 332-334, 485)

14. See the text of the decision.

(see paras 353, 354, 357, 358, 390)

15. See the text of the decision.

(see paras 368-372)

16. See the text of the decision.

(see paras 378, 380, 381)

17. See the text of the decision.

(see paras 385-387)

18. See the text of the decision.

(see paras 402-410)

19. See the text of the decision.

(see paras 415-417, 420, 421, 424)

20. See the text of the decision.

(see paras 449-454)

21. In a case of infringement of the competition rules and imposition of a fine where an increase of 60% of the basic amount of the fine to reflect repeated infringement has been justified in the light of two previous decisions of the Commission finding an infringement of the competition rules whereas only one of those decisions can be applied for the purpose of establishing repeated infringement and, in addition, that decision was the more remote in time from the beginning of the infringement referred to in the decision finding repeat infringement, the repetition of the unlawful conduct of the undertakings concerned is less serious than that initially found. It is therefore justified to reduce the percentage of that increase by half.

(see paras 461, 485, 486)

22. See the text of the decision.

(see paras 491, 492)

23. The sanction for a breach by a Court of the European Union of its obligation under the second paragraph of Article 47 of the Charter of Fundamental Rights to adjudicate on the cases before it within a reasonable time must be an action for damages brought before the General Court, since such an action constitutes an effective remedy of general application for asserting and penalising such a breach.

An action seeking only annulment of a Commission decision on EU competition law, or, in the alternative, a reduction of the amount of the fine, cannot in any event be compared with an action for damages, and is not therefore an appropriate framework for the purposes of penalising any breach by a Court of the European Union of its obligation to adjudicate within a reasonable time.

(see paras 495, 496)

24. Under the second paragraph of Article 47 of the Charter of Fundamental Rights of the European Union, every person is also entitled to have his case heard by an independent and impartial tribunal. That guarantee, which is part of the constitutional traditions common to the Member States, is also enshrined in Article 6(1) of the European Convention on Human Rights.

The guarantee of impartiality has two aspects. In the first place, the tribunal must be subjectively impartial, that is, none of its members must show bias or personal prejudice, there being a presumption of personal impartiality in the absence of evidence to the contrary. In the second place, the tribunal must be objectively impartial, which means that it must offer guarantees sufficient to exclude any legitimate doubt in this respect.

In a case where, by raising a complaint alleging that the duration of the judicial proceedings in a case is excessive, the applicant asks the Chamber of the Court responsible for the case to assess whether it has itself committed a procedural irregularity in causing an unjustified delay in dealing with the case, that composition cannot, in any event, provide that applicant with sufficient guarantees to preclude any legitimate doubt as to whether it would examine impartially the complaint alleging that the duration of the judicial proceedings was excessive.

(see paras 497-500)