Areva and Others v European Commission.
Date: 2014-04-10
30. It should be noted, at the outset, that infringement of the competition rules by a subsidiary may be imputed to the parent company in particular where, although having 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, inter alia, 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, paragraph 43).
31. 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 latter in the infringement (see Akzo Nobel and Others  v Commission , paragraph 59, Alliance One International and Standard Commercial Tobacco v Commission and Commission v Alliance One International and Others , paragraph 44).
32. The Court has made it clear that, in the particular case of a parent company with a 100% shareholding in a subsidiary which has infringed the European Union’s competition rules, 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 (see Alliance One International and Standard Commercial Tobacco v Commission  and Commission  v Alliance One International and Others , paragraph 46 and the case-law cited).
33. In those circumstances, it is sufficient for the Commission to prove that the entire share capital of a subsidiary is held by its parent in order for it to be presumed that the parent exercises decisive influence over the commercial policy of that subsidiary. The Commission will then be able to regard the parent company as 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).
34. Moreover, where a decision concerning the application of European Union competition rules affects several addressees and relates to the attribution of liability for the infringement, the decision must contain an adequate statement of reasons with respect to each of the addressees, in particular those who, according to that decision, must bear the liability for the infringement. Accordingly, with regard to a parent company held responsible for the unlawful conduct of its subsidiary, such a decision must, as a general rule, contain a statement of reasons capable of justifying the attribution of liability for that infringement to the parent company ( Alliance One International and Standard Commercial Tobacco  v Commission  and Commission  v Alliance One International and Others , paragraph 75).
35. As regards, in particular, a Commission decision which relies exclusively, with respect to certain addressees, on the presumption that they actually exercised decisive influence, the Commission is in any event required — if it is not to render that presumption in reality irrebuttable — to explain adequately to those addressees the reasons why the elements of fact and of law put forward did not suffice to rebut that presumption (Case C‑521/09 P Elf Aquitaine  v Commission  [2011] ECR I‑8947, paragraph 153).
36. However, the Commission is not in any way 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).
37. In the present case, as observed by the General Court at paragraph 91 of the judgment under appeal, it is clear from the contested decision, in particular recitals 335, 348 to 356 and 358, that in order to determine whether Alstom was liable for the infringements committed by its wholly-owned subsidiaries, the Commission did not ultimately rely exclusively on the presumption that it did actually exercise decisive influence, but instead based its decision on the ‘dual basis’ method, combining that presumption with other evidence, namely other factual evidence produced during the administrative procedure which supported that presumption (see, by analogy, Alliance One International and Standard Commercial Tobacco  v Commission  and Commission  v Alliance One International and Others , paragraph 50).
39. Such reasoning meets the objective pursued by the obligation to state the reasons on which an individual decision is based, which is, in addition to enabling judicial review to be carried out, to give the person concerned sufficient information to enable it to ascertain whether the decision may be vitiated by a defect making it possible to challenge its validity (see, by analogy, Case C‑508/11 P ENI  v Commission  [2013] ECR, paragraph 71).
40. With regard in particular to the evidence adduced by Alstom at paragraphs 90 to 150 of its response to the statement of objections to rebut the presumption that it actually exercised decisive influence, while it would appear that the Commission did not, in the contested decision, address each of those items of evidence individually, it nevertheless gave the person concerned sufficient information to enable it to ascertain whether that decision was well founded or whether it was vitiated by a defect making it possible to challenge its validity and to enable the General Court to review its legality (see, to that effect, inter alia, Joined Cases C‑189/02 P, C‑202/02 P, C‑205/02 P to C‑208/02 P and C‑213/02 P Dansk Rørindustri and Others  v Commission  [2005] ECR I‑5425, paragraph 462, and ENI v Commission , paragraph 72).
44. Moreover, it should be noted, first of all, as regards the standard of reasoning required, that, unlike the situation which gave rise to the judgment in Case C‑521/09 P Elf Aquitaine  v Commission  [2011] ECR I‑8947, relied on by the Alstom group companies, those companies were not, in the present case, faced with the first Commission decision in which the Commission altered its usual approach and relied solely on the presumption that the parent company had exercised decisive influence over the subsidiary in order to impute the infringement to the parent company (see, by analogy, Order in Case C‑421/11 P Elf Aquitaine  v Commission , paragraph 58).
49. It is established case-law that if the unlawful conduct of a subsidiary can be imputed to its parent company, those companies may be regarded, during the period of the infringement, as forming a single economic unit and thus a single undertaking within the meaning of the competition law of the European Union. In those circumstances, the Commission will be entitled to hold the parent company liable for the unlawful conduct of its subsidiary during that period and, as a consequence, for payment of the fine imposed on the subsidiary (see, to that effect, inter alia, Alliance One International and Standard Commercial Tobacco  v Commission  and Commission  v Alliance One International and Others , paragraphs 44 and 47 and the case-law cited).
54. It should be noted, first, that it has consistently been held that 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, inter alia, ENI  v Commission , paragraph 74).
55. However, the obligation to state reasons does not require the General Court to provide an account which responds exhaustively and one by one all to the arguments put forward by the parties to the case. The reasoning may therefore be implicit, on condition that it enables the persons concerned to know why the General Court has not upheld their arguments and provides the Court of Justice with sufficient material for it to exercise its power of review (see, inter alia, Case C‑439/11 P Ziegler  v Commission [2013] ECR, paragraph 82).
56. Moreover, in reviewing the legality of acts under Article 263 TFEU, the Court of Justice and the General Court cannot under any circumstances substitute their own reasoning for that of the author of the contested act (see, inter alia, Case C‑73/11 P Frucona Košice  v Commission  [2013] ECR, paragraph 89 and the case-law cited).
80. The approach adopted by the General Court to the evidence put forward by the Areva group companies to rebut the presumption of actual exercise of decisive influence does not, taken as a whole, amount to the imposition of a probatio diabolica . It follows from case-law that it is for entities seeking to rebut that presumption to adduce any evidence relating to the economic, organisational and legal links between the subsidiary in question and its parent company which, in their view, is capable of showing that those two companies did not constitute a single economic entity ( Elf Aquitaine  v Commission , paragraph 65).
81. The fact that it is difficult to adduce the evidence necessary to rebut a presumption does not in itself mean that that presumption is in fact irrebuttable, especially where the entities against which the presumption operates are those best placed to seek that evidence within their own sphere of activity ( Elf Aquitaine  v Commission , paragraph 70).
93. Finally, with regard to whether the presumption of actual exercise of decisive influence is compatible with the principles of the right to a fair hearing and the presumption of innocence, the Court has already held that that presumption is proportionate to the aim pursued and, therefore, remains within acceptable limits, since it is intended, in particular, to strike a balance between, on the one hand, the importance of the objective of combatting conduct contrary to the competition rules, in particular to Article 81 EC, and of preventing a repetition of such conduct and, on the other hand, the requirements flowing from certain general principles of European Union law, such as the principle of the presumption of innocence, the principle that penalties should be applied solely to the offender and the principle of legal certainty, as well as the rights of the defence, including the principle of equality of arms. It is for that reason in particular that the presumption is rebuttable (see, to that effect, ENI v Commission , paragraph 50, and Case C‑501/11 P Schindler Holding and Others  v Commission  [2013] ECR, paragraphs 107 and 108).
113. In accordance with 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 did not raise 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 General Court’s assessment of the pleas argued before it (see, inter alia, Alliance One International and Standard Commercial Tobacco v Commission , paragraph 111).
114.  However, an argument which was not raised at first instance does not constitute a new plea that is inadmissible at the appeal stage if it is simply an amplification of an argument already developed in the context of a plea set out in the application before the General Court (see, to that effect, inter alia, Siemens and Others  v Commission , paragraph 287).
118. Furthermore, as argued by Areva, in exercising its powers of unlimited jurisdiction, the General Court imposed a fine using the ‘cascade’ method of determination. It follows that the General Court therefore relied on that method, so that the argument alleging de facto  joint and several liability deriving from the application of that method has its origins in the judgment under appeal and that the validity of that method may be called into question in the appeal (see, to that effect, Joined Cases C‑231/11 P to C‑233/11 P Commission  v Siemens Österreich and Others and Siemens Transmission & Distribution and Others v Commission  [2014] ECR, paragraph 102 and the case-law cited).
120. According to case-law, where a number of legal persons may be held personally liable for participation in an infringement of the European Union’s competition rules because they form part of a single undertaking responsible for the infringement, the Commission has the power, under Article 23(2) of Regulation No 1/2003 to impose a fine for which those persons are jointly and severally liable (see, to that effect, Commission v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others v Commission , paragraphs 39 to 51).
121. However, when it decides to exercise that power to impose penalties, the Commission is not free to determine how joint and several liability is to be imposed from an external perspective or, in particular, the amount of the fine in respect of which it may demand full payment by each of those held jointly and severally liable (see, to that, effect, Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others v Commission , paragraphs 52 and 54).
122. As the European Union concept of joint and several liability for payment of a fine is merely the manifestation of an ipso jure  legal effect of the concept of an ‘undertaking’, the determination of the amount of the fine in respect of which the Commission may demand payment in full by each of those held jointly and severally liable derives, in any individual case, from the application of that concept of an undertaking (see, to that effect, Commission v Siemens Österreich and Others and Siemens Transmission & Distribution and Others  v Commission , paragraphs 51 and 57).
123. It should be recalled in that regard that the authors of the Treaties chose to use the concept of an undertaking to designate the perpetrator of an infringement of competition law, who is liable to be punished pursuant to Articles 81 EC and 82 EC, not other concepts such as the c oncept of a company or firm or of a legal person ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others v Commission , paragraphs 42).
124. Moreover, the European Union legislature used that concept of an undertaking in Article 23(2) of Regulation No 1/2003 to define the entity on which the Commission may impose a fine in order to penalise an infringement of the European Union’s rules on competition.
125. The Court of Justice has consistently held that, for the purposes of European Union competition law, the concept of an undertaking covers any entity engaged in an economic activity, regardless of the legal status of the entity or the way in which it is financed. That concept must be understood as covering an economic unit, even if, from a legal perspective, that unit is made up of a number of natural or legal persons (see, inter alia, Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others  v Commission , paragraph 43).
127. Accordingly, the Commission must adhere to the principle that penalties must be specific to the offender and the offence, which requires, in accordance with Article 23(3) of Regulation No 1/2003, that the amount of the fine to be paid jointly and severally must be determined by reference to the gravity of the infringement for which the undertaking concerned is held individually responsible and the duration of the infringement ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others  v Commission , paragraph 52).
128. In that context, the Commission must also respect the principle of legal certainty, which requires that any measure adopted by the institutions of the European Union should be clear and precise, so as to enable the persons concerned to ascertain precisely what their rights and obligations are under the measure and take steps accordingly (see, to that effect, inter alia, Joined Cases C‑201/09 P and C‑216/09 P ArcelorMittal Luxembourg  v Commission  and Commission  v ArcelorMittal Luxembourg and Others  [2011] ECR I‑2239, paragraph 68).
132. Moreover, while the joint and several liability mechanism enables the Commission to reduce the risk that one of the companies forming part of the same undertaking will be insolvent, which forms part of the objectives of ensuring that the Commission operates effectively and of deterrence when dealing with infringements of the competition rules ( Commission v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others  v Commission , paragraph 59), that mechanism cannot be used to force one company to bear the risk of the insolvency of another company where those companies have never formed part of the same undertaking.
134. It is true that it does not follow from the principle that the penalty must be specific to the offender and the offence that, under such a definition of joint and several liability, each company is required to infer from the decision imposing a fine for which it is jointly and severally liable with one or more other companies the share of the fine that it must pay vis-à-vis those other companies, once the Commission has been paid the full amount of the fine ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others v Commission , paragraph 66).
136. It should also be noted that the total sum of the amounts of the fine for which Areva and Alstom were found jointly and severally liable, namely, respectively, EUR 25 500 000, reduced to EUR 20 400 000 by the General Court, and EUR 53 550 000, reduced to EUR 48 195 000 by the General Court, is greater than the amount of the fine imposed jointly and severally on those companies with the subsidiary Areva T & D SA, namely EUR 53 550 000, reduced to EUR 48 195 000 by the General Court.
137. In a situation such as that in the present case, the liability of Areva and Alstom, as parent companies, for the infringement committed is wholly derived from the liability of a subsidiary which belonged to those companies in succession (see, by analogy, Case C‑286/11 P Commission  v Tomkins  [2013] ECR, paragraphs 43 and 49).
138. It follows that the total amount which the parent companies may be required to pay cannot be greater than the amount which that subsidiary must pay.
141. European Union law does not lay down any such rule ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others  v Commission , paragraphs 70 and 71). Moreover, that rule relates, in any event, only to the internal allocation of liability for payment of the fine among those jointly and severally liable, once the fine has been paid to the Commission, not to the determination, from the external perspective, of joint and several liability, of the respective amounts that the Commission may claim from the legal entities that formed part of each of the undertakings which succeeded one another during the infringement period.
148. Since a party must be able to challenge all the grounds for a judgment adversely affecting it, where the General Court has joined two cases and given a single judgment which answers all the pleas submitted by the parties to the proceedings before the Court, each of those parties may criticise the reasoning concerning pleas which, before the General Court, were raised only by the applicant in the other joined case, provided that that reasoning adversely affects it (judgment of 11 July 2013 in Case C‑444/11 P Team Relocations and Others  v Commission , paragraph 34).
151. The power to impose penalties available to the Commission is confined to determining the amount of the fine for the payment of which the legal entities forming part of the same undertaking are held jointly and severally liable, that is, the external determination of joint and several liability, and does not extend to determining the share of that amount to be borne by those persons who are jointly and severally liable in the context of their internal relationship ( Commission  v Siemens Österreich and Others and Siemens Transmission & Distribution and Others  v Commission , paragraph 58).
152. On the other hand, where there is no contractual agreement as to the shares to be paid by those held jointly and severally liable for payment of the fine, it is for the national courts to determine those shares, in a manner consistent with European Union law, by applying national law ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others  v Commission , paragraph 62).
153. It follows that the General Court erred in law by finding, in essence, at paragraph 215 of the judgment under appeal, that in the absence of any finding in the Commission’s decision imposing joint and several liability for payment of a fine on a number of companies that some of the companies in the undertaking have a greater share of responsibility than others for the undertaking’s participation in the cartel during a specific period, it must be presumed that they are equally liable and, accordingly, must pay equal shares of the amounts for which they have been held jointly and severally liable ( Commission v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others v Commission , paragraph 69).
155. However, it should be noted that, if the grounds of a judgment of the General Court disclose an infringement of European Union law but its operative part is shown to be well founded on other legal grounds, such an infringement is not capable of bringing about the annulment of that judgment, and a substitution of grounds must be made (see, to that effect, inter alia, Joined Cases C‑120/06 P and C‑121/06 P FIAMM and Others v Council and Commission  [2008] ECR I‑6513, paragraph 187 and case-law cited).
157. First, as the Commission does not have the power to determine how the fine imposed jointly and severally is to be allocated internally, each company cannot be required to infer from the decision imposing joint and several liability for payment of a fine with a number of other companies the share of the fine to be borne by it in its relationship with the other entities, once the fine has been paid in full to the Commission ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others  v Commission , paragraph 66). In the absence of any contractual agreement, that share must be determined by a national court. Accordingly, the fact that that share was not determined in the Commission’s decision imposing joint and several liability for payment of a fine cannot, of itself, constitute an infringement of the principle of legal certainty.
170. As pointed out at paragraph 118 above, a plea which has its origins in the judgment under appeal may be relied on in an appeal.
177. Lastly, according to well established case-law, it is not for this Court, when ruling on questions of law in the context of an appeal, to substitute, on grounds of fairness, its own assessment for that of the General Court exercising its unlimited jurisdiction to rule on the amount of fines imposed on undertakings for infringements by those undertakings of European Union law. Accordingly, only inasmuch as the Court of Justice considers that the level of the penalty is not merely inappropriate, but also excessive to the point of being disproportionate, would it have to find that the General Court erred in law, on account of the inappropriateness of the amount of a fine (Case C‑70/12 P Quinn Barlo and Others  v Commission  [2013] ECR, paragraph 57).
181. In accordance with Article 23(2) of Regulation No 1/2003, the amount of the fine must be determined by reference to the gravity of the infringement for which the undertaking concerned is held individually responsible and the duration of the infringement ( Commission  v Siemens Österreich and Others  and Siemens Transmission & Distribution and Others v Commission , paragraph 52).