Keywords

Summary



Keywords

1. Competition – Agreements, decisions and concerted practices – Agreements and concerted practices constituting a single infringement – Undertakings that may be held responsible for participating in an overall cartel – Criteria

(Art. 81(1) EC)

2. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement –Factors for assessment

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

3. Competition – Agreements, decisions and concerted practices – Imputation to an undertaking – Responsibility for conduct of other undertakings in the context of the same infringement – Lawfulness – Criteria

(Art. 81(1) EC)

4. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Fixing of the fine in proportion to the factors for assessment of the gravity of the infringement – Relative importance of the small size of the market at issue

(Council Regulations Nos 17, Art. 15(2), and 1/2003, Art. 23(2))

5. Competition – Fines – Amount – Determination – Criteria – Relevance of the turnover realised in respect of the products which were the subject of the restrictive practice

(Council Regulations Nos 17, Art. 15(2), and 1/2003, Art. 23(2); Commission Notice 98/C 9/03)

6. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Effective capacity to cause significant damage to competition on the market concerned

(Council Regulation No 17, Art. 15(2); Commission Notice 98/C 9/03, Section 1A)

7. Competition – Fines – Amount – Determination

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

8. Competition – Fines – Amount – Determination – Criteria – Financial situation of the undertaking concerned

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

9. Competition – Agreements, decisions and concerted practices – Participation in meetings of undertakings having an anti-competitive object – Need for the undertaking concerned to show that the agreements concluded at the meetings were not implemented

(Art. 81(1) EC)

10. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Mitigating circumstances – Passive or ‘follow-my-leader’ role of the undertaking

(Art. 81 EC; Council Regulation No 17, Art. 15; Commission Notice 98/C 9/03, sections 2 and 3)

11. Competition – Fines – Amount – Determination – Criteria – Reduction of the fine for cooperation of the fined undertaking – Conditions

(Council Regulation No 17, Art. 11(4) and (5))

12. Non-contractual liability – Conditions – Unlawfulness – Damage – Causal link – Concept – Burden of proof

(Art. 288, second para., EC)

Summary

1. An undertaking may be held liable for an overall cartel even though it is shown to have participated directly only in one or some of its constituent elements.

The fact that the roles played by various undertakings in pursuit of a common objective were different does not cancel out the fact that the anti-competitive objective, hence the infringement, was the same, provided that each undertaking has contributed, at its own level, to the pursuit of the common objective.

Agreements and concerted practices which, by virtue of the fact that they shared the same object, formed part of systems of regular meetings, target-price fixing and quota fixing, schemes which in turn formed part of a series of attempts made by undertakings to distort the normal movement of prices are not distinct infringements but constitute a single infringement.

Once an undertaking was aware of the offending conduct of the other participants in a single infringement, or could reasonably have foreseen it, and that it was prepared to take the risk, that undertaking is liable, in respect of the entire period of its participation in the infringement, for the conduct of other undertakings in the same infringement. That conclusion is not inconsistent with the principle that liability for such infringements is personal in nature.

It is sufficient for the Commission to show that the undertaking concerned participated in meetings at which anti-competitive agreements were concluded, without manifestly opposing them, to prove to the requisite standard that the undertaking participated in the cartel. Where participation in such meetings has been established, it is for that undertaking to put forward evidence to establish that its participation in those meetings was without any anti-competitive intention, by demonstrating that it had indicated to its competitors that it was participating in those meetings in a spirit that was different from theirs. The reason underlying that legal principle is that, having participated in the meetings without publicly distancing itself from what was discussed, the undertaking gave the other participants to believe that it subscribed to what was decided there and would comply with it. That is also true of the participation of an undertaking in the implementation of a single agreement. In order to establish that an undertaking participated in such an agreement, the Commission must show that the undertaking intended to contribute by its own conduct to the common objectives pursued by all the participants and that it was aware of the actual conduct planned or put into effect by other undertakings in pursuit of those same objectives, or that it could reasonably have foreseen it, and that it was prepared to take the risk.

(see paras 32-33, 37)

2. The assessment of the gravity of the infringement, which serves to determine the general starting amount for the fine, must not be confused with the assessment of the relative gravity of the participation of each of the undertakings concerned, an issue which falls to be examined in the context of considering whether ‘aggravating circumstances’ or ‘mitigating circumstances’ apply.

Moreover, whereas the starting amount of the fine is set according to the infringement, the relative gravity of the infringement is determined by reference to numerous other factors, in respect of which the Commission has a broad discretion. In addition, it is apparent from Section 1A of 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 that assessment of the gravity of the infringement is carried out in two stages. In the first, the general gravity is assessed solely by reference to factors relating to the infringement itself, such as its nature and its impact on the market; in the second, the assessment of the relative gravity is modified by reference to circumstances particular to the undertaking concerned, which, moreover, leads the Commission to take into account not only possible aggravating circumstances but also, in appropriate cases, mitigating circumstances. That step enables the Commission, particularly in the case of infringements involving a number of undertakings, to take account, in its assessment of the gravity of the infringement, of the different role played by each undertaking and of its attitude towards the Commission during the course of the procedure.

(see paras 46, 48)

3. An undertaking which has taken part in a multi-purpose infringement of Community competition rules through conduct, particular to it, which was covered by the notion of an agreement or concerted practice having an anti-competitive object, for the purposes of Article 81(1) EC, and which was intended to help bring about the infringement as a whole, could also be liable – throughout the entire period of its participation in that infringement – for conduct put into effect by other undertakings in the context of the same infringement, where it is established that the undertaking in question was aware of the offending conduct of the other participants, or could reasonably have foreseen it, and that it was prepared to take the risk.

(see para. 33)

4. The principle of proportionality requires that the measures adopted by Community institutions must not exceed what is appropriate and necessary for attaining the objective pursued.

When it comes to the calculation of fines, the gravity of infringements has to be determined by reference to numerous factors and it is important not to confer on one or other of those factors an importance which is disproportionate in relation to other factors.

In this context, the principle of proportionality requires the Commission to set the fine proportionately to the factors taken into account for the purposes of assessing the gravity of the infringement and also to apply those factors in a way which is consistent and objectively justified.

Under Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty, the Commission may impose fines on undertakings but, for each undertaking participating in the infringement, the fine must not exceed 10% of its turnover in the preceding business year. Those provisions require that, for the purposes of determining the amount of the fine within that limit, regard be had to the gravity and to the duration of the infringement. Moreover, in accordance with 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, the Commission is to determine the starting amount for the fine on the basis of the gravity of the infringement, taking account of the intrinsic nature of the infringement, its actual impact on the market, if that is measurable, and the extent of the geographic market.

Thus, neither Regulation No 17, nor Regulation No 1/2003, nor the Guidelines provide that the amount of fines must be determined in direct relation to the size of the affected market, that being only one relevant factor among others. That legal framework does not therefore expressly require the Commission to take account of the limited size of the product market. In assessing the gravity of an infringement the Commission must have regard 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. It cannot be ruled out that cases may arise in which one of the factors indicative of the gravity of an infringement is the size of the market for the product in question. Consequently, although market size may constitute a factor to be taken into account in establishing the gravity of the infringement, its importance varies according to the particular circumstances of the infringement concerned.

Practices consisting of the exchange of sensitive information on price lists and/or prices charged to individual customers; in agreements on price increases and/or on target prices; and in agreements to avoid undercutting, to the advantage of the incumbent supplier, and to arrange customer allocation constitute horizontal restrictions of the ‘price cartel’ type within the meaning of the Guidelines and, accordingly, are inherently ‘very serious’. In that context, the small size of the relevant market – even if that were to be established – is of lesser importance than all the other factors indicative of the gravity of the infringement.

(see paras 60-65)

5. The only express reference to turnover in Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty concerns the upper limit for fines. Provided that it complies with that upper limit, the Commission may in principle choose which turnover – in terms of territory and products – on the basis of which to set the fine, without being obliged to adhere precisely to the overall turnover or the turnover on the geographic market or the relevant product market. Moreover, although 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 do not state that fines should be calculated according to a specific turnover, they do not preclude the Commission from taking into account, in determining the amount of the fine, the turnover generated by the undertakings concerned on the relevant market, in order to ensure compliance with the fundamental principles of the law of the European Union and where circumstances so require. Thus, turnover may be relevant for the purposes of taking into consideration the various factors for calculating the amount of fines, which are set out in the fourth and sixth paragraphs of Section 1A of the Guidelines.

It follows that the Commission is free to take into account the turnover figure of its choice, provided that this does not appear unreasonable by reference to the circumstances of the case. Similarly, the Commission is under no obligation, when determining the amount 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 every difference between the undertakings concerned in terms of their overall turnover or their relevant turnover.

With regard to the choice made by the Commission of one and/or the other turnover, for the purposes of the analysis – undertaken with a view to setting the fine for an infringement of the competition rules – of the effective economic capacity of the offending undertakings to cause significant damage to competition, which involves an assessment of the actual importance of those undertakings on the market affected, that is to say, of their influence on the market, their overall turnover gives only an incomplete picture. The possibility cannot be ruled out that a powerful undertaking with many different activities may have only a limited presence on a specific product market. Similarly, the possibility cannot be ruled out that an undertaking occupying an important position on a geographical market outside the European Union occupies only a weak position on the EU market or the EEA market. In such circumstances, the mere fact that the undertaking concerned has a high overall turnover does not necessarily mean that it has a decisive influence on the market affected. That is why, even though the turnover of an undertaking on the market affected cannot be a decisive factor in concluding that that undertaking belongs to a powerful economic entity, it is nevertheless relevant for the purposes of determining the influence which that undertaking may exert on the market.

Thus, the proportion of turnover derived from the goods in respect of which the infringement was committed is likely to give a fair indication of the scale of the infringement on the relevant market. The turnover figure derived from the goods in respect of which the infringement was committed is likely to give a fair indication of the liability on those markets of each of the undertakings concerned, since it constitutes an objective criterion which gives a proper measure of the harm which the offending conduct represents for normal competition and it is therefore a good indicator of the capacity of each undertaking to cause damage to competition.

(see paras 76-79)

6. The Commission may, when assessing the gravity of the infringement and setting the starting amount for the fine, base its assessment of the effective economic capacity of undertakings which infringe the competition rules to cause significant damage to competition on data relating to turnover and market shares in the relevant market, unless particular circumstances, such as the characteristics of that market, may be such as appreciably to diminish the significance of those data and to require, for the assessment of the influence of the undertakings on the market, other relevant factors to be taken into account, such as vertical integration or the extent of the product range.

(see para. 82)

7. When determining the amount of fines on the basis of the gravity and duration of the infringement in question, the Commission is under no obligation to ensure, where fines are imposed on a number of undertakings involved in the same infringement, that the final amounts of the fines reflect every difference between those undertakings in terms of their overall turnover or their relevant turnover.

In that regard, Article 15(2) of Regulation No 17 and Article 23(2) of Regulation No 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty do not lay down any requirement that, where fines are imposed on a number of undertakings involved in the same infringement, the fine imposed on an undertaking which is small- or medium-sized must be no higher, as a percentage of turnover, than the fines imposed on the larger undertakings. It is clear from those provisions that, both for small- or medium-sized undertakings and for larger undertakings, account must be taken, in determining the amount of the fine, of the gravity and duration of the infringement. Where the Commission imposes on undertakings involved in a single infringement fines which are justified, for each of them, by reference to the gravity and duration of the infringement, it cannot be criticised on the ground that, for some of the undertakings, the fine is higher in relation to its turnover than that imposed on the others.

(see paras 89-90)

8. The Commission is not required, when determining the amount of the fine, to take into account the poor financial situation of an undertaking, since recognition of such an obligation would be tantamount to conferring an unfair competitive advantage on the undertakings least well adapted to market conditions. Even if a measure taken by a Community authority were to lead to the liquidation of an undertaking, such a liquidation of the undertaking in its existing legal form – although it may adversely affect the financial interests of the owners, investors or shareholders – does not mean that the personal, tangible and intangible elements represented by the undertaking would also lose their value.

(see paras 95-96)

9. To establish the non-implementation of the agreements reached at the meetings held for an anti-competitive purpose, the undertaking involved in an administrative procedure concerning a prohibited cartel must show that, during the period in which it was party to the unlawful agreements, it actually avoided implementing those agreements by adopting competitive conduct on the market or, at the very least, that it clearly and substantially breached the obligations relating to the implementation of the cartel to the point of disrupting its operation.

(see para. 111)

10. A passive role, which 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 allow to be regarded as mitigating circumstances in the implementation of a prohibited cartel, implies that the undertaking adopted a ‘low profile’, that is to say, that it did not actively participate in the creation of any anti-competitive agreements. One circumstance that may be taken into account as indicating the adoption by an undertaking of a passive role within a cartel is where the undertaking’s attendance at cartel meetings is significantly more sporadic than that of the ‘ordinary’ cartel members; another is where it enters the market affected by the infringement late, regardless of the length of its involvement in the infringement; yet another is where express statements to that effect are made by representatives of other undertakings which participated in the infringement.

The fact that an undertaking, whose participation in an unlawful concerted practice under Article 81(1) EC has been established, did not conduct itself on the market in the manner agreed with its competitors does not necessarily have to be taken into account. An undertaking which, despite colluding with its competitors, follows a policy which departs from the policy agreed on may simply be trying to exploit the cartel for its own benefit.

(see paras 119-120, 129)

11. In determining the amount of fines for infringement of Community competition rules, cooperation in an investigation that does not go further than what is required of undertakings under Article 11(4) and (5) of Regulation No 17 does not justify reduction of the fine. On the other hand, such a reduction is justified where the undertaking has provided information well in excess of that which the Commission may require under Article 11 of Regulation No 17.

Where the offending undertaking not merely provides factual data but actually provides important evidence of the infringement at issue and does not contest the facts on which the Commission based its allegations, that undertaking is entitled to obtain a reduction higher than that granted to undertakings whose cooperation was described by the Commission as useless when compared with that of the undertaking concerned.

(see paras 147-151)

12. It is for the party seeking to establish the Community’s liability to adduce proof as to the existence or extent of the damage alleged and to establish a sufficiently direct causal link between that damage and the conduct complained of on the part of the institution concerned. Where it is necessary to determine the value of a lost opportunity to make money and therefore, of necessity, the value of hypothetical economic transactions, it can be difficult, even impossible, for the claimant to put an exact figure on the loss which it claims to have sustained. In such cases, the Court can rely on mean statistical values. However, that does not relieve the claimant entirely of the obligation to adduce evidence of the loss claimed. Although the value of a lost opportunity to make money is necessarily a hypothetical fact which must be estimated, since it cannot be calculated with certainty, the fact remains that the data on which that estimate is based can – and must, in so far as is possible – be proved by the party relying on it.

(see paras 167-168)