1. During the proceedings before the Community Courts internal Commission documents are not to be communicated to the applicants, unless the circumstances of the case are exceptional and the applicants make out a plausible case for the need to do so. That is the case as regards the expert accountant’s report, whose purpose, as a purely internal Commission document solely in the nature of an opinion for the Commission, is not to set forth fresh objections or adduce fresh evidence against the undertakings involved in a proceeding under Article 85(1)of the Treaty (now Article 81(1)EC)and which does not constitute a decisive factor which must be taken into account by the Community judicature when exercising its power of review. That restriction on access to internal documents is justified by the need to ensure the proper functioning of the institution concerned when dealing with infringements of the Treaty competition rules. Thus, the application for measures of inquiry concerning production of the expert accountant’s report must be rejected, since the applicants have not shown how production of that report might be relevant to the principle of respect for the rights of the defence.
2. In prohibiting undertakings inter alia from entering into agreements or participating in concerted practices which may affect trade between Member States and have as their object or effect the prevention, restriction or distortion of competition within the common market, Article 85(1)of the Treaty (now Article 81(1)EC)is aimed at economic units which consist of a unitary organisation of personal, tangible and intangible elements, which pursue a specific economic aim on a long-term basis and can contribute to the commission of an infringement of the kind referred to in that provision.
In that connection, there is no need for the economic entity identified as a group to have legal personality. In competition law, the term undertaking must be understood as designating an economic unit for the purpose of the subject-matter of the agreement in question even if in law that economic unit consists of several persons, natural or legal. In the absence of a person at its head to which, as the person responsible for coordinating the group’s activities, responsibility can be imputed for the infringements committed by the various component companies of the group, the Commission is entitled to hold the component companies jointly and severally responsible for all the acts of the group, in order to ensure that the formal separation between those companies, resulting from their separate legal personality, does not prevent a finding that they have acted jointly on the market for the purposes of applying the rules on competition.
3. It falls, in principle, to the natural or legal person managing the undertaking in question when the infringement of the Community rules on competition was committed to answer for that infringement, even if, when the decision finding the infringement was adopted, another person had assumed responsibility for operating the undertaking. The situation would be different only where the legal person or persons responsible for running the undertaking had ceased to exist in law after the infringement has been committed. It is none the less true that in certain circumstances an infringement of the rules on competition may be imputed to the economic successor of the legal person responsible, even where the latter has not ceased to exist on the date of adoption of the decision finding the infringement, so that the effectiveness of those rules will not be compromised owing to the changes to, inter alia, the legal form of the undertakings concerned.
The Commission errs in law if it holds jointly and severally liable for the fine imposed on a group of companies an undertaking which did not yet exist at the time when the infringement was committed, whilst the natural and legal persons involved in that infringement continued their commercial activities in full and whilst no evidence has been adduced of strategies adopted for the specific purpose of avoiding the penalty incurred.
4. In the context of a complex infringement which involves many producers seeking over a number of years to regulate the market between them, the Commission cannot be expected to classify the infringement precisely, for each undertaking and for any given moment, as an agreement or a concerted practice, as in any event both those forms of infringement are covered by Article 85 of the Treaty (now Article 81 EC). The Commission is therefore entitled to classify such a single infringement as an agreement and a concerted practice or as an agreement and/or a concerted practice, since the infringement includes elements which are to be classified as an agreement and elements which are to be classified as a concerted practice. It would be artificial to split up continuous conduct, characterised by a single purpose, by treating it as consisting of a number of separate infringements.
In such a situation, the dual characterisation must be understood not as requiring, simultaneously and cumulatively, proof that each of those factual elements presents the constituent elements both of an agreement and of a concerted practice, but rather as referring to a complex whole comprising a number of factual elements some of which were characterised as agreements and others as concerted practices for the purposes of Article 85(1) of the Treaty (now Article 81(1)EC), which lays down no specific category for a complex infringement of this type.
5. In order for there to be an agreement within the meaning of Article 85(1)of the Treaty (now Article 81(1)EC), it is sufficient that the undertakings in question should have expressed their joint intention to conduct themselves on the market in a specific way. That is the case where there is a gentlemen’s agreement between a number of undertakings representing the faithful expression of such a joint intention concerning a restriction of competition. In those circumstances, the question whether the undertakings in question considered themselves bound – in law, in fact or morally – to adopt the agreed conduct is therefore irrelevant.
In that regard, the opposite conclusion cannot be inferred from the provision in Article 85(2)of the Treaty (now Article 81(2)EC)that any agreement referred to in Article 85(1)is automatically void, which is intended for cases where a legal obligation is actually in issue. The fact that only binding agreements can, by their nature, be rendered void does not mean that non-binding agreements must escape the prohibition laid down in Article 85(1)of the Treaty.
6. It follows from the actual terms of Article 85(1)of the Treaty (now Article 81(1)EC), that a concerted practice implies, besides undertakings concerting with each other, conduct on the market pursuant to those collusive practices, and a relationship of cause and effect between the two. In that regard, subject to proof to the contrary, which the economic operators concerned must adduce, the presumption must be that the undertakings taking part in the concerted arrangements and remaining active on the market take account of the information exchanged with their competitors when determining their conduct on that market.
7. Where an undertaking participates, even if not actively, in meetings between undertakings with an anti-competitive object and does not publicly distance itself from what was discussed at them, thus giving the impression to the other participants that it subscribes to the outcome of the meetings and will act in conformity with it, it may be concluded that it is participating in the cartel resulting from those meetings. It is irrelevant, in that regard, whether the undertaking in question attends meetings with undertakings having a dominant position or, at least, an economically superior position on the market. An undertaking which participates in meetings with an anti-competitive object, even under constraint from other participants with greater economic power, can always report the anti-competitive activities in question to the Commission rather than continue to participate in the meetings.
8. An undertaking which has participated in a single complex infringement of the rules on competition by its own conduct, which amounts to an agreement or a concerted practice with an anti-competitive object within the meaning of Article 85(1)of the Treaty (now Article 81(1)EC)and which was intended to play a part in bringing about the infringement as a whole, may also be responsible for the conduct of other undertakings followed in the context of the same infringement throughout the period of its participation in the infringement, where it is proved that the undertaking in question is aware of the unlawful conduct of the other participants, or can reasonably foresee such conduct, and is prepared to accept the risk. Such a conclusion is not at odds with the principle that responsibility for such infringements is personal in nature, nor does it neglect individual analysis of the evidence adduced, in disregard of the applicable rules of evidence, or infringe the rights of defence of the undertakings involved.

In the context of proceedings instigated pursuant to the Community rules on competition, the annexes to the statement of objections which do not emanate from the Commission are not documents for the purposes of Article 3 of Regulation No 1 determining the languages to be used by the European Economic Community, but must be regarded as supporting documentation on which the Commission relies and must therefore be brought to the attention of the addressee of the decision as they are, so that the addressee can apprise himself of the interpretation of them which the Commission has adopted and on which it has based both its statement of objections and its decision. It follows that the Commission, in communicating those annexes in their original language, does not infringe the right to be heard of the undertakings concerned.
The same considerations apply to the documents annexed by other undertakings to their replies to the Commission’s requests for information without there being any grounds for complaining that the principle of equality of arms has been infringed, since the original of the documents constitutes the only relevant evidence.
10. The obligation of professional secrecy laid down in Article 20(2)of Regulation No 17 for the purposes of proceedings implementing the competition rules is mitigated in regard to third parties on whom Article 19(2)of that regulation confers the right to be heard, that is to say in regard, in particular, to a third party who has made a complaint. The Commission may communicate to such a party certain information covered by the obligation of professional secrecy in so far as it is necessary to do so for the proper conduct of the investigation. However, that power does not apply to all documents of the kind covered by the obligation of professional secrecy. Article 21 of the regulation, which provides for the publication of certain decisions, requires the Commission to have regard to the legitimate interest of undertakings in the protection of their business secrets. Although they deal with particular situations, those provisions must be regarded as the expression of a general principle which applies during the course of the administrative procedure.
11. On the assumption that Commission officials are responsible, in breach of the provisions governing the obligation of professional secrecy, for leaks of confidential information used in the course of the administrative proceedings instigated for infringement of the Community competition rules, that would in any event not affect the legality of the decision, since it has not been proved that the decision would not in fact have been adopted or would have been different had the disputed statements not been made.
12. Even though the Commission is not a tribunal within the meaning of Article 6 of the European Convention on Human Rights, and even though the fines imposed by the Commission are not of a criminal law nature, the Commission must nevertheless observe the general principles of Community law during the administrative procedure.
In that regard, the fact that the provisions of Community competition law do not place the Commission under an obligation to call witnesses whom the undertaking concerned wishes to give evidence on its behalf but allows the Commission a reasonable margin of discretion to decide how expedient it may be to hear such persons is not contrary to those principles. Although the Commission may hear natural or legal persons where it deems it necessary to do so, it is not entitled to call witnesses to testify against the undertaking concerned without their agreement.
13. Neither Regulation No 99/63 nor Decision 94/810 on the terms of reference of Hearing Officers in competition procedures before the Commission precludes the Hearing Officer from submitting to the Director-General for competition the report provided for in Article 8 of Decision 94/810 before the minutes of the hearing have been approved, pursuant to Article 9(4)of Regulation No 99/63 and Article 7(4)of Decision 94/810, by each person heard. The purpose of Article 9(4)of Regulation No 99/63 is to assure the persons heard that the minutes contain a true record of the substance of what they have said. The minutes are therefore submitted to the parties for their approval in order to enable them to check what they said at the hearing, not for the purpose of adducing fresh evidence which the Hearing Officer would be obliged to take into account.
14. The provisional nature of the minutes of the hearing submitted to the Advisory Committee on agreements and dominant positions and to the Commission could only amount to a defect in the administrative procedure capable of vitiating the decision which results therefrom if the document in question was drawn up in such a way as to be misleading in a material respect.
15. The fact that several companies are held jointly and severally liable for a fine does not mean, as regards the application of the maximum amount of 10% of turnover laid down by Article 15(2)of Regulation No 17, that the amount of the fine is limited, for the companies held jointly and severally responsible, to 10% of the turnover achieved by each of those companies during the last financial year. The maximum amount of 10% of turnover within the meaning of that provision must be calculated on the basis of the total turnover of all the companies constituting the economic entity acting as an undertaking for the purposes of Article 85 of the Treaty (now Article 81 EC). Thus, in the case of an undertaking constituted by a group of companies acting as a single economic unit, only the total turnover of the component companies can constitute an indication of the size and economic power of the undertaking in question. Within the limit laid down by Article 15(2)of Regulation No 17, the Commission may thus choose which turnover to take in terms of territory and products in order to determine the fine.

16. In calculating a fine for infringement of the Community rules on competition on the basis of turnover in a given reference year, expressed in national currency, the Commission is correct to convert that turnover into ecu on the basis of the average exchange rate for that reference year, and not on the basis of the exchange rate in force on the date of adoption of the decision.
17. Regulation No 17 places the undertaking being investigated under a duty of active cooperation, which means that it must be prepared to make any information relating to the object of the inquiry available to the Commission. Even though the undertakings are free to reply or not to reply to questions put to them under Article 11(1)of Regulation No 17, it follows from the penalty provided for in the first part of the sentence in Article 15(1)(b)of that regulation that, having agreed to reply, the undertakings are required to provide accurate information.
18. The Commission is not required, when determining the amount of the fine to be imposed for an infringement of the Community rules on competition, to take into account the poor financial situation of an undertaking concerned, by way of a mitigating circumstance, since recognition of such an obligation would be tantamount to giving an unjustified competitive advantage to undertakings least well adapted to market conditions.

Judges:

P Mengozzi, P

Citations:

T-9/99, [2002] EUECJ T-9/99

Links:

Bailii

Jurisdiction:

England and Wales

European

Updated: 06 June 2022; Ref: scu.173608

Atlantic Container and others v Commission: ECFI 21 Jul 1999

ECFI 1 Article 104(2)of the Rules of Procedure of the Court of First Instance provides that applications for interim measures must state the circumstances giving rise to urgency and the pleas of fact and law establishing a prima facie case for the measures applied for. Those requirements are cumulative, so that an application for suspension of operation must be dismissed if one of them is not met. Where necessary, the court hearing an application for interim relief also balances the interests at stake.
2 An application for suspension of operation of a measure, the object of which is to obtain dispensation from the obligation to provide a bank guarantee as a condition for a fine not being recovered immediately, may be granted only in exceptional circumstances.
In order to assess the applicant’s ability to provide a bank guarantee without jeopardising its existence, account should also be taken of the group of undertakings to which it belongs directly or indirectly, particularly with regard to the possibility of providing the security which the banks might require.

Citations:

T-191/98, [1999] EUECJ T-191/98

Links:

Bailii

Cited by:

See Also – Atlantic Container and others v Commission ECJ 30-Sep-2003
ECJ Competition – Liner conferences – Regulation (EEC) No 4056/86 – Block exemption – Individual exemption – Collective dominant position – Abuse – Service contracts – Accession to the conference – Alteration of . .
Lists of cited by and citing cases may be incomplete.

European

Updated: 06 June 2022; Ref: scu.173546

Emesa Sugar v Council – T-43/98: ECFI 14 Aug 1998

Citations:

T-43/98, [2001] EUECJ T-43/98

Links:

Bailii

Jurisdiction:

European

Updated: 06 June 2022; Ref: scu.173503

Carrasco Benitez v Commission: ECFI 12 Nov 1998

ECFI Officials – Internal competition reserved for Category A temporary staff – Application by a Grade B 5 official – Unlawfulness of the notice of competition.

Citations:

T-294/97, [1998] EUECJ T-294/97

Links:

Bailii

European

Updated: 06 June 2022; Ref: scu.173458

Pescados Congelados Jogamar v Commission: ECFI 30 Apr 1999

Citations:

T-311/97, [1999] EUECJ T-311/97

Links:

Bailii

Jurisdiction:

European

Updated: 06 June 2022; Ref: scu.173468

Unione provinciale degli agricoltori di Firenze and others v Commission: ECFI 29 Apr 1999

Citations:

Jouhki v Commission T-215/97: ECFI 16 Sep 1998

Officials – Notice of competition – Refusal to admit to competition.

Citations:

[1998] EUECJ T-215/97

Links:

Bailii

European

Updated: 06 June 2022; Ref: scu.173410

Rasmussen v Commission T-234/97: ECFI 16 Sep 1998

Links:

Bailii

Statutes:

Regulation (EEC)No 804/68 of 27 June 1968 on the common organisation of the market in milk and milk products

European, Agriculture

Updated: 06 June 2022; Ref: scu.173412

Broome and Wellington v Commission: ECFI 25 May 1998

ECJ Measures whose legal effects are binding and are capable of affecting the applicants’ interests by clearly altering their legal position constitute acts which may be the subject of an action for annulment under Article 173 of the Treaty. In the case of acts adopted by a procedure involving several stages, in principle only measures definitively laying down the position of the institution on the conclusion of the procedure constitute acts which may be contested, as opposed to intermediate measures intended to pave the way for the final decision, whose legality may only be challenged in an action brought against the final decision. Moreover, only measures immediately and irreversibly affecting the legal position of the undertakings concerned are of such a nature as to justify, before completion of the administrative procedure, the admissibility of an action for annulment.
Since the act by which the Commission initiates anti-dumping proceedings is a purely preparatory act, it cannot be regarded as an actionable measure. It follows from the provisions of anti-dumping Regulation No 384/96 that the Commission is responsible for carrying out investigations and deciding, on the basis of those investigations, whether to terminate the proceedings or to continue them, either by adopting provisional measures or by proposing to the Council that it adopt definitive measures.
That conclusion cannot be called into question either by the fact that, before a particular complaint was submitted, the Commission’s spokesman had stated that the Commission would immediately open a procedure if a new complaint were lodged – which is a matter which falls to be examined in connection with the substantive legality of the Notice of Initiation – or by any greater or lesser degree of certainty as regards the imposition of anti-dumping duties since, in law, the initiation of an anti-dumping proceeding does not necessarily result in such duties being imposed. Moreover, the Notice of Initiation of an anti-dumping proceeding does not have the legal effect of compelling the undertakings concerned to alter their commercial practices or to cooperate in the investigation.

Citations:

T-267/97, [1998] EUECJ T-267/97

Links:

Bailii

Jurisdiction:

European

Updated: 06 June 2022; Ref: scu.173445

Steffens v Council and Commission: ECFI 25 Nov 1998

ECJ The limitation period laid down in Article 43 of the Statute of the Court of Justice in respect of actions brought against the Community in matters concerning non-contractual liability cannot begin to run before all the requirements governing the obligation to make good the damage are satisfied and, in particular, in cases in which liability stems from a legislative measure, before the injurious effects of the measure have been produced.
As regards the injury suffered by producers of milk and milk products who, following their entry into non-marketing or conversion undertakings under Regulation No 1078/77, were unable by operation of Regulation No 857/84 to obtain a reference quantity or, consequently, to market any quantity of milk exempt from the additional levy, the limitation period started to run on the date on which, following the expiry of their non-marketing undertaking, the producers concerned could have resumed deliveries of milk if they had not been refused a reference quantity; that is to say, in cases where the undertaking expired before the date on which Regulation No 857/84 entered into force, time started to run on that date.
Moreover, since the damage was not caused instantaneously but continued to be sustained from day to day for a certain period as a result of the maintenance in force of an illegal measure, the time-bar under Article 43 of the Statute applies, with respect to the date of the event which interrupted the limitation period, to the period more than five years prior to that date and does not affect rights which arose during subsequent periods.
So far as regards, specifically, the notion of an event which interrupts a limitation period, the waiver of the right to plead limitation – provided for by the Communication of the Council and the Commission concerning the subsequent adoption of Regulation No 2187/93 which provided for an offer of compensation to the producers concerned – does not constitute such an event. The Communication merely provided for a self-imposed restriction of the right to plead limitation. The producers were able to rely on that waiver in the circumstances referred to in Regulation No 2187/93, since it ceased to have effect at the end of the period allowed for accepting the compensation offer, from which time, in the absence of acceptance of the offer or commencement of proceedings, the institutions once again became entitled to plead limitation.

Citations:

T-222/97, [1998] EUECJ T-222/97

Links:

Bailii

European, Limitation

Updated: 06 June 2022; Ref: scu.173413

Updated: 06 June 2022; Ref: scu.173342

Jurisdiction:

European

Updated: 06 June 2022; Ref: scu.173360

Buchel v Council and Commission: ECFI 26 Sep 2000

Updated: 06 June 2022; Ref: scu.173394

Von Lowis and Alvarez-Cotera v Commission: ECFI 16 Jul 1998

Citations:

T-202/96, [1998] EUECJ T-202/96

Links:

Bailii

Jurisdiction:

Citing:

Cited – A Ahlstrom Osakeyhtio And Others v Commission Of The European Communities ECJ 27-Sep-1988
The court considered the territorial scope of Articles 81 and 82. in the context of producers outside the Community selling to purchasers established in the Community. The external producers had engaged in price fixing and therefore restricted . .

Cited by:

Cited – Adidas-Salomon Ag v Drape and others ChD 7-Jun-2006
The claimants had sponsored tennis players to wear their logo. The respondents organised tennis tournaments whose intended rules would prevent the display of the claimant’s logos. The claimants said that the restriction interfered with their rights . .
Lists of cited by and citing cases may be incomplete.

European

Updated: 06 June 2022; Ref: scu.173230

Forcheri v Commission: ECFI 16 Jul 1998

Citations:

T-162/96, [1998] EUECJ T-162/96

Links:

Bailii

Jurisdiction:

European

Updated: 06 June 2022; Ref: scu.173277

Presle v Cedefop: ECFI 16 Jul 1998

Citations:

T-93/96, [1998] EUECJ T-93/96

Links:

Bailii

Jurisdiction:

Updated: 06 June 2022; Ref: scu.173218

Conserve Italia v Commission: ECFI 12 Oct 1999

ECJ 1 Applicants for, and beneficiaries of, EAGGF financial aid are required to satisfy themselves that they are submitting to the Commission reliable information which is not liable to mislead it; otherwise the system of controls and evidence set up to determine whether the conditions for granting aid are fulfilled cannot function properly. In the absence of reliable information, projects which do not fulfil the conditions required could become the subject of aid. It follows that the obligation on applicants for, and beneficiaries of, aid to provide information and act in good faith is inherent in the EAGGF aid system and essential for its effective functioning.
2 Where there is a discrepancy between the wording of a provision and the title thereof, both must be construed in such a manner that all the terms employed serve a useful purpose.
3 Article 24(2)of Regulation No 4253/88 laying down provisions for implementing Regulation No 2052/88 as regards coordination of the activities of the different Structural Funds between themselves and with the operations of the European Investment Bank and the other existing financial instruments must be construed as meaning that the Commission may discontinue aid from the EAGGF in the event of an irregularity, in particular where a significant change to the operation affecting its nature or the conditions governing its execution is involved, for which the Commission’s prior approval has not been sought.
4 The infringement of obligations whose observance is of fundamental importance to the proper functioning of a Community system may be penalised by forfeiture of a right conferred by Community legislation, such as entitlement to aid.
The fact that a beneficiary has failed to comply with its undertaking not to start work on the project in question before receipt of the application for aid by the Commission, failed to inform the Commission of this and, in response to a request for information, forwarded a copy which was not consistent with the original of the contract for the sale of a machine referred to in the subsidised project constitutes a serious breach of fundamental obligations justifying discontinuance of financial aid from the EAGGF granted pursuant to Regulation No 355/77 on common measures to improve the conditions under which agricultural products are processed and marketed.

Citations:

T-216/96, [1999] EUECJ T-216/96

Links:

Bailii

Links:

Bailii

European

Updated: 06 June 2022; Ref: scu.173209

Boehringer v Council and Commission: ECFI 1 Dec 1999

Citations:

T-125/96, [1999] EUECJ T-125/96

Links:

Bailii

Jurisdiction:

European

Updated: 06 June 2022; Ref: scu.173253

European, Jurisdiction, Environment

Updated: 06 June 2022; Ref: scu.173120

Stora Kopparbergs Bergslags v Commission: ECFI 14 May 1998

Citations:

T-354/94, [1998] EUECJ T-354/94

Links:

Bailii

European

Updated: 06 June 2022; Ref: scu.172950

Atlanta and Internationale Fruchtimport Gesellschaft Weichert v Commission: ECFI 10 Dec 1996

Actions for annulment – Natural or legal persons – Measures of direct and individual concern to them – Regulation increasing the tariff quota for imports of bananas for traders affected by a natural disaster

Citations:

T-18/95, [1996] EUECJ T-18/95

Links:

Bailii

European, Agriculture, Customs and Excise

Updated: 06 June 2022; Ref: scu.172991

Finnboard v Commission: ECFI 14 May 1998

Citations:

T-338/94, [1998] EUECJ T-338/94

Links:

Bailii

European

Updated: 06 June 2022; Ref: scu.172942

SNCF and British Railways v Commission: ECFI 12 May 1995

ECFI Applications for interim measures – Suspension of operation of a measure – Suspension of operation of a competition decision – Conditions for granting – Serious and irreparable damage – Concept – Uncertain and speculative risk – Exclusion – Balance of convenience – (EC Treaty, Art. 185; Rules of Procedure of the Court of First Instance, Art. 104(2))
The urgency of an application for interim measures must be assessed in relation to the necessity for an interim order to prevent serious and irreparable damage to the party applying for those measures. It is for the party seeking suspension of the operation of a decision to prove that it cannot wait for the outcome of the main proceedings without suffering damage that would entail serious and irreparable consequences.
Only the existence, at least foreseeable or probable, of third-party undertakings interested in using the Channel Tunnel’ s capacity would be capable of substantiating the risk of serious and irreparable damage alleged by railway undertakings seeking the suspension of operation of the conditions attached to the Commission’ s decision granting exemption under Article 85(3) of the Treaty in so far as those conditions require the applicants to surrender to third parties up to one-quarter of their rights under the usage contract exempted by the Commission. In those circumstances, suspension could be ordered only if the applicants could demonstrate before the judge hearing the application that the surrenders of capacity at issue would immediately make it impossible for them to fulfil their obligations relating to the operation of the tunnel or that they could no longer, if their applications in the main proceedings were to succeed, recover from the third parties the capacity surrendered to them in the meantime. Since they have not adduced evidence of those conditions, the damage to them is too uncertain and speculative to be able to prevail in the assessment of the balance of convenience over the preservation of effective competition and the principle of the freedom to provide services in the rail transport sector which the Commission sought to protect by attaching the abovementioned condition to the exemption.

Citations:

T-79/95, [1995] EUECJ T-79/95R

Links:

Bailii

Cited by:

Interim measures – SNCF and British Railways v Commission ECFI 22-Oct-1996
Actions for annulment – Pleas in law – Error of fact underlying a decision applying the competition rules – Annulment of the decision – (EC Treaty, Art. 85; Council Regulation No 1017/68, Art. 5)
A decision which applies the competition rules . .
Lists of cited by and citing cases may be incomplete.

European, Transport

Updated: 06 June 2022; Ref: scu.173013

Metsa-Serla and others v Commission: ECFI 14 May 1998

Citations:

T-339/94, [1998] EUECJ T-339/94

Links:

Bailii

European

Updated: 06 June 2022; Ref: scu.172943

Atlantic Container Line and others v Commission: ECFI 28 Feb 2002

ECFI 1. In the case of an agreement between shipping lines on the scheduled transport of containers across the Atlantic between Northern Europe and the United States and on the inland carriage of the containers, the relevant markets directly affected are those in transport services and not that in the export of goods to the United States. The restrictions of competition occur within the common market because it is there that the members of the agreement, including several shipping companies established in the Community, are in competition to sell their services to clients, namely shippers, established in the Community. The fact that certain members of the agreement are not established in the Community does not cast doubt on that conclusion.
2. For an agreement between undertakings to be capable of affecting trade between Member States, it must be possible to foresee with a sufficient degree of probability and on the basis of objective factors of law or fact that it may have an influence, direct or indirect, actual or potential, on the pattern of trade between Member States, such as might prejudice the realisation of the aim of a single market between States. In particular, it is not necessary that the conduct in question should in fact have substantially affected trade between Member States. It is sufficient to establish that the conduct is capable of having such an effect.
3. An agreement between shipping companies, including a number established in the Community, which related to the conditions for the sale of maritime and inland transport services to shippers established in various Member States of the Community is capable of affecting trade between Member States for the purposes of Article 85(1) of the Treaty (now Article 81(1) EC).
Furthermore, such an agreement is capable of modifying the pattern of trade in goods transiting through the ports served by the shipping companies which are members of an agreement. As a result, that agreement must be regarded as having affected trade between Member States, over and above the trade consisting of only maritime transport services, since port and auxiliary services linked to the carriage of goods were also affected.
Finally, although more indirectly, the relevant agreement has, or at the very least is capable of having, an effect on the trade in goods between Member States, in so far as the transport prices fixed by the agreement represent a proportion of the end selling price of the goods transported.
4. An agreement can qualify for the exemption provided for in Article 3 of Regulation No 4056/86 laying down detailed rules for the application of Articles 85 and 86 of the Treaty to maritime transport only if it is a liner conference agreement.
The existence of a liner conference within the meaning of Regulation No 4056/86 depends on the charging of uniform or common freight rates by its members.
5. Having regard to the general principle of the prohibition of agreements restricting competition in Article 85(1) of the Treaty (now Article 81(1) EC), provisions derogating therefrom in an exempting regulation must, by their nature, be strictly interpreted. This conclusion applies, a fortiori, to the provisions of Regulation No 4056/86 relating to maritime transport by virtue of its unlimited duration and the exceptional nature of the restrictions on competition authorised (horizontal agreement having as its object the fixing of prices). It follows that the block exemption provided for by Article 3 of Regulation No 4056/86 cannot be interpreted broadly and progressively so as to cover all the agreements which shipping companies deem it useful, or even necessary, to adopt in order to adapt to market conditions. The exemption can relate only to the types of agreement which the Council, when Regulation No 4056/86 was adopted, regarded, in the light of experience, as satisfying the conditions of Article 85(3) of the Treaty. Apart from the power enjoyed by the Council, if the need arose, to amend Regulation No 4056/86, the undertakings concerned also always have the option to apply for an individual exemption to offset any disadvantages of the limitations inherent in the block exemption.
6. The definition of liner conference in Article 1(3)(b) of Regulation No 4056/86 was taken word for word from the United Nations Convention on a Code of Conduct for Liner Conferences. That code thus constitutes an important point of reference for the interpretation of the concept of liner conference referred to in Regulation No 4056/86.
7. By its very nature and in the light of its objectives, a liner conference, as defined by the Council for the purposes of qualification for block exemption under Regulation No 4056/86, can be characterised as a collective entity which presents itself as such on the market vis-a-vis both users and competitors.
The conference puts itself forward as an entity on the market since it fixes uniform freight rates for all its members, in the sense that the same price will be charged for the carriage of the same cargo from point A to point B, regardless of which shipowning member of the conference is responsible for carriage.
By contrast, an agreement between carriers providing for a scheme of tariffs which vary according to the members cannot be regarded as a liner conference under Regulation No 4056/86.
8. Liner conferences qualify for a block exemption because of their stabilising effect. That stability is best ensured if all the members of the conference adopt uniform freight rates rather than if there are several rates according to the members concerned. A uniform level of freight rates within the conference also allows users, account of whose interests is also a requirement for the exemption, to be assured of being able to obtain the transport service at the same price, whichever conference member it approaches. That interest of the shippers in having access to a reference rate in respect of a particular commodity is appreciably reduced if the members of the conference do not charge one rate, but two or more, in respect of the same product.
That interpretation of the concept of liner conference is not inconsistent with the possibility for a conference member to take independent action. That action is fundamentally different from the system of differentiated prices. The taking of independent action, which enables a conference member, subject to notice, to offer, for a specific product, a lower freight rate than that in the conference tariff, does not create another level of prices which may be generally charged, since that action concerns only a single ad hoc transaction. The stabilising effect of the existence of uniform or common freight rates for all conference members therefore continues in the event of independent action, whereas it is undermined where the conference tariff, which lists all the freight rates applicable, is replaced by a system of rates which vary according to the members.
Furthermore, the possibility of fixing different levels of prices makes it possible to attract into the group shipping lines which, without that flexibility, would remain independent and this situation is likely to lead to the elimination of external competition; by contrast, the obligation to fix uniform freight rates for all conference members is not such as to encourage all operators to join the conference, which guarantees the existence of external competition.
9. In the context of an action for annulment pursuant to Article 173 of the Treaty (now, after amendment, Article 230 EC), the review undertaken by the Court of the complex economic appraisals made by the Commission when it exercises the discretion conferred on it by Article 85(3) of the Treaty (now Article 81(3) EC), with regard to each of the four conditions laid down in that provision, is necessarily limited to verifying whether the rules on procedure and on the giving of reasons have been complied with, whether the facts have been accurately stated and whether there has been any manifest error of assessment or a misuse of powers.
10. Although stability in the maritime transport sector, to the extent that it contributes to assuring shippers of reliable services, may be an advantage for the purposes of the first condition of Article 85(3) of the Treaty (now Article 81(3) EC), the Commission cannot be obliged to grant individual exemption to every agreement between shipping lines which, in the opinion of the parties, may contribute to such stability. Within the limits imposed by Regulation No 4056/86, the Commission retains its discretion in applying Article 85(3) of the Treaty.
11. The four conditions for granting an exemption under Article 85(3) of the Treaty (now Article 81(3) EC) are cumulative and therefore non-fulfilment of only one of those conditions will render it necessary to refuse the exemption.
12. In assessing an agreement with a view to granting an exemption under Article 85(3) of the Treaty (now Article 81(3) EC), the market to be taken into consideration comprises 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.
In the case of an agreement between shipping lines for the scheduled transport of containers across the Atlantic between Northern Europe and the United States the relevant market is that for containerised liner shipping. The fact that other modes of transport, whether maritime or air, may engage in marginal competition on the market in containerised liner shipping services in respect of a limited number of products, does not mean that, for that reason, they can be regarded as forming part of the same market.
13. The possibility of eliminating competition in respect of a substantial part of the services in question within the meaning of Article 85(3) of the Treaty (now Article 81(3) EC), must be assessed as a whole, taking into account in particular the specific characteristics of the relevant market, the restrictions of competition brought about by the agreement, the market shares of the parties to that agreement and the extent and intensity of external competition, both actual and potential. In the context of this comprehensive approach, those different elements are closely interlinked or may balance each other out. Thus, the greater the restrictions of internal competition between the parties, the more necessary it is for external competition to be keen and substantial if the agreement is to qualify for exemption. Similarly, the larger the market shares of the parties to the agreement, the stronger the potential competition must be.
14. In order to determine whether an agreement affords its signatory parties the possibility, in respect of a substantial part of the products in question, of eliminating competition within the meaning of Article 85(3)(b) of the Treaty (now Article 81(3)(b) EC), the Commission cannot, in principle, rely merely on the fact that the agreement in question eliminates competition between those parties and that they account for a substantial part of the relevant market. First, the prohibition on eliminating competition is a narrower concept than that of the existence or acquisition of a dominant position, so that an agreement could be regarded as not eliminating competition within the meaning of Article 85(3)(b) of the Treaty, and therefore qualify for exemption, even if it established a dominant position for the benefit of its members. Second, potential competition must be taken into consideration before concluding that an agreement eliminates competition for the purposes of Article 85(3) of the Treaty.
Taking into account and analysing external competition, both actual and potential, is all the more necessary where it is a question of examining whether an agreement between shipping companies fixing maritime transport rates qualifies for individual exemption under Article 12 of Regulation No 4056/86.
15. Interveners must, under Article 116(3) of the Rules of Procedure of the Court of First Instance, accept the case as they find it at the time of their intervention and their submissions in an application to intervene are, under the fourth paragraph of Article 37 of the Statute of the Court of Justice, limited to supporting the submissions of one of the main parties, an intervener is not entitled to raise a plea in law that was not raised by the applicant.
16. In a decision finding that the provisions of an agreement between shipping lines fixing the rates and conditions of maritime transport infringe the Treaty’s competition rules, an order compelling the undertakings concerned to inform customers with whom they have concluded service contracts and other contractual relations in the context of that agreement that such customers are entitled, if they so wish, to renegotiate the terms of those contracts or to terminate them forthwith, which was not obviously necessary and does not correspond to an established line of Commission decisions, requires that institution expressly to set out its reasoning.
Even if that order may be regarded as necessary for re-establishing compliance with the law and as coming within the limits of the Commission’s power to order the undertakings concerned, in accordance with Article 11 of Regulations No 1017/68 and No 4056/86, to bring such infringement to an end, the statement of objections should in any event have set out, even briefly, but in sufficiently clear terms, the measures which the Commission intended to take in order to bring an end to the infringements and should have given the applicants all the information necessary in order to enable them properly to defend themselves before the Commission adopted a final decision on that point. That conclusion is all the more necessary where the individual service contracts account for a substantial part of the turnover of the undertakings concerned and the obligation to renegotiate with customers could thus have significant consequences for those undertakings, and could even amount to a penalty more serious than a fine.

Judges:

K. Lenaerts, P

Citations:

T-395/94, [2002] EUECJ T-395/94

Links:

Bailii

Jurisdiction:

European

Transport

Updated: 06 June 2022; Ref: scu.172976

Bailii

European

Updated: 06 June 2022; Ref: scu.172996

Updated: 06 June 2022; Ref: scu.173030