Short Reads

Court of Justice dismisses Toshiba's appeal against the gas-insulated switchgear fine

Court of Justice dismisses Toshiba's appeal against the gas-insulated

Court of Justice dismisses Toshiba's appeal against the gas-insulated switchgear fine

01.08.2017 EU law

On 6 July 2017, the European Court of Justice dismissed an appeal brought by Toshiba regarding its participation in the gas-insulated switchgear (GIS) cartel, upholding the General Court's (GC) judgment of 19 January 2016 and making the fine imposed on Toshiba final. The judgment shows that the European Commission is able and willing to repair any breach of the principle of equal treatment in the rare occasions in which this leads to the annulment of a fining decision.

Background of the dispute

In January 2007, the Commission imposed fines amounting to EUR 750 million on twenty European and Japanese companies for in essence reserving the EU market for the European producers and the Japanese market for the Japanese producers, including Toshiba.

On 12 July 2011, the GC partially annulled the 2007 decision on the ground that the Commission had infringed the principle of equal treatment in the calculation of the fine imposed on Toshiba by taking a different reference year than for the European members of the cartel. The Commission subsequently re-imposed the fines using the correct reference year, following a simple letter of facts and without issuing a new Statement of Objections (SO).

Toshiba's appeal against the new Commission decision was entirely dismissed by the GC in 2016. This judgment has now been confirmed by the Court of Justice.

No infringement of Toshiba's rights of defence

The Court of Justice held that the applicant's right to be heard was satisfied by simply issuing a letter of facts and not a second SO. In its reasoning, the Court of Justice found that the re-imposition of the fine was merely an extension of the 2007 procedure and the partial annulment of the original Commission decision did not affect the validity of the preparatory measures.

Interestingly, the Court confirmed that, though "it may be desirable", the parties' right to be heard does not require the Commission to specify "the way in which it proposes to employ the imperative criteria of the gravity and the duration of the infringement when determining the amount of the fines".

No error in the calculation of the fine

The Court of Justice also dismissed Toshiba's arguments with regard to the calculation of the fine.

Although Toshiba's fine was calculated under the old Commission Fining Guidelines, it is interesting to note that the Court confirmed the use of the starting amount of the fine assigned to TM T&D, the 50:50 joint venture in which Toshiba had transferred its GIS activities in 2002. Since following the transfer of activities to TM T&D, Toshiba had no sales in 2003 – the relevant reference year for the calculation of the fine – its fine could not be calculated in the exact same manner as that of the European producers. In addition, calculating a virtual 2003 turnover for Toshiba by splitting TM T&D's turnover and comparing it to the actual turnover of the European cartel participants, as Toshiba proposed, would not appropriately reflect the weight in the infringement that was exerted through TM T&D.

This article was published in the Competition Law Newsletter of August 2017. Other articles in this newsletter:

1. Recent enforcement action demonstrates an increasing focus on compliance with procedural EU merger rules
2. Trade and Industry Appeals annuls fine imposed on real estate traders
3. District Court of Rotterdam upheld ACM's decision to clear lottery merger
4. ACM closes probe into Fox over live-soccer TV rights due to lack of evidence of consumer harm
5. District Court of The Hague rules on ACM's powers to select and inspect digital data

Team

Related news

20.06.2018 NL law
Op weg naar één Europese spoorwegruimte: de aanpassing van de Nederlandse wetgeving aan het Europese recht

Articles - Het zogenaamde 'Vierde Spoorwegpakket' zal belangrijke gevolgen hebben voor de Europese spoorwegruimte. De Nederlandse regering maakt goede vaart met de aanpassing van het nationale recht aan de eisen die uit het Vierde Spoorwegpakket voortvloeien. Inmiddels is een daartoe strekkend wetsvoorstel aanhangig bij de Tweede Kamer. De vaste commissie voor Infrastructuur en Waterstaat heeft eind vorige maand het verslag van haar bevindingen ten aanzien van het wetsvoorstel uitgebracht.

Read more

01.06.2018 EU law
European Court of Justice rules EY did not violate stand-still obligation in Danish merger

Short Reads - On 31 May 2018, the European Court of Justice ruled that Ernst & Young (EY) did not illegally implement the acquisition of KPMG Denmark (KPMG DK) before obtaining antitrust clearance.  Following the announcement of the transaction, KPMG DK terminated a cooperation agreement. According to the Court, that act cannot be regarded as a violation of the stand-still obligation since it did not contribute to the change of control of the target undertaking.

Read more

20.06.2018 NL law
Naar een volwaardig recht op toegang tot de rechter en een eerlijk proces onder het EVRM?

Articles - Het recht op een toegang tot de rechter en een eerlijk proces van artikel 6 EVRM is één van de hoekstenen van dit verdrag. Naast strafzaken en zaken over bestuurlijke boetes vallen de meeste andere geschillen onder het toepassingsbereik van deze bepaling. Dit omdat er volgens de autonome Straatsburgse uitleg al snel sprake is van een geschil over de vaststelling van ‘civil rights and obligations’ als bedoeld in artikel 6 EVRM.

Read more

05.06.2018 EU law
New EU rules to reduce marine pollution

Articles - Plastic pollution has become a key environmental concern. And it is not surprising why: according to a recent study, of the 8.3 billion metric tons of plastics that have been produced so far, 6.3 billion metric tons has become plastic waste. Of this plastic waste, 79% is accumulating either in landfill sites or in the oceans. Therefore, on 28 May 2018 the EU Commission issued a new draft Directive aimed at tackling marine litter by addressing single use plastic items and abandoned fishing gear.

Read more

Our website uses cookies: third party analytics cookies to best adapt our website to your needs & cookies to enable social media functionalities. For more information on the use of cookies, please check our Privacy and Cookie Policy. Please note that you can change your cookie opt-ins at any time via your browser settings.

Privacy – en cookieverklaring