Summaries of judgments

 

Summaries of judgments made in collaboration with the Portuguese judges and référendaire of the General Court (Maria José Costeira, Ricardo Silva Passos and Esperança Mealha)
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Judgments of the General Court (Fifth Chamber) of the 12th of July 2019, 
T-762/15, T-763/15, T-772/15, T-1/16 and T-8/16

Competition – Agreements, decisions and concerted practices –  Market for optical disk drives – Decision finding an infringement of Article 101 TFEU and Article 53 of the EEA Agreement – Collusive agreements relating to bidding events concerning optical disk drives for notebook and desktop computers – Infringement by object – Essential procedural requirements and rights of the defence – Jurisdiction of the Commission –  Obligation to state reasons – Unlimited jurisdiction – Principle of good administration – Fines – Geographic scope of the infringement – Single and continuous infringement – 2006 Guidelines on the method of setting fines – Particular circumstances – Error of law

1 – Facts

On 21 October 2015, the European Commission adopted the Decision C(2015) 7135 final, relating to a proceeding under Article 101 TFEU and Article 53 of the EEA Agreement (Case AT.39639 – Optical Disk Drives, hereinafter “ODDs”) and, more specifically, to collusive agreements relating to bidding events concerning ODDs for computers organised by two computer manufacturers. Eight ODDs suppliers were covered by this decision, which imposes fines totaling EUR 16 million.

ODDs are used in computers produced by Dell and Hewlett Packard, the two main worldwide manufacturers in the market.

According to the Commission, between June 2004 and November 2008, the suppliers Philips, Lite-On, Philips & Lite-On Digital Solutions (their joint venture), Hitachi-LG, Data Storage, Toshiba Samsung Storage Technology, Sony, Sony Optiarc and Quanta Storage coordinated their behaviour in procurement tenders organised by the two computer manufacturers referred to above. During that period, they exchanged commercially sensitive information, communicated to each other their bidding strategies, and shared the results of procurement tenders.

The purpose of this cartel was to monitor market volumes and to ensure that prices remained higher than they would have been if there was free competition.

Philips, Lite-On and their joint venture Philips & Lite-On Digital Solutions received full immunity from fines, while Hitachi-LG Data Storage received a 50% reduction on its fine, all under the Commission’s leniency programme.

Disagreeing with the decision, the companies (which did not benefit from immunity) brought actions seeking annulment of the Commission’s decision, or a reduction of the fines imposed on them.

2 – Decision

The General Court (hereinafter “GC”) begins recalling that, in order to assess the applicability of the Union’s competition law rules, the place where the agreement was formed is not relevant. Moreover, in the present case, the Commission was able to demonstrate that part of the ODDs covered by the cartel were sold to entities established in the EEA. Since the cartel was implemented on the internal market, the Court held that Articles 101 TFEU and 53 EEA Agreement are applicable.

The GC considered that these were practices which, by their object, were capable of distorting competition, in a market with a limited number of operators.

The GC also considered that the Commission did not contradict itself by stating, on the one hand, that the infringement at issue is formed by various instances of individual anticompetitive conduct and, on the other, that it is a single and continuous infringement. In that regard, the GC recalls that the very concept of a ‘single and continuous infringement’ presupposes a complex of anticompetitive practices adopted in pursuit of a single aim. In this case, the aim was the neutralization of the mechanisms used in the tenders of the above-mentioned manufacturers, in order to increase competition between ODDs suppliers.

As for the calculation of the fines, the GC rejected the appellants’ arguments and concluded that the Commission was correct in finding that there were no particularities which would justify departing from the methodology set out in the Guidelines on the method of setting fines.

For the reasons stated above, the GC dismissed all the applications.

Judgment of the General Court (Second Chamber) of 24 September 2019, T-391/17 Romania v European Commission

Institutional law – European citizens’ initiative – Protection of national and linguistic minorities – Strengthening of cultural and linguistic diversity – Partial registration – Principle of conferral – No manifest lack of legislative powers of the Commission – Obligation to state reasons – Article 5(2) TEU – Article 4(2)(b) of Regulation (EU) No 211/2011 – Article 296 TFEU

1. Facts

On 15 July 2013, a citizens’ committee submitted to the Commission a proposal for a European Citizens’ Initiative (ECI) entitled “Minority SafePack – One million signatures for diversity in Europe”. This ECI aims to invite the Union to improve the protection of persons belonging to national and linguistic minorities and to strengthen cultural and linguistic diversity in the Union through the adoption of a series of legislative acts.

By a Decision of 13 September 2013[i] , the Commission refused to register the ECI proposal on the ground that it was manifestly outside its competence to submit a proposal for a legal act of the European Union in application of the Treaties.

The organizers of ICE challenged the Commission’s Decision before the General Court of the European Union, which, by its Judgment of 3 February 2017[ii], annulled that Decision on the ground that the Commission had failed to fulfil its duty to state reasons.

Following the Judgment of the General Court, the Commission partially registered that ECI by a Decision of 29 March 2017[iii] (‘the contested decision’).

The Commission submits that the ECI proposal, in so far as it concerns Commission proposals for legal acts of the Union for the purpose of implementing the Treaties, does not manifestly fall outside its competence to submit a proposal for a legal act of the Union for the purpose of implementing the Treaties in accordance with Article 4(2)(b) of Regulation (EU) No 211/2011 of the European Parliament and of the Council of 16 February 2011 on the citizens’ initiative (OJ 2011 L 65, p. 1).

Romania brought an action before the General Court seeking annulment of the contested decision. In particular, it submits that the Commission committed an error of assessment in concluding that the proposals for legal acts were not ‘manifestly outside’ the scope of the Commission’s competence to submit a proposal for a legal act and that the reasons for the contested decision were insufficient.

The Commission asked the General Court to dismiss the action. Hungary was allowed to intervene in support of the Commission.

2. Decision

The General Court dismisses the action brought by Romania against the Commission.

First, as regards the Commission’s sphere of competence, the General Court points out that the purpose of the ECI is, inter alia, to encourage the participation of citizens in the democratic life of the Union and to make it more accessible.

Thus, it is only where a proposal for an ECI, having regard to its subject-matter and objectives, is manifestly outside the scope of the Commission’s competence to submit a proposal for a legal act of the Union that it may refuse to register that proposal. In that context, the Commission must carry out an initial examination of the elements at its disposal in order to assess whether the proposal for an ECI is manifestly outside the scope of its competence. Then, in the event of registration of the proposal, a more complete examination is carried out.

The General Court finds that the legal acts referred to in the ECI proposal are intended to contribute, first, to ensuring respect for the rights of persons belonging to minorities, a value of the Union, and, second, to strengthening and promoting cultural and linguistic diversity within the Union, an objective pursued by the Union.

In that regard, the General Court points out that, contrary to Romania’s submissions, the Commission, by the contested decision, did not recognize the Union’s general competence in those areas, but only that those values and objectives of the Union laid down in the EU Treaty must be taken into account in the context of the Union’s actions in the areas covered by the ECI proposal. The General Court notes that, in accordance with Article 2 TFEU, respect for the rights of minorities is one of the values on which the Union is founded and, secondly, that the fourth subparagraph of Article 3(3) TEU states that the Union respects the richness of its cultural and linguistic diversity.

The General Court adds that, while in areas of Union competence the Commission is empowered to submit proposals for legal acts which take into account the values and objectives which are the subject of the ECI proposal, nothing should prevent it from submitting proposals for specific acts which, as in this case, are intended to supplement Union action in its areas of competence in order to ensure respect for the values set out in the EU Treaty.

The General Court also considers that, contrary to Romania’s reasoning, the various proposals for legal acts at issue are appropriate to contribute to the achievement of the objectives set for Union action in the area of competence at issue.

In those circumstances, the General Court finds that the ECI proposal was not ‘manifestly outside’ the scope of the Commission’s powers.

[i] Commission Decision C(2013) 5969 of 13 September 2013 rejecting the request for registration of the proposal for a European citizens’ initiative entitled ‘Minority SafePack – one million signatures for diversity in Europe’.

[ii] Judgment of 3 February 2017, Minority SafePack – one million signatures for diversity in Europe v Commission, T-646/13. (EU:T:2017:59)

[iii] Decision (EU) 2017/652 on the proposal for a European citizens’ initiative entitled ‘Minority SafePack – one million signatures for diversity in Europe’. (OJ 2017, L 92, 100)

 

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