Case T-310/01

Schneider Electric SA

v

Commission of the European Communities

‛Competition — Regulation (EEC) No 4064/89 — Decision declaring a concentration to be incompatible with the common market — Action for annulment’

Judgment of the Court of First Instance (First Chamber), 22 October 2002 II-4075

Summary of the Judgment

Competition — Concentrations — Assessment of compatibility with the common market — Creation or strengthening of a dominant position impeding competition — Relevance of the range of products and brands of the entity created by the concentration — Not decisive where presence and supply vary from one national market to another

Where, following a failure by the parties notifying a concentration between undertakings to respond to a letter requesting information within the reasonable period set therein, the Commission adopts a decision, pursuant to Article 11(5) of Regulation No 4064/89 on the control of concentrations between undertakings, ordering the parties to provide it with the information requested, the four-month period referred to in Article 10(3) of that regulation is ‘exceptionally... suspended’, under the mandatory terms of Article 10(4). Where a decision requiring information has been properly sent by the Commission to a notifying undertaking, the fact that the term ‘exceptionally’ is used does not preclude that decision from automatically suspending the four-month period from the date on which it is found that the necessary information has not been provided until the date on which it is provided. What is exceptional, within the meaning of Regulation No 4064/89, about suspension of the relevant period is the occurrence of the conditions which allow a decision requesting information to be adopted and not the consequences to be inferred from such a decision. (see paras 99-100, 104, 106, 109)

The geographic market to be taken into account for the purpose of applying Regulation No 4064/89 on the control of concentrations between undertakings is a defined geographic area in which the product concerned is marketed and where the conditions of competition are sufficiently homogeneous for all economic operators, so that the effect on competition of the concentration notified can be evaluated rationally. (see para. 154)

When applying Regulation No 4064/89 on the control of concentrations between undertakings, the Commission must, for the purpose of demonstrating the risk of the creation or strengthening of a dominant position impeding competition on previously defined national sectoral markets, use evidence of economic power relating to those markets. It may also take account of transnational effects which may increase the impact which a concentration has on each of the national sectoral markets deemed relevant but those effects must be demonstrated to the requisite legal standard and not merely presumed to exist. (see paras 171, 178-179)

When applying Regulation No 4064/89 on the control of concentrations between undertakings, the Commission may not base the arguments supporting its assessment of the risk of the creation or strengthening of a dominant position impeding competition on the national sectoral markets affected by a concentration on the fact that the new entity will have a range of products and brands which is unrivalled throughout the European Community where it is unable to establish that the entire range is offered on the relevant national markets. (see paras 239-243, 255-257, 262)

However incomplete a Commission decision finding a concentration incompatible with the common market may be, that cannot entail annulment of the decision if, and to the extent to which, all the other elements of the decision permit the Community judicature to conclude that in any event implementation of the transaction will create or strengthen a dominant position as a result of which effective competition will be significantly impeded for the purposes of Article 2(3) of Regulation No 4064/89 on the control of concentrations between undertakings. (see para. 412)