Judgments nº T-342/00 of Court of First Instance of the European Communities, April 03, 2003

Resolution DateApril 03, 2003
Issuing OrganizationCourt of First Instance of the European Communities
Decision NumberT-342/00

JUDGMENT OF THE COURT OF FIRST INSTANCE (Fifth Chamber)

3 April 2003 (1) (Competition - Regulation (EEC) No 4064/89 - Decision declaring a merger compatible with the common market - Petroleum sector - Commitments - Decision refusing approval of transferees - Inadmissibility - Definitive binding act - Infringement of essential procedural requirements - Procedural time-limits for reply - Error of assessment)

In Case T-342/00,

Petrolessence SA, established in Nancy (France),

Société de gestion de restauration routière SA (SG2R), established in Nancy,

represented by F. Puel and M. Troncoso Ferrer, lawyers, with an address for service in Luxembourg,

applicants,

v

Commission of the European Communities, represented by W. Mölls, F. Siredey-Garnier and F. Lelièvre, acting as Agents, with an address for service in Luxembourg,

defendant,

supported by

French Republic, represented by G. de Bergues and F. Million, acting as Agents, with an address for service in Luxembourg,

intervener,

APPLICATION for the annulment of the Commission decision of 13 September 2000 rejecting TotalFina Elf's proposal concerning approval of the applicants as transferees of six motorway service stations,

THE COURT OF FIRST INSTANCE

OF THE EUROPEAN COMMUNITIES (Fifth Chamber),

composed of: J.D. Cooke, President, R. García-Valdecasas and P. Lindh, Judges,

Registrar: B. Pastor, Deputy Registrar,

having regard to the written procedure and further to the hearing on 11 April 2002,

gives the following

Judgment

Facts

1.
Petrolessence SA, which was formed in 1922, was a distributor and importer of petroleum products in Lorraine and the Paris region until the end of the 1980s. From the early 1970s it implemented a policy of diversification of its service station operations and offered catering services. In 1980 it formed a subsidiary specialising in highways restaurant management, Société de gestion de restauration routière SA (SG2R), whose establishments operate under the trading name ‘Le Mirabellier’. In 1987 Petrolessence sold its petroleum business.

2.
On 24 August 1999 the Commission was notified of a planned merger whereby TotalFina would acquire full control of Elf Aquitaine by way of a public takeover bid announced on 5 July 1999. TotalFina is a public limited company incorporated under French law, in business in the production of petroleum and gas, refining, distribution of petroleum products, petrochemicals and speciality chemicals. Elf Aquitaine is a public limited company incorporated under French law, in business in the production of petroleum and gas, refining, distribution of petroleum products, petrochemicals and speciality chemicals in the health-care sector. The business of both companies is worldwide.

3.
By Decision 2001/402/EC of 9 February 2000 (Case COMP/M.1628 - TotalFina/Elf) (OJ 2000 L 143, p. 1, ‘the decision of 9 February 2000’), adopted pursuant to Article 8(2) of Council Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between undertakings (OJ 1990 L 257, p. 13), the Commission declared the notified merger compatible with the common market and the functioning of the Agreement on the European Economic Area, provided that a number of commitments proposed by the notifying parties (‘the commitments’) and annexed to the decision were fully complied with (see Article 1 of the decision of 9 February 2000).

4.
In the decision of 9 February 2000, the Commission identified several markets in issue, including that of the sale of fuel on motorways in France, which is the only relevant market in the present case. The Commission found that demand for fuel on motorways is distinct and different in nature from off-motorway demand and that the supply of fuels on motorways is not constrained by the supply of fuels off motorways. The significant and persistent price differences between fuels sold on and off motorways confirmed this and the relevant product market was therefore that for the sale of fuels on motorways (see paragraph 176). The current competitive situation on the market for motorway fuel sales was close to being one of dominance exercised either solely by TotalFina, or else jointly, with TotalFina in the role of leader (paragraph 216).

5.
In the decision of 9 February 2000 the Commission also found that the merger in question would lead to the creation of a dominant position on the market for motorway fuel sales in France and that, after the merger, TotalFina Elf would have strong incentives to raise its prices and/or reduce the quality of its services (paragraphs 220 and 221 of the decision of 9 February 2000). The proposed commitments aimed to overcome the competition problems identified by the Commission.

6.
According to point 1 of the proposed commitments, TotalFina was to divest itself of certain assets in order to maintain effective competition on the markets affected by the merger. In particular, an undertaking was given to divest 70 Elf, Total and Fina service stations on French motorways within a specified time-limit (point 36 of the commitments).

7.
The transferees of the service stations were to be approved by the Commission and to meet the conditions set out in paragraph 1 of the commitments. The conditions relevant to the present case are worded as follows:

‘(b) the transferee(s) shall be viable operators, either potentially or currently active on the markets in question, capable of maintaining or developing effective competition’.

8.
Point 2 of the commitments provides as follows:

‘The notifying party shall submit to the Commission, as soon as possible:

(a) the draft information document(s) concerning the divestiture of each category of assets (refined product depots, interests in pipelines, motorway service stations, assets in the LPG sector), to be transferred to potential purchasers,

(b) the list of potential purchasers which the notifying party intends to contact.

If the Commission does not pronounce upon the documents in question within five working days from the date of their submission, such documents shall be deemed to be accepted by the Commission’.

9.
Point 4 reads as follows:

‘The selection of the transferee(s) shall be subject to the approval of the Commission. The request for approval of the transferee(s) shall include the necessary information to permit the Commission to verify that the proposed transferee(s) meet the conditions indicated in point 1. The Commission shall inform the notifying party of its approval or rejection of the proposed candidates for transferees within 10 days from the date of submission of the request for approval of the proposed transferee(s). The absence of a response from the Commission within 10 days shall be considered as an exceptional circumstance within the meaning of point 6’.

10.
Point 5 of the commitments provides as follows:

‘The notifying party undertakes to conclude irrevocable divestiture agreements related to the assets within ... from the date of receipt of the Decision authorising the merger pursuant to Article 8(2) of Regulation No 4064/89 (hereinafter, the first time-limit). The transfer of the assets shall become effective within a maximum of ... following the conclusion of the divestiture agreement (hereinafter, the second time-limit).’

11.
Point 6 of the commitments provides as follows:

‘In the event of exceptional circumstances which prevent the conclusion of the divestiture agreement or the effective divestiture, the first or second time-limit may be extended at the discretion of the Commission and upon the duly justified request of the notifying party’.

12.
The substance and the special conditions for the implementation of the commitments relating to the market for motorway fuel sales are set out in points 36 and 37 of the commitments. Point 37(c) provides: ‘in order to ensure the immediate re-establishment of effective and long-lasting competition, the notifying party undertakes to propose to purchasers of all or some of the divested service stations to transfer to them a sufficient number of administrative, commercial and accounting management personnel ...’. Point 37(e) states, inter alia, that ‘those operators intending to make a purchase offer ... must be capable of showing their direct or indirect experience in the operation of a service station network of any type.’

13.
In order to comply with that commitment, on 12 August 2000 TotalFina Elf lodged with the Commission a request for approval of purchasers for all the 70 service stations concerned. Among the proposed purchasers, TotalFina Elf had selected the applicants, under their trading name, for the transfer of six service stations. It had also chosen Agip for the transfer of 33 service stations. In that connection on 6 July 2000 the applicants had submitted to TotalFina Elf a firm offer to purchase a certain number of motorway petrol stations, indicating the name and the price of the stations in question. The applicants annexed to the offer a draft memorandum of agreement concerning distribution on motorways, point 3.2 of which observes that, pursuant to the decision of 9 February 2000, TotalFina Elf must submit the transferees of stations for the Commission's approval and point 3.3(b) of which specifies the circumstances under which the parties' commitments would lapse.

14.
On 29 August 2000 the Commission received from TotalFina Elf the additional information deemed necessary by the Commission for it to be able to give a decision on the request for approval.

15.
By decision of 13 September 2000 notified to TotalFina Elf (the contested decision), the Commission concluded that the applicants did not meet one of the conditions set out in point 1(b) of the commitments for obtaining the required approval since, in the context of the proposed group of purchasers, their application did not allow effective competition to be...

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