Judgments nº T-325/01 of Court of First Instance of the European Communities, September 15, 2005

• Resolution Date: September 15, 2005
• Issuing Organization: Court of First Instance of the European Communities
• Decision Number: T-325/01

(Competition – Article 81 EC – Agreements, decisions and concerted practices – Agency agreements – Distribution of motor vehicles – Economic unit – Measures seeking to obstruct parallel trade in motor vehicles – Price fixing – Regulation (EC) No 1475/95 – Fine)

In Case T-325/01,

DaimlerChrysler AG, established in Stuttgart (Germany), represented by R. Bechtold and W. Bosch, lawyers,

applicant,

v

Commission of the European Communities, represented by W. Mölls, acting as Agent, and H.-J. Freund, lawyer, with an address for service in Luxembourg,

defendant,

APPLICATION primarily for annulment of Commission Decision 2002/758/EC of 10 October 2001 relating to a proceeding under Article 81 of the EC Treaty (Case COMP/36.264 – Mercedes‑Benz) (OJ 2002 L 257, p. 1), and, in the alternative, for a reduction in the fine imposed by that decision,

THE COURT OF FIRST INSTANCEOF THE EUROPEAN COMMUNITIES (Fifth Chamber),

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

Registrar: I. Natsinas, Administrator,

having regard to the written procedure and further to the hearing on 25 May 2004,

gives the following

Judgment

Facts

1 This action seeks the annulment of Commission Decision 2002/758/EC of 10 October 2001 relating to a proceeding under Article 81 of the EC Treaty (Case COMP/36.264 – Mercedes-Benz) (OJ 2002 L 257, p. 1) (‘the contested decision’).

2 DaimlerChrysler AG (‘the applicant’) is a German group which carries on business in particular in the manufacture and marketing of motor vehicles.

3 On 21 December 1998, Daimler-Benz AG merged with the applicant under a business combination agreement of 7 May 1998. The applicant then became the legal successor to Daimler-Benz AG and all of the latter’s rights, assets, liabilities and obligations were transferred to it.

4 Before the merger, Daimler-Benz AG was the umbrella company of the Daimler-Benz group, which was active worldwide through its subsidiaries. In addition, on 26 May 1997, Mercedes-Benz AG, a subsidiary of Daimler-Benz AG, merged with the latter company. Since that date, it has been the motor vehicle division within Daimler‑Benz AG. As in the contested decision, the name ‘Mercedes‑Benz’ is used in this judgment to refer, as the context requires, to Daimler-Benz AG (until 1989), to Mercedes-Benz AG (until 1997), to Daimler-Benz AG (1997 and 1998) and to the applicant (from 1998).

5 From the beginning of 1995, the Commission received a number of complaints from consumers concerning restrictions on the export of new Mercedes-Benz motor vehicles imposed by companies in the Daimler‑Benz group in various Member States.

6 The Commission had information that companies belonging to that group were partitioning the market contrary to Article 81(1) EC. On 4 December 1996, the Commission adopted a number of decisions ordering investigations pursuant to Article 14 of Council Regulation No 17 of 6 February 1962: First Regulation implementing Articles [81] and [82] of the Treaty (OJ, English Special Edition 1959-1962, p. 87). Those investigations took place on 11 and 12 December 1996 at the premises of Daimler-Benz AG in Stuttgart (Germany), Mercedes-Benz Belgium SA/NV in Belgium, Mercedes-Benz Nederland NV in Utrecht (Netherlands) and Mercedes-Benz España, SA, in Spain.

7 On 21 October 1998, the Commission sent a request for information to Daimler-Benz AG under Article 11 of Regulation No 17, to which the latter replied on 10 November 1998. On 15 June 2001, the Commission sent a further request for information to the applicant, to which the latter replied on 9 July 2001. In the course of carrying out the investigations on 11 and 12 December 1996, the Commission found and seized a large number of documents which, together with the requests for information sent to the applicant and the latter’s observations, constitute the basis of the contested decision.

8 On 10 October 2001, the Commission adopted the contested decision.

Contested decision

9 In the contested decision, the Commission held that Mercedes-Benz had itself or through its subsidiaries Mercedes-Benz España, SA (‘MBE’), and Mercedes-Benz Belgium SA (‘MBBel’) infringed Article 81(1) EC. According to the Commission, the measures established in the contested decision related to the retailing of Mercedes-Benz passenger cars (recitals 143 to 149).

10 In the contested decision, the Commission described the companies concerned and their distribution network. It stated that the distribution of Mercedes-Benz passenger cars in Germany is essentially carried out through a network comprising branches belonging to the group, agents having the status of commercial agents (as defined in Paragraph 84(1) of the German Commercial Code), who have the authority to negotiate business transactions, and commission agents (recital 15). The distribution network in Belgium comprises an importer, MBBel, which, from an unspecified date, was a wholly owned subsidiary of Daimler‑Benz AG, which has in turn been a wholly owned subsidiary of the applicant since 21 December 1998, and which sells new vehicles through two branches, dealers and agents/workshops, which also negotiate new-vehicle sales contracts (recitals 17 and 19). Passenger cars are distributed in Spain through a network comprising three branches of MBE and dealers. Some of the agents/workshops do not sell vehicles, but only negotiate sales contracts. MBE is a wholly owned subsidiary of the national holding company Daimler-Benz España, SA, which is in turn a 99.88 per cent subsidiary of Daimler-Benz AG. Since 21 December 1998, that holding company has been a wholly owned subsidiary of the applicant (recital 20).

11 The Commission held that, contrary to what the applicant had maintained during the administrative procedure, Article 81(1) EC applies to the agreements between Mercedes-Benz and its German agents in the same way as it would apply to an agreement with an authorised dealer. It stated that ‘the restrictions imposed on an agent must therefore be assessed in the same way as for a dealer’ (recital 168).

12 The Commission held in that regard, first, that the German Mercedes‑Benz agents have to bear a number of commercial risks inextricably linked to their function as agent for Mercedes-Benz and which result in Article 81 EC being applicable to the agreements between them and Mercedes-Benz (recitals 153 to 160).

13 In particular, a German Mercedes-Benz agent bears a considerable share of the price risk where he negotiates the sale of vehicles. If an agent offers discounts on the sale of new vehicles which are accepted by Mercedes-Benz, these are deducted in their entirety from his commission (recitals 155 and 156).

14 A German agent also bears the risk of transport costs for new vehicles under Clause 4(4) of the German agency agreement. In the same way as a dealer, the agent is required to pass on the costs of transport and the transport risk contractually to the customer (recital 157).

15 The agent must also use a considerable part of his own financial resources for sales promotion purposes. He must, in particular, acquire demonstration vehicles at his own expense (Clause 4(7) of the German agency agreement). Mercedes-Benz grants special terms for the purchase of demonstration and business cars. Those cars are subject to a minimum retention period of three to six months and a minimum running distance of 3 000 kilometres. Thereafter, the agent may resell them on the second-hand market, also bearing the sales risk for this not insignificant number of vehicles (recital 158).

16 In carrying out his activities, a German Mercedes‑Benz agent is exposed to a number of other commercial risks, acceptance of which is a precondition for becoming a Mercedes‑Benz agent. Clause 13 of the agency agreement requires the agent to carry out guarantee work on vehicles which are subject to a manufacturer’s guarantee. German agents are required, at their own expense, to set up a workshop and carry out after-sales service and guarantee work there and, on request, must provide standby and emergency cover (Clause 12 of the agency agreement). In addition, a German agent is required to maintain, at his own expense, a stock of spare parts to carry out repairs to vehicles in his workshop (Clause 14 of the agency agreement) (recital 159).

17 Secondly, the Commission indicated that, financially speaking, a German agent’s income from activities pursued on a self-employed basis exceeds many times over his income from negotiating the sale of new vehicles. It stated: ‘For his activity as an intermediary the agent receives a commission which in the case of passenger cars is made up of a basic commission of 12.2 per cent and a service commission of up to 3.6 per cent. This commission income of at most 15.8 per cent constitutes the revenue from the agency activity. Out of this revenue the agent has to finance the discounts he grants to car buyers. The revenue actually earned from agency business is therefore lower than the abovementioned 15.8 per cent.’ It goes on to say (recital 159): ‘the revenue from acting as an intermediary amounts, if vehicle prices are regarded as part of this revenue, to approximately 50 per cent of the total revenue of an agent. But the agent’s actual revenue from acting as an intermediary per se is the [above]mentioned commission. If this is compared with the agent’s revenue from activities contractually linked to dealing in new vehicles in respect of which the agent bears the entire risk, it becomes apparent that only about one-sixth of total revenue is derived from acting as an agent proper.’

18 The Commission held that in view of the number and quantitative scope of the risks that the agents have to bear, the applicant’s argument that those risks are typical of those borne by a true commercial agent could not be accepted. It stated that: ‘the position would be different only if the agent could choose whether to assume in particular the...