Case T-210/01: Action brought on 12 September 2001 by the General Electric Company against the Commission of the European Communities
Date: 2001-11-24
Institutions: Court of First Instance
Subjects: European Commission, action for annulment (EU), competition law, dominant position, economic concentration, electrical industry

C 331/24

EN

Official Journal of the European Communities

24.11.2001

Pleas in law and main arguments

It seeks annulment of

The applicant in the present case is a diversified technology
and manufacturing company incorporated under the laws of
the
the State of Delaware (USA).
Commission’s decision of 3 July 2001 (C(2001)1746 final,
adopted pursuant to Article 8(3) of Council Regulation (EEC)
No 4064/89 of 21 December 1989 on the control of
concentrations between undertakings, as last amended by
Regulation (EC) No 1310/97 of 30 June 1997 (‘the Merger
Regulation’).

It is pointed out in this regard that on 5 February 2001,
General Electric Company, a diversified industrial company
incorporated in the State of New York (USA), notified to the
Commission a proposed concentration pursuant to Article 4
of the Merger Regulation by which GE had agreed to acquire
the entire share capital of Honeywell.

economic analysis, and does not provide any evidence or
quantification of the alleged effects of bundling, cross-
subsidisation or predation on Honeywell’s rivals.

— The decision also infringes the applicant’s rights of
defence in that
it relies on new theories of cross-
subsidisation and predation, which either were not men-
tioned or were not developed in the statement of
objections in such a way as to allow the applicant to
defend itself.

The applicant underlines the fact that the present case concerns
the same markets and one of the same parties as those involved
in a merger which raised identical issues in the same industry
and was approved by the Commission less than 20 months
before the Commission adopted the contested decision.

Action brought on 12 September 2001 by the General
Electric Company against the Commission of the Euro-
pean Communities

In the contested decision, the Commission declared the notified
concentration to be incompatible with the common market
and with the EEA Agreement. According to that decision, the
proposed merger would lead to the creation or strengthening
of a dominant position on several markets, as a result of
which effective competition in the common market would be
significantly impeded.

(Case T-210/01)

(2001/C 331/40)

(Language of the case: English)

In support of its claims, the applicant submits that:

— The decision does not reflect the facts and relies for its
conclusions on manifest and serious factual errors. In
particular, there is no factual basis for the assertions in
that decision that bundling is a common practice in
the aerospace industry, that Honeywell has engaged in
extensive bundling in the past or that the proposed
merger with GE would have enabled the merged entity to
foreclose or marginalise rivals by engaging in bundling.

— The decision is based on manifest errors in its assessment
of the facts as regards, inter alia, its conclusions that the
merger in question would provide the incentive and the
means to engage in bundling in respect of BFE (Bayer
Furnished Equipment) products as well as SFE Supplier
Furnished Equipment) and SFE-option products,
that
customers in the aerospace industry will accept bundling,
and that bundling will marginalise Honeywell’s rivals and
force them out of the market.

— The decision is insufficiently reasoned in that it provides
no evidence in support of its conclusions concerning the
existence and effects of bundling, is not based on any

An action against the Commission of the European Communi-
ties was brought before the Court of First Instance of the
European Communities on 12 September 2001 by the General
Electric Company, a company incorporated under the laws of
the State of New York, represented by Nicholas Green QC,
Cherie Booth QC, Jessica Simor, Kelyn Bacon, Simon Baxter
and Marleen Van Kerckhove of Clifford Chance, Brussels, and
Louis Vogel and Joseph Vogel of Vogel & Vogel, Paris.

The applicant claims that the Court should:

— annul Commission Decision C(2001)1746 dated 3 July
2001 in Case COMP/M.2220 — General Electric/Hone-
ywell,

— order the Commission to pay the costs.

Pleas in law and main arguments

The applicant in this case is a diversified industrial corporation
incorporated in the State of New York (USA). On 5 February
2001, the applicant notified to the Commission, pursuant to
Article 4 of the Merger Regulation, a proposed concentration
by which the applicant has agreed to acquire the entire
share capital of Honeywell, an advanced technology and
manufacturing company incorporated in the State of Delaware
(USA).

24.11.2001

EN

Official Journal of the European Communities

C 331/25

The applicant is challenging the Commission’s decision declar-
ing the notified concentration to be incompatible with the
common market and the EEA Agreement.

European Communities on 14 September 2001 by Arnaldo
Lucaccioni, resident in St-Leonard-on-Sea (United Kingdom),
represented by Juan Ramon Iturriagagoitia, lawyer.

In support of its claim, the applicant submits that the decision
did not correctly apply the test
laid down in Article 2
of Regulation (EEC) No 4064/89 for declaring a merger
incompatible with the common market. According to the
applicant the decision failed to address, the question of the
creation or strengthening of a dominant position and the
concept of a significant barrier to competition.

The decision did not, according to the applicant, provide
sufficient evidence of the alleged practices of mixed bundling
of aircraft engines with avionics and non-avionics products.
Nor was the decision supported by an economic model
showing the negative effect of that practice on competition.
The decision did not provide evidence either of the incompati-
bility with the common market of the alleged vertical inte-
gration through the applicants leasing companies for commer-
cial and corporate jets and through Honeywell’s supply of
engine starters to engine manufacturers. Nor was the alleged
horizontal overlap between the two companies on the markets
for large regional jet engines, corporate jet engines and small
marine gas turbines supported by sufficient evidence.

The applicant claims that the Court should:

Primarily:

— annul the Commission’s decision of 16 November 2000,

— award a total of EUR 125 000 as compensation for

damage suffered,

— order the defendant to pay the costs.

Alternatively:

— acknowledge that Article 14 of the Provisions for the
Interpretation of the Rules on Insurance Against the Risk
of Accident and of Occupational Disease is unlawful.

further points out

The applicant
the commitments
proposed by the applicant to enter into were rejected by the
Commission without proper analysis.

that

The applicant also states that the Commission now paints an
entirely different picture of the market from that contained in
a decision 18 months earlier concerning the same market and
one of the same parties to the merger.

The applicant submits, in addition, that its rights of defence
were not respected, in that the Commission did not give access
to all relevant documents, or gave access to other documents
without allowing a sufficient period of time in which to review
them. The applicant also claims that its right to be heard was
not respected at the start of the investigation.

Action brought on 14 September 2001 by Arnaldo
Lucaccioni against the Commission of the European
Communities

(Case T-212/01)

(2001/C 331/41)

(Language of the case: French)

An action against the Commission of the European Communi-
ties was brought before the Court of First Instance of the

Pleas in law and main arguments

The applicant in the present action, who was granted perma-
nent invalidity at a rate of 130 % by decision of 15 April 1994,
objects to the Appointing Authority’s refusal to recognise an
aggravation of his occupational illness liable to give rise to
permanent invalidity pursuant to Article 14 of the Provisions
for the Interpretation of the Rules on Insurance Against the
Risk of Accident and of Occupational Disease (the Provisions).

In support of his claims the applicant puts forward the
following pleas:

— Invalidity of Article 14 of the Provisions, which stipulates
that accumulated allowances may not exceed 100 %, in
so far as the Staff Regulations Committee does not have
sufficient powers unconditionally recognised in the Staff
Regulations or the Rules,

— Breach of the principles of sound administration, duty to
have regard for the interests of officials, protection of
legitimate expectations and non-discrimination,

— Misuse of powers in this case.