Keywords
Summary

Keywords

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1. Competition ° Fines ° Discretionary power of the Commission ° Scope ° Power to charge default interest on fines

(EEC Treaty, Art. 89; Council Regulation No 17, Art. 15(2))

2. Competition ° Fines ° Options open to undertakings bringing actions against Commission decisions imposing fines on them ° Undertaking which has opted to provide a bank guarantee ° Reduction of the fine by the Community judicature ° Payment of default interest accruing from the due date specified in the decision but calculated on the amount of the fine set by the Community judicature

(EEC Treaty, Arts 172 and 185; Council Regulation No 17, Arts 15(2) and 17)

3. Commission ° Measures of management which may be taken pursuant to a delegation of authority ° Concept ° Decision requiring payment of default interest following a judgment by the Court of First Instance upholding in part a decision imposing a fine subject to accrual of default interest ° Included

(Rules of Procedure of the Commission (93/492), Art. 11)

4. Competition ° Fines ° Discretionary power of the Commission ° Scope ° Power to decide how payments made in relation to fines should be applied ° Conditions ° Compliance with the rules or general principles of Community law

(Council Regulation No 17, Art. 15(2))

Summary

1. The power which the Commission has under Article 15(2) of Regulation No 17 to impose fines on undertakings covers the power to determine the date on which the fine is payable and that on which default interest begins to accrue, the power to set the rate of such interest and the power to determine the detailed arrangements for implementing its decision by requiring, where appropriate, the provision of a bank guarantee covering the principal amount of the fine imposed plus interest.

If the Commission had no such power, the advantage which undertakings might be able to derive from late payment of fines would weaken the effect of the penalties imposed by the Commission when carrying out its task under Article 89 of the Treaty of ensuring that the rules on competition are applied. Thus, the charging of default interest on fines is justified by the need to ensure that the Treaty is not rendered ineffective by practices applied unilaterally by undertakings which delay paying fines imposed on them.

Furthermore, if the Commission did not have the power to charge default interest on fines, undertakings which delayed paying their fines would enjoy an advantage over those which paid their fines within the period laid down.

2. An undertaking which brings an action against a Commission decision imposing a fine on it has a choice between paying the fine when it becomes payable, applying for suspension of operation of the decision pursuant to the second sentence of Article 185 of the Treaty and Article 104 of the Rules of Procedure of the Court of First Instance, or, finally, if the Commission so allows, providing a bank guarantee as security for payment of the fine and default interest, in accordance with the conditions laid down by the Commission.

Where an applicant undertaking elects for this last option and the Community judicature, in the exercise of its unlimited jurisdiction, reduces the fine imposed by the Commission, the latter is entitled to require payment of default interest accruing from the due date specified in its decision but calculated on the amount of the fine set by the Community judicature. In view of the powers conferred on the Community judicature by Article 172 of the Treaty and Article 17 of Regulation No 17, the fine which it sets is not a new fine different in law from that which the Commission imposed in its decision and does not alter the cover provided by the bank guarantee furnished by the applicant undertaking.

3. Measures adopted by the Commission which create rights and obligations for individuals amount to decisions which must be deliberated upon by its members together, whereas measures which merely ratify those decisions constitute accessory measures of management which may be taken pursuant to a delegation of authority in accordance with Article 11 of the Commission' s Rules of Procedure.

In this regard, a decision by which the Commission requires default interest to be paid following a judgment of the Court of First Instance upholding in part a decision imposing a fine subject to accrual of default interest must, in so far as it is a measure giving effect to the original decision setting the fine and the rate of interest, be regarded as no more than a management and administrative measure.

4. In view of the fact that it has the power to make the obligation to pay the fines which it imposes subject to payment of interest where those fines are not paid, the Commission also has the power to decide how payments made in relation to those fines are to be applied, on condition that it does not infringe rules or general principles of Community law. Provided that it complies with that condition, the Commission may, by referring to rules generally accepted in most national legal systems, apply those payments against interest first and then against principal.