Keywords

Summary



Keywords

1. Competition – Community rules – Infringements – Attribution – Parent company and subsidiaries – Economic unit – Criteria for assessment

(Art. 81 EC)

2. Acts of the institutions – Statement of reasons – Obligation – Scope – Decision to apply competition rules – Decision relating to several addresses – Need for an adequate statement of reasons, in particular with respect to the entity which must bear the liability for an infringement

(Arts 81 EC and 253 EC)

3. Acts of the institutions – Statement of reasons – Obligation – Scope – Decision to apply competition rules – Statement of reasons based on a matter not set out in the statement of objections – Not permissible

(Arts 81 EC and 253 EC)

4. Acts of the institutions – Statement of reasons – Obligation – Scope – Decision to apply competition rules – Correction of an error of reasoning during the proceedings before the Court – Not permissible

(Arts 81 EC and 253 EC)

5. Acts of the institutions – Statement of reasons – Obligation – Scope – Decision to apply competition rules – Taking into account information not contained in the decision upholding the liability of an undertaking in order to assess the legality of the reasoning for the decision – Not permissible

(Arts 81 EC and 253 EC)

Summary

1. The conduct of a subsidiary may be imputed to the parent company in particular where, although having a separate legal personality, that subsidiary does not decide independently upon its own conduct on the market, but carries out, in all material respects, the instructions given to it by the parent company, having regard in particular to the economic, organisational and legal links between those two legal entities. In such a situation, the parent company and its subsidiary form a single economic unit and therefore form a single undertaking for the purposes of Article 81 EC.

In the specific case of a parent company holding 100% of the capital of a subsidiary which has infringed the European Union competition rules, first, the parent company can exercise a decisive influence over the conduct of the subsidiary and, secondly, there is a rebuttable presumption that the parent company does in fact exercise a decisive influence over the conduct of its subsidiary.

In those circumstances, it is sufficient for the Commission to prove that the entire capital of a subsidiary is held by the parent company in order to presume that the parent exercises a decisive influence over the commercial policy of the subsidiary. The Commission will then be able to regard the parent company as liable for the infringement at issue, unless the parent company, which has the burden of rebutting that presumption, adduces sufficient evidence to show that its subsidiary acts independently on the market.

In order to ascertain whether a subsidiary determines its conduct on the market independently, account must be taken of all the relevant factors relating to economic, organisational and legal links which tie the subsidiary to the parent company, which may vary from case to case and cannot therefore be set out in an exhaustive list.

(see paras 26-30)

2. As regards the statement of reasons for a Commission decision applying Article 81 EC, the Commission is not obliged to adopt a position on all the arguments relied on by the parties concerned and it is sufficient if it sets out the facts and the legal considerations having decisive importance in the context of the decision. In particular, it is not required to define its position on matters which are manifestly irrelevant or insignificant or plainly of secondary importance.

Where a decision taken in application of Article 81 EC relates to several addressees and raises a problem of imputing liability for the infringement, it must include an adequate statement of reasons with respect to each of the addressees, in particular those of them who, according to the decision, must bear the liability for the infringement. Thus, with regard to a parent company held liable for the offending behaviour of its subsidiary, such a decision must contain a detailed statement of reasons for imputing the infringement to that company.

In that context, where a parent company relies not only on the fact that it was a holding company managing its subsidiary as a straightforward financial investment, through an interposed holding company, but also pleads a body of special circumstances characterising the links between the companies concerned at the time of the infringement, and the matters submitted by that company are not mere contention, but contain detailed information on the functioning of the holding company, accompanied by statements by the directors of the companies concerned, exchanges of correspondence with third parties and a number of internal documents from the companies concerned, dating from the period of the infringement, the Commission is required to adopt a position on those arguments, examining whether, in the light of all the relevant factors relating to economic, organisational and legal links between the companies concerned, the parent company has demonstrated that its subsidiary acted independently, and to set out, if necessary, the reasons why it is of the view that the matters submitted by the parent company are inadequate to rebut the presumption at issue. The Commission’s duty to state reasons for its decision on this issue is clearly evident from the rebuttable nature of the presumption relating to the exercise of decisive influence by a parent company over its wholly owned subsidiary, in order to rebut which the parent company is required to produce evidence of all the economic, organisational and legal links between itself and its subsidiary.

(see paras 57-58, 71, 73, 75-77)

3. A matter which was not set out in the statement of objections and on which an undertaking which is the addressee of a Commission decision finding an infringement of the competition rules has not had the chance to make known its view during the administrative procedure, cannot be regarded as admissible as evidence against that undertaking. Consequently, the Commission cannot rely on it for the purposes of the reasoning of the contested decision.

(see para. 83)

4. The statement of reasons for a Commission decision applying Article 81 EC must in principle be notified to the party concerned at the same time as the decision adversely affecting it. A failure to state the reasons cannot thus be remedied by the fact that the party concerned learns the reasons for the decision during the proceedings. Therefore, the failure to state reasons at issue cannot be remedied in the course of the proceedings.

(see paras 89-90)

5. In respect of actions contesting Commission decisions imposing fines on undertakings for infringement of the competition rules, the General Court, in the context of its unlimited jurisdiction, is competent to assess the appropriateness of the amount of the fines. Whereas that assessment may, in some circumstances, justify the taking into consideration of additional information, that consideration does not apply in the context of the review of whether the duty to state reasons has been observed in the decision finding the infringement, when the legality of that decision is being reviewed.

Accordingly, although the General Court may find that the Commission committed an infringement of the duty to state reasons in the context of the determination of fines imposed for infringements of Article 81(1) EC, while stating that, in so far as the measure or decision upheld by that institution is to be confirmed as to its substance, that infringement does not lead either to the annulment of the contested decision or to an alteration of the amount of the fines, that appraisal cannot be transposed concerning the review of the legality of a Commission decision inasmuch as the Commission upheld the liability of the undertaking concerned.

(see paras 91-93)