Alliance One International, Inc (formerly Dimon, Inc.) v European Commission.
Date: 2013-09-26
35. As regards the first part of the first ground of appeal, the objection of inadmissibility raised by the Commission, on the ground that the arguments relied on by AOI are new, cannot be accepted. The criticism of the General Court is, in essence, that it re‑interpreted the contested decision, following explanations which were produced by the Commission subsequent to that decision, in order to mitigate the infringements of the obligation to state reasons and the principle of equal treatment allegedly committed by the Commission in that decision. Since such arguments could not have been raised at first instance, they cannot be held to be inadmissible on appeal (see, to that effect, Case C‑229/05 P PKK and KNK  v Council [2007] ECR I‑439, paragraph 33, and the judgment of 28 July 2011 in Joined Cases C‑471/09 P to C‑473/09 P Diputación Foral de Vizcaya and Others  v Commission , paragraph 124).
36. As regards the substance, it must be recalled, first, that liability for an infringement of the competition rules committed by a subsidiary may be attributed to its parent company in particular where, although having a separate legal personality, that subsidiary does not decide independently upon its own conduct on the market, but carries out, in all material respects, the instructions given to it by the parent company, having regard in particular to the economic, organisational and legal links between those two legal entities (see Case C‑97/08 P Akzo Nobel and Others  v Commission [2009] ECR I‑8237, paragraph 58, and Joined Cases C‑628/10 P and C‑14/11 P Alliance One International and Standard Commercial Tobacco  v Commission  and Commission  v Alliance One International and Others [2012] ECR I‑0000, paragraph 43).
37. In such a situation, since the parent company and its subsidiary form a single economic unit and therefore form a single undertaking for the purposes of Article 81 EC, the Commission may address a decision imposing fines to the parent company, without having to establish the personal involvement of the parent company in the infringement (see, Akzo Nobel and Others  v Commission , paragraph 59, and Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 44).
38. The Court has made it clear that, in the particular case of a parent company having a 100% shareholding in a subsidiary which has infringed the European Union’s rules on competition, that parent company is able to exercise decisive influence over the conduct of its subsidiary and there is a rebuttable presumption that the parent company does in fact exercise such influence ( Alliance One International and Standard Commercial Tobacco v Commission and Commission  v Alliance One International and Others , paragraph 46 and case-law cited).
39. In those circumstances, it is sufficient for the Commission to prove that the entire capital of a subsidiary is held by its parent company in order for it to be presumed that the parent actually exercises decisive influence over the commercial policy of that subsidiary. The Commission will then be able to hold the parent company to be jointly and severally liable for payment of the fine imposed on its subsidiary, unless the parent company, which has the burden of rebutting that presumption, adduces sufficient evidence to show that its subsidiary acts independently on the market ( Akzo Nobel and Others  v Commission , paragraph 61, and Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 47).
40. However, that case-law does not imply that the Commission is bound to rely exclusively on that presumption. There is nothing to prevent the Commission from establishing that a parent company actually exercises decisive influence over its subsidiary by means of other evidence or by a combination of such evidence and that presumption ( Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 49).
41. In this case, as the General Court stated in paragraphs 105 to 119 of the judgment under appeal, it is clear from the contested decision that the Commission had decided, in order to assess whether the parent companies actually exercised decisive influence over the subsidiaries, to hold the parent companies liable only where there was evidence to support the presumption of actual exercise by the parent companies of decisive influence which arises from the control by the parent companies of the entire share capital of the subsidiaries (the ‘dual basis’ method) and, accordingly, had waived reliance on the application solely of the presumption of decisive influence ( Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 50).
43. It follows from those paragraphs of the judgment under appeal that the General Court based its assessment of the dual basis method adopted by the Commission in the contested decision on its own interpretation of that method, considered as a whole (see Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraphs 121 and 132).
44. That finding of the General Court is not vitiated by any error of law. In particular, the General Court was correct to interpret the decision in such a way as to refute the reading of recital 376 of the contested decision proposed by Agroexpansión in its reply, to the effect that it was because of the absence of factors indicating the material involvement of the parent companies of Taes in the infringement that the Commission did not attribute liability to those companies, since such a reading was incompatible with a reading of that decision as a whole (see Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 133).
47. As regards AOI’s assertion that the Commission did not apply the dual basis method to Dimon, it is clear that the General Court correctly stated, in paragraphs 112 to 119 of the judgment under appeal, that the Commission had applied the dual basis method to all the parent companies in the contested decision (see, by analogy, Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 137), including, as is apparent from paragraphs 116 and 117, Dimon. That finding cannot be invalidated by the Commission’s reply to a question from the General Court in the course of proceedings, as referred to in paragraph 29 of this judgment, even if the interpretation of that reply advocated by AOI were to be correct.
50. In that regard it must be borne in mind that the appraisal of the facts by the General Court does not constitute, save where the clear sense of the evidence produced before it is distorted, a question of law which is subject, as such, to review by the Court of Justice (Case C‑397/03 P Archer Daniels Midland and Archer Daniels Midland Ingredients  v Commission [2006] ECR I‑4429, paragraph 85, and Case C‑352/09 P ThyssenKrupp Nirosta  v Commission [2011] ECR I‑2359, paragraph 180).
52. As regards, last, the second part of the first ground of appeal, it should be recalled that it follows from the second subparagraph of Article 256(1) TFEU, the first paragraph of Article 58 of the Statute of the Court of Justice of the European Union and Articles 168(1)(d) and 169(2) of the Court’s Rules of Procedure that an appeal must identify precisely the contested elements of the judgment which the appellant seeks to have set aside and also the legal arguments specifically advanced in support of the appeal (see the judgment of 11 April 2013 in Case C‑652/11 P Mindo  v Commission [2013] ECR I‑0000, paragraph 21 and case-law cited).
60. In accordance with the Court’s settled case-law, to allow a party to put forward for the first time before the Court of Justice a plea in law which it has not raised before the General Court would in effect allow that party to bring before the Court a wider case than that heard by the General Court. In an appeal, the Court’s jurisdiction is, as a general rule, confined to a review of the assessment by the General Court of the pleas argued before it (see Alliance One International and Standard Commercial Tobacco  v Commission and Commission  v Alliance One International and Others , paragraph 111 and case-law cited).
73. In that regard, it must be recalled that ‘deterrence’ is one of the factors to be taken into account in calculating the amount of the fine. In accordance with settled case‑law, fines imposed for infringements of Article 81 EC, as laid down in Article 23(2) of Regulation No 1/2003, are designed to penalise the unlawful acts of the undertakings concerned and to deter both the undertakings in question and other economic operators from infringing, in future, the rules of European Union competition law. The link between, on the one hand, the size and overall resources of undertakings and, on the other, the need to ensure that the fine has a deterrent effect cannot be disputed (see Case C‑289/04 P Showa Denko  v Commission [2006] ECR I‑5859, paragraph 16, and Case C‑413/08 P Lafarge  v Commission [2010] ECR I‑5361, paragraph 102).
74. It is the impact sought on the undertaking concerned which justifies the size and overall resources of that undertaking being taken into consideration in order to ensure that the fine has sufficient deterrent effect, and the penalty must not be negligible in the light, particularly, of the financial capacity of that undertaking ( Lafarge  v Commission , paragraph 104).
80. The Court has already had occasion to confirm the finding of the General Court that the circumstance referred to in the third indent of Section 3 of the Guidelines, namely termination of the infringement as soon as the Commission intervenes, can logically constitute a mitigating circumstance only if there are reasons to suppose that the undertakings concerned were encouraged to cease their anti‑competitive conduct by the interventions in question (see, to that effect, Case C‑407/04 P Dalmine  v Commission [2007] ECR I‑829, paragraph 158).
85. In accordance with the Court’s settled case-law, a complaint directed against a ground included in a judgment of the General Court purely for the sake of completeness cannot lead to the judgment being set aside and is therefore ineffective (see, inter alia, order of 20 January 2009 in Case C‑374/07 P Mebrom  v Commission , paragraph 57, and Case C‑96/09 P Anheuser‑Busch  v Budějovický Budvar [2011] ECR I‑2131, paragraph 211).
98. As regards the first ground of the cross-appeal, it must be observed that the obligation to state the reasons on which a judgment is based arises under Article 36 of the Statute of the Court of Justice, which applies to the General Court by virtue of the first paragraph of Article 53 of the Statute, and Article 81 of the Rules of Procedure of the General Court. In accordance with the Court’s settled case-law, the statement of the reasons on which a judgment of the General Court is based must clearly and unequivocally disclose that court’s reasoning in such a way as to enable the persons concerned to ascertain the reasons for the decision taken and the Court of Justice to exercise its power of review (see Mindo  v Commission , paragraph 29 and case-law cited).
104. Such jurisdiction was conferred on the Courts of the European Union by Article 17 of Regulation No 17, and is now confirmed by Article 31 of Regulation No 1/2003, in accordance with Article 261 TFEU. The Courts of the European Union are therefore empowered not only to carry out a mere review of the lawfulness of the penalty but also to substitute their own appraisal for that of the Commission and, consequently, to cancel, reduce or increase the fine or penalty payment imposed (see Case C‑3/06 P Groupe Danone  v Commission [2007] ECR I‑1331, paragraph 61, and Case C‑199/11 Otis and Others [2012] ECR I‑0000, paragraph 62). That jurisdiction is exercised by taking into account all the factual circumstances (see, to that effect, Case C‑534/07 P Prym and Prym Consumer  v Commission [2009] ECR I‑7415, paragraph 86 and case‑law cited).
105. It follows that the Courts of the European Union are empowered to exercise their unlimited jurisdiction where the question of the amount of the fine is before them ( Groupe Danone  v Commission , paragraph 62).
110. However, as follows from paragraphs 105 to 107 of this judgment, taking into consideration that further reduction was part of a legal assessment which the General Court was entitled to make in the exercise of its unlimited jurisdiction, without notifying the parties, prior to the delivery of the judgment (see, by analogy, Case C‑286/11 P Commission  v Tomkins [2013] ECR I‑0000, paragraph 61).
111. Further, as stated in paragraph 101 of this judgment, the application, in the judgment under appeal, of the same reduction for the benefit of Dimon was entirely consistent with the methodology followed by the Commission in the contested decision, and consequently there is no basis for the Commission’s claim that it was not foreseeable (see, to that effect, Groupe Danone  v Commission , paragraph 82).