EU General Court Largely Upholds Commission Decision In Calcium Carbide And Magnesium Reagents Cartel Case, But Adjusts Fines On Account Of Breaches Of Principles Of Equal Treatment And Proportionality

Author:Van Bael Bellis
Profession:Van Bael & Bellis
 
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On 23 January 2014, the General Court of the European Union ("GC") handed down three separate judgments concerning appeals brought by SKW Stahl-Metallurgie ("SKW"), Evonik Degussa and its subsidiary Alzchem ("Degussa"), and Gigaset against a 2009 European Commission decision fining them for their participation in a cartel on the markets for calcium carbide-based and magnesium-based reagents. Though the GC largely upheld the Commission's decision, Degussa and Gigaset had their fines reduced by approximately € 2 million because the Commission had wrongly rounded the time periods covering their participation in the cartel, in breach of the principles of equal treatment and proportionality. SKW's appeal was dismissed.

On 22 July 2009, the European Commission adopted a decision imposing fines totalling € 61.12 million on nine suppliers for their participation between April 2004 and January 2007 in a price-fixing and market-sharing cartel on the markets for calcium carbide-based and magnesium-based reagents. Calcium carbide powder and magnesium granulates are used in the production of steel, while calcium carbide granulates are used in the production of acetylene, a gas used in welding. The existence of the cartel was brought to the Commission's attention by Akzo Nobel, which applied for immunity under the Leniency Notice (see VBB on Competition Law, Volume 2009, No. 8, available at www.vbb.com).

As regards Gigaset's appeal, the GC dismissed all the claims except for the appellant's plea based on the Commission's incorrect assessment of the duration of the infringement. In calculating the fine in its decision, the Commission applied an identical duration multiplier of 2.5 to both Gigaset and SKW to reflect the duration of their participation in the infringement, even though the former was found to have participated in the cartel for 2 years, 4 months and the latter for 2 years, 8 months. The Commission chose not to base its calculation on point 24 of its 2006 Fining Guidelines, which, for the purposes of calculating the duration of an infringement, considers periods of...

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