Case C-307/04 P: Appeal brought on 15 July 2004 by SEC Corporation against the judgment delivered on 29 April 2004 by the Second Chamber of the Court of First Instance of the European Communities in joined cases T-236/01, T-239/01, T-244/01 to T-246/01, T-251/01 and T-252/01 between Tokai Carbon Co. Ltd and others and the Commission of the European Communities.
Date: 2004-09-25
Institutions: Court of Justice
Subjects: action for annulment (EU), carbon, chemical industry, coal by-products industry, control of restrictive practices, fine, restriction on competition

25.9.2004

EN

Official Journal of the European Union

C 239/1

I

(Information)

COURT OF JUSTICE

COURT OF JUSTICE

Appeal brought on 1 July 2004 by Showa Denko K.K.
against the judgment delivered on 29 April 2004 by the
Second Chamber of the Court of First Instance of the
European Communities in joined cases T-236/01, T-239/01,
T-244/01 to T-246/01, T-251/01 and T-252/01 between
Tokai Carbon Co. Ltd and others and the Commission of
the European Communities

The ‘size’ of the company or group in markets not affected by
the infringement are not relevant to the expected benefits and
incentives that a company might have to infringe the law, nor
do they relate to risk of detection. Economic analysis confirms
this. Conglomerate size and finances are therefore not relevant
for the calculation of any increase which is needed for deter-
rence.

(Case C-289/04 P)

(2004/C 239/01)

An appeal against the judgment delivered on 29 April 2004 by
the Second Chamber of the Court of First Instance of the Euro-
pean Communities in joined cases T-236/01, T-239/01, T-244/
01 to T-246/01, T-251/01 and T-252/01 between Tokai
Carbon Co. Ltd and others and the Commission of the Euro-
pean Communities, was brought before the Court of Justice of
the European Communities on 1 July 2004 by Showa Denko
(case T-245/01 (1)), established in Tokyo (Japan), repre-
K.K.
sented by M. Dolmans, J. Temple Lang and P. Werdmuller,
lawyers.

In other words, conglomerate size and finances cannot be a
reason to single out the Appellant and increase the fine on it.
Doing so is discriminatory, disproportionate, arbitrary, and not
supported by adequate reasoning.

The Appellant therefore maintains that the Commission and
the Court of First Instance were wrong to base the increase in
the Appellant's fine for ‘deterrence’ on the Appellant's group
turnover in products not affected by the infringement, without
any finding that deterrence was necessary or identifying any
rational basis for the amount of the increase.

The Appellant claims that the Court should:

(1) OJ C 17, 19.1.2002, p. 15.

— set aside the judgment in case T-245/01 Showa Denko K.K.

v. Commission of the European Communities in part;

— reduce

the amount of

to EUR
6,960,000 or by an amount considered appropriate by the
Court of Justice in the exercise of its discretion; and

the Appellant's

fine

— take any other measure that the Court of Justice deems

appropriate.

Pleas in law and main arguments:

The Appellant submits that there is no indication that the
Appellant's group or top management was involved in the
cartel, no evidence that the Appellant engaged in the infringe-
ments calculatedly, deliberately and knowingly, and certainly
no evidence that this was more so for the Appellant than for
the other participants. There is therefore no justification for
singling out the Appellant and imposing a special ‘deterrence
factor’ on it.

If a fine otherwise calculated needs to be increased for deter-
rence on this ground, then the amount of the increase must be
rationally based on the benefit which the company expected to
obtain from the infringement. This increase can only be based
on the company's turnover in the market affected by the infrin-
gement, adjusted for the probability or otherwise of detection.

Appeal brought on 15 July 2004 by SEC Corporation
against the judgment delivered on 29 April 2004 by the
Second Chamber of the Court of First Instance of the
European Communities in joined cases T-236/01, T-239/01,
T-244/01 to T-246/01, T-251/01 and T-252/01 between
Tokai Carbon Co. Ltd and others and the Commission of
the European Communities.

(Case C-307/04 P)

(2004/C 239/02)

An appeal against the judgment delivered on 29 April 2004 by
the Second Chamber of the Court of First Instance of the Euro-
pean Communities in joined cases T-236/01, T-239/01, T-244/
01 to T-246/01, T-251/01 and T-252/01 between Tokai
Carbon Co. Ltd and others and the Commission of the Euro-
pean Communities, was brought before the Court of Justice of
the European Communities on 15 July 2004 by SEC Corpora-
tion (case T-251/01 (1)), established in Amagasaki, Hyogo
(Japan), represented by K. Platteau, lawyer.

C 239/2

EN

Official Journal of the European Union

25.9.2004

The Appellant claims that the Court should:

Reference for a preliminary ruling by the Bundesfinanzhof
by order of that court of 20 April 2004 in the case of
Fleisch-Winter GmbH & Co. KG against Hauptzollamt
Hamburg-Jonas

(a) set aside in part the judgment under appeal in so far as it
determines that the Commission was entitled to use world-
wide product turnover as the differentiating factor when
setting the basic amount of the fine imposed on the Appel-
lant;

(b) annul Article 3 of the Decision (2), as modified by the Court
of First Instance, in so far as it imposes a fine of EUR 6.138
million on the Appellant, or, at least, substantially reduce
this fine further to such amount the Court deems appro-
priate; and

(c) order the Commission to pay the costs incurred before the

Court of First Instance and the Court of Justice.

Pleas in law and main arguments:

The Appellant submits that the judgment of the Court of First
Instance should be set aside on the following grounds:

1) Violation of Article 253 of the EC Treaty and the principles
of non bis in idem and of fairness by holding that the
Commission, in setting the fine imposed on SEC and in the
context of the particular features of this case, is not obliged
to take account of the sanctions previously imposed on SEC
by the US competition authorities based on the same facts.

2) Violation of Article 253 of the EC Treaty and the principles
of fairness and proportionality, by holding that the Commis-
sion is entitled to differentiate the basic amount of the fine
of
the worldwide
product turnover only, with disregard to the scope of SEC's
activities in the EEA.

the parties involved on the basis of

(1) OJ C 31, 2.2.2002, p. 12.
(2) Decision 2002/271/EC of 18 July 2001 relating to a proceeding
under Article 81 of the EC Treaty and Article 53 of the EEA Agree-
ment — Case COMP/E-1/36.490 — Graphite electrodes (OJ 2002,
L 100, p. 1).

(Case C-309/04)

(2004/C 239/03)

Reference has been made to the Court of Justice of the Euro-
pean Communities by order of the Bundesfinanzhof (Federal
Finance Court, Germany) of 20 April 2004 received at the
Court Registry on 21 July 2004, for a preliminary ruling in the
case of Fleisch-Winter GmbH & Co. KG against Hauptzollamt
Hamburg-Jonas (Hamburg-Jonas Principal Tax Office) on the
following questions:

1. Is the fact that on the basis of investigations carried out by
customs authorities there is a suspicion that a product is
subject to a ban under Community law which prohibits the
export of a product eligible for a refund from a particular
Member State to other Member States and to non-member
countries sufficient of
to exclude the existence of
sound and fair marketable quality within the meaning of the
first
(EC)
No 3665/87 (1) so that the actual condition or marketability
of the particular product is irrelevant?

of Regulation

of Article

sentence

itself

13

2. Is confirmation of sound and fair marketable quality within
the meaning of the first sentence of Article 13 of Regulation
(EC) No 3665/87, given in a national application for
payment, information for the purposes of the second para-
graph of Article 11(1)
in conjunction with Article 3 of
Regulation (EC) No 3665/97?

(1) OJ L 351, p. 1.