General Química SA and Others v European Commission.

• Jurisdiction: European Union
• Celex Number: 62009CJ0090
• ECLI: ECLI:EU:C:2011:21
• Court: Court of Justice (European Union)
• Docket Number: C-90/09
• Procedure Type: Recurso de casación - fundado
• Date: 20 January 2011

Case C-90/09 P

General Química SA and Others

v

European Commission

(Appeal – Competition – Agreements, decisions and concerted practices – Rubber chemicals sector – Decision finding an infringement of Article 81 EC – Group of undertakings – Joint and several liability of a parent company for infringements of the competition rules committed by its subsidiaries – Attribution of liability to the parent company at the head of a group)

Summary of the Judgment

1. Competition – Rules of the European Union – Infringements – Attribution – Parent company and subsidiaries – Economic unit – Criteria for assessment

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2))

2. Competition – Rules of the European Union – Infringements – Attribution – Parent company and subsidiaries – Economic unit – Criteria for assessment

(Arts 81 EC and 82 EC; Council Regulation No 1/2003, Art. 23(2))

3. Procedure – Statement of reasons for judgments – Scope

(Statute of the Court of Justice, Art. 36)

4. Appeals – Pleas in law – Error of law

(Art. 225 EC; Statute of the Court of Justice, Art. 58, first para.)

1. In the specific case in which a parent company has a 100% shareholding in a subsidiary which has infringed the competition rules of the European Union, first, the parent company can exercise a decisive influence over the conduct of the subsidiary and, second, there is a rebuttable presumption that the parent company does in fact exercise such a decisive influence. In those circumstances, it is sufficient for the Commission to prove that the subsidiary is wholly owned by the parent company in order to assume that the parent exercises a decisive influence over the commercial policy of the subsidiary. The Commission will then be able to regard the parent company as jointly and severally liable for the payment of the fine imposed on its subsidiary, unless the parent company, which has the burden of rebutting that presumption, adduces sufficient evidence to show that its subsidiary acts independently on the market.

Given its rebuttable nature, that presumption does not lead to the automatic attribution of liability to the parent company holding 100% of the capital of its subsidiary, which would be contrary to the principle of personal responsibility on which EU competition law is based. In order to rebut that presumption it is for the parent company to put before the EU judicature any evidence relating to the organisational, economic and legal links between its subsidiary and itself that are apt to demonstrate that they do not constitute a single economic entity.

(see paras 39-40, 50-52)

2. A holding company may be held jointly and severally liable for the infringements of EU competition law committed by a subsidiary of its group whose capital it does not hold directly, in so far as that holding company exercises decisive influence over that subsidiary, even indirectly through an interposed company. That is the case, in particular, when the subsidiary does not determine its conduct independently on the market in relation to that interposed company, which does not operate autonomously on the market either, but essentially acts in accordance with the instructions given to it by the holding company. In such a situation, the holding company, the interposed company and the last subsidiary in the group form part of the same economic unit and, therefore, constitute a single undertaking for the purposes of EU competition law.

In the specific case in which a holding company holds 100% of the capital of an interposed company which, in turn, holds the entire capital of a subsidiary of its group which has committed an infringement of EU competition law, there is a rebuttable presumption that that holding company exercises decisive influence over the conduct of the interposed company and also indirectly, via that company, over the conduct of that subsidiary. Consequently, in that specific situation, the Commission is entitled to require the holding company to pay the fine imposed on the last subsidiary of the group jointly and severally, unless the holding company can rebut that presumption by demonstrating that either the interposed company or the subsidiary operates independently on the market.

(see paras 86-89)

3. The statement of the reasons on which a judgment is based must clearly and unequivocally disclose the General Court’s thinking, so that the persons concerned can be apprised of the justification for the decision taken and the Court of Justice can exercise its power of review.

A judgment in which the General Court limits itself to merely asserting a principle, without setting out in a clear and unequivocal manner the grounds which led it to its conclusion and does not set out the reasons on which that conclusion is based, is vitiated by a lack of reasoning.

(see paras 59, 61-62)

4. The General Court commits an error of law when, in analysing the conduct of a subsidiary which has infringed EU competition law, it does not examine in detail the evidence furnished to demonstrate the commercial independence of a subsidiary in relation to its parent company, and rejects the arguments of the appellants by mere reference to the case-law. In that regard, since the General Court is required, for the purposes of that case law, to assess any evidence relating to the economic and legal organisational links between the parent company and the subsidiary capable of demonstrating that the latter operates independently of its parent company and that those two companies do not constitute a single economic entity, it is required to take account of and to conduct a concrete examination of the factors raised by the appellants to show that the subsidiary implements its commercial policy independently, in order to ascertain whether the Commission has made a manifest error of assessment in regarding that evidence as insufficient to demonstrate that that subsidiary does not constitute a single economic entity with its parent company.

Such verification is all the more required because the independence of a subsidiary in implementing its commercial policy forms part of the set of relevant factors enabling the appellants to rebut the presumption of decisive influence of the parent company over the conduct of the subsidiary, factors whose character and importance may vary depending on the specific characteristics of each individual case.

(see paras 75-78)

JUDGMENT OF THE COURT (First Chamber)

20 January 2011 (*)

(Appeal – Competition – Agreements, decisions and concerted practices – Rubber chemicals sector – Decision finding an infringement of Article 81 EC – Group of undertakings – Joint and several liability of a parent company for infringements of the competition rules committed by its subsidiaries – Attribution of liability to the parent company at the head of a group)

In Case C‑90/09 P,

APPEAL under Article 56 of the Statute of the Court of Justice, brought on 27 February 2009,

General Química SA, established in Alava (Spain),

Repsol Química SA, established in Madrid (Spain),

Repsol YPF SA, established in Madrid,

represented by J.M. Jiménez-Laiglesia Oñate and J. Jiménez-Laiglesia Oñate, abogados,

appellants,

the other party to the proceedings being:

European Commission, represented by F. Castillo de la Torre and E. Gippini Fournier, acting as Agents, with an address for service in Luxembourg,

defendant at first instance,

THE COURT (First Chamber),

composed of A. Tizzano (Rapporteur), President of the Chamber, J.-J. Kasel, M. Ilešič, E. Levits and M. Safjan, Judges,

Advocate General: J. Mazák,

Registrar: R. Şereş, Administrator,

having regard to the written procedure and further to the hearing on 29 April 2010,

after hearing the Opinion of the Advocate General at the sitting on 14 September 2010,

gives the following

Judgment

1 By their appeal, General Química SA (‘GQ’), Repsol Química SA (‘RQ’), and Repsol YPF SA (‘RYPF’) seek to have set aside the judgment of the Court of First Instance of the European Communities (now ‘the General Court’) of 18 December 2008 in Case T‑85/06 General Química and Others v Commission (‘the judgment under appeal’), by which the General Court dismissed their action brought against Commission Decision 2006/902/EC of 21 December 2005 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement against Flexsys NV, Bayer AG, Crompton Manufacturing Company Inc. (formerly Uniroyal Chemical Company Inc.), Crompton Europe Ltd, Chemtura Corporation (formerly Crompton Corporation), General Química SA, Repsol Química SA and Repsol YPF SA (Case No COMP/F/C.38.443 – Rubber chemicals) (OJ 2006 L 353, p. 50) (‘the contested decision’), which imposed a fine on those undertakings jointly and severally for participating in a series of agreements and concerted practices.

Facts at the origin of the dispute

2 GQ is a company governed by Spanish law which produces certain rubber chemicals. It is a wholly owned subsidiary of RQ, which is itself wholly owned by RYPF.

3 On 12 April 2005, the Commission of the European Communities notified to the appellants a statement of objections relating to a proceeding pursuant to Article 81 EC and Article 53 of the Agreement on the European Economic Area of 2 May 1992 (OJ 1994 L 1, p. 3).

4 By the contested decision, the Commission found RQ and RYPF, collectively referred to as ‘Repsol’, jointly and severally liable for GQ’s infringement.

5 In that regard, the Commission stated in the contested decision that a parent company can, a priori, be presumed liable for the unlawful conduct of its wholly-owned subsidiaries, but that it is possible for it to rebut the presumption of actual exercise of decisive influence over those subsidiaries.

6 The Commission stated that such a presumption cannot be rebutted by alleging that the parent company was not directly involved in the cartel or...