Schneider Electric SA v Commission of the European Communities.

• Jurisdiction: European Union
• Court: General Court (European Union)
• ECLI: ECLI:EU:T:2002:254
• Docket Number: T-310/01
• Date: 22 October 2002
• Procedure Type: Recours en annulation - fondé

Avis juridique important

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62001A0310

Judgment of the Court of First Instance (First Chamber) of 22 October 2002. - Schneider Electric SA v Commission of the European Communities. - Competition - Action for annulment. - Case T-310/01.

European Court reports 2002 Page II-04071

Summary
Parties
Grounds
Decision on costs
Operative part

Keywords

1. Competition - Concentrations - Examination by the Commission - Decision requesting information addressed to the notifying parties - Automatic suspension of the four-month period referred to in Article 10(3) of Regulation No 4064/89

(Council Regulation No 4064/89, Arts 10(3) and (4) and 11(5))

2. Competition - Concentrations - Assessment of compatibility with the common market - Relevant market - Geographical definition

(Council Regulation No 4064/89, Art. 2(3))

3. Competition - Concentrations - Assessment of compatibility with the common market - Creation or strengthening of a dominant position impeding competition - Assessment criteria

(Council Regulation No 4064/89, Art. 2(3))

4. Competition - Concentrations - Assessment of compatibility with the common market - Creation or strengthening of a dominant position impeding competition - Relevance of the range of products and brands of the entity created by the concentration - Not decisive where presence and supply vary from one national market to another

(Council Regulation No 4064/89, Art. 2(3))

5. Competition - Concentrations - Incompleteness of a decision declaring a concentration incompatible with the common market - Not relevant if the decision is otherwise justified by a set of factors

(Council Regulation No 4064/89, Art. 2(3))

6. Competition - Concentrations - Administrative procedure - Observance of the rights of the defence - Statement of objections - Necessary content

(Commission Regulation No 447/98, Art. 13(2))

Summary

$$1. Where, following a failure by the parties notifying a concentration between undertakings to respond to a letter requesting information within the reasonable period set therein, the Commission adopts a decision, pursuant to Article 11(5) of Regulation No 4064/89 on the control of concentrations between undertakings, ordering the parties to provide it with the information requested, the four-month period referred to in Article 10(3) of that regulation is exceptionally ... suspended, under the mandatory terms of Article 10(4). Where a decision requiring information has been properly sent by the Commission to a notifying undertaking, the fact that the term exceptionally is used does not preclude that decision from automatically suspending the four-month period from the date on which it is found that the necessary information has not been provided until the date on which it is provided.

What is exceptional, within the meaning of Regulation No 4064/89, about suspension of the relevant period is the occurrence of the conditions which allow a decision requesting information to be adopted and not the consequences to be inferred from such a decision.

( see paras 99-100, 104, 106, 109 )

2. The geographic market to be taken into account for the purpose of applying Regulation No 4064/89 on the control of concentrations between undertakings is a defined geographic area in which the product concerned is marketed and where the conditions of competition are sufficiently homogeneous for all economic operators, so that the effect on competition of the concentration notified can be evaluated rationally.

( see para. 154 )

3. When applying Regulation No 4064/89 on the control of concentrations between undertakings, the Commission must, for the purpose of demonstrating the risk of the creation or strengthening of a dominant position impeding competition on previously defined national sectoral markets, use evidence of economic power relating to those markets. It may also take account of transnational effects which may increase the impact which a concentration has on each of the national sectoral markets deemed relevant but those effects must be demonstrated to the requisite legal standard and not merely presumed to exist.

( see paras 171, 178-179 )

4. When applying Regulation No 4064/89 on the control of concentrations between undertakings, the Commission may not base the arguments supporting its assessment of the risk of the creation or strengthening of a dominant position impeding competition on the national sectoral markets affected by a concentration on the fact that the new entity will have a range of products and brands which is unrivalled throughout the European Community where it is unable to establish that the entire range is offered on the relevant national markets.

( see paras 239-243, 255-257, 262 )

5. However incomplete a Commission decision finding a concentration incompatible with the common market may be, that cannot entail annulment of the decision if, and to the extent to which, all the other elements of the decision permit the Community judicature to conclude that in any event implementation of the transaction will create or strengthen a dominant position as a result of which effective competition will be significantly impeded for the purposes of Article 2(3) of Regulation No 4064/89 on the control of concentrations between undertakings.

( see para. 412 )

6. The statement of objections must contain an account of the objections cast in sufficiently clear terms to achieve the objective ascribed to it by the Community regulations, namely to provide all the information the undertakings need to defend themselves properly before the Commission adopts a final decision.

That requirement is particularly strict in the procedures for reviewing concentrations between undertakings governed by Regulation No 4064/94 in which the Commission adopts a prospective approach to the state of competition to which the concentration under examination is likely to give rise in the future In those procedures, the statement of objections is not solely intended to spell out the complaints and give the undertaking to which it is addressed the opportunity to submit comments in response. It is also intended to give the notifying parties the chance to suggest corrective measures and, in particular, proposals for divestiture and sufficient time, given the requirement for speed which characterises the general scheme of Regulation No 4064/89, to ascertain the extent to which divestiture is necessary with a view to rendering the transaction compatible with the common market in good time.

( see paras 440-444 )

Parties

In Case T-310/01,

Schneider Electric SA, established in Rueil-Malmaison (France), represented by F. Herbert, J. Steenbergen and M. Pittie, lawyers,

applicant,

supported by

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

intervener,

v

Commission of the European Communities, represented by P. Oliver, P. Hellström and F. Lelièvre, acting as Agents, with an address for service in Luxembourg,

defendant,

supported by

Comité central d'entreprise de la SA Legrand,

Comité européen du groupe Legrand,

established in Limoges (France), represented by H. Masse-Dessen, lawyer,

interveners,

APPLICATION for annulment of Commission Decision C(2001)3014 final declaring a concentration to be incompatible with the common market and the EEA Agreement (Case COMP/M.2283 - Schneider-Legrand),

THE COURT OF FIRST INSTANCE

OF THE EUROPEAN COMMUNITIES (First Chamber),

composed of: B. Vesterdorf, President, N.J. Forwood and H. Legal, Judges,

Registrar: B. Pastor, Deputy Registrar,

having regard to the written procedure and further to the hearing on 10 July 2002,

gives the following

Judgment

Grounds

Legal framework

1 Article 2 of Council Regulation (EEC) No 4064/89/EEC of 21 December 1989 on the control of concentrations between undertakings (OJ 1989 L 395, p. 1, corrected version in OJ 1990 L 257, p. 13), as most recently amended by Council Regulation (EC) No 1310/97 of 30 June 1997 (OJ 1997 L 180, p. 1) (hereinafter Regulation No 4064/89) provides:

1. Concentrations within the scope of this Regulation shall be appraised in accordance with the following provisions with a view to establishing whether or not they are compatible with the common market.

In making this appraisal, the Commission shall take into account:

(a) the need to maintain and develop effective competition within the common market in view of, among other things, the structure of all the markets concerned and the actual or potential competition from undertakings located either within or outwith the Community;

(b) the market position of the undertakings concerned and their economic and financial power, the opportunities available to suppliers and users, their access to supplies or markets, any legal or other barriers to entry, supply and demand trends for the relevant goods and services, the interests of the intermediate and ultimate consumers, and the development of technical and economic progress provided that it is to consumers' advantage and does not form an obstacle to competition.

2. A concentration which does not create or strengthen a dominant position as a result of which effective competition would be significantly impeded in the common market or in a substantial part of it shall be declared compatible with the common market.

3. A concentration which creates or strengthens a dominant position as a result of which effective competition would be significantly impeded in the common market or in a substantial part of it shall be declared incompatible with the common market.

...

2 Under Article 6(1)(c) of Regulation No 4064/89, where the Commission finds that the concentration notified falls within the scope of the regulation and raises serious doubts as to its compatibility with the common market, it is to decide to initiate proceedings.

3 Article 7 of Regulation No 4064/89 provides:

1. A concentration as defined in Article 1 shall not be put into effect either...