2006/460/EC: Commission Decision of  17 December 2002  relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement against SGL Carbon AG, Le Carbone-Lorraine SA, Ibiden Co. Ltd, Tokai Carbon Co. Ltd, Toyo Tanso Co. Ltd, GrafTech International Ltd, NSCC Techno Carbon Co. Ltd, Nippon Steel Chemical Co. Ltd, Intech EDM BV and Intech EDM AG (Case C.37.667 — Specialty Graphite)  (notified under document number C(2002) 5083)
Date: 2002-12-17
Institutions: European Commission
Subjects: carbon, control of restrictive practices, price agreement, restriction on competition, unlawful agreement

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COMMISSION

COMMISSION DECISION

of 17 December 2002

relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement
against SGL Carbon AG, Le Carbone-Lorraine SA, Ibiden Co. Ltd, Tokai Carbon Co. Ltd, Toyo Tanso
Co. Ltd, GrafTech International Ltd, NSCC Techno Carbon Co. Ltd, Nippon Steel Chemical Co. Ltd,
Intech EDM BV and Intech EDM AG
(Case C.37.667 — Specialty Graphite)

(notified under document number C(2002) 5083)

(Only the English, French, German and Dutch versions are authentic)

(2006/460/EC)

On 17 December 2002, the Commission adopted a decision relating to a proceeding under Article 81
of the EC Treaty and Article 53 of the EEA Agreement. In accordance with the provisions of Article 30
of Council Regulation (EC) No 1/2003 (1), the Commission herewith publishes the names of the parties
and the main content of the decision, having regard to the legitimate interest of undertakings in the
protection of their business interests. A non-confidential version of the full text of the decision can be
found in the authentic languages of the case and in the Commission’s working languages on the
Competition Directorate-General website (http://ec.europa.eu.int/comm/competition/index_en.html)

1. SUMMARY OF THE INFRINGEMENT

1.1. Addressees

(1)

This decision is addressed to the following undertakings:

on account of the cartel affecting the isostatic specialty
graphite market:

— GrafTech International Ltd,

— SGL Carbon AG,

— Le Carbone-Lorraine SA,

— Ibiden Co. Ltd,

— Tokai Carbon Co. Ltd,

— Toyo Tanso Co. Ltd,

(2)

(3)

— Nippon Steel Chemical Co., Ltd/NSCC Techno Carbon

Co. Ltd,

— Intech EDM BV/Intech EDM AG;

(1) OJ L 1, 4.1.2003, p. 1. Regulation as amended by Regulation (EC)

No 411/2004 (OJ L 68, 6.3.2004, p. 1).

on account of the cartel affecting the extruded specialty
graphite market:

— SGL Carbon AG,

— GrafTech International Ltd.

1.2. Nature of the infringement

The case concerns two hard-core cartels between the
producers of
isostatic and extruded specialty graphite,
respectively. The Commission has gathered evidence
that from July 1993 to February 1998 in the isostatic
cartel, and from February 1993 to November 1996 in
the extruded one, the cartel participants agreed on price
targets for the product and exchanged sales volume and
other commercial
information. The two cartels covered
the whole world. The Decision deals with infringements
in the Community, as well as in the EEA since 1 January
1994.

Both infringements consists on the participation of the
abovementioned addressees
in continuing agreements
and/or concerted actions contrary to Article 81(1) of
the EC Treaty (from February 1986) and Article 53 of
the EEA Agreement (from January 1994) covering the
the EEA, by which they agreed on price
whole of
the product; agreed on price increases;
targets
exchanged sales volume and other commercial
infor-
mation and monitored and enforced their agreements.
isostatic market
The
also
the
concerned the agreement of
trading conditions and,
notably at local level, occasional repartition of customers.

arrangements

for

on

(4)

(5)

(6)

(7)

(8)

(9)

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1.3. Product

‘Specialty graphites’ is the general term widely used in the
industry to describe a group of graphite products for
diverse applications. Specialty graphite products are
often categorised by the way the graphite is produced:
isostatic graphite (produced through isostatic moulding),
used in EDM electrodes, continuous-casting dies, hot-
press moulds, semiconductor applications; and extruded
graphite (produced through extrusion), used in elec-
trolytic anodes and cathodes, boats,
sintering trays,
crucibles. The present proceedings concern isostatic and
extruded specialty graphite in blocks and cut blocks.

Intech EDM BV and Intech EDM AG also replied
jointly to the Commission’s objections.

(10) Replies to the SO were received between 19 and 25 July
2002. All the companies but Intech EDM AG and Intech
EDM BV recognised the infringement. None of
the
companies substantially contested the facts. An oral
hearing was held on 10 September 2002, during which
all parties had the opportunity to be heard.

1.4. Origin and procedural steps taken

that

Beginning in June 1997, the Commission carried out an
investigation on the graphite electrodes market. In the
course of
investigation, UCAR approached the
Commission in order to submit an application under
the ‘Leniency notice’. The submission took place on the
13 April 1999, and concerned alleged anticompetitive
practices in a market, specialty graphite, related to the
market on graphite electrodes.

On the basis of the documents submitted by UCAR, the
Commission addressed requests for information pursuant
to Article 11 of Regulation No 17 (1). Requests were sent
in March 2000 to SGL, Intech, POCO, LCL, Nippon Steel
Corporation,
Ibiden, Tokai and Toyo Tanso, requiring
detailed explanations concerning contacts with compe-
titors, evolution of prices and relevant
turnover. A
second set of letters was sent in July 2000 to Nippon
Carbon, NSCC and Schunk. The companies replied to
those requests for information during the months of
May to November 2000.

2. FINES

2.1. Basic amount

(11)

In fixing the amount of any fine, the Commission must
have regard to all relevant circumstances and particularly
the gravity and duration of the infringement, which are
the two criteria explicitly referred to in Article 15(2) of
Regulation 17.

2.1.1. Gravity

(12) According to the Guidelines, the Commission must take
account of (i) the nature of the infringement, (ii) its actual
impact on the market, and (iii) the size of the relevant
geographic market.

(13) The present infringements consist mainly of price-fixing
information,
practices and the exchange of commercial
which are by their very nature very serious violations of
Article 81(1) EC and Article 53(1) EEA.

The Commission addressed a further set of requests to
the addressees of the Statement of Objections (SO)
in
September
replies were
and October 2001. The
received between the end of October and the beginning
of December 2001.

(14) The cartel agreements were carefully implemented by
producers which,
for the relevant period, covered the
vast majority of the worldwide market for isostatic and
extruded specialty graphite. They must therefore have had
an actual impact on both markets in the EEA.

Upon reception of those responses, the Commission sent
a final request for information to the same undertakings
on 22 November 2001,
to which they replied in
December 2001.

this Decision. All parties

On 17 May 2002, the Commission sent a SO to the
submitted
addressees of
written observations in response to the Commission’s
SO. Nippon Steel Chemical Co., Ltd and NSCC Techno
Carbon Co., Ltd submitted a joint response. Similarly,

(1) OJ 13, 21.2.1962, p. 204/62.

(15) The cartels covered the whole of the common market
and, following its creation, the whole of the EEA. Every
part of
the
territory covered by the EEA, was under their influence.

the common market, and later

that of

(16) Taking into account the nature of the behaviour under
scrutiny, the actual impact on the isostatic and extruded
markets, and the fact that they covered the whole of the
common market and, following its creation, the whole of
the EEA, the Commission considers that the addressees of
the present draft Decision committed,
in both cases, a
very serious infringement of Article 81(1) EC and Article
53(1) EEA.

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2.1.2. Differential treatment

likely fines makes

(17) Within the category of very serious infringements, the
proposed scale of
it possible to
apply differential treatment to undertakings in order to
take account of the effective economic capacity of the
offenders to cause significant damage to competition and
to set the fine at a level which ensures it has sufficient
deterrent effect.

the fine determined for gravity is therefore increased by
30 %.

(24) UCAR committed an infringement of medium duration
of one year and two months. The starting amount of the
fine determined for gravity is therefore increased by
10 %.

(18)

In the circumstances of this case, which involves several
it will be necessary in setting the basic
undertakings,
amount of
the specific
weight and therefore the real
impact of the offending
conduct of each undertaking on competition.

the fines to take account of

(25)

(19)

For the purposes of calculating the fine on account of the
isostatic cartel, we propose to divide the companies into
five categories on the basis of their worldwide product
turnover. The first category includes SGL; the second
Toyo Tanso; in the third are placed LCL and Tokai ; in
the fourth Ibiden and NSC/NSCC; and in the fifth UCAR
and Intech.

(20) As for the cartel in the extruded specialty market, UCAR
and SGL had a similar presence in the worldwide market
for this product. They are therefore placed in a single
category.

2.1.3. Duration

2.1.3.1. I s o s t a t i c s p e c i a l t y g r a p h i t e

(21)

SGL, LCL,
Ibiden, Tokai, Toyo Tanso and NSC/NSCC
infringed Article 81(1) of the Treaty from July 1993
the EEA
until February 1998 and Article 53(1) of
Agreement from 1 January 1994 until February 1998.
UCAR committed the same infringement from February
1996 to May 1997, and Intech from February 1994 to
May 1997.

(22) Consequently, SGL, LCL, Ibiden, Tokai, Toyo Tanso and
NSC/NSCC have committed an infringement of
four
i.e. of medium duration. The
years and six months,
starting amounts of
the fines, determined by their
gravity, are therefore increased by 45 %.

(23)

Intech committed an infringement, of medium duration,
of three years and two months. The starting amount of

2.1.3.2. E x t r u d e d s p e c i a l t y g r a p h i t e

the EEA Agreement

SGL and UCAR have infringed Article 81(1) of the Treaty
from February 1993 to November 1996 and Article
53(1) of
from 1 January 1994
until November 1996, or three years and eight months,
i.e. of medium duration. The starting amounts of the
fines,
therefore
their
increased by 35 % for each company.

determined

gravity,

are

by

2.2. Aggravating circumstances (role of leader in the
infringement)

(26)

SGL was the leader and instigator of the infringement in
the isostatic specialty market. SGL has not contested the
Commission’s finding in this regard. This aggravating
circumstance justifies an increase of 50 % in the basic
amount of
the fines to be imposed on SGL for its
infringements affecting the isostatic specialty market.

(27) The Commission also considers that no specific ring-
leader can be identified for the infringement affecting
the extruded specialty market.

2.3. Attenuating circumstances

(28) The Commission considers

that

there

is only an
attenuating circumstance to be applied to Intech, in the
isostatic cartel, on account of some specific circum-
stances that only concern this undertaking. The invol-
vement of Intech in the isostatic cartel was particular
in that it was, to a considerable extent, under instructions
from Ibiden, in order to implement by its participation in
the European and local meetings, as Ibiden’s distributor,
(where
the decisions of principle taken at higher level
Intech). The Commission
Ibiden participated, but not
considers
justify a
reduction of 40 % in the basic amount of the fine to
be imposed on Intech for
its participation in the
infringement affecting the isostatic market

those specific circumstances

that

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2.4. Application of the Leniency Notice

(29) The addressees of the Decision have cooperated with the
Commission at different stages of the investigation for
the purpose of receiving favourable treatment set out in
the Commission’s Leniency Notice. In the draft Decision
it is proposed to apply the Leniency Notice as follows:

2.4.1. Non-imposition of a fine or a very substantial reduction
(Section B: reduction from of 75 to

its amount

of
100 %)

information to establish the

(30) The Commission accepts that UCAR was the first under-
taking to submit decisive evidence on the existence of an
international cartel affecting the EEA in the isostatic and
extruded specialty graphite industries. The Commission
also acknowledges that, when it was approached by
UCAR, it had not undertaken investigations, nor had it
sufficient
existence of
the infringements. UCAR had also put an end to its
the time at which it disclosed the
involvement at
cartels and did not compell other enterprises to take
part in those cartels. UCAR therefore fulfils, for both
infringements, the conditions set out in Section B of
the Leniency Notice. The Commission accordingly
grants UCAR a 100 % reduction of the fine that would
otherwise have been imposed on account of the each
infringement.

2.4.2. Substantial reduction in a fine (Section C: reduction

from 50 to 75 %)

(31) Neither SGL, LCL, Toyo Tanso, Tokai, Ibiden, NSC/NSCC
or Intech were the first to provide the Commission with
decisive information on the isostatic or extruded specialty
cartels, as required under point (a) of Section C of the
Leniency Notice. Consequently none of the above under-
takings meet the conditions as set out in this section C.

2.4.3. Significant reduction of a fine (Section D: reduction

from 10 to 50 %)

(32) Before the Commission adopted its SO, SGL, LCL, Ibiden,
Tokai, Toyo Tanso and NSC/NSCC provided the
Commission with information and documents which
materially contributed to establishing the existence of
the infringements. None of them substantially contests
the facts on which the Commission based its SO. The
information and documents provided allowed the
Commission to confirm and identify the functioning of
the cartels and certain elements thereof.

(33) Given that any cooperation under the Leniency Notice
must be voluntary and in particular outside the exercise

of any investigatory power, the Commission considers
that part of the information provided by these under-
takings was, in fact, an integral part of their replies to
the Commission’s formal requests for information. The
information provided by the undertakings is therefore
regarded
contribution within the
as
meaning of
the Leniency Notice only where it went
beyond that requested pursuant to Article 11 of Regu-
lation No 17.

voluntary

a

(34) The Commission concludes that the documents referred
to above provided detailed evidence of the organisational
structure of the cartel arrangements affecting the two
to establishing
markets
these infrin-
and/or confirming essential aspects of
gements. Together with UCAR’s
these
documents constitute the main source of evidence used
by the Commission in preparing the present Decision.

and contributed decisively

statement,

(35)

Furthermore, the Commission considers that it is not
possible to make a distinction as to the value added,
that those submissions provided, to the investigation in
the isostatic market, since they all took place, with short
in reaction to the Commission’s
differences in time,
formal request for information, and they all provided
evidence of
the
submissions was on its own essential for the Commission
to keep the substance of its objections in the infringe-
ment, since they substantially overlapped each other as to
the evidence provided.

similar quality. Moreover, none of

(36)

Intech did not provide any documentary evidence on
meetings in its reply to the Commission’s request for
information. However,
it did not substantially contest
the facts on which the Commission bases its allegations
in the SO.

(37)

SGL, LCL,
Ibiden, Tokai, Toyo Tanso and NSC/NSCC
therefore fulfil the conditions set out in section D(2),
first and second indent, of the Leniency Notice and are
granted a 35 % reduction of the fine. Intech fulfils the
conditions set out in section D(2), second indent, of the
Leniency Notice and is granted a 10 % reduction of fine.

2.5. Point 5(b) of the Guidelines on fines

(38) According to point 5(b) of the Guidelines on fines, the
Commission should take certain objective factors into
account, depending on the circumstances of a given
case, when fixing fines.

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2.5.1. Ability to pay

6. Toyo Tanso Co. Ltd,

from July 1993 to February

(39)

(40)

SGL and NSC have presented arguments relating to their
ability to pay. In particular, both companies have high-
lighted […] (*).

the Commission
In order to consider this argument,
companies’
requested detailed information on the
companies’
financial positions. After
examining the
replies of 20 November 2002, as well as SGL’s further
submission made on 8 November 2002, the Commission
concludes that it is not appropriate to adjust the amount
of the fines in this case. Although the financial data
provided by the two undertakings show that both SGL
and NSC are […], to take account of the mere fact of the
undertakings
to general market
conditions, would be tantamount to conferring an unjus-
tified competitive advantage on them.

[…], mainly due

2.5.2. Other factors

(41)

SGL is […].

(42) On 18 July 2001 the Commission imposed on SGL a
fine of EUR 80,2 million for violation of Article 81 of
the Treaty, as a result of the undertaking’s involvement in
the graphite electrodes cartel.

(43)

It follows that SGL is both in […] and has relatively
the
recently been imposed a
Commission. The Commission considers that,
in these
particular circumstances,
imposing the full amount of
the fine does not appear necessary in order to ensure
effective deterrence.

significant

fine by

(44)

In view of these two factors, the Commission considers
that,
in this specific case, the fine should be reduced
by 33 %.

1998;

7. Nippon Steel Chemical Co. Ltd and NSCC Techno
from

jointly and severally liable,

Carbon Co. Ltd,
July 1993 to February 1998;

8. Intech EDM BV and Intech EDM AG,

jointly and

severally liable, from February 1994 to May 1997.

(46) The following undertakings have infringed Article 81(1)
of the Treaty and Article 53(1) of the EEA Agreement by
participating, for the periods indicated, in a complex of
agreements
the
Community and EEA markets for extruded specialty
graphite:

concerted

practices

affecting

and

1. SGL Carbon AG, from February 1993 to November

1996;

2. GrafTech International, Ltd, from February 1993 to

November 1996.

(47) The undertakings listed above shall immediately bring to
an end the infringements referred to in that Article, in so
far as they have not already done so. They shall refrain
from repeating any act or conduct referred to above, and
from any act or conduct having the same or equivalent
object or effect.

(48)

For the infringements referred to above, the following
fines are imposed on the following undertakings:

(a) GrafTech International, Ltd

— Isostatic specialty graphite: EUR 0,

— Extruded specialty graphite: EUR 0;

3. DECISION

(b) SGL Carbon AG

(45) The following undertakings have infringed Article 81(1)
of the Treaty and Article 53(1) of the EEA Agreement by
participating, for the periods indicated, in a complex of
affecting
agreements
the
and
Community and EEA markets
isostatic specialty
graphite:

practices
for

concerted

1. GrafTech International Ltd, from February 1996 to

May 1997;

2. SGL Carbon AG, from July 1993 to February 1998;

3. Le Carbone-Lorraine SA, from July 1993 to February

1998;

4. Ibiden Co., Ltd, from July 1993 to February 1998;

— Isostatic specialty graphite: EUR 18 940 000,

— Extruded specialty graphite: EUR 8 810 000;

(c) Le Carbone-Lorraine SA: EUR 6 970 000;

(d) Ibiden Co. Ltd: EUR 3 580 000;

(e) Tokai Carbon Co. Ltd: EUR 6 970 000;

(f) Toyo Tanso Co. Ltd: EUR 10 790 000;

(g) Nippon Steel Chemical Co., Ltd and NSCC Techno
liable:
jointly

severally

Ltd,

and

Carbon Co.
EUR 3 580 000;

5. Tokai Carbon Co. Ltd, from July 1993 to February

(h) Intech EDM BV and Intech EDM AG,

jointly and

1998;

severally liable: EUR 980 000.

(*) Parts of this text have been edited to ensure that confidential infor-
mation is not disclosed; those parts are enclosed in square brackets.