Case C‑625/13 P

Villeroy & Boch AG

v

European Commission

(Appeal — Competition — Agreements, decisions and concerted practices — Bathroom fittings and fixtures markets of Belgium, Germany, France, Italy, the Netherlands and Austria — Decision finding an infringement of Article 101 TFEU and Article 53 of the Agreement on the European Economic Area — Price coordination and exchange of sensitive business information — Single infringement — Proof — Fines — Unlimited jurisdiction — Reasonable time — Proportionality)

Summary — Judgment of the Court (First Chamber), 26 January 2017

Competition—Fines—Determination—Failure to observe the principle that administrative and judicial proceedings must be concluded within a reasonable time—Breach not justifying, on its own, a reduction of the fine

Appeal—Jurisdiction of the Court of Justice—Whether it may review, on grounds of fairness, the assessment by the General Court in regard to the amount of the fines imposed on undertakings which have infringed the competition rules of the Treaty—Not included—Challenge to that assessment on grounds alleging breach of the principle of proportionality—Lawfulness

Appeal—Jurisdiction of the Court of Justice—Review of the assessment carried out by the Commission of the gravity of the infringement for the purpose of setting the fine—Not included—Review limited to ascertaining whether the General Court took into account all the factors essential to the assessment of the gravity of the infringement and all the arguments raised against the fine imposed

Competition—Fines—Amount—Determination—Judicial review—Unlimited jurisdiction of the EU judicature—Scope—Obligation of the competent Court to review of its own motion the decision imposing a fine—No such obligation—Infringement of the right to effective judicial protection—No such infringement

Competition—Undertaking—Meaning—Economic unit—Attribution of infringements—Parent company and subsidiary undertakings—Joint and several liability of the undertakings concerned—Obligation of the Commission to determine the shares to be paid by those held jointly and severally liable—No such obligation

Competition—EU rules—Infringements—Attribution—Parent company and subsidiaries—Economic unit—Criteria for assessment—Presumption that a parent company exercises decisive influence over subsidiaries in which it owns all, or virtually all, the shares—Rebuttable—Infringement of the presumption of innocence—No such infringement—Infringement of the principles in dubio pro reo and nullum crimen, nulla poena sine lege—No such infringement

Competition—Administrative procedure—Commission decision finding an infringement—Burden of proving the infringement and its duration on the Commission—Extent of the burden of proof—Proof adduced by a number of indicia and coincidences pointing to the existence and duration of continuous anti-competitive practices—Lawfulness

Agreements, decisions and concerted practices—Prohibition—Infringements—Agreements and concerted practices constituting a single infringement—Attribution of liability to an undertaking for the infringement as a whole—Conditions—Unlawful practices and conduct forming part of an overall plan—Assessment—Requirement that the participating undertakings be competitors—No such requirement

Appeal—Grounds—Inadequate statement of reasons—Scope of the obligation to state reasons—Requirement that the General Court provide an explanation of the differences between various judgments concerning the same Commission decision—No such requirement

Appeal—Grounds—Mistaken assessment of the facts—Inadmissibility—Review by the Court of Justice of the assessment of the evidence—Possible only where the clear sense of the evidence has been distorted—Review by the Court of Justice of whether the obligation to state reasons has been observed—Included

See the text of the decision. (see paras 38, 39, 96, 107, 135, 138)

The General Court’s obligation to state the reasons for its judgments does not in principle extend to requiring it to justify the approach taken in one case as against that taken in another case, even if the latter concerns the same Commission decision relating to a proceeding under Article 101 TFEU. (see paras 42, 61)

An undertaking which has participated in a single and complex infringement of the competition rules by its own conduct, which fell within the definition of an agreement or concerted practice having an anticompetitive object within the meaning of Article 101(1) TFEU and was intended to help bring about the infringement as a whole, may be responsible also in respect of the conduct of other undertakings in the context of the same infringement throughout the period of its participation in the infringement. That is the position where it is shown that the undertaking intended, through its own conduct, to contribute to the common objectives pursued by all the participants and that it was aware of the offending conduct planned or put into effect by other undertakings in pursuit of the same objectives or that it could reasonably have foreseen it and was prepared to take the risk. Moreover, the text of Article 101(1) TFEU refers generally to all agreements and concerted practices which, in either horizontal or vertical relationships, distort competition on the internal market, irrespective of the market on which the parties operate, and only the commercial conduct of one of the parties need be affected by the terms of the arrangements in question. It follows that the General Court can, without erring in law, hold that a company has participated in a single infringement of the competition rules covering a given territory where it is established that the company was aware that anticompetitive practices which formed part of the overall plan to restrict competition were being engaged in in that territory, even though the company did not itself put those practices into effect. (see paras 56, 59, 60)

See the text of the decision. (see paras 69, 70, 130)

See the text of the decision. (see paras 72, 73, 137)

See the text of the decision. (see paras 86, 87)

In most cases, the existence of an anti-competitive practice or agreement must be inferred from a number of coincidences and indicia which, considered together, may, in the absence of another plausible explanation, constitute evidence of an infringement of the competition rules. Thus, as regards, in particular, an infringement extending over a number of years, the fact that direct evidence of a company’s participation in that infringement during a specified period has not been produced does not preclude that participation from being regarded as established also during that period, provided that that finding is based on objective and consistent indicia; the lack of any public distancing on the part of that company may be taken into account in that regard. (see para. 111)

The Commission establishes to the requisite legal standard the participation of an undertaking in an infringement of Article 101(1) TFEU when it relies not simply on the leniency application of one of the companies taking part in the cartel but on a handwritten account of an unlawful meeting that was drawn up by a representative of that company on the actual day of the meeting, which does not date from the time when that company made an application under the Notice on immunity from fines and reduction of fines in cartel cases but is contemporaneous with the facts. Such evidence does not require there to be other corroborating evidence. (see para. 134)

The settled case-law to the effect that, in the particular case in which a parent company holds, directly or indirectly, all or almost all of the capital in a subsidiary which has committed an infringement of the EU competition rules, there is a rebuttable presumption that that parent company actually exercises a decisive influence over its subsidiary, which enables the offending conduct of the subsidiary to be attributed to it, does not infringe the right to be presumed innocent that is guaranteed by Article 48(1) of the Charter or the principles of in dubio pro reo and nullum crimen, nulla poena sine lege. The presumption that a parent company exercises decisive influence over its subsidiary when it holds all or almost all of the capital in the subsidiary does not lead to a presumption of guilt on the part of either one of those companies and therefore does not infringe either the right to be presumed innocent or the principle of in dubio pro reo. As regards the principle of nullum crimen, nulla poena sine lege, it requires that the law give a clear definition of offences and the penalties which they attract. That requirement is satisfied where the person concerned is in a position to ascertain 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. (see paras 146, 147, 149)

While it follows from Article 23(2) of Regulation No 1/2003 that the Commission is entitled to hold a number of companies jointly and severally liable for payment of a fine, in so far as they formed part of the same undertaking, it is not possible to conclude on the basis of either the wording of that provision or the objective of the joint and several liability mechanism that that power to impose penalties extends, beyond the determination of joint and several liability from an external perspective, to the power to determine the shares to be paid by those held jointly and severally liable from the perspective of their internal relationship. On the contrary, the mechanism of joint and several liability is intended to constitute an additional legal device available to the Commission to strengthen the effectiveness of the action taken by it for the recovery of fines imposed for infringements of the competition rules, since that mechanism reduces for the Commission, as creditor of the debt represented by such fines, the risk of insolvency: that is part of the objective of deterrence pursued generally by competition law. The determination, in the context of the internal relationship of those held jointly and severally liable for payment of a fine, of the shares each of them is required to pay does not pursue that dual objective. That is a contentious issue, to be resolved at a later stage, and, in principle, the Commission no longer has any interest in the matter, where the fine has been paid in full by one or more of those held liable. Accordingly, the Commission cannot be required to determine such shares. (see paras 151-153)

As regards the judicial review of Commission decisions imposing a fine for infringement of the competition rules, the review of legality provided for in Article 263 TFEU is supplemented by the unlimited jurisdiction conferred on the EU judicature by Article 31 of Regulation No 1/2003, in accordance with Article 261 TFEU. That jurisdiction empowers the competent Court, in addition to carrying out a mere review of legality with regard to the penalty, to substitute its own appraisal for the Commission’s and, consequently, to cancel, reduce or increase the fine or penalty payment imposed. In order to satisfy the requirements of Article 47 of the Charter of Fundamental Rights when conducting a review in the exercise of its unlimited jurisdiction with regard to the fine, the EU judicature is bound, in the exercise of the powers conferred by Articles 261 and 263 TFEU, to examine all complaints based on issues of fact and law which seek to show that the amount of the fine is not commensurate with the gravity or the duration of the infringement. However, the exercise of unlimited jurisdiction is not equivalent to an own-motion review, and proceedings are inter partes. It is, in principle, for the applicant to raise pleas in law against the contested decision and to adduce evidence in support of those pleas. That absence of an own-motion review of the whole of the contested decision does not contravene the principle of effective judicial protection. Compliance with that principle does not require that the General Court — which is indeed obliged to respond to the pleas in law raised and to carry out a review of both the law and the facts — should be obliged to undertake of its own motion a new and comprehensive investigation of the file. (see paras 178-182)

See the text of the decision. (see paras 183, 187-189)

See the text of the decision. (see paras 184, 192)