The Dow Chemical Company and Others v European Commission.
Date: 2013-07-18
47. One of those principles is indisputably the imposition of fines, on the basis of Article 23(2) of Regulation No 1/2003, on undertakings which have entered into an anti‑competitive agreement, which means that, where the Commission decides, exceptionally, not to impose a fine on an undertaking even though that undertaking has infringed the EU rules on competition, it must base its decision on objective reasons capable of justifying such a departure from the principles set out in Article 101 TFEU. One such objective reason can be the fact that the Commission is unable, in a specific case, to prove to the requisite legal standard that the parent company has exercised a decisive influence over the conduct of its subsidiary, that being the company which was immediately involved in the infringement. According to settled case-law, proving such influence is significantly easier where a parent company holds 100% of the capital of a subsidiary (see, to that effect, inter alia, Case C‑97/08 P Akzo Nobel and Others v Commission [2009] ECR I‑8237, paragraph 60 and the case-law cited).
48. On that point, it should be borne in mind that, according to settled case‑law, the possibility of imposing a fine on the parent company of a subsidiary which has directly participated in an infringement of EU competition law presupposes that the 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, regard being had in particular to the economic, organisational and legal links between those two legal entities, and that that is so because, in such a situation, the parent company and its subsidiary form a single economic unit and accordingly form a single undertaking for the purposes of the case-law (see, inter alia, Akzo Nobel and Others v Commission , paragraphs 58 and 59 and the case-law cited).
49. Since, in the situation described in the preceding paragraph, the parent company and its subsidiary form a single undertaking, the Commission’s obligation under Article 105(1) TFEU to ensure the application of the principles laid down in Article 101 TFEU, inter alia, when deciding whether or not to impose a fine applies in the same way, whichever of the two companies is concerned, the parent company or its subsidiary. As the Court has held, there is no ‘order of priority’ when the Commission is imposing a fine on one or other of those companies (see, by analogy, Joined Cases C‑125/07 P, C‑133/07 P, C‑135/07 P and C‑137/07 P Erste Group Bank and Others v Commission [2009] ECR I‑8681, paragraphs 81 and 82).
50. Moreover, another of the principles referred to in paragraph 46 above is that, where the Commission adopts, in respect of a cartel, one specific method for determining whether the parent companies concerned are liable for the infringements engaged in by their subsidiaries, it must – unless there are special circumstances – use the same criteria for all those parent companies (see, to that effect, 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, paragraphs 57 and 59).
56. Lastly, regarding the alleged lack of reasoning in the judgment under appeal in that respect, it should be borne in mind that, according to settled case-law, the Court of Justice does not require the General Court to provide an account which follows exhaustively and one by one all the arguments put forward by the parties to the case and the General Court’s reasoning may therefore be implicit on condition that it enables the persons concerned to know why that court has not upheld their arguments and provides the Court of Justice with sufficient material for it to be able to exercise its jurisdiction to review legality (see, inter alia, the order in Case C‑593/11 P Alliance One International v Commission  [2012] ECR I‑0000, paragraph 28 and the case-law cited).
70. Lastly, Dow’s argument that its right to be heard was infringed cannot succeed. In that regard, it should be borne in mind that, according to the settled case-law of the Court, provided that – as it has done in the present case – the Commission indicates expressly in the statement of objections that it will consider whether it is appropriate to impose fines on the undertakings concerned and provided that it sets out the principal elements of fact and of law that may give rise to a fine, such as the gravity and the duration of the alleged infringement and the fact that it has been committed ‘intentionally or negligently’, it fulfils its obligation to respect the undertakings’ right to be heard. In so doing, the Commission provides them with the necessary elements to defend themselves not only against a finding of infringement but also against being fined for that infringement (see, 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 428 and the case-law cited).
86. The Court has consistently held that the purpose of the multiplier for deterrence and of taking into consideration, in that context, the size and global resources of the undertaking in question resides in the desired impact on that undertaking, and the penalty must not be negligible in the light, particularly, of the financial capacity of that undertaking (see, to that effect, inter alia, Case C‑413/08 P Lafarge v Commission  [2010] ECR I‑5361, paragraphs 104 and 105, and the order in Case C‑421/11 P Total and Elf Aquitaine v Commission  [2012] ECR I‑0000, paragraph 82). The Court has also had occasion to state that disproportionate importance must not be attributed to turnover ( Total and Elf Aquitaine v Commission , paragraph 80).
87. Accordingly, in order to calculate fines imposed on undertakings which have participated in a cartel, differentiated treatment of the undertakings concerned is inherent in the exercise of the Commission’s powers in that area. In exercising its discretion, the Commission is required to fit the penalty to the individual conduct and specific characteristics of those undertakings, in order to ensure that, in each case, the EU competition rules are given full effect (see Case C‑564/08 P SGL Carbon v Commission  [2009] ECR I‑191 (summary publication), paragraph 43 and the case-law cited).
88. On the basis of the case-law referred to in paragraph 86 above, the Commission is primarily required to ensure that the penalty does not become ‘negligible’ in the light, inter alia, of the financial capacity of the undertakings concerned, but that does not mean that an undertaking with a particularly high turnover as compared with that of its fellow cartel members must have its fine increased in strict accordance with the ratio of its turnover to that of all the other undertakings involved in the cartel. If that were the case, the fines imposed on the largest undertakings in a cartel, increased on the basis of such an arithmetic method, would admittedly be likely to have a sufficiently deterrent effect, but would run the risk of being disproportionate to the gravity of the infringement actually committed, particularly where, as in the present case, there is a considerable difference between the turnovers of the undertakings concerned (see Case C‑511/11 P Versalis v Commission  [2013] ECR I‑0000, paragraph 105).
89. It is also settled law that, in the exercise of its powers of unlimited jurisdiction, the General Court  cannot, through mechanical recourse to an arithmetical formula based only on the turnover of the undertaking concerned, divest itself of its own power of assessment as regards the setting of fines (see, to that effect, inter alia, Joined Cases 100/80 to 103/80 Musique Diffusion française and Others v Commission  [1983] ECR 1825, paragraph 121; Case C‑283/98 P Mo och Domsjö v Commission  [2000] ECR I‑9855, paragraph 47; and Dansk Rørindustri and Others v Commission , paragraph 243).