Summary for publication of Commission Decision of 24 January 2007 relating to a proceeding under Article 81 of the Treaty establishing the European Community and Article 53 of the EEA Agreement (Case COMP/38.899 — Gas Insulated Switchgear) (Notified under document number C(2006) 6762 final) (Text with EEA relevance)
Date: 2007-01-24
Institutions: European Commission
Subjects: electrical equipment, electrical industry, fine, restriction on competition, sale

10.1.2008

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Official Journal of the European Union

C 5/7

Summary for publication of Commission Decision

of 24 January 2007

relating to a proceeding under Article 81 of the Treaty establishing the European Community and
Article 53 of the EEA Agreement

(Case COMP/38.899 — Gas Insulated Switchgear)

(Notified under document number C(2006) 6762 final)

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

(Text with EEA relevance)

(2008/C 5/07)

SUMMARY OF THE INFRINGEMENT

PROCEDURE

(1) This Decision was addressed to ABB Ltd, Alstom (Société
Anonyme), Areva SA, Areva T&D AG, Areva T&D Holding
SA, Areva T&D SA, Fuji Electric Holdings Co., Ltd, Fuji
Electric Systems Co., Ltd, Hitachi Ltd, Hitachi Europe Ltd,
Japan AE Power Systems Corporation, Mitsubishi Electric
Corporation, Nuova Magrini Galileo SpA, Schneider
Electric SA, Siemens AG, Siemens Aktiengesellschaft
Österreich, Siemens Transmission & Distribution Ltd,
Siemens Transmission & Distribution
SA, Toshiba
Corporation and VA Tech Transmission & Distribution
GmbH & Co KEG.

(2) The above 20 legal entities (belonging to 10 undertakings,
with some legal entities held liable as parent companies)
infringed Article 81 of the EC Treaty and Article 53 of the
EEA Agreement by participating in a single and continuous
infringement between 15 April 1988 and 11 May 2004 in
the Gas Insulated Switchgear industry.

(3) Japanese and European providers of GIS coordinated the
allocation of GIS projects worldwide, with the exception of
notably the USA and Canada. They allocated projects
according to agreed rules, thereby respecting quotas and
price levels, while reserving some territories to certain
producers.

THE INDUSTRY

(4) Gas Insulated Switchgear (GIS) is used to control energy
flow in electricity grids. It is heavy electrical equipment,
used as a major component for turnkey power substations.
GIS is sold as a stand-alone product and as part of
GIS based turnkey power substations. The product
is
specialised and, therefore, custom made. Clients normally
specify their needs and ask potential suppliers to make a
bid. The annual worldwide market value of GIS projects
power
(stand-alone
stations
approximately
EUR 1 700-2 300 million during the years 2001-2003.

and associated services) was

product, GIS

turnkey

based

(5) The case was opened on the basis of the immunity applica-
tion, lodged by the Swiss undertaking ABB on 3 March
2004 in accordance with the Leniency Notice (1). ABB was
immunity from fines on 15 April
granted conditional
2004.

(6) The Statement of Objections was sent on 20 April 2006, a
supplementary SO was issued on 21 June 2006 and the
Oral Hearing took place on 18-19 July 2006.

(7) The Advisory Committee on Restrictive Practices and
Dominant Positions met on 8 December 2006 and
19 January 2007 and issued a favourable opinion.

FACTS

(8) The cartel had a complex structure. Firstly, there was a
common understanding between the participants that the
Japanese undertakings would not sell in Europe and the
European undertakings would not sell in Japan. Secondly,
projects outside defined European countries and Japan
were divided on the basis of global quotas. A number of
countries were excluded totally from the agreements,
notably the USA and Canada. Thirdly, based upon the
common understanding,
European undertakings
the
discussed among themselves projects relating to European
countries. These projects, however, were accounted for
under the global quotas that had been agreed upon with
the Japanese companies. Fourthly, certain European coun-
tries were designated ‘home countries’. These ‘home coun-
tries’ were left to the home-producers and sales in the
‘home countries’ were not included (loaded) in the calcula-
tion of the global quotas.

(9) The parties regularly met

— to allocate GIS projects in accordance with the set

quotas,

— to agree upon the prices that the assigned undertaking

could charge,

(1) OJ C 45, 19.2.2002, p. 3.

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— to agree upon the prices that members of the cartel
that were not to win the tender would bid in order to
leave the impression of genuine competition, and

— to agree upon the pricing parameters to respect when
themselves to

the parties could not agree amongst
whom the project would be allocated.

(10) The participants took elaborate measures to conceal their
cartel activities. Not only did the cartelists prepare spurious
bids in order to leave an impression of genuine competi-
they also used code names and increasingly
tion, but
from
sophisticated means of
private accounts with encrypted messages; mobile tele-
phones with encryption) to avoid detection.

communication (e-mail

(11) The evidence provided by the immunity applicant

in
combination with the findings of the Commission inspec-
tion enables the Commission to establish that the infringe-
ment started at least as early as April 1988 and lasted
until
i.e. 11 May
2004.

the day the Commission intervened,

industry, we have applied differential treatment (groupings)
to take account of each undertaking's weighting:
this
approach seeks to differentiate how each undertaking's
relative importance in the market concerned damaged
competition.

(16) The undertakings have been divided into four categories
according to their relative market size in the year 2003
(2001 for the parents of the Japanese joint-ventures).

Sufficient deterrence

(17) In order to set the amount of the fine at a level which
ensures that it has sufficient deterrent effect it is considered
appropriate to apply a multiplier
to the fines
imposed, based on the size of the undertakings concerned.
On this basis, the draft Decision proposes to multiply the
fine for those undertakings with a particularly large size
based on their worldwide turnover and to apply such
multiplier to Siemens, Hitachi, Toshiba, Melco and ABB.

factor

1. LEGAL ASSESSMENT

Duration

(12) On the basis of the above, it is concluded that a single and
continuous infringement of Article 81 of the EC Treaty
and Article 53 of the EEA Agreement took place from
15 April 1988 until 11 May 2004.

(18) Individual percentage increases will be applied according
to the duration of the infringement by each company as
set out above.

(13) All parent companies having actually exercised a decisive
influence on the commercial conduct of their subsidiaries
involved in the infringement are held jointly and severally
liable with their subsidiaries for the infringement. This
regards single parent companies (in particular of wholly
owned subsidiaries), for which the presumption of control
has not been rebutted. Moreover,
it is also proposed to
hold the cartel members who continued their involvement
joint-ventures jointly and
in the cartel by means of
severally liable with the joint-ventures for the infringement
committed by
the
relevant companies exercised a decisive influence over the
joint-ventures.

to the

extent

latter,

that

the

2. FINES

Basic amount

Gravity

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

Aggravating circumstances

Repeated infringements

(19) At the time the infringement took place ABB had already
been subject to a previous Commission prohibition deci-
sion for cartel activities. This justifies an increase in the
basic amount of the fine to be imposed on it.

Role of leader

(20) Siemens, Alstom and Areva have assumed the role of
secretary of the European cartel members in subsequent
periods. This justifies an increase in the basic amount to
be imposed on these undertakings for leadership.

Attenuating circumstances

(21) Several undertakings claimed attenuating circumstances
such as:
a
termination of
minor/passive role and the absence of an effective imple-
mentation of the practices. These claims are all rejected as
being unfounded.

infringement,

early

the

Differential treatment

Application of the 10 % turnover limit

(15) As there is considerable disparity between each underta-
turnover in the cartelised

king's weighting in terms of

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

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Application of the 2002 Leniency Notice

Immunity

immunity from fines

(23) ABB was the first to inform the Commission of the exis-
tence of a cartel and the Commission has granted ABB
conditional
in accordance with
point 15 of the Leniency Notice. ABB has co-operated
fully, on a continuous basis and expeditiously throughout
the Commission's administrative procedure and provided
the Commission with all evidence available to it relating to
the suspected infringement. ABB ended its involvement in
the suspected infringement no later than the time at which
it submitted evidence under the Leniency Notice and did
not take steps to coerce other undertakings to participate
in the infringement. Hence, ABB qualifies for a full immu-
nity from fines.

Point 23(b)

(24) Areva, Siemens, VA Tech, Hitachi and Jaeps, Melco and Fuji

made applications under the Leniency Notice.

(25) Pursuant to the Leniency Notice, the Commission exam-
ined the other submissions in the chronological order in
which submissions were made in order
to evaluate
whether it constitutes significant added value within the
meaning of point 21. It is concluded that these submis-
sions did not contain significant added value within the
meaning of
the Leniency Notice in comparison to the
information the Commission already had in its possession
at that time from ABB, from the inspections carried out
on 11-12 May 2004, and from the investigation carried
out until the respective applications were made.

(j) Hitachi Europe

from 15 April 1988 to
31 December 1999, and from 2 July 2002 to
30 September 2002;

Ltd,

(k) Japan AE Power Systems Corporation, from 1 October

2002 to 11 May 2004;

(l) Mitsubishi Electric Corporation, from 15 April 1988

to 11 May 2004;

(m) Nuova Magrini Galileo SpA, from 15 April 1988 to
13 December 2000, and from 1 April 2002 to
11 May 2004;

(n) Schneider Electric SA,
13 December 2000;

from 15 April 1988 to

(o) Siemens AG, from 15 April 1988 to 1 September
1999, and from 26 March 2002 to 11 May 2004;

(p) Siemens

Aktiengesellschaft

from
20 September 1998 to 13 December 2000, and from
1 April 2002 to 11 May 2004;

Österreich,

(q) Siemens Transmission & Distribution Ltd,

from
15 April 1988 to 13 December 2000, and from
1 April 2002 to 11 May 2004;

(r) Siemens Transmission & Distribution SA,

from
15 April 1988 to 13 December 2000, and from
1 April 2002 to 11 May 2004;

(s) Toshiba Corporation, from 15 April 1988 to 11 May

2004;

(t) VA Tech Transmission & Distribution GmbH &
Co KEG, from 20 September 1998 to 13 December
2000, and from 1 April 2002 to 11 May 2004.

DECISION

(27) The fines imposed pursuant to Article 23(2) of Regulation

(EC) No 1/2003 are as follows:

(26) The addressees of the Decision and the duration of their

involvement were as follows:

(a) ABB Ltd, from 15 April 1988 to 2 March 2004;

(b) Alstom (Société Anonyme), from 15 April 1988 to

8 January 2004;

(c) Areva SA, from 9 January 2004 until 11 May 2004;

(a) ABB Ltd: EUR 0;

(b) Alstom (Société Anonyme): EUR 11 475 000;

(c) Alstom (Société Anonyme), jointly and severally with
Areva T&D SA: EUR 53 550 000. Of the amount of
Areva T&D SA (EUR 53 550 000), Areva SA, Areva
T&D Holding SA and Areva T&D AG jointly and
severally with Areva T&D SA: EUR 25 500 000;

(d) Areva T&D AG from 22 December 2003 to 11 May

2004;

(d) Fuji Electric Holdings Co., Ltd,

jointly and severally

with Fuji Electric Systems Co, Ltd: EUR 2 400 000;

(e) Areva T&D Holding SA, from 9 January 2004 until

11 May 2004;

(e) Hitachi Ltd: EUR 50 400 000 of which jointly and
severally with Hitachi Europe Ltd: EUR 48 375 000;

(f) Areva T&D SA, from 7 December 1992 to 11 May

2004;

(g) Fuji Electric Holdings Co., Ltd, from 15 April 1988 to

11 May 2004;

(h) Fuji Electric Systems Co, Ltd, from 15 April 1988 to

11 May 2004;

(i) Hitachi Ltd, from 15 April 1988 to 31 December

1999, and from 2 July 2002 to 11 May 2004;

(f) Japan AE Power Systems Corporation,

jointly and
severally with Fuji Electric Holdings Co., Ltd, Fuji
Ltd:
Systems
Electric
EUR 1 350 000;

and Hitachi

Co.,

Ltd

(g) Mitsubishi Electric Corporation: EUR 113 925 000;

(h) Mitsubishi Electric Corporation jointly and severally

with Toshiba Corporation: EUR 4 650 000;

(i) Toshiba Corporation: EUR 86 250 000;

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(j) Schneider Electric SA: EUR 3 600 000;

(k) Schneider Electric SA,

jointly and severally with
Siemens Transmission & Distribution SA and Nuova
Magrini Galileo SpA: EUR 4 500 000;

(l) Siemens

Transmission

&

Distribution

Ltd:

EUR 22 050 000, of which:

(i) jointly and severally with Siemens Transmission &
Distribution SA and Nuova Magrini Galileo SpA:
EUR 17 550 000; and

(ii) jointly

and

severally

with
Siemens
Aktiengesellschaft Österreich
and VA Tech
Transmission & Distribution GmbH & Co KEG:
EUR 12 600 000;

(m) Siemens AG: EUR 396 562 500.

(28) The undertakings listed above were ordered to immediately
bring to an end the infringements referred to in that
Article, insofar as they have not already done so and were
ordered to refrain from repeating any act or conduct
described above, and from any act or conduct having the
same or similar object or effect.