Case T-209/01: Action brought on 12 September 2001 by Honeywell International Inc. 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, economic concentration, electrical industry

24.11.2001

EN

Official Journal of the European Communities

C 331/23

Action brought on 10 September 2001 by Volkswagen
AG against the Commission of the European Communi-
ties

(Case T-208/01)

(2001/C 331/38)

(Language of the case: German)

An action against the Commission of the European Communi-
ties was brought before the Court of First Instance of the
European Communities on 10 September 2001 by Volkswag-
en AG, Wolfsburg (Germany), represented by R. Bechtold,
lawyer.

The applicant claims that the Court should:

— Annul the Commission’s decision of 29 June 2001 (Case

COMP/F-2/36.693 — Volkswagen);

— in the alternative, reduce the fine imposed by Article 2 of

the Decision;

— order the Commission to pay the costs.

Referring to the case-law of the Court of Justice, the applicant
submits that Volkswagen’s written and oral requests were
unilateral measures and not agreements within the meaning of
Article 81(1) EC. They were not incorporated in the dealership
agreement and the Contracting Parties did not subsequently
make them part of the agreement.

Further, the applicant maintains that there is no appreciable
effect on trade between the Member States. It has not been
proved that increasing or decreasing the discount by a few
percentage points would have led to a noticeable increase in
parallel trade.

Finally, the applicant submits that the fine imposed on it is
unfounded. Even supposing that there were infringement of
Article 81(1), the fine is excessively high.

Action brought on 12 September 2001 by Honeywell
International Inc. against the Commission of the European
Communities

(Case T-209/01)

(2001/C 331/39)

Pleas in law and main arguments

(Language of the case: English)

At the time of the launch of the new ‘VW Passat’ onto
the German market, the Volkswagen marketing director for
Germany sent a circular urging German Volkswagen dealers
and garages not to sell the new models for less than the
recommended retail price and to observe ‘strict price disci-
pline’.

On the basis of a complaint made by a car buyer, the
Commission initiated a formal procedure, which led to the
In the Decision, the
adoption of the contested Decision.
Commission found that the applicant, by fixing the selling
price of the VW Passat on the basis of the abovementioned
request, had infringed Article 81(1) EC. A fine of EUR
30,96 million was imposed on the applicant.

In support of its claims, the applicant argues that the conduct
complained of and not disputed by it did not
infringe
Article 81(1) EC. It admits that its employees contravened
German competition law in a way attributable to it. However,
the applicant submits that Article 81(1) does not contain a
prohibition on making recommendations. That provision
prohibits only anticompetitive agreements, decisions and
concerted practices but not requests and mere recommen-
dations.

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 Honeywell
International Inc., represented by Paul Lasok QC and Frederic
Depoortere of Skadden, Arps, Slate, Meagher & Flom LLP,
Brussels (Belgium).

The applicant claims that the Court should:

— join the present case with the action brought by General
Electric Co. for annulment of the Commission’s decision
of 3 July 2001,

— order such measures of inquiry (including the hearing as
witnesses or, as the case may be, as experts of the persons
identified in this application) as may appear necessary,

— annul the Commission’s decision of 3 July 2001,

— take such other or further steps as justice may require,

— order the Commission to pay its own and Honeywell’s

costs.

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).