2007/691/EC: Commission Decision of 20 September 2006 relating to a proceeding under Article 81 of the Treaty establishing the European Community and Article 53 of the EEA Agreement (Case COMP/F/38.121 — Fittings) (notified under document number C(2006) 4180) (Text with EEA relevance )
Date: 2006-09-20
Institutions: European Commission
Subjects: fine, infringement procedure (EU), piping, price agreement, restrictive trade practice

27.10.2007

EN

Official Journal of the European Union

L 283/63

(Acts adopted under the EC Treaty/Euratom Treaty whose publication is not obligatory)

II

DECISIONS

COMMISSION

COMMISSION DECISION

of 20 September 2006

relating to a proceeding under Article 81 of the Treaty establishing the European Community and
Article 53 of the EEA Agreement
(Case COMP/F/38.121 — Fittings)

(notified under document number C(2006) 4180)

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

(Text with EEA relevance)

(2007/691/EC)

(1)

(2)

(3)

SUMMARY OF THE INFRINGEMENT

The Decision was addressed to Aalberts Industries NV,
Aquatis France SAS, Simplex Armaturen + Fittings
GmbH & Co. KG, VSH Italia Srl, Yorkshire Fittings
Limited, Advanced Fluid Connections plc, IBP Limited,
International Building Products France SA, International
Building Products GmbH, Delta plc, Aldway Nine
Limited, Delta Engineering Holdings Limited, Druryway
Samba
Flowflex
Limited,
Ltd,
IMI Kynoch Ltd, Mueller
Components Ltd,
Industries
Inc, Mueller Europe Ltd, WTC Holding
Company Inc, Pegler Ltd, Tomkins plc, FRA.BO SpA,
Supergrif SL, SANHA Kaimer GmbH & Co. KG, Kaimer
GmbH & Co. Holdings KG, SANHA Italia srl, Viega
GmbH & Co. KG, Legris Industries SA and Comap SA.

Flowflex Holdings
IMI plc,

The above 30 legal entities (belonging to 11 under-
takings, with some legal entities held liable as parent
companies) committed an infringement of Article 81 of
the EC Treaty and Article 53 of the EEA Agreement by
participating in a single and continuous infringement
between 31 December 1988 and 1 April 2004 in the
fittings industry in the EEA. Not all the undertakings
participated to the infringement for its entire duration.

(4)

(5)

(6)

The infringement’s main features included: competitors
discussing prices, agreeing, implementing and monitoring
price agreements as well as discounts and rebates,
agreeing on implementation mechanisms, allocating of
commercially
markets

exchanging

customers,

and

important and confidential market and/or company
information, participating in regular meetings
relevant
and having other contacts
to agree to the above
restrictions and monitor implementation within the EEA.

THE FITTINGS INDUSTRY

fittings

The product concerned is copper
including
copper alloy fittings (such as gunmetal, brass and other
copper-based alloys). A fitting connects tubes used in the
for plumbing,
transportation of water, air, gas, etc.
heating,
are
various types of fittings such as end-feed, solder ring,
compression, press and push-fit. All
these types are
implicated in this Decision.

sanitation and other purposes. There

the cartel covered the
The investigation showed that
the EEA. The 2003 EEA market value for
whole of
copper and copper alloy fittings was approximately
EUR 525 million for about 960 million pieces.

PROCEDURE

In January 2001 the company Mueller Industries Inc
informed the Commission of the existence of a cartel
in the Fittings industry (and in other related industries
in the copper tubes market) and expressed the wish to
cooperate with the Commission under
the 1996
Leniency Notice. Mueller provided the Commission
with evidence
carrying out of
inspections.

enabled the

that

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Official Journal of the European Union

27.10.2007

(7)

(8)

(9)

industrial

On 22 and 23 March 2001, the Commission carried out
concerning both
the
first unannounced inspections
copper tubes and fittings. Thereafter,
it
in April 2001,
was decided to separate the cases into copper plumbing
tubes (38.240) and fittings
tubes (38.069),
(38.121). Subsequently, on 24 and 25 April 2001, the
further unannounced on-site
Commission carried out
the Delta group. The
inspections at
latter inspections covered only fittings.
In the copper
the Commission adopted two decisions
tubes sector
imposing fines in the industrial tubes case (in 2003)
and the copper plumbing tubes case (in 2004).

the premises of

letters

requesting information,

the inspections and after
In September 2003, after
having sent
the IMI
group applied for leniency. This leniency application
the Delta group (March
was
2004) and Frabo (July 2004). The last leniency appli-
cation was
submitted by Oystertec/Advanced Fluid
Connections plc, in May 2005.

followed by those of

The Statement of Objections was addressed to 30 under-
takings belonging to 11 undertakings and to one as-
sociation of undertakings. All parties but Flowflex,
Comap and Supergrif exercised their right to be heard
and participated in the oral hearing which was held on
25 and 26 January 2006.

FUNCTIONING OF THE CARTEL

the collusive arrangements

(10) Whilst there are indications that the first anti-competitive
contacts between the UK producers of fittings occurred
prior
the
to 1988, evidence in the possession of
Commission demonstrates on a solid and lasting basis
that December 1988 was the starting date of the in-
fringement. On this basis the Commission considered
that
started in the UK
among UK manufacturers on 31 December 1988. As
to the behaviour of
fittings manufacturers at pan-
European level, due to the loose form and exploratory
nature of contacts before January 1991, the Commission
limited its assessment under competition rules to the
period from 31 January 1991, date of the first ‘Super-
EFMA’ meeting, when the competitors agreed on prices
arrangements were
pan-European
and when
evidenced as an organised and structured scheme.

the

(12)

of

the

overall

structure

anti-competitive
The
arrangements for the fittings products shows that they
can be considered as one single infringement whereby
competitors discussed prices, agreed,
implemented and
monitored price agreements as well as discounts and
implementation mechanisms,
rebates,
allocated markets
exchanged
and
commercially important and confidential market infor-
mation.

customers

agreed

and

on

FINES

Basic amount

Gravity

(13)

Regarding the gravity of the infringement, impact on the
market and its geographic scope, the infringement must
be qualified as very serious.

Differential treatment

(14) As there was considerable disparity between each under-
taking’s weighting in terms of turnover in the cartelised
industry,
differential
treatment (groupings) to take account of each under-
taking’s weighting: this approach seeks to differentiate
how each undertaking’s weighting damaged competition.

the Commission has

applied

(15)

The undertakings have been divided into six categories
according to their relative importance. As the basis for
determining the relative importance of the undertakings
in this infringement, the Commission took into account
the respective market shares of each undertaking with the
product concerned. The individual weight of the par-
ticipants in the infringement was compared on the
basis of their product market shares in the EEA for all
the undertakings, in the year 2000, except Aalberts and
Advanced Fluid Connections, for which the year 2003
was taken as the basis of differentiation. The Commission
chose 2000 because it was the most recent year of the
infringement in which all the undertakings to which this
Decision was addressed were active in the cartel except
the two undertakings mentioned.

(16) Accordingly Viegener and Aalberts were placed in the
first category. IMI and Delta were placed in the second
category, Advanced Fluid Connections in the third, Legris
Industries in the fourth, SANHA Kaimer, Flowflex, Frabo
and Mueller in the fifth and Pegler in the sixth category.

(11)

continued even after

Further evidence in the Commission’s file shows that this
infringement
the Commission
inspections in March and April 2001, as far as Comap,
IBP/Oystertec (Advanced Fluid Connections) and Frabo
are concerned until April 2004 and to a lesser extent
as far as Delta is concerned. With regard to Aalberts, it
participated in the infringement after the inspections
between June 2003 and April 2004. This is the first
cartel case which for certain participant companies
continued for three years after the inspections.

(17)

Sufficient deterrence

that

it has

sufficient deterrent

In order to set the amount of the fine at a level which
the
ensures
Commission considered it appropriate to apply a multi-
plication factor to the fine imposed on Tomkins/Pegler.
In 2005, the most recent financial year preceding the
turnover of Tomkins, Pegler’s
Decision,
mother company, was EUR 4,65 billion.

effect

total

the

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(18) Accordingly and in line with previous decisions,

the
Commission considered it appropriate to multiply the
fine for Tomkins.

(23)

Duration

Individual multiplying
applied
according to the duration of the infringement by each
legal entity.

factors were

also

Misleading information

Furthermore in its reply to the Statement of Objections,
Advanced Fluid Connections provided the Commission
with misleading information. In a statement annexed to
the reply to the Statement of Objections an employee of
Advanced Fluid Connections stated that he did not have
any telephone contacts with Frabo in the period between
telephone bills provided by
2001 and 2005. Several
that between
Frabo show, contrary to this statement,
April 2002 and July 2003, Frabo contacted Advanced
Fluid Connections via mobile phone at least 28 times.

AGGRAVATING CIRCUMSTANCES

Participation in the infringement after the inspections

(24)

This aggravating circumstance justified an increase in the
basic amount of the fine to be imposed on Advanced
Fluid Connections.

(19)

(20)

of

the

rules. When

The Decision established that Oystertec/Advanced Fluid
Connections, Comap, Frabo and to a lesser extent Delta
did not terminate the infringement immediately after the
inspections. These undertakings participated in the in-
fringement after the inspections had taken place. As far
as Aalberts is concerned,
it is established that it parti-
cipated in the infringement after the inspections between
June 2003 and April 2004. This behaviour is a blatant
disregard
the
competition
Commission conducts an inspection in a cartel case, it
officially alerts the undertakings concerned that compe-
tition rules may have been infringed.
In the over-
whelming majority of cases, experience has shown that
the inspections spur the undertakings to immediately put
an end to the infringement, providing thereby immediate
the
relief
Commission’s decision in the case.
the
inspections have the function to deter the undertakings
involved from continuing the infringement. Therefore,
for
inspections, undertakings
should immediately stop any infringing behaviour. None-
theless,
these undertakings disregarded the inspections
and certain of them continued as much as three years
after.

consumers, while

the period after

In this sense,

awaiting

the

the

for

(21)

This justified an increase in the basic amount of the fine
to be imposed on Aalberts, Advanced Fluid Connections,
Comap, Frabo and Delta.

(22) However, as far as Frabo is concerned,

the Decision
recognises that its contribution in this regard was par-
ticularly decisive. Frabo was the first company to disclose
the anti-competitive behaviour after the inspections and
provided the link for the years before and after the
inspections. Thus,
to
establish continuity between the two periods which
without Frabo’s contribution, could not have been
proven. Having regard to this circumstance and in line
with the principle of fairness, Frabo was not penalised
given it disclosed this post-inspection arrangement.
Consequently, Frabo was exempted from this aggravating
factor.

the Commission was

able

(25)

(26)

ATTENUATING CIRCUMSTANCES

Several undertakings claimed some or all of the following
attenuating circumstances: early termination of the in-
fringement, a minor/passive role,
the absence of an
effective implementation of the practices, the implemen-
tation of compliance programs, absence of benefit, diffi-
culties in the Fittings industry. These claims are all
rejected as being unfounded except for the minor/passive
role claimed by Flowflex. The basic amount for Flowflex
was therefore reduced by 10 %.

Cooperation outside the leniency notice

Frabo’s

The Decision considered that
cooperation
qualified for an attenuating factor in this regard. Frabo
was the first to disclose the duration of the cartel after
the inspections, and,
it was the first to
in particular,
provide evidence and explanations to prove continuity
the inspections and until
of
April 2004. Prior to Frabo’s leniency application,
the
Commission could not have established the duration
and continuity of the infringement from March 2001
until April 2004.

the infringement after

(27)

Frabo should not be penalised for its cooperation by
imposing on it a higher
it
cooperation.
would have had to pay without
Therefore the basic amount of Frabo’s fine was reduced
by the hypothetical amount of the fine that would have
been imposed on Frabo for a three year infringement.

fine than the one that
its

APPLICATION OF THE 10 % TURNOVER LIMIT

(28) Where appropriate, the 10 % worldwide turnover limit of
Article 23(2) of Council Regulation (EC) No 1/2003 (1)
was applied to the fines calculated.

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

(EC) No 1419/2006 (OJ L 269, 28.9.2006, p. 1).

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APPLICATION OF THE 1996 LENIENCY NOTICE

(29) Mueller,

Frabo

IMI, Delta,

Fluid
co-operated with the Commission at
Connections
different stages of
the investigation with a view to
receiving the favourable treatment set out in the 1996
Leniency Notice, applicable to the present case.

and Advanced

Exemption from fines

(30) Mueller was

first undertaking to inform the
the
Commission about
in the
the existence of a cartel
fittings sector affecting the EEA market in the 1990s.
The evidence Mueller provided enabled the Commission
to establish the existence, content and the participants of
a number of cartel meetings and other contacts held in
particular between 1991 and 2000 as well as
to
undertake inspections on 22 March 2001 and thereafter.
Mueller therefore qualified for total exemption from any
fine.

Reduction of fines

(31) On 18 September 2003 IMI approached the Commission
with a view to submitting a leniency application.
IMI
materially contributed to establishing the existence of
the
the
after
Statement of Objections, IMI informed the Commission
it confirmed the facts presented in its leniency
that
submissions.
IMI's cooperation was rewarded with a
50 % reduction of the fine.

infringement,

received

having

and

(32) On 10 March 2004, Delta submitted a leniency appli-
cation. Delta’s application was followed by other written
submissions, a meeting and the presentation of oral
statements. To a great extent, Delta corroborated the
leniency submissions.
facts presented by IMI
a 20 %
Delta's
reduction of the fine.

cooperation was

rewarded with

in its

the

first

that

to disclose

(33) On 19 July 2004, Frabo submitted a leniency application.
To a great extent Frabo corroborated the facts presented
by IMI and Delta in their leniency submissions. Frabo
was
infringement
continued for the period after the inspections and until
In addition, Frabo’s information was also
April 2004.
used to draft requests for information that contributed
Fluid Connections’
to
leniency
submission,
in which it provided evidence on partici-
pation in the infringement after the inspection. Based
on the foregoing, Frabo's cooperation was rewarded
with a 20 % reduction of the fine.

trigger Advanced

the

(34) On 24 May 2005, Advanced Fluid Connections
(Oystertec) submitted a leniency application. To a great
extent Advanced Fluid Connections corroborated the
facts presented by Frabo in its leniency submission.
in its reply to the Statement of Objections
However,

during

the Oral Hearing, Advanced

Fluid
and
Connections strongly contested that
the Commission
had established continuity between the periods before
and after the inspections until April 2004. Finally, as
indicated above, Advanced Fluid Connections misled
the Commission and attempted to weaken its ability to
after due
prove
con-
infringement. Therefore,
sideration of all these circumstances,
the Commission
did not grant Advanced Fluid Connections a reduction
of the fine

the

CLOSURE OF PROCEEDINGS

(35)

In view of the elements brought forward by the under-
takings and the association of undertakings in their
replies to the Statement of Objections and at the Oral
Hearing, the Commission had evidence that implicateed
the Fédération Française des Négociants en Appareils
et
Sanitaires,
Canalisations
(FNAS)
reached on 16
February 2004 to increase prices.

Chauffage-Climatisation
indirectly in an agreement

(36) However there was not sufficient evidence indicating that
FNAS actively accepted the task entrusted to it by the
manufacturers and that
indeed facilitated the im-
plementation of the agreement.

it

(37)

Consequently, the Commission came to the conclusion
that FNAS was not part of the agreement or any other
anti-competitive arrangements. Therefore the proceedings
against
the Fédération Française des Négociants en
Appareils Sanitaires, Chauffage-Climatisation et Canali-
sations (FNAS) were closed.

DECISION

(38)

The addressees of the Decision and the duration of their
involvement were as follows:

— Aalberts Industries NV, from 25 June 2003 until 1

April 2004,

— Aquatis France SAS, from 31 January 1991 until 22
March 2001 (IMI) and from 25 June 2003 until 1
April 2004 (Aalberts),

— Simplex Armaturen + Fittings GmbH & Co. KG, from
31 January 1991 until 22 March 2001 (IMI) and
from 25 June 2003 until 1 April 2004 (Aalberts),

— VSH Italia Srl, from 15 March 1994 until 22 March

2001,

— Yorkshire Fittings Limited, from 31 December 1988

until 22 March 2001,

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— Advanced Fluid Connections plc, from 23 November

— IMI Kynoch Ltd, from 31 December 1988 until 22

2001 until 1 April 2004,

March 2001,

— IBP Limited, from 23 November 2001 until 1 April

2004,

— International Building Products France SA,

from 4
April 1998 until 23 November 2001 (Delta) and
from 23 November 2001 until 1 April 2004
(Advanced Fluid Connections),

— International Building Products GmbH,
January 1991 until 23 November 2001,

from 31

— Delta plc,

from 31 December 1988 until 23

November 2001,

— Legris Industries SA, from 31 January 1991 until 1

April 2004,

— Comap SA,
2004,

from 31 January 1991 until 1 April

— Mueller Industries Inc., from 12 December 1991 until

12 December 2000,

— Mueller Europe Ltd., from 28 February 1997 until 12

December 2000,

— WTC Holding Company,

Inc.,
1997 until 12 December 2000,

from 28 February

— Aldway Nine Limited, from 28 July 1999 until 23

November 2001,

— Pegler Ltd, from 31 December 1988 until 22 March

2001,

— Delta

Engineering Holdings

Limited,

from 31

December 1988 until 23 November 2001,

— SANHA Kaimer GmbH & Co. KG, from 30 July 1996

until 22 March 2001,

— Druryway Samba Limited, from 31 December 1988

until 23 November 2001,

— Kaimer GmbH & Co. Holdings KG,

from 30 July

1996 until 22 March 2001,

— Flowflex Holdings Ltd, from 1 April 1989 until 22

March 2001,

— Flowflex Components Ltd, from 31 December 1988

until 22 March 2001,

— FRA.BO SpA, from 30 July 1996 until 1 April 2004,

— SANHA Italia srl,
March 2001,

from 1 January 1998 until 22

— Supergrif SL, from 22 July 1991 until 23 November

2001,

— Tomkins plc,
March 2001,

from 31 December 1988 until 22

— IMI plc, from 31 December 1988 until 22 March

— Viega GmbH & Co. KG, from 12 December 1991

2001,

until 22 March 2001.

(39)

Following the above recitals, the following fines were imposed:

(a) Aalberts Industries NV:

of which jointly and severally with:

EUR 100,80 million

(i) Aquatis France SAS: EUR 55,15 million; and

(ii) Simplex Armaturen + Fittings GmbH & Co. KG: EUR 55,15 million

(b) 1. IMI plc jointly and severally with IMI Kynoch Ltd:

EUR 48,30 million

of which jointly and severally with:

(i) Yorkshire Fittings Limited: EUR 9,64 million; and

(ii) VSH Italia Srl: EUR 0,42 million; and

(iii) Aquatis France SAS: EUR 48,30 million; and

(iv) Simplex Armaturen + Fittings GmbH & Co. KG:

EUR 48,30 million

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2. Aquatis France SAS and Simplex Armaturen + Fittings GmbH & Co.
KG are jointly and severally liable for the additional amount of:

EUR 2,04 million

(c) Advanced Fluid Connections plc:

EUR 18,08 million

of which jointly and severally with:

(i) IBP Limited: EUR 11,26 million; and

(ii) International Building Products

France SA: EUR 5,63 million

(d) Delta plc jointly and severally with Delta Engineering Holdings Limited:

EUR 28,31 million

of which jointly and severally with:

(i) Druryway Samba Limited: EUR 28.31 million; and

(ii) International Building Products GmbH: EUR 2,81 million; and

(iii) International Building Products France SA: EUR 5,63 million; and

(iv) Aldway Nine Limited: EUR 28,31 million; and

(v) Supergrif SL: EUR 0,59 million

(e) Flowflex Holdings Ltd

EUR 1,34 million

jointly and severally with Flowflex Components Ltd:

(f) FRA.BO SpA:

(g) Legris Industries SA:

of which jointly and severally

with Comap SA: EUR 18,56 million

(h) Tomkins plc

jointly and severally with Pegler Ltd:

(i) Kaimer GmbH & Co. Holdings KG:

of which jointly and severally with:

EUR 1,58 million

EUR 46,80 million

EUR 5,25 million

EUR 7,97 million

(i) SANHA Kaimer GmbH & Co. KG: EUR 7,97 million; and

(ii) SANHA Italia srl: EUR 7,15 million

(j) Viega GmbH & Co. KG:

EUR 54,29 million

(40)

The undertakings listed in recital 38 were ordered to bring to an end immediately the infringement
referred to in recital 3, insofar as they had not already done so and to refrain from repeating any act
or conduct described in recital 3, and from any act or conduct having an identical or similar object
or effect.