Archer Daniels Midland Co. v Commission of the European Communities.

• Jurisdiction: European Union
• Court: Court of Justice (European Union)
• Writing for the Court: Levits
• ECLI: ECLI:EU:C:2008:280
• Date: 15 May 2008
• Docket Number: C-510/06
• Procedure Type: Recurso de anulación

OPINION OF ADVOCATE GENERAL

TRSTENJAK

delivered on 15 May 2008 ¹(1)

Case C‑510/06 P

Archer Daniels Midland Company

v

Commission of the European Communities

(Appeal – Competition – Article 81 EC – Cartel – Sodium gluconate market – Regulation No 17 – Fines – Guidelines on the method of setting fines – Statement of reasons demonstrating the need to increase the level of fines – EEA-wide product turnover – Principle of equal treatment – Determination of market impact – Burden of pleading and proving the facts – Duration of the infringement and termination of the cartel – Attenuating circumstances)

Table of contents

I – Introduction

II – Legal framework

A – Regulation No 17

B – Guidelines

III – Facts

IV – Proceedings before the Court of First Instance and the contested judgment

V – Proceedings before the Court of Justice

VI – The appeal

A – Failure to observe a supposedly mandatory criterion for the calculation of fines, namely the criterion of ‘necessity’ when raising the level of fines, and failure to state reasons in that regard (first and second grounds of appeal)

1. Introductory observations

2. Requirement to state reasons as to the necessity of raising the level of fines

a) Arguments of the parties

b) Legal assessment

B – Disregard of EEA‑wide product turnover as the starting point for the calculation of fines (third ground of appeal)

1. Introductory observations

2. Arguments of the parties

3. Contested judgment and legal assessment

C – Infringement of the principle of equal treatment in the calculation of the fine (fourth ground of appeal)

1. Arguments of the parties

2. Legal assessment

D – Errors of law in the determination of the market impact of the cartel (fifth, sixth and seventh grounds of appeal)

1. Introductory observations

2. Arguments of the parties

3. Contested judgment

4. Legal assessment

E – Errors of law in regard to the date of termination of the cartel (8th, 9th, 10th and 11th grounds of appeal)

1. Introductory observations

2. Infringement of Article 81 EC by misapplying the rules on termination of involvement in a cartel

a) Arguments of the parties

b) Contested judgment and legal assessment

3. Infringement of Article 81 EC as regards the meeting in Anaheim

a) Arguments of the parties

b) Contested judgment and legal assessment

4. Distortion of evidence in relation to the date of termination of the cartel or the date of ADM’s withdrawal

a) Assessment of documents of other cartel participants

i) Arguments of the parties

ii) Contested judgment and legal assessment

b) The note attributed to Roquette

i) Arguments of the parties

ii) Legal assessment

F – Error of law in examining the attenuating circumstance of termination of the infringement – breach of the principle that self‑imposed rules must be followed (12th ground of appeal, raised in the alternative)

1. Arguments of the parties

2. Contested judgment and legal assessment

VII – Costs

VIII – Conclusion

I – Introduction

1. This case concerns an appeal brought by Archer Daniels Midland Company (‘ADM’ or ‘the appellant’) against the judgment of the Court of First Instance of the European Communities of 27 September 2006 in Case T‑329/01 Archer Daniels Midland v Commission (‘the contested judgment’). In the contested judgment, the Court of First Instance dismissed ADM’s action for annulment, which was directed essentially against two articles of Commission Decision C(2001) 2931 final of 2 October 2001 relating to a proceeding under Article 81 EC and Article 53 of the EEA Agreement (COMP/E-1/36.756 – Sodium Gluconate; ‘the decision at issue’).

2. It concerns the consequences of ADM’s participation, which is not essentially at issue, in a cartel in the first half of the 1990s in respect of the sodium gluconate market, in particular in the form of a price cartel. The case displays certain parallels with Case C‑397/03 P Archer Daniels Midland and Others v Commission, which concerned a cartel – also in the first half of the 1990s – in respect of the market for amino acids, in particular lysine. (2)

3. The pleas put forward by ADM before the Court of First Instance, all of which relate to the setting of the fine imposed on it, concern (i) whether the relevant Commission Guidelines (3) on the method of setting fines (‘the 1998 Guidelines’) apply to this case, (ii) the gravity of the infringement, (iii) the duration of the infringement, (iv) the existence of attenuating circumstances, (v) ADM’s cooperation during the administrative procedure and (vi) observance of the rights of the defence.

4. By its appeal, ADM claims that the contested judgment should be set aside in part and that the fine imposed by the decision at issue should be cancelled or substantially reduced.

5. The 1998 Guidelines, even though not directly and formally challenged as such, are once again (4) a cardinal theme of the complaints. (5)

II – Legal framework

6. Article 81 EC prohibits ‘all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market’.

A – Regulation No 17

7. Article 15(2) of Regulation No 17 of the Council of 6 February 1962, First Regulation implementing Articles [81] and [82] of the Treaty (‘Regulation No 17’), (6) entitled ‘Fines’, provides:

‘The Commission may by decision impose on undertakings or associations of undertakings fines of from 1 000 to 1 000 000 units of account, or a sum in excess thereof but not exceeding 10% of the turnover in the preceding business year of each of the undertakings participating in the infringement where, either intentionally or negligently:

(a) they infringe Article [81](1) or Article [82] of the Treaty;

…

In fixing the amount of the fine, regard shall be had both to the gravity and to the duration of the infringement.’

8. Regulation No 17 has since been replaced by Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty, (7) which, according to Article 45 of the latter regulation, has applied since 1 May 2004.

B – Guidelines

9. The Commission’s 1998 Guidelines (8) state by way of introduction:

‘The principles outlined here should ensure the transparency and impartiality of the Commission’s decisions, in the eyes of the undertakings and of the Court of Justice alike, while upholding the discretion which the Commission is granted under the relevant legislation to set fines within the limit of 10% of overall turnover. This discretion must, however, follow a coherent and non-discriminatory policy which is consistent with the objectives pursued in penalising infringements of the competition rules.’

10. They then explain that the new method of determining the amount of a fine will adhere to rules which start from a basic amount that will be increased to take account of aggravating circumstances or reduced to take account of attenuating circumstances. The rules for determining the fine which then follow consist of a number of steps:

11. Under Section 1 of the 1998 Guidelines, the Commission will first determine the basic amount of the fine ‘according to the gravity and duration of the infringement’. With regard to the first‑mentioned aspect, infringements will be put into one of three categories: ‘minor’, ‘serious’ and ‘very serious’ infringements, according to their nature, their actual impact on the market, where this can be measured, and the size of the relevant geographic market (Section 1(A) of the 1998 Guidelines). Criteria for the classification of infringements are set out for each of those three categories. In Section 1(B) of those guidelines, when account is taken of duration, a distinction will be made between infringements of short duration (in general, less than one year), medium duration (in general, one to five years) and long duration (in general, more than five years).

12. After the basic amount has been determined, the 1998 Guidelines provide, in Sections 2 and 3, that it must be examined whether that amount should be increased on account of aggravating circumstances (9) or reduced on account of attenuating circumstances, including ‘termination of the infringement as soon as the Commission intervenes (in particular when it carries out checks)’. (10) The next step (Section 4 of the 1998 Guidelines) provides for application of the Notice of 18 July 1996 on the non‑imposition or reduction of fines. (11)

13. Section 5(a) of the 1998 Guidelines provides inter alia:

‘It goes without saying that the final amount calculated according to this method (basic amount increased or reduced on a percentage basis) may not in any case exceed 10% of the worldwide turnover of the undertakings, as laid down by Article 15(2) of Regulation No 17.’

14. In 2006, the 1998 Guidelines were replaced by a new version (12) (‘the 2006 Guidelines’). These are applied in cases where a statement of objections is notified after the date of publication of the Guidelines in the Official Journal (1 September 2006). (13)

III – Facts

15. The following facts are apparent from the contested judgment:

16. ADM is the parent company of a group of companies which operate in the cereal and oil seed processing industry. ADM entered the sodium gluconate market in 1990.

17. Sodium gluconate is a chelating agent, products which inactivate metal ions in industrial processes. Those processes are used, inter alia, in industrial cleaning (bottle washing, utensil cleaning), surface treatment (de-rusting, degreasing, aluminium etching) and water treatment. Chelating agents are thus used in the food industry, the cosmetics industry, the pharmaceutical industry, the paper industry, the concrete industry and in various other industries. Sodium gluconate is sold...