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Language of document : ECLI:EU:T:2018:922

Case T‑691/14

(publication by extracts)

Servier SAS and Others

European Commission

(Competition — Agreements, decisions and concerted practices — Abuse of a dominant position — Market for perindopril, a medicinal product intended for the treatment of cardiovascular diseases, in its originator and generic versions — Decision finding an infringement of Articles 101 and 102 TFEU — Principle of impartiality — Consultation of the Advisory Committee on Restrictive Practices and Dominant Positions — Right to an effective remedy — Brevity of the period of time for lodging applications in the light of the length of the contested decision — Patent dispute settlement agreements — Licensing agreements — Technology acquisition agreements — Exclusive purchasing agreement — Potential competition — Restriction of competition by object — Restriction of competition by effect — Balance between competition law and patent law — Classification as separate infringements or as a single infringement — Definition of the relevant market at the level of the compound of the medicinal product concerned — Fines — Imposition of cumulative fines under Articles 101 and 102 TFEU — Principle that offences and penalties must have a proper legal basis — Value of sales — Method of calculation in the event of cumulative infringements on the same markets)

Summary — Judgment of the General Court (Ninth Chamber, Extended Composition), 12 December 2018

1. Judicial proceedings — Application initiating proceedings — Formal requirements — Brief summary of the pleas in law on which the application is based — General reference to other documents not annexed to the application – Reference to the application lodged by another applicant against the same decision adopted in the sphere of competition law — Inadmissibility

(Statute of the Court of Justice, Arts 21, first para., and 53, first para.; Rules of Procedure of the General Court (1991), Arts 43(1) and 44(1))

2. Competition — Administrative procedure — Principle of sound administration — Requirement of impartiality — Scope — Public statements made by Members of the Commission during the administrative procedure

(Art. 101(1) TFEU; Charter of Fundamental Rights of the European Union, Art. 41)

3. Competition — Administrative procedure — Advisory Committee on agreements, decisions, concerted practices and dominant positions — Obligation to consult — Essential formality — Scope

(Arts 101 and 102 TFEU; Council Regulation No 1/2003, Art. 14)

4. EU law — Principles — Rights of defence — Equality of arms principle — Compliance in the context of judicial proceedings — Scope — Brevity of the period of time for lodging applications in the light of the length of the contested decision — No infringement

(Art. 263, sixth para., TFEU; Charter of Fundamental Rights of the European Union, Art. 47; Rules of Procedure of the General Court (1991), Art. 102(2))

5. Actions for annulment — Subject-matter — Grounds of a decision — Exclusion unless exception — Plea in law directed against the grounds of a decision finding an infringement of the competition rules — Grounds which do not support the finding of the infringements identified — Invalid plea in law

(Arts 101, 102 and 263 TFEU)

6. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Distinction between infringements by object and infringements by effect — Infringement by subject-matter — Whether sufficiently harmful — Sufficient — Consideration of the potential effects of the agreement — Limits

(Art. 101(1) TFEU)

7. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Distinction between infringements by object and infringements by effect — Infringement by subject-matter — Whether sufficiently harmful — Assessment

(Art. 101(1) TFEU)

8. Competition — EU rules — Substantive scope — Patent dispute settlement agreement — Included — Balancing of patent law and the competition rules

(Art. 101(1) TFEU; Council Regulation No 1/2003)

9. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products — Inducive reverse payment received by the generic undertaking — Restriction by object

(Art. 101(1) TFEU)

10. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products — Payment received by the generic undertaking — Classification as an inducive reverse payment — Conditions

(Art. 101(1) TFEU)

11. Agreements, decisions and concerted practices — Adverse effect on competition — Ancillary restraint — Concept — Restriction necessary to the implementation of a main operation which is not anti-competitive — Main operation constituting a restriction of competition by object — Ancillary restraints doctrine inapplicable in the presence of an inducive reverse payment

(Art. 101(1) TFEU)

12. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Description of an undertaking as a potential competitor – Real concrete possibilities of entering the market — Criteria — Essential factor — Ability of the undertaking to enter the relevant market — Sufficiently fast entry — Perception of operators present on the market

(Art. 101(1) TFEU)

13. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Description of an undertaking as a potential competitor — Real concrete possibilities of entering the market — Criteria — Essential factor — Ability of the undertaking to enter the relevant market — Patent-related obstacles

(Art. 101(1) TFEU)

14. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Description of an undertaking as a potential competitor — Real concrete possibilities of entering the market — Criteria — Essential factor — Ability of the undertaking to enter the relevant market — Date of assessment — Burden of proof

(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 2)

15. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Description of an undertaking as a potential competitor — Criteria — Essential factor — Ability of the undertaking to enter the relevant market — Generic undertaking — Obstacles linked to the originator company’s patents and to the technical, regulatory and financial difficulties faced by the generic undertaking – Real concrete possibilities of overcoming those difficulties and entering the market

(Art. 101(1) TFEU)

16. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products — Payment received by the generic undertaking — Classification as an inducive reverse payment — Inducive nature apparent from the actual wording of the agreement

(Art. 101(1) TFEU)

17. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products – Exclusive purchasing clause amounting to a clause prohibiting the marketing of products

(Art. 101(1) TFEU)

18. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products — Side deal providing for a transfer of value to the generic undertaking — Classification as an inducive reverse payment — Conditions

(Art. 101(1) TFEU)

19. Agreements, decisions and concerted practices — Prohibition — Agreements which continue to produce their effects after they have formally ceased to be in force — Application of Article 101 TFEU

(Art. 101(1) TFEU)

20. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products — Licence agreement side deal providing for a transfer of value to the generic undertaking — Lawfulness — Classification of the value transfer as an inducive reverse payment — Conditions

(Art. 101(1) TFEU)

21. Agreements, decisions and concerted practices — Adverse effect on competition — Patent dispute settlement agreement — Agreement concluded between an originator company and a generic undertaking — Agreement containing clauses prohibiting patent challenges and clauses prohibiting the marketing of products — Licence agreement side deal providing for a transfer of value to the generic undertaking — Classification of the licence agreement side deal as inducive — Licence not covering all of the territory covered by the restrictive clauses — Irrelevant

(Art. 101(1) TFEU)

22. Competition — Administrative procedure — Commission decision finding an infringement — Burden of proving the infringement and its duration on the Commission — Extent of the burden of proof — Degree of precision required of the evidence used by the Commission — Agreements at issue concluded in the form of contracts and well publicised — Consequences

(Art. 101(1) TFEU)

23. Agreements, decisions and concerted practices — Adverse effect on competition — Assessment of the anti-competitive nature of an agreement as regards its effects on the market — Procedures — Examination of the competition that would have existed in the absence of the agreement at issue — Agreement implemented before the adoption of the decision by the Commission — Obligation for the Commission to analyse the actual effects of the agreement on competition

(Art. 101(1) TFEU)

24. Agreements, decisions and concerted practices — Prohibition — Infringements — Agreements and concerted practices constituting a single infringement — Attribution of liability for the entire infringement to a single undertaking — Conditions — Unlawful practices and conduct forming part of an overall plan — Assessment — Criteria — Common objective pursued by all the participants

(Art. 101(1) TFEU)

25. Dominant position — Relevant market — Definition — Criteria — Medicinal products — Availability of medicinal products recognised or perceived as equivalent by prescribers — Consideration of qualitative or non-price competitive constraints

(Art. 102 TFEU; Commission notice 97/C 372/03)

26. Dominant position — Relevant market — Definition — Criteria — Medicinal products — Availability of medicinal products recognised or perceived as equivalent by prescribers — Errors in the analysis of the relevant market such as to vitiate the result of that analysis

(Art. 102 TFEU)

27. Dominant position — Relevant market — Definition — Judicial review — Review of legality — Comprehensive review — Complex evaluation of economic matters — Commission’s margin of assessment – Errors in the market analysis of the relevant market such as to vitiate the result of that analysis

(Art. 101 TFEU, 102 TFEU and 263 TFEU)

28. Fundamental rights — Charter of Fundamental Rights of the European Union — Principle that offences and penalties must have a proper legal basis — Scope — Foreseeability of the infringing nature of the penalised conduct — Patent dispute settlement agreement between an originator company and a generic undertaking — Agreement contrary to competition law – Originator company which could not have been unaware of the anti-competitive nature of its conduct

(Art. 101(1) TFEU; Charter of Fundamental Rights of the European Union, Art. 49(1))

29. Competition — Fines — Amount — Whether appropriate — Judicial review — Imposition of cumulative fines imposed on a company that participated in several distinct infringements — Breach of the principle of proportionality — Conditions

(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 23(2))

30. Competition — Fines — Decision imposing fines — Obligation to state reasons — Scope — Indication of the factors which led the Commission to apply a correction coefficient to the value of sales — Sufficient indication — Subsequent communication of more specific information — Irrelevant

(Art. 101(1) TFEU)

31. Competition — EU rules — Infringements — Committed intentionally or negligently — Concept — Undertaking not capable of being unaware of the anti-competitive nature of its conduct

(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 23(1))

32. Competition — Fines — Amount — Determination — Determination of the basic amount — Gravity of the infringement — Criteria for assessment — No obligation to take account of the actual impact on the market

(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 23(3); Commission notice 2006/C 210/02, points 20 to 22)

33. Competition — Fines — Amount — Determination — Determination of the basic amount — Gravity of the infringement — 'Entry fee' — Factors to be taken into consideration

(Art. 101(1) TFEU; Council Regulation No 1/2003, Art. 23(3); Commission notice 2006/C 210/02, point 25)

1. See the text of the decision.

(see paras 90, 91)

2. The guarantees afforded by the EU legal order in administrative proceedings include, in particular, the principle of sound administration, affirmed in Article 41 of the Charter of Fundamental Rights, which entails the duty of the competent institution to examine carefully and impartially all the relevant aspects of the individual case. That requirement of impartiality encompasses, on the one hand, subjective impartiality, in so far as no member of the institution concerned who is responsible for the matter may show bias or personal prejudice, and, on the other hand, objective impartiality, in so far as there must be sufficient guarantees to exclude any legitimate doubt as to bias on the part of the institution concerned.

In that respect, the two Members of the Commission consecutively responsible for competition, who were in office when the decision finding an infringement of Articles 101 and 102 TFEU was adopted, did not infringe either the principle of impartiality or the right to sound administration of the companies concerned by having commented publically and in substance on the initiation of proceedings against those companies, on the communication of a statement of objections and on the forthcoming adoption of a decision bringing those proceedings to a close, since they merely informed the other institutions and the public about investigations in progress, with the discretion and circumspection required by their obligation of impartiality.

(see paras 119, 131-134)

3. Consultation of the Advisory Committee on Restrictive Practices and Dominant Positions referred to in Article 14(1) of Regulation No 1/2003 is an essential procedural requirement, breach of which affects the legality of the Commission’s final decision if it is proved that the failure to comply with the rules on consultation prevented the Advisory Committee from delivering its Opinion in full knowledge of the facts. The substance of the obligations under the provisions governing the consultation of the Advisory Committee, and the question whether or not they constitute essential requirements, must therefore be determined in each case in the light of that purpose of enabling the committee to carry out its advisory task in full knowledge of the facts.

In the absence of any objection from one of the members of the Advisory Committee to the dates of the meetings set, the staggered transmission of a draft decision to that Committee, which in some cases did not comply with the period of 14 days prescribed by Article 14(3) of Regulation No 1/2003, does not constitute a breach of the essential procedural requirement of consultation, since the members of the Advisory Committee were sufficiently informed of the substance of the case and of the content of the draft decision, in view of the communication of various documents adopted or received during the procedure and, consequently, the Advisory Committee was able to give its opinion in full knowledge of the facts.

Nor is the obligation to consult the Advisory Committee breached by the fact that those meetings of that Committee were attended by a low number of representatives of national competition authorities, since no provision is made for any quorum rule for the adoption of opinions of the Advisory Committee, Article 14(3) of Regulation No 1/2003 expressly provides that the Advisory Committee may deliver an opinion even if some members are absent and are not represented, and the Commission took all the necessary steps to enable the competition authorities of the Member States to participate in the Advisory Committee, as it is required to do.

(see paras 148-150, 154-156, 165, 166)

4. See the text of the decision.

(see paras 170-174)

5. Only the operative part of a decision finding an infringement of the competition rules is capable of producing legal effects and of adversely affecting a person’s interests and the assessments made in the recitals are not in themselves capable of forming the subject of an application for annulment. Those assessments can be subject to judicial review by the EU judicature only to the extent that, as grounds of an act adversely affecting a person’s interests, they constitute the essential basis for the operative part of that act and if, in particular, those grounds are likely to alter the substance of what was decided in the operative part of the measure in question.

Thus, a plea for annulment directed against the grounds of a Commission decision which does not relate to the conduct and practices constituting the infringement of competition law penalised by that decision, but to the context in which that infringement occurred, must be rejected as ineffective.

(see paras 188, 198)

6. The anticompetitive object and effect of an agreement are not cumulative but alternative conditions for assessing whether an agreement comes within the scope of the prohibition laid down in Article 101(1) TFEU. In that respect, it is not necessary to show actual anticompetitive effects of conduct where the anticompetitive object of that conduct is proved. In addition, establishing the existence of a restriction of competition by object cannot, under the guise, inter alia, of the examination of the economic and legal context of the agreement at issue, lead to the assessment of the effects of that agreement, since otherwise the distinction between a restriction of competition by object and by effect laid down in Article 101(1) TFEU would lose its effectiveness.

Nevertheless, the Commission and the Courts of the European Union cannot, when examining whether an agreement restricts competition by object and, in particular, in assessing the economic and legal context of that agreement, completely ignore its potential effects. Since agreements which are restrictive of competition by object are those which reveal a sufficient degree of harm, in that they are so likely to have anticompetitive effects, that it may be found that there is no need to examine their specific effects on the market, agreements which, having regard to their context, have ambivalent potential effects on the market cannot be regarded as being a restriction of competition by object. However, the analysis of the potential effects of such an agreement must be limited to those resulting from information objectively foreseeable at the time of the conclusion of that agreement, since otherwise the distinction between a restriction of competition by object and by effect laid down in Article 101(1) TFEU would lose its effectiveness.

(see paras 219, 221, 304, 644, 989, 990)

7. The concept of restriction of competition by object within the meaning of Article 101(1) TFEU can be applied only to certain types of coordination between undertakings that reveal, by their very nature, a sufficient degree of harm to the proper functioning of normal competition that it may be found that there is no need to examine their effects. Where the Commission finds that agreements constitute restrictions of competition by object, it is not however required to use the words ‘sufficient degree of harm’ in its decision, if it is apparent from that decision that it correctly grasped the concept of restriction of competition by object.

In order to determine whether an agreement between undertakings reveals a sufficient degree of harm that it may be considered a restriction of competition by object’ within the meaning of Article 101(1) TFEU, regard must be had to the content of its provisions, its objectives and the economic and legal context of which it forms part. When determining the economic and legal context, it is also necessary to take into consideration the nature of the goods or services affected, as well as the real conditions of the functioning and structure of the market or markets in question.

In that respect, the mere fact that a case is unprecedented does not mean that the agreement in question cannot be classified as a restriction of competition by object. The practices referred to in Article 101(1)(a) to (e) TFEU do not constitute an exhaustive list of prohibited collusion and, even though experience may undoubtedly show that certain types of cooperation are inherently harmful to competition, the fact that the Commission has not, in the past, considered that a certain type of agreement was, by its very object, restrictive of competition is not, in itself, such as to prevent it from doing so in the future following an individual and detailed examination of the measures in question. Similarly, it is not necessary that an agreement be considered to be prima facie or undoubtedly sufficiently harmful to competition, without a concrete and individual examination of its content, its purpose, and its legal and economic context by the Commission or the EU judicature, in order to be regarded as a restriction of competition by object.

(see paras 220, 221, 224, 230, 231)

8. The use of a settlement to resolve a patent dispute does not exempt the parties from the application of competition law.

In that respect, although the Commission is not competent to determine the scope of a patent, it is still the case that it may not refrain from all action when the scope of the patent is relevant for the purposes of determining whether there has been an infringement of Article 101 or 102 TFEU, since even in cases where the protection afforded by a patent is the subject of proceedings before the national courts, the Commission must be able to exercise its powers in accordance with the provisions of Regulation No 1/2003, the Commission’s findings do not in any way pre-empt the determinations made later by national courts in disputes brought before them on the subject of patent rights and the Commission’s decision is subject to review by the EU judicature. Thus, while it is not for the Commission or the General Court to rule on the validity of a patent, the existence of the patent must nevertheless be taken into account in the analysis carried out in the framework of the EU competition rules.

For the purposes of reconciling patent law and competition law in the particular context of settlements between parties to a patent dispute, a balance must be struck between, on the one hand, the need to allow undertakings to make settlements, the increased use of which is beneficial for society and, on the other hand, the need to prevent the risk of misuse of settlement agreements, contrary to competition law, leading to entirely invalid patents being maintained.

(see paras 244, 252, 253)

9. In the context of a pharmaceutical patent settlement agreement concluded between an originator company, as the patent holder, and a generic company, a finding of a restriction of competition by object presupposes that the settlement agreement contains both an inducement in the form of a benefit for the generic company and a corresponding limitation of the generic company’s efforts to compete with the originator company. Where those two conditions are met, a finding of restriction of competition by object within the meaning of Article 101(1) TFEU must be made in view of the harmfulness of that agreement to the proper functioning of normal competition.

Thus, the mere presence, in such a settlement agreement, of non-marketing clauses and non-challenge clauses whose scope is limited to that of the patent in question does not — despite the fact that those clauses are, by themselves, restrictive — justify a finding of a restriction of competition sufficiently harmful to be described as a restriction by object, where those agreements are based on the recognition, by the parties, of the validity of the patent. The presence of such clauses is, however, problematic when it is apparent that the generic company’s agreement to those clauses is not based on its recognition of the validity of the patent. Accordingly, where an unjustified reverse payment from the originator company to the generic company occurs in the conclusion of the settlement, the generic company must then be regarded as having been induced by that payment to agree to the non-marketing and non-challenge clauses and it must be concluded that there is a restriction by object.

Where an inducement has been found, the parties may no longer rely on their recognition, in the context of the settlement, of the validity of the patent. The fact that the validity of the patent is confirmed by a judicial or administrative body is, in that regard, irrelevant. It is then the inducement, and not the recognition of the validity of the patent by the parties to the settlement, which must be regarded as the real cause of the restrictions of competition introduced by the non-marketing and non-challenge clauses, which — since they are in that case entirely illegitimate — therefore reveal a sufficient degree of harm to the proper functioning of normal competition that a restriction by object may be found.

(see paras 262, 263, 265, 269, 270, 272)

10. In the context of pharmaceutical patent dispute settlement agreements concluded between an originator company, as the patent holder, and a generic company, a finding of a restriction of competition by object within the meaning of Article 101(1) TFEU presupposes that the settlement agreement contains both an inducement in the form of a benefit for the generic company and a corresponding limitation of the generic company’s efforts to compete with the originator company.

In order to establish whether or not a reverse payment, that is to say a transfer of value from the originator company to the generic company, constitutes an inducement to accept non-marketing and non-challenge clauses in a settlement agreement, it is necessary to examine, taking into account its nature and its justification, whether the transfer of value covers costs inherent in the settlement of the dispute.

If a reverse payment provided for in a settlement agreement containing clauses restrictive of competition is aimed at compensating costs that are inherent in that settlement, that payment cannot in principle be regarded as an inducement. Nevertheless, a finding of an inducement and of a restriction of competition by object is not ruled out in such a case. It means however that the Commission must prove that the amounts corresponding to those costs inherent in the settlement, even if they are established and precisely quantified by the parties to that settlement, are excessive.

By contrast, some costs incumbent upon the generic company are, a priori, too extraneous to the dispute and to its settlement to be regarded as inherent in the settlement of a patent dispute. Those include, for example, the costs of manufacturing the infringing products, corresponding to the value of the stock of those products, and research and development expenses incurred in developing those products. The same is true of sums which must be paid by the generic company to third parties as a result of contractual commitments which were not undertaken in the context of the dispute. It is therefore for the parties to the agreement in question, if they do not wish the payment of those costs to be regarded as an inducement, and indicative of a restriction of competition by object, to demonstrate that those costs are inherent in the dispute or in its settlement, and then to justify the amount.

(see paras 272, 277, 278, 280)

11. See the text of the decision.

(see paras 284-291)

12. In the context of patent settlement agreements, the unlawful nature of which might not have been evident to an outside observer, the Commission cannot, in order to demonstrate the existence of potential competition on a given market, limit itself to verifying the absence of insurmountable barriers to market entry in order to infer the existence of potential competition. The Commission was therefore correct to assess potential competition on the relevant market on the basis of the real concrete possibilities criterion, in accordance with which potential competition can be found to exist only if there are realistic possibilities of entry, which could have taken place in the absence of any restrictive measure.

The essential factor on which a determination of the existence of real concrete possibilities of entering the market must be based is whether an undertaking has the ability to enter that market. The intention of the undertaking concerned to enter a market, on the other hand, is neither necessary in order to find that there is potential competition on that market, nor capable of calling that finding into question, nevertheless, when such an intention is established, it may support the conclusion that a given operator has the ability to enter the market and thus contribute to its classification as a potential competitor.

Moreover, an operator cannot be described as a potential competitor unless its potential entry could take place sufficiently quickly to form a constraint on market participants and thus exert competitive pressure on them. That concept of ‘sufficiently fast’ entry depends on the facts of the case at hand and its legal and economic context, which must be taken into account in order to determine whether the undertaking outside the market exerts competitive pressure on the undertakings currently operating in that market.

The criterion of the incumbent operator’s perception is also a relevant, but not sufficient, criterion for assessing the existence of potential competition. Thus, the perception of these operators, even experienced ones, cannot by itself lead to the conclusion that another operator is one of their potential competitors. However, that perception may support the conclusion that an operator has the ability to enter a market and, accordingly, may contribute to its classification as a potential competitor.

(see paras 318, 320, 325, 326-329, 334, 336, 347, 382)

13. The patents of an undertaking which is the subject of proceedings concerning an infringement of the competition rules do not, in principle, constitute insurmountable barriers to the market entry of a competitor, since it is possible for undertakings outside that market to take the risk of entering the market with a product, including by potentially infringing the patent in force, and that at risk entry or launch could be successful, if the patent holder decides not to bring an infringement action or, in the event that such an action is brought, if that infringement action is dismissed. That possibility of entering the market at risk does not in itself imply that the potential competitors have real concrete possibilities of entering that market, which depend on their ability and their intention to make such an at risk market entry.

In addition, even though patents do not, in principle, constitute insurmountable barriers to the market entry of a competitor, they may give rise to such barriers depending on the outcome of patent litigation and have an impact on the real concrete possibilities of entering that market. In that regard, the assessments of the outside operators themselves concerning the possibilities of the incumbent operator’s patents being declared invalid or being infringed may be taken into account in order to determine whether those outside operators had real concrete possibilities of entering the market.

(see paras 359, 379, 384)

14. In the context of proceedings concerning an infringement of the competition rules, the existence of potential competition on a particular market between undertakings that concluded patent settlement agreements is assessed on the date of conclusion of the agreements at issue. In order to determine whether such agreements are restrictive of competition for the purposes of Article 101 TFEU, it is necessary to determine what actual or potential competition existed on the relevant market at the time the agreements were concluded. It follows that arguments and documents based on data subsequent to the conclusion of the agreements at issue cannot be taken into account, since such data reflect the implementation of those agreements and not the competitive situation on the market when they were concluded.

The burden of proving the existence of real concrete possibilities of a competitor entering the market, like the more general burden of proving the existence of an infringement, rests with the Commission. Nevertheless, to the extent that most of the data which may be used to establish the ability and intention of operators outside the market to enter that market, and thus their real concrete possibilities of doing so, are data internal to those undertakings, which the latter are best placed to gather, the Commission may, in the absence of evidence to the contrary concerning technical, regulatory, commercial or financial difficulties, establish the existence of such possibilities by gathering a body of consistent evidence attesting, at the very least, to steps being taken to produce and market the product at issue within a sufficiently short period to form a constraint on the incumbent operator.

(see paras 385, 386)

15. See the text of the decision.

(see paras 432-501, 579-614, 718-752)

16. See the text of the decision.

(see paras 527-547)

17. See the text of the decision.

(see paras 644-678)

18. In the context of a pharmaceutical patent settlement agreement concluded between an originator company, as the patent holder, and a generic company, a finding of a restriction of competition by object presupposes that the settlement agreement contains both an inducement in the form of a benefit for the generic company and a corresponding limitation of the generic company’s efforts to compete with the originator company.

In that regard, the presence of a normal commercial agreement linked to a settlement agreement which contains clauses which are by themselves restrictive may constitute a strong indication of the existence of an inducement and, consequently, of a restriction of competition by object, where that side deal provides for a transfer of value from the originator company to the generic company. However, that strong indication is not sufficient and the Commission must therefore support it with other consistent evidence justifying the conclusion that there is a reverse payment. Such a payment, in the specific context of side deals, corresponds to the part of the payment made by the originator company which exceeds the ‘normal’ value of the asset traded.

It follows that, in the light of all the evidence available to it and, as the case may be, the lack of an explanation or the lack of a plausible explanation from the parties to the agreements, the Commission may be justified in finding, following an overall assessment, that the side deal was not concluded at arm’s length, that is to say that the payment made by the originator company exceeds the value of the asset traded, or that the value of the asset transferred to the generic company exceeds the payment made by the latter. The Commission may thus conclude that there is a reverse payment. A reverse payment, if it is not intended to compensate for costs inherent in the settlement, therefore constitutes an inducive benefit. However, the parties to the agreement may still argue that the benefit in question is insignificant, if the amount of that benefit is insufficient to be regarded as a significant inducement to accept the competition-restricting clauses set out in the settlement agreement.

(see paras 797, 798, 802-804, 808-810, 866)

19. See the text of the decision.

(see paras 903-906)

20. In the context of a pharmaceutical patent settlement agreement concluded between an originator company, as the patent holder, and a generic company, a finding of a restriction of competition by object presupposes that the settlement agreement contains both an inducement in the form of a benefit for the generic company and a corresponding limitation of the generic company’s efforts to compete with the originator company. Where there is a licence agreement between the originator company and the generic company, those two elements are mitigated, or even absent, with the result that a sufficient degree of harm to the proper functioning of normal competition cannot easily be identified.

It follows that, by way of exception to the considerations relating to other types of side deals, the linking of a licence agreement to a settlement agreement settling a genuine dispute in relation to pharmaceutical patents which contains non-marketing and non-compete clauses does not constitute a strong indication of a reverse payment. It is therefore for the Commission to rely on other indicia for the purpose of establishing that the licence agreement was not concluded at arm’s length and that it actually masks a reverse payment inducing the generic company to accept the non-marketing and non-challenge clauses. In that situation, it is therefore for the Commission to demonstrate that that quid pro quo given by the generic company to the patent holder is abnormally low, that is to say to such an extent that it cannot be explained by considerations limited to the economic value of the asset to which the contract relates, and that the licence agreement thus involves a reverse payment to the generic company.

(see paras 943, 949, 951, 952, 956, 963)

21. See the text of the decision.

(see paras 992-999)

22. See the text of the decision.

(see paras 1016, 1025)

23. In order to determine whether an agreement is to be considered to be contrary to Article 101(1) TFEU by reason of the distortion of competition which is its effect, the competition in question should be assessed within the actual context in which it would occur in the absence of the agreement in dispute. It is therefore necessary to show — by a comparison between the competition that existed when the agreement was in force and the competition that would have occurred if that agreement had not been concluded — that the competitive situation was worse when that agreement was in force.

In that respect, when the Commission adopts a decision finding an infringement of Article 101(1) TFEU, the mere fact that the Commission has established the existence of potential competition and a limitation of the autonomy of a potential competitor, or even the elimination of that autonomy, does not release it from its obligation to demonstrate an analysis of the actual effects of the measure in question on competition where the clauses of an agreement have been implemented and their impact on competition can be measured by taking into account the relevant factual developments, including those subsequent to the conclusion of the agreement, which took place before the Commission issued its decision. If it were possible for the Commission to rely, in relation to agreements which have been implemented, solely on the effects that they are likely to have, in order to demonstrate that they had an anticompetitive effect, the distinction between restrictions of competition by object and by effect, established by Article 101(1) TFEU, would lose its relevance.

The Commission therefore erred in law by considering that, since it had established that an agreement excluded a potential competitor from the market in question, it was not required, in order to demonstrate the competition that would have occurred had an agreement not been concluded, to take into account the actual course of events which it could have observed at the time it adopted its decision, some of which were not only relevant, but also decisive for the purposes of the comparison between the competition that existed when the agreement was in force and the competition that would have occurred if that agreement had not been concluded.

(see paras 1076, 1092, 1121-1123, 1128, 1219, 1220)

24. See the text of the decision.

(see paras 1264-1282, 1295-1303)

25. For the purposes of investigating the possibly dominant position of an undertaking on a particular market, the possibilities of competition must be judged in the context of the market comprising the totality of the products which, with respect to their characteristics, are particularly suitable for satisfying constant needs and are only to a limited extent interchangeable with other products. The definition of the relevant market is carried out in order to define the boundaries within which it must be assessed whether a given undertaking is able to behave, to an appreciable extent, independently of its competitors, its customers and, ultimately, consumers. Thus, the relevant product market comprises all those products or services which are regarded as substitutable by the consumer, by reason of the products’ characteristics, their prices and their intended use.

In that respect, competitive relationships in the pharmaceutical sector respond to mechanisms which differ from those determining competitive interactions normally present in markets which are not so heavily regulated. Indeed, the pharmaceutical sector is ‘unusual’ in that the demand for prescription medicines is guided by the prescribing doctor and not the ultimate consumer (the patient). Similarly, doctors are primarily guided by the therapeutic effect of medicines when choosing what to prescribe. Consequently, in so far as they determine doctors’ choices, non-price factors, such as therapeutic use, constitute, alongside price-based indicators, relevant factors for the purposes of market definition.

Doctors’ freedom of choice, between the originator medicinal products available on the market or between originator medicinal products and generic versions of other compounds, and the priority focus of prescribers on therapeutic aspects permit, where appropriate, the operation of significant qualitative and non-price competitive constraints in addition to the usual mechanisms of price pressure. Such constraints may exist where the therapeutic value of a medicinal product is clearly superior to that of other medicinal products available for treatment of the same condition and where the available medicinal products are recognised or perceived as equivalent by prescribers.

In particular, where, for the treatment of the same condition, prescribers have a choice between medicinal products of which none is recognised or perceived as superior to the others, the analysis of the competition between those medicinal products also relies, in large part, on a qualitative comparison. Accordingly, where medicinal products are recognised or perceived as equivalent or substitutable, the market analysis must pay particular attention to the factors making it possible to identify qualitative or non-price competitive constraints, reflected, inter alia, in efforts to make a medicinal product the initial choice of treatment for new prescribers, in switching by continued-use patients to other competing medicinal products and in the intensity of promotional activities carried out for a medicinal product where equivalent or less expensive alternatives exist.

(see paras 1380-1382, 1385, 1395, 1397, 1402)

26. See the text of the decision.

(see paras 1405-1592)

27. The scope of judicial review provided for in Article 263 TFEU extends to all the elements of Commission decisions relating to proceedings applying Articles 101 and 102 TFEU which are subject to in-depth review by the General Court, in law and in fact, in the light of the pleas raised by the applicants and taking into account all the elements submitted by the latter.

Moreover, whilst, in areas giving rise to complex economic assessments, the Commission has a margin of discretion with regard to economic matters, that does not mean that the Courts of the European Union must refrain from reviewing the Commission’s interpretation of information of an economic nature. Those Courts must establish, among other things, not only whether the evidence relied on is factually accurate, reliable and consistent but also whether that evidence contains all the information which must be taken into account in order to assess a complex situation and whether it is capable of substantiating the conclusions drawn from it.

In defining the relevant market for the purpose of assessing the existence of a dominant position, the Commission made a series of errors such as to vitiate the result of its analysis, by wrongly considering, inter alia, that the product at issue, namely a medicinal product intended for the treatment of hypertension, differed, with regard to therapeutic use, from other medical products within the same therapeutic class, by underestimating the propensity of patients to switch treatment and by attaching excessive importance to the price factor in analysing competitive pressures.

(see paras 1587-1590)

28. The effective penalisation of infringements of competition law cannot go so far as to disregard the principle that offences and penalties must have a proper legal basis as enshrined in Article 49 of the Charter of Fundamental Rights. That principle cannot, however, be interpreted as precluding the gradual, case-by-case clarification of the rules on criminal liability by judicial interpretation, provided that the result was reasonably foreseeable at the time the offence was committed, especially in the light of the interpretation put on the provision in the case-law at the material time.

The scope of the notion of foreseeability depends to a considerable degree on the content of the text in issue, the field it covers and the number and status of those to whom it is addressed. A law may still satisfy the requirement of foreseeability even if the person concerned has to take appropriate legal advice to assess, to a degree that is reasonable in the circumstances, the consequences which a given action may entail. This is particularly true in relation to persons carrying on a professional activity, who are used to having to proceed with a high degree of caution when pursuing their occupation. Such persons can therefore be expected to take special care in evaluating the risk that such an activity entails.

In that respect, an originator company could assume that by inducing generic companies to accept non-marketing and non-challenge clauses, by themselves restrictive of competition, it rendered the inclusion of such clauses in a patent settlement agreement entirely illegitimate. Such inclusion is no longer based on recognition by the parties to the agreements of the validity of the patent and thus indicates a misuse of the patent, unrelated to its specific purpose. The originator company could therefore reasonably have foreseen that its conduct was caught by the prohibition laid down in Article 101(1) TFEU.

Although, because the agreements at issue were concluded in the form of patent settlements, the unlawful nature of those agreements might not have been evident to an outside observer such as the Commission or lawyers specialising in the fields in question, the same could not be said for the parties to the agreement.

(see paras 1655, 1657, 1658, 1661, 1666)

29. The imposition of cumulative fines on a company which participated in several different infringements cannot, in principle, be regarded as being disproportionate. It is even less disproportionate where the Commission, in order to take into account the fact that the undertaking in question committed several infringements which — although different — relate to the same product and largely to the same geographic areas and periods of time, applies a correction which leads it to reduce the values of the sales relating to the various infringements. However, an additional correction is required as regards an infringement which has particularly strong links to another infringement penalised in the decision and which, since its purpose is to strengthen the effects of the latter, is of a lower degree of gravity than that other infringement.

(see paras 1685-1699)

30. The fact that more specific information concerning the calculation of the amount of the fine for infringement of the competition rules is communicated subsequently, in the course of the judicial proceedings, is not such as to show that the contested decision was in that regard, vitiated by inadequate reasoning. Where the author of a contested decision provides explanations to supplement a statement of reasons which is already adequate in itself, that does not go to the question whether the duty to state reasons has been complied with, though it may serve a useful purpose in relation to review by the Courts of the European Union of the adequacy of the grounds of the decision, since it enables the institution to explain the reasons underlying its decision.

(see para. 1732)

31. See the text of the decision.

(see paras 1786-1788)

32. See the text of the decision.

(see paras 1802-1810)

33. See the text of the decision.

(see paras 1883-1910)