French Republic and Société commerciale des potasses et de l'azote (SCPA) and Entreprise minière et chimique (EMC) v Commission of the European Communities.
Date: 1998-03-31
51 Finally, while the conditions attached to the contested decision of the Commission can admittedly affect the applicant companies' interests only in so far as the commitments referred to therein are implemented by the parties to the concentration, it is beyond doubt that since those parties have undertaken vis-à-vis the Commission to take certain measures in return for a declaration that the concentration is compatible with the common market, they are firmly resolved to comply with those commitments, especially as under Article 8(5)(b) of the Regulation the Commission may revoke its decision if the undertakings concerned commit a breach of an obligation attached thereto (see to that effect Case 11/82 Piraiki-Patraiki and Others v Commission [1985] ECR 207, paragraphs 7 to 9).
54 In view of the fact that the Court's case-law in this respect underlines the part played by natural or legal persons in the administrative procedure (see to that effect Case 264/82 Timex v Council and Commission [1985] ECR 849, and Cofaz and Others, paragraph 24), it should be noted, first, that the applicant companies submitted observations in the administrative procedure before the Commission, which took those observations into account for the purposes of the contested decision. In particular, the documents in the case show that in response to the concerns expressed by the applicant companies, the Commission decided not to make the commitment of the parties to the concentration relating to Potacan a formal condition for the concentration to be compatible with the common market.
62 It is settled case-law that any measure which produces binding legal effects such as to affect the interests of an applicant by bringing about a distinct change in his legal position is an act or decision which may be the subject of an action under Article 173 of the Treaty for a declaration that it is void (Case 60/81 IBM v Commission [1981] ECR 2639, paragraph 9).
72 On this point, it should be noted that under the fourth paragraph of Article 37 of the Protocol on the EC Statute of the Court of Justice, submissions made in an application to intervene are limited to supporting the submissions of one of the parties.  Moreover, under Article 93(4) of the Rules of Procedure, the intervener must accept the case as he finds it at the time of his intervention. It follows that the interveners have no standing to raise a plea of inadmissibility and the Court is thus not obliged to examine the pleas put forward by them (see to that effect Case C-225/91 Matra v Commission [1993] ECR I-3203, paragraphs 11 and 12).
74 Whether or not the objection raised by the intervener undertakings should be considered an absolute bar to proceeding with the case, the fact remains that, according to Könecke v Commission, paragraph 9, even if in the circumstances it proved impossible for the institution whose act was declared void to fulfil the obligation to take the necessary measures to comply with the Court's judgment, an interest in making the application would still subsist, at least as the basis for a possible action for damages.
143 The Court notes, to begin with, that a proper definition of the relevant market is a necessary precondition for any assessment of the effect of a concentration on competition. With reference to the application of the Regulation as envisaged in the present case, the relevant geographical market is a defined geographical area in which the product concerned is marketed and where the conditions of competition are sufficiently homogeneous for all economic operators, so that the effect on competition of the concentration notified can be evaluated rationally (see, to this effect, Case 27/76 United Brands v Commission [1978] ECR 207, paragraphs 11 and 44).
168 Since the textual and historical interpretations of the Regulation, and in particular Article 2 thereof, do not permit its precise scope to be assessed as regards the type of dominant position concerned, the provision in question must be interpreted by reference to its purpose and general structure (see, to that effect, Case 11/76 Netherlands v Commission [1979] ECR 245, paragraph 6).
174 In any event, even on the assumption that a finding by the Commission that the proposed concentration creates or strengthens a collective dominant position involving the undertakings concerned on the one hand and a third party on the other may in itself adversely affect that third party, it must be borne in mind that observance of the right to be heard is, in all proceedings liable to culminate in a measure adversely affecting a particular person, a fundamental principle of Community law which must be guaranteed even in the absence of any rules governing the procedure (see, to that effect, Case 85/76 Hoffmann-La Roche v Commission [1979] ECR 461 and Case C-32/95 P Commission v Lisrestal and Others [1996] ECR I-5373, paragraph 21).
221 In the case of an alleged collective dominant position, the Commission is therefore obliged to assess, using a prospective analysis of the reference market, whether the concentration which has been referred to it leads to a situation in which effective competition in the relevant market is significantly impeded by the undertakings involved in the concentration and one or more other undertakings which together, in particular because of correlative factors which exist between them, are able to adopt a common policy on the market and act to a considerable extent independently of their competitors, their customers, and also of consumers.
223 In this respect, however, the basic provisions of the Regulation, in particular Article 2 thereof, confer on the Commission a certain discretion, especially with respect to assessments of an economic nature.
224 Consequently, review by the Community judicature of the exercise of that discretion, which is essential for defining the rules on concentrations, must take account of the discretionary margin implicit in the provisions of an economic nature which form part of the rules on concentrations.
226 As points 51 and 52 of the contested decision show, K+S/MdK and SCPA will hold shares of the relevant market, after the concentration, of 23% and 37% respectively, calculated on the basis of sales. A market share of approximately 60%, subdivided in that way, cannot of itself point conclusively to the existence of a collective dominant position on the part of those undertakings.
227 As to the alleged structural links between K+S and SCPA, which were the essential factor relied on by the Commission in making its own assessment, some of the applicants' criticisms playing down the significance of those links as evidence of the creation of a collective dominant position on the part of the two undertakings are well founded.
228 Thus the Commission's finding that the holding of K+S and SCPA in the Kali-Export export cartel may have an impact on their competitive behaviour in the Community would not appear to be supported by a sufficiently cogent and consistent body of evidence. The Commission merely notes, on this point, that the British producer CPL started marketing its products independently on the French market only after it had left the cartel in 1987, because it could not reconcile direct competition with SCPA on the French market with its membership of the cartel (see point 60 of the contested decision). Even if the fact were disregarded that the Commission's argument concerns the alleged effects of membership of the cartel only on part of the Community market apart from Germany, it must be observed that the Spanish producer Coposa, likewise a member of Kali-Export, markets independently in France a quantity of potash corresponding to slightly over 5% of French consumption. That quantity accounts for about 47% of Coposa's exports to the market in question as well as two-thirds of its exports to France, and was indeed also considered significant in the context of the definition of the relevant geographical market (see point 38 of the contested decision). In those circumstances, it would appear that the Commission has not established to the necessary legal standard the existence of a causal link between K+S and SCPA's membership of the export cartel and their anticompetitive behaviour on the relevant market.
256 It follows from the Court's case-law that partial annulment of a decision, limited solely to the conditions it imposes, is possible if those conditions may be severed from the remainder of the decision (see, to that effect, Case 37/71 Jamet v Commission [1972] ECR 483, paragraph 11, and Case 17/74 Transocean Marine Paint v Commission [1974] ECR 1063, paragraph 21). The partial annulment of a Commission decision concerning the control of concentrations is, moreover, one of the cases expressly provided for in Article 10(5) of the Regulation.
257 However, it does not appear that annulment limited to the section of the operative part of the contested decision which relates to the conditions and obligations set out in point 63 thereof is possible without the substance of the decision being altered.