Case T‑265/12

Schenker Ltd

v

European Commission

‛Competition — Agreements, decisions and concerted practices — International air freight forwarding services — Decision finding an infringement of Article 101 TFEU — Price fixing — Surcharges and charging mechanisms affecting the final price — Evidence contained in an application for immunity — Protection of the confidentiality of communications between lawyers and clients — Code of Conduct rules on duty of loyalty and prohibition on double representation — Fiduciary duties — Whether trade between Member States affected — Whether unlawful conduct can be attributed — Choice of companies — Fines — Proportionality — Gravity of the infringement — Mitigating circumstances — Equal treatment — Cooperation — Settlement — 2006 Guidelines on the method of setting fines’

Summary — Judgment of the General Court (Ninth Chamber), 29 February 2016

1. Competition — Fines — Amount — Determination — Discretion of the Commission — Judicial review — Unlimited jurisdiction of the EU judicature — Scope

   (Art. 261 TFEU; Council Regulation No 1/2003, Art. 31)

2. Competition — Administrative procedure — Commission decision finding an infringement — Use as evidence of statements of other undertakings which participated in the infringement — Lawfulness — Conditions

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

3. Competition — Administrative procedure — Commission’s powers of investigation — Power to demand production of a communication between lawyer and client — Limits — Protection of the confidentiality of such a communication — Scope

   (Art. 101 TFEU; Council Regulation No 1/2003, Arts 2, 17 and 19)

4. Competition — Administrative procedure — Commission decision finding an infringement — Use of information and evidence provided by an undertaking in an immunity application — Lawfulness — Lawyer having infringed the prohibition on double representation or the obligation of loyalty — Irrelevant — Conditions

   (Arts 101 TFEU and 102 TFEU)

5. Competition — Transport — Competition rules — Air transport — Regulation No 17 — Scope — Activities directly concerning the provision of air transport services — Not included — Activities not concerning air transport itself, but an upstream or downstream market — Included

   (Art. 101 TFEU; Council Regulations No 17 and No 141, third recital and Art. 1)

6. Competition — Agreements, decisions and concerted practices — Definition of the market — Purpose — Determination of the effect on trade between Member States — Appreciable effect

   (Art. 101 TFEU; EEA Agreement, Art. 53)

7. Competition — Agreements, decisions and concerted practices — Effect on trade between Member States — Criteria for assessment

   (Art. 101 TFEU)

8. Competition — EU rules — Infringements — Attribution — Legal entity liable for the infringement — Disappearance at the time the of adoption of the Commission decision or transfer of its economic activity to another entity having a structural link with it — Imputation to the economic successor — Lawfulness

   (Art. 101 TFEU)

9. Competition — Administrative procedure — Decision of the Commission finding an infringement and imposing a fine — Choice of legal entities subject to a penalty — Margin of discretion — Limits — Respect for the principle of equal treatment

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

10. Act of the institutions — Statement of reasons — Obligation — Scope — Decision to apply competition rules — No possibility of the Commission regularising the lack of reasoning for the decision during proceedings before the EU judicature

    (Arts 101 TFEU and 296 TFEU)

11. Competition — Fines — Amount — Determination — Determination of the base amount — Determination of the value of sales — Gravity of the infringement — Determination of the fine in proportion to the factors for assessment of the gravity of the infringement — Overall turnover of the undertaking concerned — Turnover corresponding to the goods covered by the infringement — To be taken into consideration — Limits

    (Art. 101 TFEU; Charter of Fundamental Rights, Art. 49(3); Council Regulation No 1/2003, Art. 23(3); Commission Notice 2006/C 210/02, point 13)

12. Competition — Fines — Guidelines on the method of setting fines — Legal nature — Indicative rule of conduct implying a self-limitation on the discretion of the Commission — Possibility of the Commission departing therefrom — Conditions

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, points 13 and 37)

13. Competition — Fines — Amount — Determination — Determination of the base amount — Determination of the value of sales — Sales carried out in direct or indirect relation to the infringement — Cartel in the international air freight forwarding services sector — Cartel regarding freight forwarding services as a package of services — Account taken of the value of sales made in the provision of freight forwarding services as a package of services — Lawfulness

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 13)

14. Competition — Fines — Amount — Determination — Determination of the base amount — Determination of the value of sales — Sales carried out in direct or indirect relation to the infringement — Not limited to sales actually affected by the cartel

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, point 13)

15. Competition — Fines — Amount — Determination — Guidelines adopted by the Commission — Existence of a cartel concerning a market upstream of that concerned by the infringement — Not a circumstance requiring the Commission to depart from the guidelines

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 13)

16. Competition — Fines — Amount — Determination — Pursuit of an objective of general deterrence — Lawfulness

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 210/02, point 13)

17. Competition — Fines — Amount — Determination — Criteria — Mitigating circumstances — Existence of a cartel concerning a market upstream of that concerned by the infringement — Absence

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 29)

18. Competition — Fines — Amount — Determination — Principle of equal treatment — Commission’s decision-making practice — Indicative nature

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2) and (3); Commission Notice 2006/C 210/02, point 13)

19. Competition — Administrative procedure — Observance of the rights of the defence — Access to the file — Scope — Refusal to communicate 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

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 27(1) and (2); Commission Regulation No 773/204, Art. 15)

20. Competition — Fines — Amount — Determination — Adjustment of the basic amount — Communication of the Commission on immunity form fines and reduction in their amount for cooperation of the undertakings concerned — Binding upon the Commission — Breach of principle of the protection of legitimate expectations — Conditions

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 298/11, point 38)

21. Competition — Fines — Amount — Determination — Legal context — Guidelines adopted by the Commission — Communication of the Commission on immunity form fines and reduction in their amount for cooperation of the undertakings concerned — Discretion of the Commission — Judicial review — Scope

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 298/11)

22. Competition — Fines — Amount — Determination — Criteria — Non-imposition or reduction of the fine for cooperation of the undertaking concerned — Granting of a conditional immunity from fines — Condition — Information provided not having to enable the Commission to form a detailed and precise idea of the nature and extent of the presumed cartel — Information having to enable the Commission to carry out a targeted investigation in relation to a presumed infringement

    (Art. 101 TFEU; Council Regulation No 1/2003, Art. 23(2); Commission Notice 2006/C 298/11, points 8(a), 9(a), and 18)

23. Competition — Administrative procedure — Settlement procedure — Opening — Discretion of the Commission — Scope

    (Arts 101 TFEU and 102 TFEU; Commission Regulations No 773/2004, Art. 10a(1), and No 622/2008, fourth recital; Commission Notice 2008/C 167/01)

1.  See the text of the decision.

   (see paras 31-34)

2.  See the text of the decision.

   (see paras 40-42)

3.  See the text of the decision.

   (see paras 45, 46)

4.  There are no provisions of EU law which state that the Commission is not entitled to use information and evidence submitted to it by an undertaking in an application for immunity, where the lawyer who has acted for that undertaking has infringed the prohibition on double representation or the duty of loyalty to his or her former clients who participated in a cartel.

   However, the fundamental rights and general principles of EU law must also be respected by the Commission during the preliminary phases of investigation and collection of information.

   Even if: (i) rules of professional conduct prohibiting dual representation and imposing a duty of loyalty were to be deemed to be the expression of general principles which must be taken into account in the procedure before the Commission and (ii) the conduct of the lawyer in question did not comply with those rules, the Commission does not err in concluding that it is entitled to use the information and evidence contained in the immunity application where all the said information and evidence was at the disposal of the company making the immunity application, irrespective of an infringement by the lawyer of professional secrecy in relation to one of his or her former clients. Finally, any breach, by a lawyer, of national rules of professional conduct applicable to it could be punished under national law.

   (see paras 48, 52, 53, 55, 56)

5.  In order to be exempted from the scope of Regulation No 17 pursuant to Article 1 of Regulation No 141 exempting transport from the application of Council Regulation No 17, the conduct of an undertaking must have as its object or effect the restriction of competition in a transport market. According to the third recital of Regulation No 141, only conduct directly relating to the provision of transport services is to be exempted by that article.

   Moreover, the conduct of an undertaking which does not concern air transport itself, but a market situated upstream or downstream of air transport, cannot be regarded as directly relating to the provision of transport services and is therefore not exempted by Article 1 of Regulation No 141.

   Furthermore, Article 1 of Regulation No 141 does not exempt the activities of an undertaking in their entirety solely because one part of its activities concerns air transport services. Consequently, even if an undertaking seeks to obtain transport services on an upstream market, its activities on a downstream market, which are not directly related to transport services, are not exempted by virtue of that article.

   (see paras 77, 78, 81)

6.  See the text of the decision.

   (see paras 141-143)

7.  See the text of the decision.

   (see para. 151)

8.  Where a company infringes the competition rules, it falls to that company, in accordance with the principle of personal responsibility, to answer for that infringement. However, the principle of personal responsibility does not mean that, in some circumstances, the economic successor of a company cannot be held liable for the conduct of that company.

   Thus, the economic successor of a legal entity which is responsible for an infringement of European Union competition law may be held liable, where that entity has ceased to exist at the time when the Commission decision is adopted.

   Moreover, where a company responsible for an infringement of competition law transfers the economic activity on the market concerned to another company at a time when those two companies are part of the same undertaking, the company to which the activity was transferred may be held liable by reason of the structural links which existed then between those two companies.

   In those two situations, an attribution of liability to the economic successor is justified in the interests of achieving effective implementation of the competition rules. If the Commission did not have such an option, undertakings would find it easy to evade penalties by means of restructuring, transfers or other legal or organisational changes. The objective of punishing conduct which is contrary to the competition rules and preventing its repetition by means of deterrent penalties would thus be compromised.

   (see paras 189-193)

9.  According to Article 23(2)(a) of Regulation No 1/2003, the Commission may by decision impose fines on undertakings and associations of undertakings where, either intentionally or negligently, they infringe Article 101 TFEU. That provision refers solely to the possibility of imposing penalties on undertakings, but does not define the legal entities on which a fine can be imposed. The Commission therefore has a discretion concerning the choice of legal entities on which it can impose a penalty for an infringement of EU competition law.

   However, in the exercise of that choice, the Commission is not entirely free. The Commission must have regard to, inter alia, the general principles of EU law and the fundamental rights guaranteed at EU level.

   Accordingly, where, in the course of its investigation, the Commission decides not to impose a fine on a particular category of legal entities which might have been part of the undertaking which committed the infringement, the Commission must have due regard to, inter alia, the principle of equal treatment.

   It follows that not only must the criteria which the Commission establishes in order to make a distinction between those legal entities on which it imposes a fine and those on which it decides not to impose a fine not be arbitrary, but they must also be applied consistently.

   The Commission may thus decide not to impose fines on the former parent companies of subsidiaries concerned by an infringement of the competition rules. Such an approach is within the discretion available to the Commission. As part of that discretion, the Commission can take into consideration the fact that an approach intended to impose penalties on all the legal entities which might be held to be liable for an infringement might add considerably to the work involved in its investigations.

   The Commission does not therefore exceed the limits of its discretion if it decides to impose penalties solely on companies directly involved in the infringement and on their current parent companies which could be held liable for their conduct, and not on their former parent companies.

   (see paras 211-214, 216, 217, 219)

10.  See the text of the decision.

    (see paras 229-231, 424-428)

11.  See the text of the decision.

    (see paras 244-248, 276)

12.  See the text of the decision.

    (see paras 251, 252)

13.  Under point 13 of the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation (EC) No 1/2003 (‘the 2006 Guidelines’), the Commission is to identify the value of the sales of goods or services to which the infringement directly or indirectly relates. In the case of a cartel in the international air freight forwarding services sector, concerning a new export system, regarding freight forwarding services as a package of services, the Commission does not exceed the limits which it imposed on itself in point 13 of the 2006 Guidelines by using the value of sales made in the provision of freight forwarding services as a package of services, and not solely the value of sales made in the provision of new export system filing services.

    (see para. 256)

14.  See the text of the decision.

    (see paras 267, 268, 270)

15.  The existence of a cartel affecting a market upstream of the market affected by the infringement for which fines were imposed cannot be deemed to be a circumstance that obliges the Commission to depart from the general methodology laid down in point 13 of the 2006 Guidelines.

    The use of the criterion of the value of sales as the starting point for the calculation of fines finds its justification in, inter alia, the fact that the part of the overall turnover that derives from the sale of the goods or services which are the subject matter of the infringement best reflects the economic importance of that infringement and is an objective criterion which can be easily applied.

    If an approach were adopted whereby the existence of an unlawful cartel affecting an upstream market would compel the Commission to adjust the value of sales to which an infringement affecting a downstream market relates, the result would be to introduce an element of uncertainty at the very first stage of the calculation of fines. First, the amount of the deductions to be made would generally be difficult to determine. Second, in order to respect the principle of equal treatment, deductions would have to be made not only in the circumstance where an unlawful cartel might affect an upstream market, but, more generally, in all circumstances where factors to be considered as contrary to EU law might have a direct or indirect impact on the prices of the goods or services concerned. Third, the result of such an approach would be to create the risk that the basis for the calculation of the amount of a fine would be challenged after the adoption of the contested decision, in circumstances where factors liable to have a direct or indirect impact on the prices of inputs were discovered after that time. Such an approach would therefore be likely to encourage endless, insoluble disputes, including allegations of unequal treatment.

    (see paras 276, 278, 280)

16.  The value of sales is used as a proxy for the economic importance of the infringement, not only because it can best reflect the economic importance of that infringement and the relative weight of each undertaking participating in the infringement, but also because it is an objective criterion which is easy to apply. That latter aspect of the value of sales means that the action of the Commission is more foreseeable for undertakings and enables them to assess the size of the fine they are liable to incur when they decide to take part in an unlawful cartel. Use of the criterion of the value of sales in point 13 of the 2006 Guidelines therefore pursues, inter alia, an objective of general deterrence. There is nothing to prevent the Commission, in the mission conferred on it by the Treaty to supervise compliance with European Union competition law, from pursuing an objective of general prevention, when it determines the general methodology for the calculation of fines.

    (see para. 291)

17.  Point 29 of the 2006 Guidelines sets out a non-exhaustive list of the mitigating circumstances which may lead, subject to certain conditions, to a reduction in the basic amount of the fine.

    Where an infringement has been committed by several undertakings, the relative gravity of the participation of each of them must be examined in order to determine whether aggravating or mitigating circumstances exist in relation to them.

    Where an infringement has been committed by several undertakings, the relative gravity of the participation of each of them must be examined in order to determine whether aggravating or mitigating circumstances exist in relation to them.

    It is not possible to link the existence of a cartel affecting an upstream market to one of the mitigating circumstances expressly mentioned in point 29 of the 2006 Guidelines.

    (see paras 317-319)

18.  See the text of the decision.

    (see paras 326-329, 431)

19.  See the text of the decision.

    (see paras 341-345)

20.  See the text of the decision.

    (see para. 361)

21.  See the text of the decision.

    (see para. 362)

22.  At the time when the Commission receives an application for immunity under point 8(a), it does not yet have any knowledge of the cartel concerned. Accordingly, as is stated in footnote No 1 to point 8(a) of the Commission Notice on immunity from fines and reduction of fines in cartel cases (‘the 2006 Leniency Notice’), the Commission must carry out an ex ante assessment of the application for immunity, based exclusively on the type and quality of information submitted by the undertaking.

    The 2006 Leniency Notice therefore does not preclude the Commission granting conditional immunity to an undertaking even where the information provided by that undertaking does not yet enable the Commission to form a conception of the nature and scope of the alleged cartel which is detailed and specific.

    First, although point 9(a) of the 2006 Leniency Notice requires that the undertaking seeking immunity must submit to the Commission a ‘detailed description’ of, inter alia, the alleged cartel and its geographic scope together with ‘specific information’ on its content, that obligation applies only in so far as the undertaking has such knowledge at the time of its application. Second, the collaboration of an undertaking in the detection of a cartel of which the Commission had no prior knowledge has an intrinsic value which can justify immunity from fines. The objective of point 8(a) and point 18 of the 2006 Leniency Notice is to facilitate the detection of infringements which are not known to the Commission, which would remain secret in the absence of evidence disclosed by the undertaking applying for immunity.

    Accordingly, point 8(a) and points 9 and 18 of the 2006 Leniency Notice do not require that the material submitted by an undertaking should constitute information and evidence pertaining specifically to the infringements which are identified by the Commission at the end of the administrative procedure. It is sufficient if that material enables the Commission to carry out a targeted investigation in relation an alleged infringement which covers the infringement(s) that the Commission finds to exists at the end of that procedure.

    (see paras 368-371)

23.  Under Article 10a(1) of Regulation No 773/2004, as amended by Commission Regulation (EC) No 622/2008, the Commission may set a time limit within which the parties may indicate in writing that they are prepared to engage in settlement discussions with a view to possibly introducing settlement submissions. It is therefore plain from the wording of that provision that the Commission is not obliged to make contact with the parties, but that it has a discretion in that regard. That reading of Article 10a(1) of Regulation No 773/2004, as amended, is confirmed by recital 4 of Regulation No 622/2008, which states that the Commission has a broad margin of discretion to determine in which cases it may appropriately explore the parties’ interest to engage in settlement discussions, as well as to decide to engage in such discussions or discontinue them or finally to settle the case.

    In that context, the Commission’s practice is consistent with that approach. According to point 6 of the Commission’s Notice on the conduct of settlement procedures with a view to adopting decisions under Articles 7 and 23 of Regulation No 1/2003 in cartel cases, where the Commission considers that a particular case may, in principle, be suitable for settlement, it is supposed to explore the possible interest in settlement of all the parties, although the parties to the proceedings do not have a right to that procedure. It is plain from point 6 that only if the Commission were to consider that a case is suitable for settlement would it be supposed to explore the interest of the undertakings concerned. Accordingly, point 6 also provides for the possibility that the Commission may consider that a case is not suitable for settlement without first having made contact with the parties concerned and having explored their interest in achieving a settlement.

    Since the aim of settlement is to make optimum use of the Commission’s resources through the imposition of effective and timely punishment, the Commission must, according to recital 4 of Regulation No 622/2008, take account of the probability of reaching a common understanding, regarding the scope of the potential objections, with the parties involved within a reasonable time frame. In that context, the Commission may take account of factors such as the number of parties involved, foreseeable conflicting positions on the attribution of liability, and the extent to which the facts may be disputed. It is also stated in that recital that the Commission may take account of concerns other than those relating to possible efficiency gains, such as the possibility of setting a precedent.

    Further, the fact that undertakings make known their interest in participating in settlement is one of the factors which the Commission may take into account in order to decide whether the case is suitable for settlement, since that factor may affect the probability of reaching a common understanding, regarding the scope of the potential objections, with the parties involved within a reasonable time frame. However, the weight of an expression of interest is variable, and dependent on the stage in the proceedings. In a case where, without committing any error, the Commission has envisaged not opting for settlement and has already initiated proceedings which do not involve settlement, the efficiency gains which may arise from settlement may prove to be more limited.

    (see paras 395, 396, 402, 417)