Short Reads

General Court underlines importance of Commission's duty to state reasons

General Court underlines importance of Commission's duty to state rea

General Court underlines importance of Commission's duty to state reasons

01.08.2018 NL law

On 13 July 2018, the General Court annulled the EUR 1.13 million fine imposed on Stührk Delikatessen Import GmbH & Co. KG (Stührk) by the European Commission in 2013 for Stührk's participation in the shrimp cartel. The Court ruled that the Commission had failed to adequately state reasons in the contested decision as to why the cartel participants were granted divergent fine reductions.

On 27 November 2013, the Commission fined four North sea shrimp traders a total of EUR 28.7 million for making price fixing agreements and sharing sales volume information between 2000 and 2009, which constituted a single and continuous infringement. The Commission reduced the individual fines on the basis of paragraph 37 of the fining guidelines, which allows it to depart from the methodology set out in the fining guidelines if this approach can be justified by the peculiarities of a given case.

In 2014, Stührk appealed the decision and sought to annul both the decision and the fine on the basis of nine grounds of appeal. In one of the grounds of appeal, Stührk claimed that the Commission had erroneously concluded that it could be held liable for the infringements committed by the other three participants. The General Court held that the Commission may attribute liability for the single and continuous infringement as a whole to an undertaking participating in only some anticompetitive acts, if that participant was aware of all the other infringements committed by the other participants or could reasonably foresee those infringements and was prepared to take the risk. The Court ruled that, as Stührk had obtained price information from Klaas Puul through Heiploeg, it must have been aware that the coordination of prices with Heiploeg extended beyond its relationship with Heiploeg and at least included Klaas Puul. Therefore, the Court rejected this ground of appeal and ruled that the Commission was right to consider Stührk liable for the anticompetitive acts committed by the other participants comprising the single and continuous infringement.

However, the General Court went on to annul the fine imposed on Stührk on the basis of the last ground of appeal, complaining that the Commission had applied the reductions under paragraph 37 of the fining guidelines contrary to the principle of equal treatment. Stührk argued that the Commission had granted the other participants a greater reduction of their respective fines, despite their larger roles in the cartel. The Court held that where the Commission exercises its wide margin of discretion to grant a fine reduction under paragraph 37 of the fining guidelines, the duty to state reasons is all the more important to properly assess whether the Commission observed the principle of equal treatment. Subsequently, the Court introduced an ex officio ground that the Commission had failed to state reasons. According to the Court, it was unclear which criteria the Commission had used for calculating the respective fine reductions, to the extent that the participants were not able to contest the Commission's approach nor was the Court able to assess whether the principle of equal treatment had been applied. To conclude, the Court ruled that the Commission had failed to provide adequate reasoning within the meaning of Article 296 TFEU in determining the fines and therefore annulled the fine imposed on Stührk.

The judgment clarifies the requisite degree of awareness of, or ability to foresee, anticompetitive acts committed by other participants in establishing liability. In addition, the judgment once more  underlines the duty of the Commission to adequately state reasons for its fine decisions [see our January 2017 Newsletter].

This article was published in the Competition Law Newsletter of August 2018. Other articles in this newsletter:

  1. European Court of Justice dismissed Orange Polska’s appeal in abuse of dominance case
  2. General Court dismisses appeals by investor against power cable cartel fine
  3. Google receives a second record fine of EUR 4.34 billion for imposing restrictions on Android device makers
  4. European Commission issues a new Best Practices Code for State aid control
  5. District Court in the Netherlands rules on limitation periods in CRT case
  6. Court of Appeal in the Netherlands decides to appoint independent economic experts in TenneT v ABB
  7. Belgian Court of Cassation annuls decision prohibiting pharmacists from using Google Adwords

Team

Related news

08.06.2021 NL law
De Europese Klimaatwet uitgelicht

Short Reads - Op 21 april 2021 is een voorlopig akkoord bereikt over de Europese Klimaatwet. Deze Klimaatwet kan worden gezien als de kern van de Europese Green Deal, die in december 2019 werd gepubliceerd door de Europese Commissie. Het overstijgende doel van deze instrumenten is om een klimaatneutraal Europa te bewerkstelligen in 2050. De Europese Klimaatwet zorgt ervoor dat deze klimaatneutraliteitsdoelstelling in een Europese verordening wordt vastgelegd. Dit blogbericht gaat nader in op de Europese Klimaatwet en legt uit wat dit met zich brengt.

Read more

22.07.2021 NL law
Towards a European legal framework for the development and use of Artificial Intelligence

Short Reads - Back in 2014, Stephen Hawking said, “The development of full artificial intelligence could spell the end of the human race.” Although the use of artificial intelligence is nothing new and dates back to Alan Turing (the godfather of computational theory), prominent researchers – along with Stephen Hawking – have expressed their concerns about the unregulated use of AI systems and their impact on society as we know it.

Read more

08.06.2021 NL law
Actualiteiten milieustrafrecht: zorgelijke ontwikkelingen

Short Reads - Vrijdag 28 mei jl. hadden wij een inspirerend webinar over actualiteiten op het gebied van milieustrafrecht. Wij spraken gedurende 90 minuten onder meer over aansprakelijkheden van bestuurders, de zorgplichten, incidentenrapportages vanuit strafrechtelijk- en bestuursrechtelijk perspectief.

Read more

03.06.2021 NL law
First material judgment in Dutch damages proceedings in trucks infringement

Short Reads - In its judgment of 12 May 2021, the Amsterdam District Court ruled that it has not been established that it is definitively excluded that the trucks infringement led to damage to the claimants. However, this does not alter the fact that it must still be assessed for each claimant whether the threshold for referral to the damages assessment procedure has been met. For this to be the case, it must be plausible that a claimant may have suffered damage as a result of the unlawful actions of the truck manufacturers. The Amsterdam District Court has not yet ruled on this issue.

Read more