Case T-25/06: Action brought on  24 January 2006  — Alliance One International v Commission
Date: 2006-01-24
Institutions: Court of First Instance
Subjects: European Commission, action for annulment (EU), fine, tobacco industry, unlawful agreement

C 60/50

EN

Official Journal of the European Union

11.3.2006

Form of order sought

— Declare Article 1.1(a) of Commission Decision C(2005)
4012 final, of 20 October 2005, relating to a proceeding
under Article 81(1) EC (Case COMP/C.38.281/B.2 — Raw
Tobacco Italy) partially null and void to the extent that it
refers to a longer duration of the infringement (which is
deemed to be terminated on 19 February 2002 instead of
15 January 2002, at the latest);

— declare Article 2(b) of the Contested Decision null and void
to the extend that MINDO should have been granted full
immunity from fines under the Leniency Notice, or in the
alternative, the amount of the fine imposed on MINDO and
on a joint and several basis to ‘Alliance One International’
should be substantially reduced;

— order the Commission to pay the costs of the proceedings.

Pleas in law and main arguments

By the contested Decision the Commission found that several
companies, including the applicant, infringed Article 81(1) EC
by way of agreements and/or concerted practices in the Italian
raw tobacco sector. The applicant requests the partial annul-
ment of this Decision invoking, firstly, an alleged infringement
of its legitimate expectations regarding the application of the
Leniency Notice. The applicant contests the Commission's
rejections of its application to benefit from immunity on the
grounds that another company, and not the applicant, was
entitled to immunity. According to the applicant, that other
the
company did not comply with the requirements of
Leniency Notice whereas the Commission failed to prove that
the applicant did not comply with the same requirements.

In the alternative, the applicant contends that its participation
to the infringements ceased on 15 January 2002 at the latest,
rather than on 19 February 2002, and that the fine imposed on
it should be reduced accordingly on this basis.

Further, the applicant considers that the Commission violated
the principles of proportionality and legal certainty as well as
the duty to state reasons regarding the assessment of the scope
of the applicant's restrictive conduct. According to the appli-
cant, the Commission failed to take into account that it partici-
pated in agreements regarding the purchase price and the quan-
tities of surplus production only in 1998 and 1999 and that it
did so in the context of interprofessional agreements authorised
under Italian legislation.

The applicant also invokes an infringement of the rights of
defence as well as of the principles of proportionality and legiti-
mate expectations in the calculation of the basic amount of the
fine. In this context the applicant alleges that the basic amount
of the fine materially exceeds the total value of the products
which were affected by the cartel practices; that the Commis-
sion has erred in the assessment of the two potential effects of
the restrictive practices cited in the contested Decision; that
those two potential effects are new to the contested Decision
and had not been stated in the Statement of Objections; and
that the Commission mistakenly applied a multiplying factor in

order to calculate the basic amount of the fine without taking
into consideration that at the time of the contested Decision's
adoption the applicant was not part of any large multinational
undertaking.

Further, the applicant invokes an infringement of the duty to
state reasons and the principles of legal certainty and of legiti-
mate expectations in connection with the Commission's alleged
failure to take certain mitigating factors into account, notably
the early termination of
the infringing conduct and the
minimal effects of the restrictive practices attributed to the
applicant.

Finally, the applicant also invokes an infringement of the prin-
ciples of proportionality and of legitimate expectations as well
as the duty to state reasons in the application of section 5(b) of
the Commission's guidelines, regarding the specific economic
and social context in which the restrictive practices took place.
It also alleges that the Commission failed to take into consid-
eration, when setting the amount of the fine,
its extremely
fragile economic situation and its ability to pay.

Action brought on 24 January 2006 — Alliance One Inter-
national v Commission

(Case T-25/06)

(2006/C 60/93)

Language of the case: English

Parties

Applicant: Alliance One International,
Inc.
[represented by: C. Osti, A. Prastaro, lawyers]

(Danville, USA)

Defendant: Commission of the European Communities

Form of order sought

— Annul Article 1.1(a) of Commission Decision C(2005)
4012 final, of 20 October 2005, relating to a proceeding
under Article 81(1) EC (Case COMP/C.38.281/B.2 — Raw
Tobacco Italy) insofar as it relates to SCC, Dimon Inc. and
Alliance One;

— accordingly reduce the fines imposed on Transcatab and
Dimon Italia- Mindo so that the fines do not exceed 10 %
of their turnover in the latest financial year;

— alternatively, reduce the fine imposed on Transcatab and
Dimon Italia- Mindo as the multiplying factor is not applic-
able;

— order the Commission to pay the costs.

11.3.2006

EN

Official Journal of the European Union

C 60/51

Pleas in law and main arguments

Form of order sought

By the contested Decision the Commission found that several
companies, including the applicant and its subsidiaries, Trans-
catab and Dimon Italia, later renamed Mindo, infringed Article
81(1) EC by way of agreements and/or concerted practices in
the Italian raw tobacco sector.

The applicant requests the partial annulment of this Decision
arguing, firstly, that by holding it jointly and severally liable for
the infringement committed by its subsidiaries, the Commission
breached the rules regulating responsibility of parent compa-
nies. The applicant contests in this context the arguments and
the evidence cited by the Commission in support of its finding.

The applicant also considers that the Commission breached
Article 23(2) of Regulation 1/2003 (1) by imposing fines which
exceed 10 % of the total turnover of its subsidiaries.

Finally, the applicant considers that the Commission should not
have applied a multiplying factor to its subsidiaries as this was
not justified on the basis of the parties' turnovers and the
Commission's decisional practice.
the
multiplying factor applied to it is higher than that applied to
another undertaking leading to an evident violation of propor-
tionality and lack of reasoning. The applicant also submits that
the reasoning for the application of a multiplying factor to
Mindo is inconsistent as it applies different criteria to determine
the same fine.

further argues that

It

(1) Council Regulation (EC) No 1/2003 of 16 December 2002 on the
implementation of the rules on competition laid down in Articles
81 and 82 of the Treaty, OJ L 1, 04/01/2003 p. 1.

— Annul Commission Decision C(2005) 4012 final, of 20
October 2005, relating to a proceeding under Article 81(1)
EC (Case COMP/C.38.281/B.2 — Raw Tobacco Italy)
insofar as it is addressed to the applicant;

— order the Commission to pay the costs.

Pleas in law and main arguments

By the contested Decision the Commission found that several
companies,
its indirect
including the applicant and one of
subsidiaries, infringed Article 81(1) EC by way of agreements
and/or concerted practices in the Italian raw tobacco sector. On
this basis, it imposed a fine on the applicant, jointly and sever-
ally with its subsidiary.

In support of its application the applicant contends, firstly, that
in the contested Decision the Commission adopted, without
giving any explanation or objective justification, a diametrically
opposed position to its own position in the Spanish raw
tobacco case which involved the same parent/subsidiary rela-
tionship, the same time frame, the same commodity, the same
buying prices and the same lack of involvement or knowledge
by the applicant. On this basis the applicant considers that the
Commission violated its obligation to state reasons, disregarded
the principle of equal treatment and violated the applicant's
legitimate expectations by imposing a fine on it for the infrin-
gement of its subsidiary.

The applicant further argues that the Commission failed to
prove to the requisite legal standard any decisive influence by
the applicant on the commercial behaviour of its subsidiary. In
this context, it submits that the Commission wrongly consid-
ered that requirements for reporting and for certain approvals
confirm its exercise of decisive commercial influence over its
subsidiary whereas this was not the case, due to the applicant's
very decentralised structure and organisation.

Action brought on 24 January 2006 — Universal v
Commission

(Case T-34/06)

(2006/C 60/94)

Language of the case: English

Parties

Applicant: Universal Corp. (Richmond, USA) [represented by: A.
Riesenkampff, T. Reher, M. Holzhäuser, C. Swaak, M. Mollica,
avocats]

Order of the Court of First Instance of 16 January 2006 —
Germany v Commission

(Case T -389/04) (1)

(2006/C 60/95)

Language of the case: German

The President of the First Chamber has ordered that the case be
removed from the register.

Defendant: Commission of the European Communities

(1) OJ C 300, 4.12.2004.