Notice for the OJ
Action brought on 28 January 2005 by William Prym GmbH & Co. KG and Prym Consumer GmbH & Co. KG against the Commission of the European Communities
(Case T-30/05)
Language of the case: German
An action against the Commission of the European Communities was brought before the Court of First Instance of the European Communities on 28 January 2005 by William Prym GmbH & Co. KG and Prym Consumer GmbH & Co. KG, Stolberg (Germany), represented by H.J.Meyer-Lindemann, lawyer, with an address for service in Luxembourg.
The applicants claim that the Court should:
annul the Commission's Decision C(2004) 4221 final of 26 October 2004 in Case COMP/F-1/38.338-PO/Nadeln, in so far as it relates to the applicants;
in the alternative, cancel the fine of EUR 30 000 000 jointly and severally imposed on the applicants or (further in the alternative) reduce it;
order the defendant to pay the costs of the proceedings.
Pleas in law and main arguments
In the contested decision, the Commission found that during the period from 10 September 1994 to 31 December 1999, the applicants and other undertakings had infringed Article 81(1) EC by particpating in concerted practices and entering into a series of formal bilateral agreements which were to be regarded as a tripartite agreement, the effect and object of which were, first, to share the European hard haberdashery market - in other words, functional market sharing between the hand sewing and special needles market, the wider markets for needles and other hard haberdashery markets - and secondly, sharing the European market for needles; in other words, geographic market sharing in the needles market.
The application is based on three pleas in law. In the first plea the applicants allege breach of the right to a fair hearing and of the obligation to state reasons. According to the applicants, the defendant failed adequately to address various arguments which the applicants put forward, and it was not clear why the defendant had proceeded on the basis of a particularly serious infringement. Also, the reasons for the amount of the fine were simply in a standard form, so that the applicants could not establish whether factors favourable to them had been taken into account. Finally, the applicants argue that the defendant's reasons were subsequently corrected.
In the second plea, the applicants refer to several allegedly material errors in the application of Article 81(1) EC. No fine could have been imposed on the first applicant because it could not be held responsible for the second applicant's conduct. Furthermore, the defendant had failed to take into account the fact that the second applicant had made a loss on the goods concerned, and that the agreement on geographic market sharing was a condition of entry of another associated undertaking into the market for suture needles, and that this agreement therefore restricted competition which would otherwise not have existed at all. Further, the defendant had misjudged the size and economic power of that other undertaking.
The third plea concerns assessment of the fine. In the applicants' view, such a large fine amounts to a penalty akin to those that might be imposed under criminal law, for which there is insufficient authority under the provisions of Article 23(3) of the Regulation
1, since the legislature itself is required to specify in sufficient detail the particular basis on which the fine is to be assessed. In any event, the fine infringes Article 23(2) of Regulation 1/2003, as it amounts to more than 10% of the total turnover of each of the two applicants and is completely disproportionate to the economic effects of the offence, as well as to the fine imposed on another associated undertaking. In addition, the applicants have been prejudiced by the arbitrary separation of the 'hard haberdashery: needles' case from the 'hard haberdashery: fasteners' case. Finally, the defendant failed to take into account various mitigating factors in the applicants' favour and to grant them a reduction in the fine for not disputing the facts.