Keywords

Summary



Keywords

1. Competition – Community rules – Undertaking – Concept – Economic unit

(Art. 81(1) EC)

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

(Art. 81(1) EC)

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

(Art. 81(1) EC)

4. Competition – Community rules – Infringements – Attribution – Parent company and subsidiaries – Undertaking under the joint control of several other undertakings or persons

(Art. 81(1) EC)

5. Acts of the institutions – Statement of reasons – Obligation – Scope – Decision applying the competition rules

(Arts 81 EC and 253 EC)

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

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

Summary

1. Community competition law refers to the activities of ‘undertakings’. The concept of an undertaking covers any entity engaged in an economic activity, regardless of its legal status and the way in which it is financed. The case‑law has specified that, in the same context, the concept of an undertaking must be understood as designating an economic unit even if in law that economic unit consists of several persons, natural or legal. Where such an economic entity infringes the rules of competition, it falls to that entity, in accordance with the principle of personal responsibility, to answer for that infringement.

(see paras 122-124)

2. The infringement of Community competition law must be attributed unequivocally to a legal person on whom fines may be imposed. For the purposes of applying and enforcing Commission competition law decisions, it is necessary to identify, as addressee, an entity having legal personality.

The conduct of a subsidiary may be attributed to the parent company in particular where that subsidiary, despite having a separate legal personality, 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, regard being had 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. As a consequence, it is not because of a relationship between the parent company and its subsidiary in instigating the infringement or, a fortiori , because the parent company is involved in the infringement, but because they constitute a single undertaking for the purposes of Article 81 EC that the Commission is able to address a decision imposing fines to the parent company.

The Commission cannot merely find that the parent company is in a position to exercise decisive influence over the conduct of its subsidiary, but must also check whether that influence was actually exercised. In the specific case where a parent company has a 100% shareholding in a subsidiary which has infringed the Community competition rules, the parent company is able to exercise decisive influence over the conduct of the subsidiary and there is a rebuttable presumption that the parent company does in fact exercise decisive influence over the conduct of its subsidiary. In those circumstances, it is sufficient for the Commission to prove that the subsidiary is wholly owned by the parent company in order to avail itself of the presumption that the parent exercises decisive influence over the commercial policy of the subsidiary. The Commission will be able to regard the parent company as jointly and severally liable for payment of the fine imposed on its subsidiary, 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. The presumption arising from 100% ownership of the capital can apply not only in cases where there is a direct relationship between the parent company and its subsidiary, but also in cases where that relationship is indirect, through an intermediary subsidiary.

The Commission may however choose not to rely on that presumption alone, but to base its findings also on evidence which is designed to establish that the parent companies in fact exercise decisive influence over their subsidiary and, accordingly, to support that presumption.

(see paras 125-130, 132, 141)

3. The central feature on which the Commission relied in order to establish that the parent company and its subsidiary form a single economic unit is the subsidiary’s lack of independence in deciding upon its own conduct on the market, since that lack of independence is the corollary of the exercise by the parent company of decisive influence over the conduct of the subsidiary.

The decisive influence that a parent company must exercise in order to have liability attributed to it for the infringement committed by its subsidiary cannot be limited to the activities which form part of the subsidiary’s commercial policy stricto sensu and which, furthermore, are directly linked to that infringement. In order to determine whether a subsidiary decides independently upon its own conduct on the market, account must be taken of all the relevant factors relating to the economic, organisational and legal links between the subsidiary and the parent company, which may vary from case to case and which cannot, therefore, be exhaustively listed.

(see paras 135, 170-171)

4. Where an undertaking is under the joint control of two or more other undertakings or persons, those undertakings or persons are by definition able to exercise decisive influence over it. That is not enough, however, to enable them to be held liable for the infringement of the competition rules committed by the undertaking which they control jointly, because such liability also requires fulfilment of the condition concerning the actual exercise of decisive influence. If those conditions are fulfilled, it would be possible to hold the various undertakings or persons which exercise joint control liable for the unlawful conduct of their subsidiary. However, if it transpired that, in reality, only one of the undertakings or persons holding joint control in fact exercises decisive influence over the conduct of their subsidiary, or if other specific circumstances were to justify it, the Commission would be able to hold only that undertaking or person jointly and severally liable, with its subsidiary, for the infringement committed by the subsidiary.

(see para. 165)

5. The statement of reasons required by Article 253 EC must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the competent Court to exercise its power of review. The requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements of Article 253 EC must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question.

Where a decision taken in application of Article 81 EC relates to several addressees and raises a problem with regard to 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.

(see paras 149-150)

6. The Commission is bound by the principle of equal treatment, which, according to settled case­‑law, requires that comparable situations must not be treated differently, and different situations must not be treated in the same way, unless such treatment is objectively justified.

Thus, where, in a case concerning an infringement involving several different undertakings, the Commission adopts, within the framework laid down by the case‑law, a certain method for determining whether it is appropriate to attribute liability both to the subsidiaries which materially committed that infringement and to their parent companies, it must – save in specific circumstances – rely for those purposes on the same criteria in the case of all those undertakings.

(see paras 156-157)