Final Report of the Hearing Officer – Case AT.39914 – Euro Interest Rate Derivatives
Date: 2021-06-24
Institutions: Directorate-General for Competition, European Commission
Subjects: EU competition policy, cartel, control of restrictive practices, euro, exchange of information, financial derivative, interest, restriction on competition, sanction (EU), trade information








C_202501142EN.000101.fmx.xml












Official Journal of the European Union


EN
C series













C/2025/1142


14.2.2025






Final Report of the Hearing Officer (1)

Case AT.39914 – Euro Interest Rate Derivatives
(Text with EEA relevance)
(C/2025/1142)

The draft decision is addressed to HSBC Holdings plc, HSBC Bank plc and HSBC France, the latter now renamed HSBC Continental Europe (collectively ‘HSBC’).

BACKGROUND

On 7 December 2016, in Case AT.39914 – Euro Interest Rate Derivatives (EIRD), the Commission adopted Commission Decision C(2016) 8530 final relating to a proceeding under Article 101 TFEU and Article 53 EEA (the ‘2016 Decision’). In the 2016 Decision the Commission imposed a fine of EUR 33 606 000 jointly and severally on HSBC for participation in a single and continuous infringement regarding Euro interest rate derivatives (‘EIRD’) covering the entire EEA, which consisted of agreements and/or concerted practices that had as their object the distortion of the normal course of pricing components in the EIRD sector.
On 24 September 2019, in Case T-105/17 (2) (the ‘HSBC Judgment’), the General Court upheld the infringement finding in Article 1(b) of the 2016 Decision (3). However, as regards the fines, the General Court annulled Article 2(b) of the 2016 Decision, as a result of a breach of the Commission’s obligations under Article 296 TFEU to provide sufficient explanations in the 2016 Decision of the reasons why the reduction factor applied for discounting HSBC’s cash receipts was set at 98,849 %.

RE-ADOPTION PROCEDURE

By letter of 8 May 2020, Executive Vice-President Ms Vestager informed HSBC of her intention to propose to the College of Commissioners that the Commission adopt a new decision addressed to HSBC sanctioning HSBC for its participation in the infringement described in Article 1(b) of the 2016 Decision. That letter provided further explanations regarding the Commission’s intended methodology to calculate the fine, based on the same parameters that were used when setting the basic amount of the fine in the 2016 Decision while also considering whether any additional adjustments should be made so as to reflect the General Court’s findings in the HSBC Judgment, and invited HSBC to submit its observations. On 16 April 2021, the Directorate-General for Competition (‘DG Competition’) sent a further letter to HSBC providing certain additional explanations regarding elements of the envisaged fine calculation. HSBC set out its observations on the explanations given by the Commission in letters of 14 July 2020 and 14 May 2021 (following extensions of the deadlines for response by DG Competition).
On 11 May 2021, HSBC made a reasoned request to the Hearing Officer for access to certain information underlying calculations of individual netting ratios of banks, which DG Competition’s letters of 8 May 2020 and 16 April 2021 referred to in the context of one of the intermediate steps of the Commission’s fine calculation (4). In application of Article 7 of Decision 2011/695/EU, the Hearing Officer assessed whether the documents requested by HSBC were necessary for it to properly exercise its right to be heard. By decision of 20 May 2021, HSBC’s request to the Hearing Officer was rejected as unfounded. The decision considered, in essence, that (i) HSBC did not specify any standard recognised in the Union Courts’ case-law on the basis of which the Commission would be required to grant access to the documents requested before adopting the current draft decision, which merely includes an additional statement of reasons in the context of determining the amount of the fine; while, at the same time, (ii) the final reduction factor proposed to be applied for discounting HSBC’s cash receipts at 98,849 % was not the exact or definitive result of the abovementioned calculations, but was determined by the application, at various stages of the methodology, of the Commission’s discretion in determining the amount of the fine.

THE DRAFT DECISION

Pursuant to Article 16 of Decision 2011/695/EU, I have examined whether the draft decision deals only with objections in respect of which HSBC has been afforded the opportunity of making known its views. In the draft decision, the Commission does not address any new objections to HSBC, but replaces Article 2(b) of the 2016 Decision, in accordance with the methodology to calculate the fines to be imposed on HSBC as further described in the draft decision, including a further reduction of 5 % to the basic amount of the fine to be imposed on HSBC compared to the 2016 Decision, thus resulting in a 15 % overall reduction in the fine to take account of mitigating circumstances in the light of the HSBC Judgment.
In view of all of the above, and taking into account that HSBC has not addressed any further requests or complaints to me, I consider that the effective exercise of the procedural rights of the parties to the proceedings in this case has been respected.


Brussels, 24 June 2021.

Dorothe DALHEIMER
               





(1)  Pursuant to Articles 16 and 17 of Decision 2011/695/EU of the President of the European Commission of 13 October 2011 on the function and terms of reference of the hearing officer in certain competition proceedings, OJ L 275, 20.10.2011, p. 29 (‘Decision 2011/695/EU’).

(2)  Judgment of 24 September 2019, HSBC Holdings, HSBC Bank and HSBC France v Commission, T-105/17, ECLI: EU:T:2019:675.

(3)  Although the General Court found certain errors that do not affect the lawfulness of Article 1(b) of the 2016 Decision but could be potentially relevant as part of the assessment of whether the amount of the fine imposed under Article 2(b) of the 2016 Decision is proportionate in light of the number and intensity of the remaining incidents of anticompetitive conduct.

(4)  By letter of 30 April 2021, HSBC had first requested such access from DG Competition, which rejected HSBC’s request on 3 May 2021, stating that ‘the Commission services take the view that such access is not necessary as the information provided in the letters of 8 May 2020 and 16 April 2021 sufficiently explain the methodology used to determine the reduction factor when calculating the proxy for the value of sales in this case and allow HSBC to effectively present its observations on this additional reasoning.’
         


ELI: http://data.europa.eu/eli/C/2025/1142/oj
ISSN 1977-091X (electronic edition)