Case T-151/07
Kone Oyj and Others
v
European Commission
(Competition – Agreements, decisions and concerted practices – Market for the installation and maintenance of elevators and escalators – Decision finding an infringement of Article 81 EC – Bid-rigging – Market sharing – Price fixing)
Summary of the Judgment
1. Competition – Fines – Guidelines on the method of setting fines – Legal nature
(Commission Notice 98/C 9/03)
2. Competition – Fines – Amount – Determination – Criteria – Consistency as between the amounts imposed on a number of undertakings
(Art. 81 EC; Council Regulation No 1/2003; Commission Notice 98/C 9/03, Section 1A)
3. Competition – Fines – Amount – Determination – Criteria – Gravity of the infringement – Obligation to take account of the actual impact on the market – No such obligation – Primary role played by the criterion relating to the nature of the infringement
(Council Regulation No 1/2003, Art. 23(2); Commission Notice 98/C 9/03, Section 1A)
4. Competition – Fines – Amount – Determination – Application of the Leniency Notice – Discretion of the Commission
(Council Regulation No 1/2003, Art. 23(2); Commission Notice 2002/C 45/03)
5. Competition – Administrative procedure – Inspection powers of the Commission – Decision ordering an investigation – Duty to state reasons – Scope
(Art. 81 EC; Council Regulation No 1/2003, Art. 20(4))
6. Competition – Fines – Amount – Determination – Commission notice on the non-imposition or reduction of fines in return for cooperation of the undertakings concerned – Binding upon the Commission
(Council Regulation No 1/2003, Art. 23(2); Commission Notice 2002/C 45/03)
7. Competition – Fines – Amount – Determination – Breach of the principle of equal treatment – Conditions – Comparability of situations
(Council Regulation No 1/2003, Art. 23(2); Commission Notice 2002/C 45/03)
8. Competition – Administrative procedure – Observance of the rights of the defence – Access to the file – Scope – Refusal to supply a document – Consequences – Need to draw a distinction, in relation to the burden of proof borne by the undertaking concerned, between incriminating and exculpatory documents
9. Competition – Fines – Amount – Determination – Criteria – Attitude of the undertaking during the administrative procedure
(Art. 81 EC; Council Regulation No 1/2003, Arts 18(1) and 20(3))
10. Competition – Fines – Amount – Determination – Criteria – Non-imposition or reduction of the fine in return for cooperation of the undertaking concerned – Application of the Leniency Notice – Reduction for not contesting the facts outside the Leniency Notice
(Council Regulation No 1/2003, Art. 23(2); Commission Notices 96/C 207/04 and 2002/C 45/03)
11. Competition – Fines – Amount – Determination – Non-imposition or reduction of the fine in return for cooperation of the undertaking concerned – Reduction for not contesting the facts – Conditions
(Council Regulation No 1/2003, Art. 23(2); Commission Notice 96/C 207/04, Section D2)
12. Competition – Fines – Amount – Determination – Criteria – Attitude of the undertaking during the administrative procedure – Unlawfulness of reductions in the fine granted to undertakings that have not expressly recognised the Commission’s allegations of fact
(Council Regulation No 1/2003, Art. 23)
1. Although 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 may not be regarded as rules of law which the administration is always bound to observe, they nevertheless form rules of practice from which the administration may not depart in an individual case without giving reasons that are compatible with the principle of equal treatment. In adopting such rules of conduct and announcing through their publication that they will henceforth apply to the cases to which they relate, the Commission imposes a limit on the exercise of its discretion and cannot depart from those rules without running the risk of suffering the consequences of being in breach of general principles of law, such as equal treatment or the protection of legitimate expectations. Furthermore, those guidelines determine, generally and abstractly, the method which the Commission has bound itself to use in assessing the fines imposed by the decision and, consequently, ensure legal certainty on the part of the undertakings.
(see paras 34-36)
2. Even assuming that the Commission, when it finds in one and the same decision that a number of very serious infringements have been committed, were required to keep a proportionate relationship between the general starting amounts and the sizes of the various markets affected, there is no indication that a general starting amount set for an infringement in a Member State is disproportionate as compared with the general starting amounts set for infringements in other Member States if the Commission sets the starting amounts in a reasonable and coherent manner without, however, using a precise mathematical formula, which it is not in any event required to do.
(see paras 54-55)
3. The gravity of infringements of EU competition law must be assessed in the light of numerous factors, such as, inter alia, the particular circumstances of the case, its context and the dissuasive effect of fines, although no binding or exhaustive list of the criteria to be applied has been drawn up. In that regard, the size of the relevant market is not as a rule a factor which must be taken into account, but just one among a number of other factors for evaluating the gravity of the infringement, since, moreover, the Commission is not obliged to define the market concerned or to assess its size where the infringement in question has an anti-competitive object.
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 do not provide that fines are to be calculated according to the overall turnover of undertakings or their turnover in the market affected. However, nor do they preclude the Commission from taking either figure into account in determining the amount of the fine in order to ensure compliance with the general principles of EU law and where circumstances demand it.
In that context, where the Commission has not set the general starting amount of a fine for an infringement concerning one Member State on the basis of the size of the market affected but has based its decision on the nature of that infringement and its geographic scope, the view that the general starting amount of the fine set for the infringement in that Member State should reflect the allegedly limited size of the market affected is based on an incorrect assumption and the Commission’s decision does not infringe the principle of proportionality.
The same is true where the impact of the infringement on the market is not taken into account. Under the first paragraph of Section 1A of the abovementioned Guidelines, the Commission, when assessing the gravity of the infringement, must undertake an examination of the actual impact on the market only where it is apparent that that impact can be measured. In order to assess that impact, the Commission must take as a reference the competition that would normally have existed had there been no infringement. However, when the Commission considers that it was impossible to measure the precise effects of an infringement on the market – and the undertakings concerned have not established that that was not the case – the Commission may base its decision on the serious nature of the infringement and on its geographic scope.
The effect of an anti-competitive practice is not a conclusive criterion for assessing the gravity of an infringement. Factors relating to the intentional aspect may be more significant than those relating to the effects, particularly where they relate to infringements which are intrinsically serious, such as market sharing. Accordingly, the nature of the infringement plays a primary role, in particular in classifying infringements as ‘very serious’. It follows from the description of very serious infringements given by the said guidelines that agreements or concerted practices seeking inter alia to share markets may, solely on account of their nature, be classified as ‘very serious’, there being no need to categorise such behaviour on the basis of particular impact or geographic extent. That conclusion is corroborated by the fact that, whilst the description of serious infringements expressly mentions their impact on the market and their effects on extensive areas of the common market, that of very serious infringements, on the other hand, does not mention any requirement as to the actual market impact or the effects produced in a particular geographic area.
Accordingly, by their very nature, infringements of the EU competition rules established in a Commission decision are among the most serious breaches of Article 81 EC where they have as their object secret collusion between cartel participants to share markets or freeze market shares by allocating projects for the sale and installation of new elevators and/or escalators, as well as not to compete with each other for maintenance and modernisation of elevators and escalators. Apart from the serious distortion of competition which they entail, such agreements, by obliging the parties to respect distinct markets, often delimited by national frontiers, cause the isolation of those markets, thereby counteracting the Treaty’s main objective of integrating the Community market. Thus, infringements of this type, especially where horizontal cartels are concerned, are classified by the case-law as particularly serious or obvious infringements.
(see paras 32, 46-47, 56, 61-62, 64, 67-69)
4. The Notice on immunity from fines and reduction of fines in cartel cases constitutes an instrument intended to define, while complying with higher-ranking law, the criteria which the Commission proposes to apply in the exercise of its discretion when setting fines for infringements of the EU competition rules. That discretion is thus subject to a self-imposed limitation which is not, however, incompatible with the retention of a considerable margin of assessment for the Commission.
Thus, the Commission enjoys a broad margin of assessment when it is required to determine whether the evidence provided by an undertaking that has stated that it wishes to benefit from the Leniency Notice represents significant added value for the purposes of point 21 of the notice.
Similarly, the Commission, once it has found that the evidence represents significant added value within the meaning of point 21 of the Leniency Notice, has a margin of assessment when it is required to determine the exact level of the reduction of the fine to be granted to the undertaking concerned. The first paragraph of point 23(b) of the Leniency Notice in fact provides for fine-reduction bands for the various categories of undertakings concerned. In view of that margin of assessment, it is only where the bounds of that margin are manifestly exceeded that there may be censure by the Courts of the European Union.
In order to obtain immunity from fines under point 8(b) of the Leniency Notice, the undertaking must be the first to submit evidence which, in the Commission’s view, may enable it to find an infringement of Article 81 EC.
Furthermore, it is the quality of the cooperation of an undertaking which determines whether it may benefit from immunity from fines under that provision. It is not sufficient that such an undertaking provided some information and material allowing the infringement to be successfully investigated. Although it is not necessary for the evidence provided to be sufficient to prove the infringement in its entirety or down to its every last detail, the evidence must none the less be sufficient in nature, precision and probative value to enable the Commission to find an infringement of Article 81 EC.
In that respect, statements drawn up from memory by the managers of an undertaking, which may not be wholly accurate, and unilateral statements cannot suffice for a finding of infringement unless they are supported by precise and consistent documentary evidence. The Commission is required to set out in its decision sufficiently precise and consistent evidence to give grounds for a firm conviction that the alleged infringement took place.
In those circumstances, the Commission does not manifestly go beyond the bounds of its margin of assessment when it refuses immunity from fines to an undertaking which has provided evidence of limited probative value, which is not contemporaneous with the infringement and a part of which is undated. The fact that that undertaking obtained immunity for infringements of the same type committed in other Member States is irrelevant in that regard since the nature and precision of the information provided in each case were different.
Nor does the Commission manifestly go beyond the bounds of the margin of assessment it enjoys in the appraisal of an undertaking’s cooperation for the purpose of reducing the amount of the fine imposed in concluding that evidence which is not contemporaneous, which denies the anti-competitive object of a cartel and which is ambiguous is not sufficiently precise to represent significant added value within the meaning of point 21 of the Leniency Notice. Indeed, when an undertaking which does not, in the framework of its leniency application, provide the Commission with contemporaneous evidence informs the Commission of certain matters previously unknown to it, those matters cannot be regarded as significantly strengthening the Commission’s ability to prove the infringement unless the undertaking concerned shows the connection between those matters and the cartel’s existence, since the undertaking’s contribution has actually to strengthen the Commission’s ability to prove the infringement. Thus, any reduction of a fine by the Commission must reflect an undertaking’s actual contribution to the Commission’s establishment of the infringement.
(see paras 80-81, 83-84, 91, 94, 97-99, 100, 102-103, 108, 111-113, 117-119, 122-124, 162, 165, 169, 174-176, 179)
5. The Commission must, in its decisions ordering an investigation, clearly indicate the presumed facts which it intends to investigate. However, it is not necessary for a decision ordering an investigation to delimit precisely the relevant market, to set out the exact legal nature of the presumed infringements and to indicate the period during which those infringements were committed.
(see para. 116)
6. The Commission notice on immunity from fines and reduction of fines in cartel cases creates legitimate expectations on which undertakings may rely when disclosing the existence of a cartel to the Commission. In view of the legitimate expectation which undertakings intending to cooperate with the Commission are entitled to derive from the notice, the Commission is obliged to adhere to it when it assesses, for the purpose of determining the fine to be imposed on an undertaking, the latter’s cooperation. In that regard, an economic operator cannot, as a rule, base a legitimate expectation that immunity from fines will be granted merely on silence on the part of the Commission.
(see paras 127, 130, 186)
7. The Commission is not entitled, in its appraisal of the cooperation provided by members of a cartel, to disregard the principle of equal treatment. There is no breach of that principle – since the two situations are not comparable – when the Commission, on the one hand, grants immunity from fines to an undertaking whose information triggered the first inspections and, on the other, refuses immunity to another undertaking which provided information after the Commission had carried out that first round of inspections.
(see paras 135, 137-138, 140)
8. In all proceedings in which sanctions, especially fines or penalty payments, may be imposed, observance of the rights of the defence is a fundamental principle of EU law which must be complied with even if the proceedings in question are administrative proceedings.
Access to the file in competition cases is intended in particular to enable the addressees of statements of objections to acquaint themselves with the evidence in the Commission’s file so that on the basis of that evidence they can express their views effectively on the conclusions reached by the Commission in its statement of objections. Access to the file is thus one of the procedural safeguards intended to protect the rights of the defence and to ensure, in particular, that the right to be heard can be exercised effectively.
The Commission is thus under a duty to make available to the undertakings involved in proceedings under Article 81(1) EC all documents, incriminating or exculpatory, which it has obtained during the course of the investigation, save where the business secrets of other undertakings, the internal documents of the institution or other confidential information are involved.
Moreover, the mere failure to disclose an incriminating document constitutes a breach of the rights of the defence only if the undertaking concerned is able to show that the Commission relied on that document to support its objection concerning the existence of an infringement and that the objection could be proved only by reference to that document.
As regards, however, failure to disclose an exculpatory document, the undertaking concerned need establish only that the non-disclosure was able to influence, to its detriment, the course of the procedure and the content of the Commission’s decision. It is thus sufficient for the undertaking to show that it would have been able to use the exculpatory documents for its defence, in the sense that, had it been able to rely on them during the administrative procedure, it would have been able to put forward evidence which was not consistent with the inferences made at that stage by the Commission and therefore could have had an influence, in any way at all, on the assessments made by the Commission in any decision, at least as regards the gravity and duration of the conduct of which it was accused and, accordingly, the level of the fine.
(see paras 143-147,151)
9. In the determination of the amount of a fine for infringement of the EU competition rules, a reduction of the fine on grounds of cooperation during the administrative procedure is justified only if the conduct of the undertaking in question enabled the Commission to establish the existence of an infringement more easily and, where relevant, to bring it to an end. Moreover, an undertaking which expressly states that it is not contesting the allegations of fact on which the Commission bases its objections may be regarded as having facilitated the Commission’s task of finding infringements of the EU competition rules and bringing them to an end.
Moreover, under Article 18(1) and Article 20(3) of Regulation No 1/2003, undertakings are obliged to respond to requests for information and to submit to inspections. Cooperation in an investigation which does not go beyond that which undertakings are required to provide under those provisions does not justify a reduction of the fine.
Furthermore, the fact that an undertaking has claimed to have been flexible with regard to claims for confidential treatment of information it provides to the Commission cannot be regarded as facilitating the Commission’s task. In that regard, an investigation is not affected in any negative manner by any reasonable confidentiality claims and, in any event, it is for the undertaking concerned to request confidential treatment for information which it considers should not be disclosed to third parties.
Consequently, cooperation which does not go beyond those limits cannot give rise to a legitimate expectation as regards a reduction of the fine.
(see paras 204, 222)
10. The right to rely on the principle of the protection of legitimate expectations extends to any individual who is in a situation in which it is clear that the EU authorities have given him precise assurances, thereby causing him to entertain justified expectations. However, a person may not plead infringement of the principle of the protection of legitimate expectations unless he has been given precise assurances by the authorities. Information that is precise, unconditional and consistent and comes from an authorised and reliable source constitutes such assurances.
In the determination of the amount of a fine for infringement of the EU competition rules, the announcement by the Commission in the statement of objections that it is considering granting a reduction in the fine outside the Notice on immunity from fines and reduction of fines in cartel cases does not amount to a precise assurance as to the extent or the rate of the reduction that might, where appropriate, be granted to the undertakings concerned. Accordingly, such an announcement can in no case give rise to any legitimate expectation whatsoever in that regard.
Nor can a practice of the Commission in previous decisions cause the undertakings concerned to entertain a legitimate expectation concerning the rate of reduction of a fine.
In any event, economic operators are not justified in having a legitimate expectation that an existing situation which is capable of being altered by the institutions in the exercise of their discretion will be maintained. Thus, the proper application of the EU competition rules requires that the Commission be able at any time to adjust the level of fines to the needs of that policy.
(see paras 206-208, 210, 212)
11. In order to receive a reduction of the fine on the ground that it does not contest the facts, in accordance with the second indent of Section D2 of the Commission notice on the non-imposition or reduction of fines in cartel cases, an undertaking must expressly inform the Commission, after perusing the statement of objections, that it has no intention of substantially contesting the facts. In that regard, a general statement that the undertaking concerned does not contest that the collusion, to the extent that this is supported by the facts in the Commission’s file, concerned a single and continuous infringement cannot be regarded as facilitating the Commission’s task of finding infringements of the EU competition rules and bringing them to an end. The same is true where the non-contestation is purely formal and ambiguous and does not have any positive impact on the establishment of the facts, the undertaking concerned merely describing its participation either in purely hypothetical terms or in terms playing down the anti-competitive effects of the unlawful arrangements.
(see paras 227, 230-231)
12. In the determination of the amount of a fine for infringement of the EU competition rules, the Commission is not entitled, in its appraisal of the cooperation shown by members of a cartel, to disregard the principle of equal treatment. However, respect for the principle of equal treatment must be reconciled with respect for the principle of legality, according to which a person may not rely, in support of his claim, on an unlawful act committed in favour of a third party.
In that regard, an undertaking which expressly states that it is not contesting the allegations of fact on which the Commission bases its objections may be regarded as having facilitated the Commission’s task of finding and bringing to an end infringements of the EU competition rules. In its decisions finding infringements of those rules, the Commission is entitled to take the view that such conduct constitutes an acknowledgement of the allegations of fact and thus proves that the allegations are correct. Such conduct may therefore justify a reduction of the fine.
That is not the case when an undertaking contests in its reply the essential points of those allegations. By adopting such an attitude during the administrative procedure the undertaking does not facilitate the Commission’s task.
(see paras 234-235)