Judgment of the Court of First Instance (First Chamber) of 10 March 1992. - Hoechst AG v Commission of the European Communities. - Competition - Concepts of agreement and concerted practice - Collective responsibility. - Case T-10/89.



European Court reports 1992 Page II-00629



Summary

Parties

Grounds

Decision on costs

Operative part



Keywords

++++

1. Competition - Administrative procedure - Commission decision finding that an infringement has been committed - Evidence which may be used

(EEC Treaty, Art. 85(1) )

2. Competition - Administrative procedure - Access to the file - Commission' s obligation owing to rules laid down by itself in a report on competition policy

3. Competition - Cartels - Agreements between undertakings - Meaning - Common purpose as to conduct to be adopted on the market

(EEC Treaty, Art. 85(1) )

4. Competition - Cartels - Prohibition - Agreements continuing to produce their effects after they have formally ceased to be in force - Application of Article 85 of the Treaty

(EEC Treaty, Art. 85)

5. Competition - Cartels - Concerted practice - Meaning - Coordination and cooperation incompatible with the requirement for each undertaking to determine independently its conduct on the market - Meetings between competitors having as their purpose the exchange of information decisive for the participants' marketing strategy

(EEC Treaty, Art. 85(1))

6. Competition - Cartels - Complex infringement involving elements of agreements and elements of concerted practices - A single characterization as "an agreement and a concerted practice" - Whether permissible - Consequences as regards the proof to be adduced

(EEC Treaty, Art. 85(1))

7. Acts of the institutions - Reasons - Duty to state them - Scope - Decision implementing the competition rules

(EEC Treaty, Art. 190)

8. Action for annulment - Consideration by the Court of its own notion of the question of the existence of the contested measure - Conditions

(EEC Treaty, Art. 173, second paragraph)

Summary

1. In a decision addressed to an undertaking pursuant to Article 85(1) of the Treaty there may be used against it as evidence only documents from which it appeared, at the time when the statement of objections was issued and from the mention made of them in the statement or its annexes, that the Commission intended to rely upon them so that the undertaking was thus able to comment on their probative value at the appropriate time.

2. Once the Commission, going beyond what is required by observance of the rights of the defence, has established a procedure for providing access to the file in competition cases and has laid down the rules of that procedure and published in them in one of its reports on competition policy, it may not depart from the rules which it has imposed on itself and thus has the obligation to make available to the undertakings involved in Article 85(1) proceedings all documents, whether in their favour or otherwise, which it has obtained during the course of the investigation, save where the business secrets of other undertakings, the internal documents of the Commission or other confidential information are involved.

3. In order for there to be an agreement within the meaning of Article 85(1) of the EEC Treaty it is sufficient that the undertakings in question should have expressed their joint intention to conduct themselves on the market in a specific way. Such is the case where there were common intentions between undertakings to achieve price and sales volume targets.

4. Article 85 of the EEC Treaty is applicable to agreements between undertakings which are no longer in force but which continue to produce their effects after they have formally ceased to be in force.

5. The criteria of coordination and cooperation enabling the concept of concerted practice to be defined must be understood in the light of the concept inherent in the competition provisions of the EEC Treaty according to which each economic operator must determine independently the policy which he intends to adopt on the common market. Although this requirement of independence does not deprive economic operators of the right to adapt themselves intelligently to the existing and anticipated conduct of their competitors, it does, however, strictly preclude any direct or indirect conduct between such operators the object or effect whereof is either to influence the conduct on the market of an actual or potential competitor or to disclose to such a competitor the course of conduct which they themselves have decided to adopt or contemplate adopting on the market.

Participation in meetings concerning the fixing of price and sales volume targets during which information is exchanged between competitors about the prices which they intend to charge, their profitability thresholds, the sales volume restrictions they judge to be necessary or their sales figures constitutes a concerted practice since the participant undertakings cannot fail to take account of the information thus disclosed in determining their conduct on the market.

6. Since Article 85(1) of the Treaty lays down no specific category for a complex infringement which is nevertheless a single infringement because it consists of continuous conduct, characterized by a single purpose and involving at one and the same time factual elements to be characterized as "agreements" and elements to be characterized as "concerted practices", such an infringement may be characterized as "an agreement and a concerted practice" and proof that each of those factual elements presents the constituent elements both of an agreement and of a concerted practice is not simultaneously and cumulatively required.

7. Although under Article 190 of the EEC Treaty the Commission is obliged to state the reasons on which its decisions are based, mentioning the factual and legal elements which provide the legal basis for the measure and the considerations which led it to adopt its decision, it is not required, in the case of a decision applying the competition rules, to discuss all the issues of fact and of law raised by every party during the administrative proceedings.

8. Even though the Community court, in an action for annulment under the second paragraph of Article 173 of the Treaty, must of its own motion consider the issue of the existence of the contested measure, that does not mean that in every action brought under the second paragraph of Article 173 of the Treaty the possibility that the contested measure is non-existent must automatically be investigated. It is only in so far as the parties put forward sufficient evidence to suggest that the contested measure is non-existent that the Community court must review that issue of its own motion.

Parties

In Case T-10/89,

Hoechst Aktiengesellschaft, a company incorporated under German law, having its registered office in Frankfurt am Main (Germany), represented by H. Hellmann, Rechtsanwalt, Cologne, with an address for service in Luxembourg at the Chambers of Messrs Loesch and Wolter, 8 Rue Zithe,

applicant,

v

Commission of the European Communities, represented by Anthony McClellan, Principal Legal Adviser, and B. Jansen, a member of its Legal Department, acting as Agents, with an address for service in Luxembourg at the office of R. Hayder, a representative of its Legal Department, Wagner Centre, Kirchberg,

defendant,

APPLICATION for the annulment of the Commission' s decision of 23 April 1986 relating to a proceeding under Article 85 of the EEC Treaty (IV/31.149-Polypropylene),

THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES

(First Chamber),

composed of: J.L. Cruz Vilaça, President, R. Schintgen, D.A.O. Edward, H. Kirschner and K. Lenaerts, Judges,

Advocate General: B. Vesterdorf,

Registrar: H. Jung,

having regard to the written procedure and further to the hearing held from 10 to 15 December 1990,

after hearing the Opinion of the Advocate General delivered at the sitting on 10 July 1991,

gives the following

Judgment

Grounds

Facts and background to the action

1 This case concerns a Commission decision fining fifteen producers of polypropylene for infringing Article 85(1) of the EEC Treaty. The product which is the subject-matter of the contested decision (hereinafter referred to as "the Decision"), polypropylene, is one of the principal bulk thermoplastic polymers. It is sold by the producers to processors for conversion into finished or semi-finished products. The largest producers of polypropylene have a range of more than 100 different grades covering a wide range of end uses. The major basic grades of polypropylene are raffia, homopolymer injection moulding, copolymer injection moulding, high-impact copolymer and film. The undertakings to which the Decision is addressed are all major petrochemical producers.

2 The west European market for polypropylene is supplied almost exclusively from European-based production facilities. Before 1977, that market was supplied by ten producers, namely Montedison (now Montepolimeri SpA), Hoechst AG, Imperial Chemical Industries PLC and Shell International Chemical Company Limited (called "the big four"), which together account for 64% of the market, Enichem Anic SpA in Italy, Rhône-Poulenc S.A. in France, Alcudia in Spain, Chemische Werke Huels and BASF AG in Germany and Chemie Linz AG in Austria. Following the expiry of the controlling patents held by Montedison, seven new producers came on stream in western Europe in 1977: Amoco and Hercules Chemicals N.V. in Belgium, ATO Chimie S.A. and Solvay et Cie S.A. in France, SIR in Italy, DSM N.V. in the Netherlands and Taqsa in Spain. Saga Petrokjemi AS & Co, a Norwegian producer, came on stream in the middle of 1978, and Petrofina S.A. in 1980. The arrival of the new producers, with nameplate capacity of some 480 000 tonnes, brought a substantial increase in installed capacity in western Europe which for several years was not matched by the increase in demand in that market. This led to low rates of utilization of production capacity, which, however, rose progressively between 1977 and 1983, increasing from 60% to 90%. According to the Decision, supply and demand were roughly in balance from 1982. However, during most of the period covered by the investigation (1977-1983), the polypropylene market was reported to be characterized by either low profitability or substantial losses, owing in particular to the extent of the fixed costs and to the increase in the cost of the raw material, propylene. According to the Decision (point 8), in 1983 Montepolimeri SpA held 18% of the European polypropylene market, Imperial Chemical Industries PLC, Shell International Chemical Company Limited and Hoechst AG each held 11%, Hercules Chemicals N.V. slightly below 6%, ATO Chimie S.A., BASF AG, DSM N.V., Chemische Werke Huels, Chemie Linz AG, Solvay et Cie S.A. and Saga Petrokjemi AS & Co from 3 to 5% and Petrofina S.A. about 2%. The Decision states that there was a substantial trade in polypropylene between Member States because each of the EEC producers operating at that time supplied the product in most, if not all, Member States.

3 Hoechst AG was one of the producers supplying the polypropylene market before 1977 and is one of the "big four". Its market share was between about 10.5% and 12.6%.

4 On 13 and 14 October 1983, Commission officials, acting pursuant to Article 14(3) of Council Regulation No 17 of 6 February 1962, the first regulation implementing Articles 85 and 86 of the Treaty (Official Journal, English Special Edition 1959-1962, p. 87, hereinafter referred to as "Regulation No 17"), carried out simultaneous investigations at the premises of the following undertakings, producers of polypropylene supplying the Community market:

ATO Chimie S.A., now Atochem ("ATO"),

BASF AG ("BASF"),

DSM N.V. ("DSM"),

Hercules Chemicals N.V. ("Hercules"),

Hoechst AG ("Hoechst"),

Chemische Werke Huels ("Huels"),

Imperial Chemical Industries PLC ("ICI"),

Montepolimeri SpA, now Montedipe ("Monte"),

Shell International Chemical Company Limited ("Shell"),

Solvay et Cie S.A. ("Solvay"),

BP Chimie ("BP").

No investigations were carried out at the premises of Rhône-Poulenc S.A. ("Rhône-Poulenc") or at the premises of Enichem Anic SpA.

5 Following the investigations, the Commission addressed requests for information under Article 11 of Regulation No 17 (hereinafter referred to as "the request for information"), not only to the undertakings mentioned above but also to the following undertakings:

Amoco,

Chemie Linz AG ("Linz"),

Saga Petrokjemi AS & Co, which is now part of Statoil ("Statoil"),

Petrofina S.A. ("Petrofina"),

Enichem Anic SpA ("Anic").

Linz, which is an Austrian undertaking, contested the Commission' s jurisdiction and declined to reply to the request for information. In accordance with Article 14(2) of Regulation No 17, the Commission officials then carried out investigations at the premises of Anic and Saga Petrochemicals UK Ltd, the United Kingdom subsidiary of Saga, and of the selling agents of Linz established in the United Kingdom and in the Federal Republic of Germany. No request for information was sent to Rhône-Poulenc.

6 The evidence obtained during the course of those investigations and pursuant to the requests for information led the Commission to form the view that between 1977 and 1983 the producers concerned had, in contravention of Article 85 of the EEC Treaty, by a series of price initiatives, regularly set target prices and developed a system of annual volume control to share out the available market between them according to agreed percentage or tonnage targets. On 30 April 1984, the Commission therefore decided to open the proceedings provided for by Article 3(1) of Regulation No 17 and in May 1984 sent a written statement of objections to the undertakings mentioned above with the exception of Anic and Rhône-Poulenc. All the addressees submitted written answers.

7 On 24 October 1984, the hearing officer appointed by the Commission met the legal advisers of the addressees of the statements of objections in order to agree certain procedural arrangements for the hearing provided for as a part of the administrative procedure, which was to begin on 12 November 1984. At that meeting the Commission announced, as a result of the arguments advanced by the undertakings in their replies to the statement of objections, that it would shortly send them further material complementing the evidence already served on them regarding the implementation of price initiatives. On 31 October 1984, the Commission sent to the legal advisers of the undertakings a bundle of documents consisting of copies of the price instructions given by the producers to their sales offices together with tables summarizing those documents. In order to ensure the protection of business secrets, the sending of that material was made subject to certain conditions; in particular, the documents were not to be made known to the commercial services of the undertakings. The lawyers of a number of undertakings refused to accept those conditions and returned the documentation before the oral hearing.

8 In view of the information supplied in the written replies to the statement of objections, the Commission decided to extend the proceedings to Anic and Rhône-Poulenc. To that end, a statement of objections, similar to the statement of objections addressed to the other fifteen undertakings, was sent to those two undertakings on 25 October 1984.

9 The first session of the oral hearing took place from 12 to 20 November 1984. During that session all the undertakings were heard, with the exception of Shell (which refused to take part in any hearing) and Anic, ICI and Rhône-Poulenc (which considered that they had not had sufficient opportunity to prepare their case).

10 At that session, several undertakings refused to deal with the matters raised in the documentation sent to them on 31 October 1984, asserting that the Commission had completely changed the direction of its case and that at the very least they should have the opportunity to make written observations. Other undertakings claimed that they had had insufficient time to examine the documents in question before the hearing. A joint letter to that effect was sent to the Commission on 28 November 1984 by the lawyers of BASF, DSM, Hercules, Hoechst, ICI, Linz, Monte, Petrofina and Solvay. In a letter of 4 December 1984, Huels associated itself with the view taken in the joint letter.

11 Consequently, on 29 March 1985 the Commission sent to the undertakings a new set of documentation, setting out price instructions given by the undertakings to their sales offices, accompanied by price tables, as well as a summary of the evidence relating to each price initiative for which documents were available. It requested the undertakings to reply both in writing and at further sessions of the oral hearing and stated that it was removing the original restrictions on disclosure to commercial departments.

12 By another letter of the same date the Commission replied to the argument raised by the lawyers that it had not clearly defined the legal nature of the alleged cartel under Article 85(1) and invited the undertakings to submit written and oral observations.

13 A second session of the oral hearing took place from 8 to 11 July 1985 and on 25 July 1985. Anic, ICI and Rhône-Poulenc submitted their observations and the other undertakings (with the exception of Shell) commented on the matters raised in the Commission' s two letters of 29 March 1985.

14 The preliminary draft of the minutes of the oral hearing, together with all other relevant documentation, was given to the Members of the Advisory Committee on Restrictive Practices and Dominant Positions (hereinafter referred to as "the Advisory Committee") on 19 November 1985 and sent to the applicants on 25 November 1985. The Advisory Committee gave its opinion at its 170th meeting on 5 and 6 December 1985.

15 At the end of that procedure, the Commission adopted the contested decision of 23 April 1986, which has the following operative part:

"Article 1

ANIC SpA, ATO Chemie SA (now Atochem), BASF AG, DSM N.V., Hercules Chemicals N.V., Hoechst AG, Chemische Werke Huels (now Huels AG), ICI PLC, Chemische Werke LINZ, Montepolimeri SpA (now Montedipe), Petrofina S.A., Rhône-Poulenc S.A., Shell International Chemical Co. Ltd, Solvay & Cie and SAGA Petrokjemi AG & Co. (now part of Statoil) have infringed Article 85(1) of the EEC Treaty, by participating:

- in the case of ANIC, from about November 1977 until a date in late 1982 or early 1983,

- in the case of Rhône-Poulenc, from about November 1977 until the end of 1980,

- in the case of Petrofina, from 1980 until at least November 1983,

- in the case of Hoechst, ICI, Montepolimeri and Shell from about mid-1977 until at least November 1983,

- in the case of Hercules, LINZ and SAGA and Solvay from about November 1977 until at least November 1983,

- in the case of ATO, from at least 1978 until at least November 1983,

- in the case of BASF, DSM and Huels, from some time between 1977 and 1979 until at least November 1983,

in an agreement and concerted practice originating in mid-1977 by which the producers supplying polypropylene in the territory of the EEC:

(a) contacted each other and met regularly (from the beginning of 1981, twice each month) in a series of secret meetings so as to discuss and determine their commercial policies;

(b) set 'target' (or minimum) prices from time to time for the sale of the product in each Member State of the EEC;

(c) agreed various measures designed to facilitate the implementation of such target prices, including (principally) temporary restrictions on output, the exchange of detailed information on their deliveries, the holding of local meetings and from late 1982 a system of 'account management' designed to implement price rises to individual customers;

(d) introduced simultaneous price increase implementing the said targets;

(e) shared the market by allocating to each producer an annual sales target or 'quota' (1979, 1980 and for at least part of 1983) or in default of a definitive agreement covering the whole year by requiring producers to limit their sales in each month by reference to some previous period (1981, 1982).

Article 2

The undertakings named in Article 1 shall forthwith bring the said infringement to an end (if they have not already done so) and shall henceforth refrain in relation to their polypropylene operations from any agreement or concerted practice which may have the same or similar object or effect, including any exchange of information of the kind normally covered by business secrecy by which the participants are directly or indirectly informed of the output, deliveries, stock levels, selling prices, costs or investment plans of other individual producers, or by which they might be able to monitor adherence to any express or tacit agreement or to any concerned practice covering prices or market sharing inside the EEC. Any scheme for the exchange of general information to which the producers subscribe (such as Fides) shall be so conducted as to exclude any information from which the behaviour of individual producers can be identified and in particular the undertakings shall refrain from exchanging between themselves any additional information of competitive significance not covered by such a system.

Article 3

The following fines are hereby imposed on the undertakings named herein in respect of the infringement found in Article 1:

(i) ANIC SpA, a fine of 750 000 ECU, or Lit 1 103 692 500;

(ii) Atochem, a fine of 1 750 000 ECU, or FF 11 973 325;

(iii) BASF AG, a fine of 2 500 000 ECU, or DM 5 362 225;

(iv) DSM N.V., a fine of 2 750 000 ECU, or Fl 6 657 640;

(v) Hercules Chemicals N.V., a fine of 2 750 000 ECU, or Bfrs 120 569 620;

(vi) Hoechst AG, a fine of 9 000 000 ECU, or DM 19 304 010;

(vii) Huels AG, a fine of 2 750 000 ECU, or DM 5 898 447.50;

(viii) ICI PLC, a fine of 10 000 000 ECU, or 6 447 970;

(ix) Chemische Werke LINZ, a fine of 1 000 000 ECU, or Lit 1 471 590 000;

(x) Montedipe, a fine of 11 000 000 ECU, or Lit 16 187 490 000;

(xi) Petrofina S.A., a fine of 600 000 ECU, or Bfrs 26 306 100;

(xii) Rhône-Poulenc S.A., a fine of 500 000 ECU, or FF 3 420 950;

(xiii) Shell International Chemical Co. Ltd, a fine of 9 000 000 ECU, or 5 803 173;

(xiv) Solvay & Cie, a fine of 2 500 000 ECU, or Bfrs 109 608 750;

(xv) Statoil Den Norske Stats Oljeselskap AS (now incorporating SAGA Petrokjemi), a fine of 1 000 000 ECU or 644 797.

Article 4

...

Article 5

..."

16 On 8 July 1986, the definitive minutes of the hearings, incorporating the textual corrections, additions and deletions requested by the applicants, was sent to them.

Procedure

17 These are the circumstances in which, by application lodged at the Registry of the Court of Justice on 2 August 1986, the applicant brought this action seeking annulment of the Decision. Thirteen of the fourteen other addressees of the Decision have also brought actions for its annulment (Cases T-1/89 to T-4/89, T-6/89 to T-9/89 and T-11/89 to T-15/89).

18 The written procedure took place entirely before the Court of Justice.

19 By order of 15 November 1989, the Court of Justice referred this case and the thirteen other cases to the Court of First Instance, pursuant to Article 14 of the Council Decision of 24 October 1988 establishing a Court of First Instance of the European Communities (hereinafter referred to as "the Council Decision of 24 October 1988").

20 Pursuant to Article 2(3) of the Council Decision of 24 October 1988, an Advocate General was designated by the President of the Court of First Instance.

21 By letter of 3 May 1990, the Registrar of the Court of First Instance invited the parties to an informal meeting in order to determine the arrangements for the oral procedure. That meeting took place on 28 June 1990.

22 By letter of 9 July 1990, the Registrar of the Court of First Instance requested the parties to submit their observations on the possible joinder of Cases T-1/89 to T-4/89 and T-6/89 to T-15/89 for the purposes of the oral procedure. No party had any objection on this point.

23 By order of 25 September 1990, the Court joined the abovementioned cases for the purposes of the oral procedure, on account of the connection between them, in accordance with Article 43 of the Rules of Procedure, then applicable mutatis mutandis to the procedure before the Court of First Instance by virtue of the third paragraph of Article 11 of the Council Decision of 24 October 1988.

24 By order of 15 November 1990 the Court adjudicated on the requests for confidential treatment lodged by the applicants in Cases T-2/89, T-3/89, T-9/89, T-11/89, T-12/89 and T-13/89 and granted them in part.

25 By letters lodged at the Registry of the Court between 9 October and 29 November 1990, the parties replied to the questions put to them by the Court in a letter sent to them by the Registrar on 19 July 1990.

26 In the light of the answers provided to its questions, on hearing the report of the Judge Rapporteur and after hearing the views of the Advocate General the Court decided to open the oral procedure without any preparatory inquiry.

27 The parties presented oral argument and answered questions from the Court at the hearing which took place from 10 to 15 December 1990.

28 The Advocate General delivered his Opinion at the sitting on 10 July 1991.

Forms of order sought by the parties

29 Hoechst claims that the Court should:

(i) annul the Commission' s decision of 23 April 1986 relating to a procedure under Article 85(1) of the EEC Treaty (IV/31.149 - Polypropylene) in so far as it concerns the applicant, and in the alternative reduce the fine imposed;

(ii) order the defendant to pay the costs.

The Commission claims that the Court should:

(i) dismiss the application;

(ii) order the applicant to pay the costs.

Substance

30 The Tribunal considers that it is necessary to examine, first, the applicant' s grounds of challenge relating to a breach of the rights of the defence allegedly committed by the Commission in so far as it (1) failed to disclose to the applicant documents on which it based the Decision, (2) failed to give the applicant access to the whole of the file and (3) raised certain objections against the applicant for the first time in the Decision; secondly, the grounds of challenge relating to proof of the infringement concerning (1) the findings of fact made by the Commission and (2) the application to those facts of Article 85(1) of the EEC Treaty whereby it is contended that the Commission (A) did not correctly define the infringement, (B) did not correctly assess its anti-competitive effect; thirdly, the grounds of challenge relating to the reasoning of the Decision; and, fourthly, the grounds of challenge relating to the determination of the fine, which is alleged to be (1) partially time-barred, (2) disproportionate to the duration of the alleged infringement and (3) disproportionate to the gravity of the alleged infringement.

The rights of the defence

1. Non-disclosure of documents upon notification of the statement of objections

31 The applicant contends that under Article 4 of Regulation No 99/63 of the Commission of 25 July 1963 on the hearings provided for in Article 19(1) and (2) of Council Regulation No 17 (Official Journal, English Special Edition 1963-1964, p. 47) the Commission may in its decisions deal only with those objections in respect of which the undertakings have had the opportunity of making known their views. In the applicant' s view, that presupposes that the Commission should, in the statement of objections, provide a sufficient account of the factual circumstances and the legal conclusions which it draws from them, and should attach to that statement or make available to the undertakings the documents on which it intends to base its final decision.

32 In this case, it states that the Commission has based the decision on 28 documents or sets of documents which were not provided to it. The documents concerned consist of the note of a meeting of 13 May 1982 drawn up by an employee of Hercules (Decision, points 15(b) and 70), the note of a meeting of 10 March 1982 drawn up by an employee of ICI (Decision, point 15(b) ), a document allegedly found at the premises of Solvay dated 6 December 1977 (Decision, point 16, penultimate paragraph), Shell' s reply to the statement of objections (Decision, point 17), the replies of Amoco, ATO, BASF, DSM, Huels, Linz, Monte, Petrofina, Rhône-Poulenc, Saga and Solvay (Decision, point 18), circular letters sent by national sales offices to customers concerning price increases (Decision, point 25), two sets of minutes of Shell internal meetings held on 5 July and 12 September 1979 (Decision, points 29 and 31), a Solvay internal document (Decision, point 32), a reminder sent by Solvay to its sales offices on 17 July 1981 (Decision, point 35), articles from the trade press concerning polypropylene prices at the end of 1981 (Decision, point 36, third paragraph), an ICI internal note referring to the "firm climate" (Decision, point 46), a Shell document headed "PP W. Europe - Pricing" (Decision, point 49), Shell documents concerning the United Kingdom and France (Decision, point 49), an internal ATO note dated 28 September 1983 (Decision, point 51), an undated ICI note intended as a briefing for a meeting with Shell in or about May 1983 (Decision, point 63, second paragraph), a planning document relating to the first quarter of 1983 found at the premises of Shell (Decision, point 63, third paragraph) and, finally, documents from ATO, DSM and Shell concerning the conduct of meetings (Decision, point 70).

33 The applicant maintains that according to the case-law of the Court of Justice (judgments in Joined Cases 100 to 103/80 Pioneer v Commission [1983] ECR 1825, paragraph 29, and Case 107/82 AEG-Telefunken v Commission [1983] ECR 3151, paragraph 27) it is not sufficient, in order for evidence to be used against an undertaking, that it should have been made aware of it during the access-to-file procedure. The evidence must not only be disclosed to the undertakings by the Commission; it must also mention the probative force and the importance which it proposes to attach to them for the purposes of the decision to be made.

34 It adds that even documents which simply provide confirmation may have decisive importance for the purposes of proof and that it is not for the Commission to decide that certain documents are irrelevant to one or other of the undertakings when it asserts that each undertaking bears unrestricted liability for the conduct of other undertakings.

35 The applicant concludes that the items of evidence which were not disclosed to it cannot be used against it.

36 The Commission states that the applicant' s assertions concerning certain documents with which it claims not to have been able to acquaint itself are in part false and, for the rest, irrelevant in law.

37 It states first that the documents mentioned in point 25 of the Decision were disclosed to the applicant as appendices 19, 42, 46, 50 and 52 to the main statement of objections and as appendices to the letter of 29 March 1985 (Appendices I6 to I9), that the document mentioned in point 46 of the Decision is appendix 35 to the main statement of objections and that the ATO documents mentioned in point 70 of the Decision appear as appendices 60 and 72 to the main statement of objections.

38 The Commission goes on to state that the document mentioned in points 15(b) and 70 of the Decision, the replies of the undertakings to the Commission' s request for information mentioned in point 18 of the Decision, the document mentioned in point 40 of the Decision and the DSM and Shell documents mentioned in point 70 were made available to the applicant during the access-to-file procedure in June 1984. It adds that the document mentioned in points 15(b) and 70 of the Decision merely confirmed a document which constituted appendix 24 to the main statement of objections.

39 The Commission states that the other documents listed by the applicant were not provided to it either because they were of no relevance to the proceedings against it, since they concerned only the undertakings expressly mentioned in them, or because they merely confirmed other documents of which the applicant was already aware. It concludes that as regards the applicant the Decision is not based on those documents.

40 It acknowledges that as the result of an error an ICI note concerning an "experts' " meeting of 10 March 1982, mentioned in the Decision (point 58), was not disclosed but states that that note merely confirmed a note drawn up by Hercules of the same meeting which was attached to the main statement of objections (Appendix 23).

41 The Court notes that, according to the case law of the Court of Justice, the important point is not the documents as such but the conclusions which the Commission has drawn from them, and if those documents were not mentioned in the statement of objections, the undertaking concerned was entitled to take the view that they were of no importance for the purposes of the case. By not informing an undertaking that certain documents would be used in the Decision, the Commission prevented it from putting forward at the appropriate time its view of the probative value of such documents. It follows that those documents cannot be regarded as admissible evidence as far as it is concerned (judgment of the Court of Justice in Case 107/82 AEG-Telefunken AG v Commission [1983] ECR 3151, paragraph 27, and see most recently the judgment of 3 July 1991 in Case C-62/86 AKZO Chemie v Commission, not yet published in the Reports of Cases before the Court, at paragraph 21).

42 In this instance, only the documents mentioned in the main or specific statements of objections or in the letter of 29 March 1985, or those appended to them without being specifically mentioned therein, may be treated as admissible evidence as against the applicant in the present case. As far as the documents which are appended to the statements of objections but which are not mentioned therein are concerned, they may be used in the Decision as against the applicant only if the applicant could reasonably deduce from the statements of objections the conclusions which the Commission intended to draw from them.

43 It follows that, of the documents mentioned by the applicant, only the circular letters sent by national sales offices to their customers (Decision, point 25), the ICI internal note on the "firm climate" (Decision, point 46) and the documents found at the premises of ATO concerning questions discussed at meetings (Decision, point 70) may be used as evidence against the applicant, since they were mentioned respectively in the tables contained in the letter of 29 March 1985, in points 71, 94 and 102 of the main statement of objections, to which they also form Appendices A to I as regards the letter of 29 March 1985 and Appendices 35, 60 and 72 as regards the main statement of objections. The other documents referred to by the applicant may not be considered to be evidence admissible against it in the present case.

44 The question whether the last-mentioned documents provide essential support for the findings of fact made by the Commission against the applicant in the Decision falls to be considered by the Court in its examination of the question whether those findings are well founded. The Court also observes that the applicant has not alleged that those documents may contain material exculpating it.

2. Insufficient access to the file

45 The applicant contends that the restricted access which it was able to have to the file was contrary to the principle of a fair hearing. The applicant' s legal representatives consulted the Commission' s files in June 1984, but, as the responsible rapporteur of the Commission himself admitted, they were only provided with the items of evidence on which the Commission relied in the statement of objections in order to establish unlawful conduct or might rely in the subsequent proceedings. The Commission cannot rely on the judgment of the Court of Justice in Joined Cases 43 and 63/82 (VBVB and VBBB v Commission [1984] ECR 19) to justify such a restriction on access to the file since it concerned a different situation, namely the application of Article 85(3) of the EEC Treaty.

46 According to the applicant, such a restriction on the consultation of the file to the inculpatory items of evidence and the selection of documents which it presupposes cannot be accepted. They prevent the undertakings' lawyers from evaluating the importance of inculpatory and exculpatory evidence and determining whether the Commission has correctly assessed them. Since the Court itself generally does not have the opportunity of seeing the whole of the file, exculpatory documents which the Commission has not or not sufficiently used or assessed may remain buried in the Commission' s files.

47 Since it was unable to consult the file thoroughly, the applicant, like the Court, cannot know whether there were in fact exculpatory documents among those withheld from its consultation of the file. The very incomplete nature of the evidence put forward in this case not only requires the utmost care in weighing all the items of evidence but also arouses the suspicion that the Commission may have evaluated it in a biased manner.

48 It adds that even if the Commission is correct in its assertion that all the documents were made available with the exception of those containing confidential information, it is for the Court to ensure that those documents do not contain material exculpating undertakings.

49 The Commission states that it is not obliged to disclose the whole of the file to the parties concerned, as the Court of Justice has held in analogous circumstances (judgment in Joined Cases 43 and 63/82 VBVB and VBBB v Commission, cited above). In this case, moreover, although it was not obliged to do so the Commission granted access to virtually all the documents in its possession (with the exception of documents containing business secrets) at the time of the statement of objections and its additional letter of 29 March 1985. It gave access to other documents in the course of the access-to-file procedure in June 1984.

50 The Commission further maintains that it is not true that it used only inculpatory documents and withheld exculpatory documents. It points out that the applicant has not identified any document as a basis for its assertions.

51 The Court observes that regard for the rights of the defence requires that an applicant must have been put in a position to express, as it sees fit, its views on all the objections raised against it by the Commission in the statement of objections addressed to it and on the evidence which is to be used to support those objections and is mentioned by the Commission in the statement of objections or annexed to it (judgment of the Court of Justice in Case 322/81 Nederlandsche Banden-Industrie Michelin N.V. v Commission [1983] ECR 3461, paragraph 7 at p. 3498).

52 However, regard for the rights of the defence does not require that an undertaking involved in a procedure pursuant to Article 85(1) of the EEC Treaty must be able to comment on all the documents forming part of the Commission' s file since there are no provisions requiring the Commission to divulge the contents of its files to the parties concerned (judgment of the Court of Justice in Joined Cases 43 and 63/82 VBVB and VBBB v Commission, cited above, paragraph 25 at p. 59).

53 It must be observed, however, that in establishing a procedure for providing access to the file in competition cases, the Commission imposed on itself rules exceeding the requirements laid down by the Court of Justice. According to those rules, which are explained in the Twelfth Report on Competition Policy (pages 40 and 41), the Commission

"... permits the undertakings involved in a procedure to inspect the file on the case.

... Undertakings are informed of the contents of the Commission' s file by means of an annex to the statement of objections or to the letter rejecting a complaint, listing all the documents in the file and indicating documents or parts thereof to which they may have access.

They are invited to come and consult these documents on the Commission' s premises. If an undertaking wishes to examine only a few of them the Commission may forward copies.

However, the Commission regards the documents listed below as confidential and accordingly inaccessible to the undertaking concerned:

(i) documents or parts thereof containing other undertakings' business secrets;

(ii) internal Commission documents, such as notes, drafts or other working papers;

(iii) any other confidential information, such as documents enabling complainants to be identified where they wish to remain anonymous, and information disclosed to the Commission subject to an obligation of confidentiality."

The Commission may not depart from rules which it has thus imposed on itself (judgments of the Court of Justice in Case 81/82 Commission v Council [1973] ECR 575, paragraph 9 at p. 584, and in Case 148/73 Louwage v Commission [1974] ECR 81).

54 It follows that the Commission has an obligation to make available to the undertakings involved in Article 85(1) proceedings all documents, whether in their favour or otherwise, which it has obtained during the course of the investigation, save where the business secrets of other undertakings, the internal documents of the Commission or other confidential information are involved.

55 The Court observes that the Commission categorically denies that its officials failed to make available to the applicant all the documents which might contain material exculpating it.

56 In response to the Commission' s denials the applicant has not put forward any evidence to show that the Commission made only selected documents available to the applicant in order to prevent it from refuting the evidence advanced by the Commission to prove its participation in the infringement. It refers to statements made by the Commission' s rapporteur to its lawyer but has not proved or offered to prove that such statements were made and had the meaning which it attributes to them.

57 Consequently, this ground of challenge must be dismissed.

3. New objections

58 The applicant contends that the Decision (Article 1 and point 81) accuses the undertakings of having subscribed to a framework agreement which was implemented through a series of more detailed sub-agreements or a single continuing agreement for the purposes of Article 85(1) of the EEC Treaty, although there was no suggestion of a single general agreement in the statement of objections, which refers instead to a complex of agreements and concerted practices. In respect of certain specific matters and certain periods the statement of objections went so far as expressly to exclude the existence of agreements. In its letter of 29 March 1985 the Commission did envisage the existence of a "central agreement" but left that point hanging and provided no further details. Finally, it maintained without restriction its original accusation, which was again confirmed during the second series of hearings. Accordingly, the main accusation made in the Decision is new both in fact and in law, and the parties to the proceedings had no opportunity to state their position on that accusation.

59 It adds that the Commission cannot validly object that the accusation of an infringement contained in the statements of objections was simply replaced, having regard to the outcome of the administrative procedure, by a second accusation alleging the conclusion of a framework agreement without that entailing any change in the assessment of the material in the file. Those two accusations are entirely different in fact and in law. According to the judgment of the Court of Justice in Joined Cases 209 to 215 and 218/78 (Van Landewyck v Commission [1980] ECR 3125, paragraph 68) objections may only be re-drafted or supplemented. The completely new nature of the accusation resides in the concept of a "framework agreement" itself, which is totally separate from that of a "continued infringement".

60 According to the applicant, a "framework agreement" constitutes a very precise legal concept which it defines as a legal act by which the parties commit themselves in advance and lay down rules which determine the content of future legal acts or transactions or set general conditions to be specified in each case. The essential element of a "framework agreement" thus resides in a general prior consensus, which presupposes the will to be bound in respect of specific future acts. The existence of a framework agreement is thus necessarily prior to the agreements and concerted practices. However, the Commission has made no finding of fact and still less has it adduced any evidence from which it may be concluded that such a framework agreement was concluded in 1977. Indeed, the grounds of the Decision seem rather to refute than to support the idea of a framework agreement. In its account of the facts in relation to 1977 the Decision does not speak of a framework agreement and contains no finding of fact to that effect. On the contrary, the Decision seeks to prove a specific understanding on prices (the original floor-price agreement), without attributing it to a framework agreement. It does not even indicate the undertakings alleged to have concluded that framework agreement.

61 The applicant submits that it is not possible to conclude retrospectively, in the light of possible subsequent specific agreements, that a framework agreement existed. Since the essence of a framework agreement is to agree in advance on certain rules governing subsequent specific acts, the existence of a framework agreement can be inferred a posteriori from specific agreements only if the specific acts cannot be explained in any way other than by the prior conclusion of a framework agreement. The Commission made no such allegation before its defence and the facts found do not indicate that the various acts alleged to have been committed in 1977 and later years uniformly or regularly followed a previously arranged scheme of conduct. For example, the Commission speaks of a "system of regular meetings", but that assessment is not confirmed by the evidence, which does not reveal the slightest regularity in the holding of meetings.

62 The applicant submits that if the Commission now alleges the existence of a framework agreement it is in order to remedy, by a devious legal ploy, its inability to prove the existence of specific agreements or concerted practices, as is shown by the fact that it states in its defence that "it is reasonable to suppose that the meetings on whose subject-matter no details are known (essentially those held between the end of 1977 or the beginning of 1978 and the end of 1981) generally had the same purpose as those on which it does know the details."

63 Similarly, it states that it is in vain that, for the same reason, the Commission seeks to rely on the concept of a continuing infringement. Since that concept is intended to group together in a single general offence a series of separate offences each of which fulfils all the conditions of the infringement, it does not relieve the Commission of the obligation of adducing specific evidence, for each period concerned and each accusation, of an infringement of competition law.

64 The applicant concludes that as regards both the framework agreement and the continuing infringement the Commission should have specified in respect of which particular acts it considered that an agreement within the meaning of Article 85(1) of the EEC Treaty had been established before going on to group the various infringements together on that basis. Instead, it took the opposite course, by concluding from all the facts that there was a general "framework agreement" or a "single continuing agreement" without proving the existence of separate infringements, as is shown by point 81 of the Decision.

65 It argues that this error of law, which affects the factual elements and the legal basis of the Decision and even reaches its operative part, cannot be rectified before the Court and must therefore entail the annulment of the Decision. In theory, of course, the Court can itself examine the various acts in respect of which it considers the infringement to be established, but in that event the rights of the defence would be disregarded since the undertakings concerned would be made to defend themselves against accusations which the authorities prosecuting them have not yet made.

66 The Commission considers that it complied in every way with the case-law of the Court of Justice (judgment in Joined Cases 209 to 215 and 218/78 Van Landewyck v Commission, cited above), according to which it is entitled to use the results of the administrative procedure to "supplement and re-draft its arguments both in fact and in law in support of the objections which it maintains". The Commission refers to the terms of the statement of objections and its subsequent letter of 29 March 1985 and considers that it enabled a thorough discussion of the real nature of the cartel to be held during the administrative procedure. The Decision contains the conclusions which it drew from that debate.

67 It adds that the original statement of objections referred in several places (points 128 and 132) to "continuing and institutionalized cooperation". Moreover, in its letter of 29 March 1985 the Commission indicated that it did not exclude the possibility of a "core" agreement among the four major producers (p. 3) and that in relation to the other participants in the meetings the agreements stemmed from "a sufficiently detailed plan to amount to an 'agreement' or 'agreements' under Article 85" (p. 4).

68 According to the Commission, the framework agreement may be seen in the decision to establish an institutionalized system of producers' meetings in order to discuss the sales strategy to be adopted. That framework agreement was supplemented, where necessary, by specific agreements on concrete measures. What was involved was an overall plan implemented by increasingly intensive activities intended to have an influence on market forces by means of cooperation among polypropylene producers on prices, sales targets, market shares and related measures. That overall plan retained the same basic characteristics throughout, despite differences in its implementation owing to the mutual distrust of the participants.

69 The Commission denies having "invented" a framework agreement in order to cover the gaps in its evidence, as the applicant alleges.

70 The Court observes that the passages in the Decision which are criticized by the applicant correspond in their content to the objections made by the Commission in relation to the applicant and the other undertakings to which the Decision is addressed in the statements of objections which were sent to them.

71 Contrary to the assertions of the applicant, the Decision does not simply state baldly in point 81 that the undertakings in question "participated in an overall framework agreement which was manifested in a series of more detailed sub-agreements worked out from time to time" and that this was thus "a single continuing 'agreement' within the meaning of Article 85(1)", since the first of those phrases is preceded by the words "In the present case the producers, by subscribing to a common plan to regulate prices and supply in the polypropylene market ..." and the second is introduced by the words "The Commission considers that the whole complex of schemes and arrangements decided in the context of a system of regular and institutionalized meetings constituted ...". It follows that in the Decision the terms "framework agreement" and "single continuing 'agreement' " are merely means of expressing the fact that the Commission found the undertakings to which the Decision was addressed guilty of a single infringement whose various elements made up an integrated complex of systems of regular meetings of polypropylene producers, of the fixing of price targets and quotas, which had a single economic purpose, namely to distort the normal movement of prices on the polypropylene market.

72 That is precisely the purport of the whole of the main statement of objections sent to the applicant and to the other undertakings to which the Decision was addressed, in particular points 1, 5, 128, 132 and 151(a). For example, point 1 is worded as follows:

"The present statement of objections concerns the application of Article 85(1) of the EEC Treaty to a complex of arrangements and/or concerted practices by which from about 1977 to October 1983 the producers supplying the bulk thermoplastic polypropylene in the Common Market co-ordinated their sales and pricing policy on a continuing and regular basis by setting and implementing 'target' and/or minimum prices, controlling the tonnages supplied to the market by means of agreed 'targets' and/or quotas and meeting regularly in order to monitor the progress of the said restrictive arrangements."

The last sentence of point 132 states:

"Effectively the producers were aiming to control the market and a continuing and institutionalised co-operation at a high level was substituted for the normal play of competitive forces."

73 It should be added that tenor of the objections made in relation to the applicant and the other undertakings to which the Decision was addressed is confirmed by the letter which was sent to them on 29 March 1985, which states at page 4 that "Such arrangements constituted a sufficiently detailed plan to amount to an 'agreement' or 'agreements' under Article 85, at least as far as the producers involved in the meetings were concerned."

74 Consequently, the Court considers that in its Decision the Commission merely re-drafted and clarified from the point of view of the law the arguments on which it bases the objections which it has maintained and therefore has not prevented the applicant from stating its position on the objections before the Decision was adopted.

75 It follows that the applicant is wrong to accuse the Commission of having infringed the rights of the defence by raising new objections against it in the Decision.

Proof of the infringement

76 According to the Decision (point 80, first paragraph), from 1977 onwards the polypropylene producers supplying the EEC had been party to a whole complex of schemes, arrangements and measures decided on in the framework of a system of regular meetings and continuous contact. The Decision (point 80, second paragraph) goes on to state that the overall plan of the producers was to meet and reach agreement upon specific matters.

77 It is therefore necessary to verify first of all whether the Commission has established to the requisite legal standard its findings of fact relating to (A) the floor-price agreement, (B) the system of regular meetings, (C) the price initiatives, (D) the measures designed to facilitate the implementation of the price initiatives and (E) the fixing of target tonnages and quotas, taking into account (a) the contested decision and (b) the arguments of the parties, before going on to (c) an assessment of them; it will then be necessary to review the application of Article 85(1) of the EEC Treaty to those facts.

1. The findings of fact

A. The floor-price agreement

a. The contested decision

78 The Decision (point 16, first, second and third paragraphs; see also point 67, first paragraph) states that during 1977, after seven new polypropylene producers came on stream in western Europe, the established producers initiated discussions with a view to avoiding a substantial drop in price levels and attendant losses. As part of those discussions the major producers, Monte, Hoechst, ICI and Shell, initiated a "floor-price agreement" which was to be in operation by 1 August 1977. The original arrangement did not involve volume control but if it proved successful tonnage restrictions were envisaged for 1978. That agreement was to run for an initial period of four months and details of it were communicated to other producers, including Hercules, whose marketing director noted as the basis for floor prices for the major grades for each Member State a raffia grade market price of DM 1.25/kg.

79 According to the Decision (point 16, fifth paragraph), ICI and Shell admit that there were contacts with other producers as to how the price slide could be checked. According to ICI, a price level may have been suggested below which prices should not be permitted to fall. It is confirmed by ICI and Shell that discussions were not limited to the "big four". Precise details of the operation of the floor-price agreement could not be ascertained. However, by November 1977, when the raffia price was reported as having fallen to around DM 1.00/kg, Monte announced an increase to DM 1.30/kg due to take effect on 1 December, and on 25 November the trade press quoted the other three majors as expressing their support for the move, with similar increases planned from the same date or later in December.

80 According to the Decision (point 17, first and second paragraphs), it was at about this time that the system of regular meetings of the polypropylene producers began, and ICI claims that meetings were not held until December 1977 but has admitted that contact was occurring between producers before that date, probably by telephone and on an ad hoc basis. Shell says that its executives "may have had discussions concerning price with Montedison in or about November 1977 and Montepolimeri may have suggested the possibility of increasing prices and may have sought (Shell' s) views on its reactions to any increase". In the third paragraph of point 17 of the Decision it is stated that while there is no direct evidence of any group meetings being held to fix prices before December 1977, the producers were already informing meetings of a trade association of customers, the EATP, held in May and November of 1977, of the perceived need for common action to be taken to improve price levels. In May 1977 Hercules had stressed that the "traditional industry leaders" should take the initiative, while Hoechst had indicated its belief that prices needed to rise by 30 to 40%. GROUNDS CONTINUED UNDER DOC.NUM : 689A0010.1

81 It is in that context that the complaint is made against the applicant (Decision, point 17, fourth paragraph; point 78, third paragraph; and point 104, second paragraph) that, like Hercules, Linz, Rhône-Poulenc, Saga and Solvay, it stated that it would be supporting the announcement made by Monte in an article appearing in the trade press (European Chemical News, hereinafter referred to as "ECN") on 18 November 1977 of its intention to raise the price of raffia to DM 1.30/kg as from 1 December. The various statements made in this regard at the EATP meeting held on 22 November 1977, as recorded in the minutes, show that the DM 1.30/kg level set by Monte had been accepted by the other producers as a general industry "target".

(b) Arguments of the parties

82 The applicant states that in support of its assertion that an agreement on floor prices was reached in 1977 the Commission adduces only one piece of evidence, namely a handwritten note drawn up by an employee of Hercules (main statement of objections, Appendix 2), who was not a direct witness of the discussions reported in that note. It has not, moreover, been proved that Hercules was a party to that agreement.

83 It adds that the word "agreement" as used in that note is ambiguous inasmuch as it might merely represent a convergence of views.

84 The applicant draws further comfort from the fact that the price increase provided for in the note did not take place and that there is no evidence that it was postponed. It states that a postponement of that increase can certainly not be inferred from the note of the meeting of EATP on 22 November 1977 (main statement of objections, Appendix 6). The announcement by Monte of a price increase which is reported in that note does not support such an assertion, for two reasons: first, the public announcement of price increases is not prohibited by Article 85(1) of the EEC Treaty and, secondly, there is no basis for the assertion that the announcement was the result of an agreement, especially since Monte was not a member of EATP in 1977. It adds that the announcement by Monte at another meeting of EATP held on 26 May 1978 (main statement of objections, Appendix 7) of a price increase that had already been decided on is entirely irrelevant.

85 It repeats that the document found at the premises of Solvay which is mentioned in point 16, last paragraph, of the Decision cannot be used against it because it was not disclosed to it.

86 The Commission replies that the applicant has put forward no argument casting doubt on the content of the Hercules note describing the agreement on floor prices (main statement of objections, Appendix 2). It stresses that that note is entirely consistent with the announcements of uniform price increases made simultaneously by various producers at the EATP meetings on 22 November 1977 and 26 May 1978 (main statement of objections, Appendices 6 and 7).

(c) Assessment by the Court

87 The Court observes that the text of the note made by the Hercules employee to which the Commission refers is clear and unambiguous. It states:

"Major producers have made agreement (Mont., Hoechst, Shell, ICI) 1. No tonnage control; 2. System floor prices - DOM less for importers; 3. Floor prices from July 1. definitely Aug. 1st when present contracts expire; 4. Importers restrict to 20% for 1000 tonnes; 5. Floor prices for 4 month period only - alternative is for existing; 6. Com.[panies] to meet Oct. to review progress; 7. Subject [of the] scheme working - Tonnage restrictions would operate next year."

(There then follows a list of prices for three grades of polypropylene in four national currencies, including DM 1.25/kg for raffia.)

88 Faced with that evidence the applicant has simply maintained that there is no proof of the conclusion of an agreement since the author of the note was not a party to the agreement and the note is therefore unreliable, and the word "agreement" used in it merely reflects the identity of the undertakings' views regarding the need for a price increase.

89 The Court considers that the applicant' s submissions are not such as to weaken the evidentiary value given by the Commission to that note. The fact that Hercules was not a party to the original agreement on floor prices is irrelevant since the Commission expressly uses that note as a written contemporary account of the facts, showing that the producers other than Hercules reached an agreement.

90 Similarly, although the word "agreement" may in some cases refer to an identity of views it should be observed that in the note it is part of the expression "made agreement", which can only mean "concluded an agreement" and thus refers to something more than identity of views, a common intention among the applicant and three other producers on floor prices.

91 Nor does the fact that the agreed floor prices could not be achieved tell against the applicant' s participation in the floor-price agreement, since even if that fact is assumed to be established, it would at the most tend to show that the floor prices were not implemented, not that they were not agreed. However, far from asserting that the floor prices were achieved, the Decision (point 16, last paragraph) states that the price of raffia had fallen to around DM 1.00/kg in November 1977.

92 It follows that the Commission has established to the requisite legal standard that in mid-1977 a common purpose emerged among several polypropylene producers, including the applicant, concerning the fixing of floor prices and that in order to do so it did not need to rely on documents which it did not mention in its statements of objections or did not disclose to the applicant.

B. The system of regular meetings

(a) The contested decision

93 The Decision (point 17) states that the system of regular meetings of polypropylene producers began at about the end of November 1977. It goes on to state that ICI claims that meetings were not held until December 1977 (that is to say, after Monte' s announcement) but admitted that contact was occurring between producers before that date.

94 According to the Decision (point 18, first paragraph), at least six meetings were held during 1978 between senior managers responsible for the overall direction of the polypropylene business of some of the producers ("bosses"). This system soon evolved to include a lower tier of meetings attended by managers possessing more detailed marketing knowledge ("experts") (ICI' s reply to the request for information under Article 11 of Regulation No 17, main statement of objections, Appendix 8). The Decision asserts that the applicant was a regular participant at those meetings until at least the end of September 1983 (point 105, fourth paragraph).

95 In point 21 the Decision states that the purposes of these regular meetings were, in particular, the setting of target prices and sales volumes and the monitoring of their observance by the producers.

96 According to the Decision (point 68, second and third paragraphs), at the end of 1982 the "big four" began to meet in restricted session the day before each bosses' meeting. These so-called "pre-meetings" provided a forum in which the four major producers could agree a position between themselves prior to the full meeting in order to encourage moves towards price stability by adopting a united approach. ICI admitted that the topics discussed in pre-meetings were the same as those dealt with by the bosses' meetings which followed, but Shell denied that the "big four" meetings were in any sense preparatory to a plenary meeting or involved coordination on a common stance before the next meeting. The Decision states, however, that the records of some of those meetings (in October 1982 and May 1983) disprove this claim of Shell.

(b) Arguments of the parties

97 The applicant submits that the Commission has not adduced any evidence at all to support its reference to "a system of regular meetings". The evidence in the Commission' s possession does not show the slightest regularity in the holding and conduct of meetings or the names of participants. For example, according to table 3 of the Decision only six meetings were held in 1978, none in 1979, only one in 1980 and ten in 1981.

98 It repeats that it is in order to remedy the gaps in the evidence that the Commission alleges the existence of a framework agreement, as is shown by the fact that it indicates in its defence that "it is reasonable to suppose that the meetings on whose subject-matter no details are known (essentially those held between the end of 1977 or the beginning of 1978 and the end of 1981) generally had the same purpose as those on which it does know the details". That also shows that the Commission has no proof of its allegations concerning the purpose of the meetings held in the years from 1977 to 1981.

99 The applicant submits that in order to determine the purpose of the meetings the Commission relies on notes made by an ICI employee concerning certain producers' meetings, in which the result of the meetings is sometimes described as "agreed". It points out, first, that that description may mean that there was unanimity of opinion and, secondly, that the notes cannot objectively reflect the results of the meetings because, for example, of the personal interest of their author in making the results appear better than they were in fact.

100 The Commission states that it is clear from ICI' s reply to the request for information (main statement of objections, Appendix 8) that the meetings began in 1977 and that it was suggested that they be pursued on an ad hoc basis. Subsequently the meetings became more highly structured, more frequent and more regular. ICI stated in its reply that Hoechst was one of the regular participants in the meetings.

101 It adds that the applicant' s participation in the meetings is also attested by several notes of meetings found at the premises of ICI, which are themselves corroborated by various tables found at the premises of ICI and ATO (main statement of objections, Appendices 55 to 61), which include inter alia the sales figures of various producers. ICI stated in its reply to the request for information that those figures were provided by the producers themselves.

102 The Commission states that the purpose of those meetings was to agree on target prices, price initiatives and sales volume targets, to compare market shares and to adopt related measures, such as the "account leadership" system. The meetings were thus concerned with the harmonization of the participants' sales strategies.

103 It adds that the applicant has not given any valid reason to doubt the reliability of the documents produced by the Commission, in particular the notes of meetings drawn up by ICI' s employees.

(c) Assessment by the Court

104 The Court observes that ICI' s reply to the request for information (main statement of objections, Appendix 8) numbers the applicant, unlike two other producers, among the regular participants in the "bosses' " and "experts' " meetings. That reply must be interpreted as meaning that the applicant participated in meetings from the beginning of the system of "bosses' " and "experts' " meetings, which was instituted in late 1978 or early 1979.

105 ICI' s reply to the request for information is corroborated on this point by the mention, next to the applicant' s name, in various tables found at the premises of ICI, ATO and Hercules (main statement of objections, Appendices 55 to 61), of its sales figures for various months and years. Most of the applicants admitted in their replies to a written question put by the Court that the tables found at the premises of ICI, ATO and Hercules could not have been drawn up on the basis of statistics from the FIDES data exchange system. Indeed, in its reply to the request for information ICI stated in relation to one of the tables that "the source of information for actual historic figures in this table would have been the producers themselves". Moreover, in the course of the proceedings before the Court the applicant, in the face of this serious evidence, never specifically denied being present at the meetings, and it did not deny that they took place.

106 As regards the question whether the applicant participated in the meetings in 1978, the Court should point out that it is clear from a reading of point 18 of the Decision together with the particular objections addressed to Hoechst that it is accused of having participated in them.

107 The Court notes that rather than denying participation in the meetings held between 1978 and 1982 the applicant argues that the Commission has no proof that they were held or of their purpose.

108 The existence of producers' meetings in 1978 is established by ICI' s reply to the request for information, which states:

"During the first year (1978) about six 'ad hoc' meetings took place at about two-monthly intervals between the Senior Managers responsible for the polypropylene business of some producers."

That reply also indicates that the meetings began in about December 1977:

"Because of the problems facing the polypropylene industry ..., a group of producers met in about December 1977 to discuss what, if any, measures could be pursued in order to reduce the burden of the inevitable heavy losses about to be incurred by them",

that is to say, immediately after the EATP meeting of 22 November 1977, in which Hoechst participated.

109 The Court further observes that the meetings held in 1978 had the same purpose as the EATP meetings, namely to discuss measures to be taken in order to stifle the losses incurred by the polypropylene producers. ICI' s reply to the request for information states:

"It was felt to be essential for producers to consider appropriate means of alleviating this impending crisis which could, unless controlled in some way, lead eventually to the collapse of the polypropylene industry. It was proposed that future meetings of those producers who wished to attend should be called on an 'ad hoc' basis in order to exchange and develop ideas to tackle those problems .... Generally speaking, however, the concept of recommending 'Target Prices' was developed during the early meetings which took place in 1978 ...".

110 At the EATP meeting on 22 November 1977 the producers indicated that prices were too low and that they could not tolerate them indefinitely. Hoechst made the following statement:

"Yesterday morning, Hoechst announced a European wide modest price increase. The price increase will not bring us to a level which suits us, but we hope that it is going to improve our critical situation.

We hope that this move will not be misinterpreted. We think that it cannot be in the interests of both polymer makers and processors to go on in the way in which we have been during recent months."

The producers also stressed the need to increase prices and supported Monte' s announcement of a price increase.

111 Consequently, the Court considers that the meetings held in 1978 and subsequent years were a continuation for the producers of their statements at the EATP meeting on 22 November 1977.

112 It must also be pointed out that ICI' s reply to the request for information shows that those meetings were the point of departure, in terms both of their organization and their purpose, for the system of "bosses' " and "experts' " meetings in which the applicant participated from the end of 1978 or the beginning of 1799 onwards. That reply states that:

"By late 1978/early 1979 it was determined that the 'ad hoc' meetings of Senior Managers [' Bosses' ][of 1978] should be supplemented by meetings of lower level managers with more marketing knowledge [' Experts' ]."

and it should be recalled that the idea of recommending target prices, implemented through the system of "bosses' " and "experts' " meetings was developed during the 1978 meetings.

113 Consequently, the Court finds that since the applicant participated in both the EATP meeting of 22 November 1977 and the system of "bosses' " and "experts' " meetings the Commission was entitled to take the view that the applicant had participated in the meetings in 1978 which constituted for the producers a continuation of their statements made at the meeting of 22 November 1977 and enabled them to institute the system of "bosses' " and "experts' " meetings.

114 The Court considers that the Commission was fully entitled to take the view, based on the information which was provided by ICI in its reply to the request for information and was borne out by numerous meeting notes, that the purpose of the meetings was, in particular, to fix target prices and sales volumes. That reply contains the following passages:

"Generally speaking, however, the concept of recommending 'Target Prices' was developed during the early meetings which took place in 1978"; "' Target prices' for the basic grade of each principal category of polypropylene as proposed by producers from time to time since 1 January 1979 are set forth in Schedule ...";

and

"A number of proposals for the volume of individual producers were discussed at meetings".

115 The Court observes that the contents of the notes of meetings made by ICI are confirmed by various documents, such as a number of tables relating to the sales volumes of the various producers and price instructions broadly corresponding in their amount and date of entry into force to the target prices mentioned in those meeting notes. Similarly, the replies of the various producers to the requests for information addressed to them by the Commission bear out in the aggregate the contents of those notes.

116 Consequently, the Commission was able to take the view that the meeting notes found at the premises of ICI reflected fairly objectively what went on at the meetings which were chaired by different members of ICI' s staff, which increased the need for them properly to inform those members of ICI staff who did not attend particular meetings about what had transpired at them by making notes of them.

117 In those circumstances it is for the applicant to provide another explanation of the subject-matter of the meetings in which it participated, by putting forward specific evidence such as notes taken by its own employees at meetings which they attended or the testimony of those persons. It must be observed that the applicant has not put forward or offered to put forward such material before the Court.

118 In addition, in explaining the organization of marketing "experts' " meetings as well as "bosses' " meetings from the end of 1978 or the beginning of 1979, ICI' s reply to the request for information reveals that the discussions about the fixing of target prices and sales volumes became increasingly concrete and precise, whereas in 1978 the "bosses" had confined themselves to developing the actual concept of target prices.

119 Besides the passages set forth above, the following statement appears in ICI' s reply to the request for information: "Only 'Bosses' and 'Experts' meetings came to be held on a monthly basis". The Commission was fully entitled to deduce from that reply, as well as from the identical nature and purpose of the meetings, that they were part of a system of regular meetings.

120 As regards the particular role played by the "big four" in the system of meetings, it must be noted that Hoechst does not deny that meetings between the "big four" took place on 15 June 1981 in the absence of Hoechst, on 13 October and 20 December 1982, and on 12 January, 15 February, 13 April, 19 May and 22 August 1983 (Decision, Table 5, and main statement of objections, Appendix 64).

121 After December 1982, those meetings of the "big four" took place the day before the "bosses' " meetings, and their purpose was to determine the steps which they could take together in order to bring about a rise in prices, as is shown by the summary note prepared by an ICI employee in order to inform one of his colleagues about what had transpired at a pre-meeting on 19 May 1983 which the "big four" had attended (main statement of objections, Appendix 101). That note mentions a proposal to be submitted to the "bosses' " meeting on 20 May.

122 It follows that the Commission has established to the requisite legal standard that the applicant participated regularly in the regular meetings of polypropylene producers between the end of 1977 and September 1983, that the purpose of those meetings was, in particular, to set price and sales volume targets and that they were part of a system.

C. The price initiatives

(a) The contested decision

123 According to the Decision (points 28 to 51), a system for fixing price targets was implemented through price initiatives of which six could be identified, the first lasting from July to December 1979, the second from January to May 1981, the third from August to December 1981, the fourth from June to July 1982, the fifth from September to November 1982 and the sixth from July to November 1983.

124 With regard to the first of those price initiatives, the Commission (Decision, point 29) states that it has no detailed evidence of any meetings held or price initiatives undertaken in the first part of 1979. However, a note of a meeting held on 26 and 27 September 1979 shows that a price initiative had been planned based on a raffia grade price of DM 1.90/kg applicable from 1 July and DM 2.05/kg from 1 September. The Commission has price instructions from certain producers, including Hoechst, showing that those producers had given orders to their sales offices to apply this price level or its equivalent in national currencies from 1 September, in most cases before the planned price increase was announced in the trade press (Decision, point 30).

125 However, since it was difficult to get further price increases, the producers decided at the meeting held on 26 and 27 September 1979 to postpone the date for implementing the target by several months until 1 December 1979, the new plan being to "hold" the existing levels over October with the possibility of an immediate step increase to DM 1.90 or 1.95/kg in November (Decision, point 31, first and second paragraphs).

126 As regards the second price initiative, the Commission, whilst admitting (in point 32 of the Decision) that no meeting notes were found for 1980, states that at least seven producers' meetings were held in that year (reference is made to Table 3 of the Decision). Although at the beginning of the year producers were reported in the trade press as favouring a strong price push during 1980, a substantial fall occurred in market prices to a level of DM 1.20/kg or less before they began to stabilize in about September of that year. Price instructions issued by a number of producers - DSM, Hoechst, Linz, Monte, Saga and ICI - indicated that in order to re-establish price levels targets were set for December 1980 - January 1981 based on raffia at DM 1.50/kg, homopolymer at DM 1.70/kg and copolymer DM 1.95 to 2.00/kg. A Solvay internal document includes a table comparing "achieved prices" for October and November 1980 with what are referred to as "list prices" for January 1981 of DM 1.50/1.70/2.00. The original plan was to apply these levels from 1 December 1980 (a meeting was held in Zurich on 13 to 15 October) but this initiative was postponed to 1 January 1981.

127 The Decision (point 33) then refers to Hoechst' s participation in two meetings in January 1981, at which it was decided that a price increase, fixed in December 1980 for 1 February 1981, was required in two stages on the basis of DM 1.75/kg for raffia: the 1 February target was to remain at DM 1.75/kg and a target of DM 2.00/kg was to be introduced "without exception" from 1 March. A table was drawn up in six national currencies of the target prices for six principal grades, to come into effect on 1 February and 1 March 1981.

128 According to the Decision (point 34), the plan to move to DM 2.00/kg on 1 March not, however, appear to have succeeded. The producers modified their expectations and now hoped to reach the DM 1.75/kg level by March. An experts' meeting, of which no record survives, was held in Amsterdam on 25 March 1981 but immediately afterwards at least BASF, DSM, ICI, Monte and Shell gave instructions to raise target (or "list") prices to the equivalent of DM 2.15/kg for raffia, effective on 1 May. Hoechst gave identical instructions for 1 May but was some four weeks behind the others in doing so. Some of the producers allowed their sales offices flexibility to apply "minimum" or "rock bottom" prices somewhat below the agreed targets. During the first part of 1981 there was a strong upward movement in prices, but despite the fact that the 1 May increase was strongly promoted by the producers momentum was not maintained. By mid-year the producers anticipated either a stabilizing of price levels or even some downward movement as demand fell during the summer.

129 As regards the third price initiative, the Decision (point 35) states that Shell and ICI had already foreseen a further price initiative in September/October 1981 in June of that year when the slowing down of the first-quarter price rise had become apparent. Shell, ICI and Monte met on 15 June 1981 to discuss methods of implementing higher prices in the market. Within a few days of this meeting both ICI and Shell instructed their sales offices to prepare the market place for a major rise in September based on a plan to move the raffia price to DM 2.30/kg. Solvay also reminded its Benelux sales office on 17 July 1981 to warn customers of a substantial price increase due to take effect on 1 September, the exact amount of which was to be decided in the last week of July, when an experts' meeting was planned for 28 July 1981. The original plan to go for DM 2.30/kg in September 1981 was revised, probably at this meeting, with the planned level for August back to DM 2.00/kg for raffia. The September price was to be DM 2.20/kg. A handwritten note obtained at the premises of Hercules and dated 29 July 1981 (the day after the meeting, which Hercules probably did not attend) lists these prices as the "official" prices for August and September and refers in cryptic terms to the source of the information. More meetings were held in Geneva on 4 August and in Vienna on 21 August 1981. Following these sessions, new instructions were given by producers to go for a price of DM 2.30/kg on 1 October. BASF, DSM, Hoechst, ICI, Monte and Shell gave virtually identical price instructions to implement these prices in September and October.

130 According to the Decision (point 36), the plan now was to move during September and October 1981 to a "base price" level of DM 2.20 to 2.30/kg for raffia. A Shell document indicates that originally a further step increase to DM 2.50/kg on 1 November had been mooted but was abandoned. Reports from the various producers showed that during September prices increased and the initiative continued into October 1981 reaching achieved market prices of some DM 2.00 to 2.10/kg for raffia. A Hercules note shows that during December 1981 the target of DM 2.30/kg was revised downwards to a more realistic DM 2.15/kg, but reports that "general determination got prices up to DM 2.05, the closest ever to published (sic) target prices". By the end of 1981, the trade press was reporting polypropylene market prices as raffia DM 1.95 to 2.10/kg, some 20 pfennig below the producers' targets. Capacity utilization was said to be running at a "healthy" 80%.

131 The fourth price initiative of June to July 1982 took place as supply and demand returned into balance on the market. That initiative was decided upon at the producers' meeting of 13 May 1982 in which Hoechst participated and during which a detailed table of price targets for 1 June was drawn up for various grades of polypropylene in various national currencies (DM 2.00/kg for raffia) (Decision, points 37, 38 and 39, first paragraph).

132 The meeting of 13 May 1982 was followed by price instructions from ATO, BASF, Hoechst, Hercules, Huels, ICI, Linz, Monte and Shell, corresponding, with a few insignificant exceptions, to the target prices set at the meeting (Decision, point 39, second paragraph). At the meeting on 9 June 1982, the producers were able to announce only modest increases.

133 According to the Decision (paragraph 40), the applicant also participated in the fifth price initiative of September-November 1982 decided upon at the meeting on 20 and 21 July 1982, the aim of which was to achieve a price of DM 2.00/kg by 1 September and DM 2.10/kg by 1 October, since it was present at the majority if not all of the meetings held between July and November 1982 in which this initiative was planned and monitored (Decision, point 45). At the meeting on 20 August 1982, the increase planned for 1 September was postponed until 1 October, and that decision was confirmed at the meeting on 2 September 1982 (Decision, point 41).

134 Following the meetings of 20 August and 2 September 1982, ATO, DSM, Hercules, Hoechst, Huels, ICI, Linz, Monte and Shell gave price instructions in accordance with the price target set at those meetings (Decision, point 43).

135 According to the Decision (point 44), at the meeting on 21 September 1982, in which the applicant participated, an examination of the measures taken to achieve the target previously set was undertaken and the undertakings expressed general support for a proposal to raise the price to DM 2.10/kg by November-December 1982. That increase was confirmed at the meeting on 6 October 1982.

136 Following the meeting on 6 October 1982, BASF, DSM, Hercules, Hoechst, Huels, ICI, Linz, Monte, Shell and Saga gave price instructions applying the increase decided upon (Decision, point 44, second paragraph).

137 Like ATO, BASF, DSM, Hercules, Huels, ICI, Linz, Monte and Saga, the applicant supplied the Commission with price instructions issued to its local sales offices, which corresponded not only with each other in terms of amount and timing but also with the target-price table attached to ICI' s account of the "experts' " meeting held on 2 September 1982 (Decision, point 45, second paragraph).

138 According to the Decision (point 46, second paragraph), the December 1982 meeting resulted in an agreement that the level planned for November-December was to be established by the end of January 1983.

139 Finally, according to the Decision (point 47), the applicant participated in the sixth price initiative of July-November 1983. At the meeting on 3 May 1983, it was agreed that the producers would try to apply a price target of DM 2.00/kg in June 1983. However, at the meeting on 20 May 1983, the target previously set was postponed until September and an intermediate target was fixed for 1 July (DM 1.85/kg). Subsequently, at a meeting on 1 June 1983, the producers present, including Hoechst, reaffirmed complete commitment to the DM 1.85/kg increase. On that occasion, it was agreed that Shell would lead publicly in European Chemical News (ECN).

140 The Decision (point 49) states that after the meeting of 20 May 1983, ICI, DSM, BASF, Hoechst, Linz, Shell, Hercules, ATO, Petrofina and Solvay issued instructions to their sales offices to apply from 1 July a price table based on DM 1.85/kg for raffia. It goes on to state that only fragmented price instructions were obtained from ATO and Petrofina but these confirmed that these producers were implementing the new price levels, somewhat belatedly in the case of Petrofina and Solvay. The Decision concludes that, with the exception of Huels, for which the Commission found no price instructions for July 1983, all the producers which had attended the meetings or had promised support for the new price target of DM 1.85/kg are shown to have given instructions to implement the new price.

141 The Decision (point 50) also points out that further meetings, in which all the regular participants took part, took place on 16 June, 6 and 21 July, 10 and 23 August and 5, 15 and 29 September 1983. At the end of July and beginning of August 1983, BASF, DSM, Hercules, Hoechst, Huels, ICI, Linz, Solvay, Monte and Saga all issued price instructions to their various national sales offices for application from 1 September based on raffia at DM 2.00/kg, whilst a Shell internal note of 11 August, relating to its prices in the United Kingdom, indicated that its United Kingdom subsidiary was "promoting" basic prices to be in force on 1 September corresponding to the targets fixed by the other producers. By the end of the month, however, Shell was instructing the United Kingdom sales office to postpone the full increase until the other producers had established the desired basic level. The Decision states that, with minor exceptions, those instructions were identical by grade and currency.

142 According to the Decision (point 50, last paragraph), the instructions obtained from the producers show that it was later decided to maintain the impetus of the September move with further steps based on raffia at DM 2.10/kg on 1 October, rising to DM 2.25/kg on 1 November. It is further stated (point 51, first paragraph) that BASF, Hoechst, Huels, ICI, Linz, Monte and Solvay each sent instructions to their sales offices setting identical prices for October and November, with Hercules initially fixing slightly lower prices.

143 The Decision (point 51, third paragraph) states that an internal note obtained at the premises of ATO and dated 28 September 1983 shows a table headed "Rappel du prix de cota (sic)" giving for various countries prices for September and October for the three main grades of polypropylene which are identical to those of BASF, DSM, Hoechst, Huels, ICI, Linz, Monte and Solvay. During the investigation at the premises of ATO in October 1983 the representatives of the undertaking confirmed that these prices were communicated to sales offices.

144 According to the Decision (point 105, fourth paragraph), whatever the date of the last meeting, the infringement lasted until November 1983, since the agreement continued to produce its effects at least until that time, November being the last month for which it is known that target prices were agreed and price instructions issued.

145 Finally, the Decision (point 51, last paragraph) points out that, according to the trade press, by the end of 1983 polypropylene prices had "firmed" to reach a raffia market price of DM 2.08 to 2.15/kg (compared with the reported target of DM 2.25/kg).

(b) Arguments of the parties

146 The applicant submits in essence that the Commission has failed to prove its participation in the price initiatives. It considers that the evidence put forward by the Commission does not support its objections, and these are further contradicted by the applicant' s actual conduct on the market.

147 As regards the 1979 price initiative, the applicant states that the only item of proof that the Commission has been able to produce is the note of a meeting held on 26 and 27 September 1979 (main statement of objections, Appendix 12) whose text does not reveal whether the DM 2.05/kg price target which it mentions was the individual target fixed by the author of the note, whether it represented the general view or whether, as the Commission maintains, it was the result of agreement among the producers. The applicant points out, however, that the author of the note also observes that it is not possible to achieve that price on 1 October or 1 November. In spite of that, the Commission alleges that there was a price increase on 1 September agreed upon at that meeting.

148 It states that for 1980 the Commission has no evidence of the existence of an agreement on prices.

149 As regards the 1981 price initiatives the applicant argues that the Commission has produced only one piece of evidence, a note of two meetings held in January 1981 (main statement of objections, Appendix 17) which simply contains an indication of a target price which the Commission has been obliged to acknowledge (Decision, point 34) was not achieved.

150 As regards the price initiatives in 1982 and 1983, it points out that the Commission has produced a number of notes made by representatives of certain producers concerning the meetings. It reiterates that it has already stated the reasons why those notes are unreliable and that the word "agreed" which appears in some of them has several senses and is not necessarily to be understood as meaning an actual agreement, since it may refer simply to a convergence of views. It adds that ICI' s reply to the request for information (main statement of objections, Appendix 8) does not reveal the existence of agreements between the participants in the meetings. Finally, it observes that in order to confirm the existence of agreements on price increases the Commission relies on allegedly parallel price instructions issued by the various producers to their sales offices, but that when those price instructions were disclosed to the undertakings they were not told that they might be used as evidence in these proceedings. The applicant considers that they are therefore inadmissible and must be excluded.

151 The applicant states that in view of the disputable and incomplete nature of the evidence on the price agreements the Commission should have verified, by observing the market, whether the undertakings engaged in collective conduct corresponding to the agreements, and in particular whether it can be inferred that the undertakings concerned had the intention to commit themselves. In Hoechst' s view the existence of such an intention to commit themselves is contradicted by the fact that for several years the undertakings acted on the market in a way which did not correspond to the alleged agreements.

152 It submits in that regard that although the Commission refused to do so, it is necessary to take into account the actual conduct on the market of the undertakings involved in the proceedings, and in particular the continued price competition. The net sales proceeds broken down by customer and by month in the studies carried out by an independent firm of auditors, Coopers & Lybrand (hereinafter referred to as "the Coopers & Lybrand audit") is evidence of price formation which differed so much according to the individual case that it decisively refutes the Commission' s assertions of uniform collective conduct on the market, as regards both the application of single price targets or minimum prices and the alleged concerted price increases.

153 On the basis of tables showing Hoechst' s business relations with three customers in 1982 the applicant concludes that its net prices diverged from the list prices to a degree which varied according to the customer but was very significant, going as far as - 30.7%, and that its net prices fell despite rising list prices and the alleged concerted price increases, since for every increase in price of DM 0.10, that is to say 4.5%, its net prices fell by from 2.5% to 19.7% depending on the customer.

154 It submits further tables from which it draws the following conclusions: less than 3% of all the quantities concerned were sold at the current list price; slightly less than 23% was sold at a price above the list price, while nearly 75% had to be sold at a price below the current list price. Those tables also show that, of the quantities sold at above list prices, 6.8% were sold at more than 5% above list price, whereas more than half the quantities were sold at prices more than 5% below the current list price and more than a quarter were sold at prices more than 10% below list price.

155 According to the applicant, the micro-economic results of the Coopers & Lybrand audit correspond to the results of a competitive market which a macro-economic analysis would predict, having regard to the relevant basic data, general conditions and economic indicators. It appears from the study carried out by Professor Albach of the University of Bonn that the market results are no different from what could be expected in the event of effective competition on the polypropylene market. On the contrary, those results were for several years the consequence of ruinous competition on price and quantities. That study has been confirmed by a further study by the same professor covering a longer period and more undertakings, in which he also replies to the Commission' s objections to his initial study.

156 The applicant concludes from all those studies that the undertakings at no time entered into an agreement on price formation and that the existence of price agreements restricting competition is therefore not proved.

157 It submits that those circumstances make it impossible to regard the alleged uniformity of price instructions as conduct resulting from an agreement. Th