Case T‑352/09
Novácke chemické závody a.s.
v
European Commission
(Competition — Agreements, decisions and concerted practices — Market for calcium carbide and magnesium for the steel and gas industries in the EEA, with the exception of Ireland, Spain, Portugal and the United Kingdom — Decision finding an infringement of Article 81 EC — Price-fixing and market-sharing — Fines — Obligation to state reasons — Proportionality — Equal treatment — 2006 Guidelines on the method of setting fines — Ability to pay)
Summary — Judgment of the General Court (Third Chamber), 12 December 2012
1. Competition — Fines — Amount — Determination — Criteria — Deterrent effect of the fine — Discretion of the Commission — Limits — Account taken of the Guidelines on the method of setting fines imposed for infringements of the competition rules — Respect for the principles of proportionality and equal treatment
(Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 37)
2. Competition — Fines — Amount — Discretion of the Commission — Judicial review — Unlimited jurisdiction — Scope — Increase in the fine imposed on other undertakings which have not been given an opportunity to comment in that respect — Exclusion
(Art. 261 TFEU; Council Regulation No 1/2003, Art. 31)
3. Competition — Fines — Amount — Determination — Criteria — Deterrent effect of the fine — Discretion of the Commission — Same percentage applied in respect of all cartel participants — Breach of the principle of equal treatment — None
(Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, points 4, 19, 21 and 25)
4. Competition — Fines — Amount — Determination — Criteria — Deterrent effect of the fine — Specific increase for undertakings which have a particularly large turnover — Discretion of the Commission
(Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 30)
5. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Aggravating circumstances — Role of leader in the infringement — Concept — Criteria for assessment
(Council Regulation No 1/2003, Art. 23(2) and (3))
6. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Mitigating circumstances — Unawareness of the unlawful nature of a cartel which has as its object the restriction of competition — Infringement committed intentionally — Not included
(Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 29)
7. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Mitigating circumstances — Passive or ‘follow-my-leader’ role of the undertaking — Aspect not included in the new guidelines — Discretion of the Commission
(Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 29)
8. Union law — Principles — Rights of the defence — Use in judicial proceedings of statements of an undertaking obtained by the Commission pursuant to the Leniency Notice — Infringement of the right of that undertaking not to incriminate itself — None
(Commission Notices 2002/C 45/03 and 2006/C 298/11, point 31)
9. Competition — Fines — Amount — Determination — Criteria — Gravity of the infringement — Mitigating circumstances — Cooperation of the undertaking in question outside the scope of the Leniency Notice — Included — Conditions
(Art. 81 EC; Commission Notices 2002/C 45/03 and 2006/C 210/02, point 29)
10. Competition — Fines — Amount — Determination — Guidelines adopted by the Commission — Ability of the Commission to depart from them — Limits — Respect for the principle of equal treatment — Account taken of the particular characteristics of an undertaking having regard, in particular, to the risk that the fine may be disproportionate
(Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 37)
11. Competition — Fines — Amount — Determination — Criteria — Gravity and duration of the infringement — Fine imposed on a small or medium-sized undertaking — Larger fine, as a percentage of turnover, than that imposed on larger undertakings which participated in the same infringement — Breach of the principle of proportionality —None
(Art. 81 EC; Council Regulation No 1/2003, Art. 23(2) and (3))
12. Competition — Fines — Amount — Determination — Maximum amount — Fine imposed on a small or medium-sized undertaking — Fine representing a percentage very close to the maximum ceiling of 10% of its worldwide turnover — Higher percentage than that applied in respect of other cartel participants — Breach, for that reason alone, of the principle of equal treatment — None
(Art. 81 EC; Council Regulation No 1/2003, Art. 23(2) and (3))
13. Competition — Fines — Amount — Determination — Criteria — Obligation to take into consideration the poor financial situation of the undertaking concerned — None — Actual ability of the undertaking to pay in a specific social and economic context — To be taken into consideration — Conditions
(Art. 81 EC; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 35)
14. Acts of the institutions — Statement of reasons — Obligation — Scope — Decision imposing fines — Indication of the factors which enabled the Commission to assess the gravity and the duration of the infringement — Sufficient indication
(Art. 253 EC; Council Regulation No 1/2003, Art. 23)
15. Competition — Fines — Amount — Whether appropriate — Judicial review — Factors which may be taken into account by the EU judicature — Information not contained in the decision imposing the fine and not required under the obligation to state reasons — Included
(Art. 253 EC; Council Regulation No 1/2003, Arts 23 and 31)
16. Competition — Union rules — Objectives — Commission decision imposing a fine for infringement of the competition rules — Infringement of Article 3(1)(g) EC — None
(Arts 3(1)(g) EC and 81 EC)
1. See the text of the decision.
(see paras 43-48)
2. See the text of the decision.
(see paras 49-51, 55, 56)
3. See the text of the decision.
(see paras 58-61)
4. Point 30 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003 provides that the Commission has the power, but not the obligation, to increase the fine imposed on an undertaking which has a particularly large turnover beyond the sales of goods or services to which the infringement relates.
In that regard, while it follows from that point that such an increase may prove necessary in order to ensure that that fine has a sufficiently deterrent effect, it does not follow conversely that a fine which does not represent a significant percentage of the worldwide turnover of the undertaking concerned will not have a sufficiently deterrent effect on that undertaking. A fine determined in accordance with the methodology set out in the Guidelines represents, in principle, a substantial percentage of the value of sales which the undertaking being penalised has achieved in the sector affected by the infringement. Thus, as a result of the fine, the undertaking in question will see its profits in that sector diminish significantly; it may even record losses. Even if that undertaking’s turnover in that sector represents only a small fraction of its worldwide turnover, it is not necessarily inconceivable that the decline in profits made in that sector, or even their transformation into losses, will have a deterrent effect, since a commercial undertaking generally operates in a given sector in order to generate a profit.
Thus, where an undertaking does not put forward any specific evidence – beyond a vague reference to what it claims is the large worldwide turnover of certain cartel participants – that might demonstrate that the Commission should have used that power, the Commission cannot be criticised on that ground for any breach of the principles of equal treatment or proportionality.
(see paras 62-64)
5. See the text of the decision.
(see paras 76-80)
6. See the text of the decision.
(see paras 84-89)
7. Point 29 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003 provides for the basic amount of a fine to be adjusted on the basis of certain mitigating circumstances, which are specific to each undertaking concerned. Point 29 lays down, in particular, a non-exhaustive list of the mitigating circumstances that may be taken into account. However the exclusively passive or ‘follow-my-leader’ role of an undertaking in an infringement does not appear in that non-exhaustive list, although it was expressly referred to as an attenuating circumstance in the first indent of Section 3 of the Guidelines on the method of setting fines imposed pursuant to Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty.
In that regard, while the Commission may not depart from rules which it has imposed on itself, it is nevertheless free to modify those rules or to replace them. In a case that falls within the scope of the new rules, the Commission cannot be criticised for having failed to take into account a mitigating circumstance not provided for by those new rules, solely on the ground that it was provided for under the earlier rules. The fact that the Commission considered in previous decisions that certain factors constituted mitigating circumstances for the purposes of determining the amount of the fine does not mean that it is obliged to make the same assessment in a subsequent decision.
The fact remains that the list in point 29 of the Guidelines of mitigating circumstances that may be taken into account by the Commission is not exhaustive. Consequently, the fact that the Guidelines do not include in the list of mitigating circumstances the passive role of an undertaking that has participated in an infringement does not preclude that aspect from being taken into consideration as a mitigating circumstance if it is capable of demonstrating that the relative gravity of that undertaking’s participation in the infringement is less significant.
(see paras 92-94)
8. Cooperation under the 2002 Notice on immunity from fines and reduction of fines in cartel cases is a matter entirely within the will of the undertaking concerned. It is not in any way coerced to provide evidence of the presumed cartel. The degree of cooperation which the undertaking wishes to offer in the administrative procedure is therefore governed entirely by its freedom of choice and is not in any circumstances imposed by that notice.
Furthermore, since the publication of the 2006 Notice on immunity from fines and reduction of fines in cartel cases, having regard to point 31 thereof, an undertaking which decides to submit a statement with a view to obtaining a reduction in the amount of the fine is aware of the fact that although a reduction will be granted to it only if, in the Commission’s opinion, the conditions for a reduction referred to in the statement are satisfied, the statement will in any event form part of the file and may be used in evidence, including against its author.
Having thus freely and in full knowledge of the facts chosen to submit such a statement, the undertaking concerned cannot reasonably invoke the principle relating to the privilege against self-incrimination, pursuant to which, inter alia, the Commission may not compel an undertaking to provide it with answers which might involve an admission on its part of the existence of an infringement which it is incumbent upon the Commission to prove. Therefore, an undertaking which has submitted an application for leniency voluntarily and without being obliged to do so cannot criticise the Commission for having relied on that application for leniency in its pleadings before the General Court.
(see paras 110-113)
9. See the text of the decision.
(see paras 114, 115)
10. See the text of the decision.
(see paras 135-148)
11. See the text of the decision.
(see paras 158-160)
12. See the text of the decision.
(see paras 161-164)
13. The Commission is not required, in principle, to take into account when determining the amount of the fine the poor financial situation of an undertaking, since recognition of such an obligation would be tantamount to conferring an unfair competitive advantage on the undertakings least well adapted to market conditions.
Furthermore, the fact that a measure adopted by a Union authority leads to the insolvency or liquidation of a given undertaking is not prohibited as such by Union law. Although the liquidation of an undertaking in its existing legal form may adversely affect the financial interests of the owners, investors or shareholders, it does not mean that the personal, tangible and intangible elements represented by the undertaking would also lose their value.
In adopting point 35 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003, the Commission has not imposed on itself an obligation that runs counter to those principles. This is evidenced by the fact that point 35 makes no reference to the bankruptcy of an undertaking but covers situations arising ‘in a specific social and economic context’ in which the imposition of a fine ‘would irretrievably jeopardise the economic viability of the undertaking concerned and cause its assets to lose all their value’.
It follows from this that the mere fact that the imposition of a fine for infringements of the competition rules might give rise to the bankruptcy of the undertaking concerned is not sufficient as regards the application of point 35 of the Guidelines. While bankruptcy adversely affects the financial interests of the owners or investors concerned, it does not necessarily mean that the undertaking in question will disappear. That undertaking may continue to exist as such, either – in the case of the recapitalisation of the company declared bankrupt – as a legal person operating that undertaking, or – in the case of the acquisition by another entity of all its assets and thus of the undertaking – as an entity carrying out an economic activity. Such an acquisition of the assets may take the form either of a voluntary purchase or of a forced sale of the assets of the bankrupt company with its continued operation.
Consequently, point 35 of the Guidelines must be construed, in particular with regard to the reference to the loss of all value of the assets of the undertaking concerned, as envisaging a situation in which the acquisition of the undertaking, or at least of its assets, appears unlikely or even impossible. If that were the case, the assets of the bankrupt undertaking would be offered for sale individually, and it is likely that many of them would not find a buyer or, at best, would be sold only at a heavily reduced price; accordingly it seems legitimate to refer, as does point 35 of the Guidelines, to the loss of all their value.
Furthermore, the application of point 35 of the Guidelines also requires, according to its wording, a ‘specific social and economic context’. The consequences which payment of a fine could have, in particular, by leading to an increase in unemployment or deterioration in the economic sectors upstream and downstream of the undertaking concerned, constitute such a context.
(see paras 186-190, 192)
14. See the text of the decision.
(see paras 203, 204, 207)
15. See the text of the decision.
(see para. 212)
16. In providing for the institution of a system ensuring that competition in the common market is not distorted, Article 3(1)(g) EC requires a fortiori that competition must not be eliminated. This requirement is so essential that, without it, numerous provisions of the Treaty would be pointless. Thus, the restrictions of competition which the Treaty allows under certain conditions because of the need to harmonise the various objectives of the Treaty are limited by that requirement, and to go beyond that limit would involve the risk that the weakening of competition would adversely affect the aims of the common market.
Nevertheless, those considerations are irrelevant to the imposition of a penalty on an undertaking that has infringed the competition rules by its participation in an agreement between undertakings or in a concerted practice which has as its object or effect the prevention, restriction or distortion of competition within the meaning of Article 81(1) EC.
The imposition by the Commission of fines when it finds an infringement of the competition rules constitutes a means, specifically, of achieving the aim stated in Article 3(1)(g) EC and clearly cannot be regarded as an infringement of that provision.
(see paras 235-237)