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2018:773 Infineon Technologies AG v European Commission

Court

Court of Justice

Date of ruling

26 September 2018

Case name (short version)

Infineon Technologies AG v European Commission

Case Citation

C-99/ 17 P

ECLI:EU:C:2018:773

Key words

Appeal — Agreements, decisions and concerted practices — European market for smart card chips — Network of bilateral contacts — Exchanges of commercially sensitive information — Challenge of the authenticity of the evidence — Rights of the defence — Restriction of competition ‘by object’ — Single and continuous infringement — Judicial review — Unlimited jurisdiction — Scope — Calculation of the amount of the fine

Basic context

By its appeal, Infineon Technologies AG seeks the setting aside of the judgment of the General Court of the European Union of 15 December 2016, Infineon Technologies v Commission (T758/14, not published, ‘the judgment under appeal’, EU:T:2016:737), by which the General Court dismissed the appellant’s action which sought, primarily, the annulment of Commission Decision C(2014) 6250 final of 3 September 2014 relating to proceedings under Article 101 TFEU and Article 53 of the EEA Agreement (Case AT.39574 — Smart Card Chips) (‘the decision at issue’) and, in the alternative, a reduction in the fine imposed on the appellant

Points arising – admissibility

Points arising – substance

First ground of appeal, alleging insufficient review by the General Court

 

47      In that regard, it should be noted that the system of judicial review of Commission decisions relating to proceedings under Articles 101 and 102 TFEU consists in a review of the legality of the acts of the institutions for which provision is made in Article 263 TFEU, which may be supplemented, pursuant to Article 261 TFEU and at the request of applicants, by the General Court’s exercise of unlimited jurisdiction with regard to the penalties imposed in that regard by the Commission (judgment of 21 January 2016, Galp Energía España and Others v Commission, C603/13 P, EU:C:2016:38, paragraph 71).

 

48      It should be recalled that the scope of judicial review provided for in Article 263 TFEU extends to all the elements of Commission decisions relating to proceedings applying Articles 101 and 102 TFEU which are subject to in-depth review by the General Court, in law and in fact, in the light of the pleas raised by the appellant and taking into account all the relevant evidence submitted by the latter (see, to that effect, judgment of 21 January 2016, Galp Energía España and Others v Commission, C603/13 P, EU:C:2016:38, paragraph 72 and the case-law cited).

 

51      Thus, the General Court explained to the requisite legal standard its reasons for exercising review over a limited number of the contacts disputed by the appellant.

 

52      Moreover, in order to uphold the lawfulness of the Commission’s finding of the appellant’s participation in the infringement at issue, the General Court was entitled to confine itself to reviewing the Commission’s assessments relating not only to the first and last collusive contacts, but also to one or two contacts per year of participation.

 

53      In the context of an infringement extending over a certain period, the fact that the agreement is shown to have applied during different periods, which may be separated by longer or shorter periods, has no effect on the existence of the agreement, provided that the various actions which form part of the infringement pursue a single purpose and fall within the framework of a single and continuous infringement (judgment of 21 September 2006, Technische Unie v Commission, C113/04 P, EU:C:2006:593, paragraph 169).

 

54      Moreover, according to settled case-law, the fact that an undertaking did not take part in all aspects of an anticompetitive arrangement or that it played only a minor role in the aspects in which it did participate is not material for the purposes of establishing the existence of an infringement on its part, given that those factors need to be taken into consideration only when the gravity of the infringement is assessed and only if and when it comes to determining the fine (see judgment of 6 December 2012, Commission v Verhuizingen Coppens, C441/11 P, EU:C:2012:778, paragraph 45 and the case-law cited).

 

65      The Court notes that the principle which prevails in EU law is that of the unfettered evaluation of evidence, from which it results, first, that, where evidence has been obtained lawfully, its admissibility cannot be contested before the General Court and, secondly, that the only relevant criterion for the purpose of assessing the probative value of evidence lawfully adduced relates to its credibility (judgment of 19 December 2013, Siemens and Others v Commission, C239/11 P, C489/11 P and C498/11 P, not published, EU:C:2013:866, paragraph 128 and the case-law cited).

 

66      When the Commission relies on evidence which is in principle sufficient to demonstrate the existence of the infringement, it is not sufficient for the undertaking concerned to raise the possibility that a circumstance arose which might affect the probative value of that evidence so that the Commission bears the burden of proving that that circumstance was not capable of affecting the probative value of that evidence. On the contrary, except in cases where such proof could not be provided by the undertaking concerned on account of the conduct of the Commission itself, it is for the undertaking concerned to prove to the requisite legal standard, first, the existence of the circumstance relied on by it and, second, that that circumstance calls into question the probative value of the evidence relied on by the Commission (judgment of 22 November 2012, E.ON Energie v Commission, C89/11 P, EU:C:2012:738, paragraph 76).

 

67      Those considerations are applicable to a situation in which the appellant contests, as in the present case, the authenticity of an item of evidence rather than its credibility.

 

76      By this part, the appellant claims that the General Court was wrong to reject its line of argument alleging that the Commission, by failing to communicate to it during the administrative procedure its own forensic assessments relating to the authenticity of the email of 3 November 2003, had infringed the appellant’s rights of defence.

 

77      In that regard, the General Court observed, in paragraphs 77 and 80 of the judgment under appeal, that the Commission should have provided its forensic assessments to the appellant as inculpatory evidence. It nevertheless held, in paragraphs 81 to 85 of that judgment, that the appellant had not established that the result at which the Commission had arrived in the decision at issue would have been different if there had been such a communication, and therefore rejected the appellant’s line of argument alleging infringement of its rights of defence.

 

78      In so doing, the General Court complied with the case-law of the Court of Justice according to which an infringement of the rights of the defence results in the annulment of the contested measure only if, without such an irregularity, the outcome of the procedure might have been different, which it is for the undertaking concerned to show (judgment of 16 June 2016, SKW Stahl-Metallurgie and SKW Stahl-Metallurgie Holding v Commission, C154/14 P, EU:C:2016:445, paragraph 69 and the case-law cited).

 

79      The appellant has not submitted any material capable of showing that the General Court erred in law or distorted the facts or evidence inasmuch as it found, on the basis of the arguments and evidence submitted before it, that the appellant had not established that the result at which the Commission arrived in the decision at issue might have been different if that institution had communicated to the appellant its forensic assessments during the administrative procedure.

 

97      Accordingly, that claim is inadmissible in accordance with settled case-law that, in an appeal, the jurisdiction of the Court of Justice is confined to a review of the findings of law on the pleas and arguments debated before the General Court. Accordingly a party cannot raise for the first time before the Court of Justice an argument that it did not put forward before the General Court (see, to that effect, judgments of 8 November 2016, BSH v EUIPO, C43/15 P, EU:C:2016:837, paragraph 43, and of 13 December 2017, Telefónica v Commission, C487/16 P, not published, EU:C:2017:961, paragraph 84).

 

100    Second, as regards paragraphs 123 and 124 of the judgment under appeal, it should be pointed out that, in so far the appellant relies on the vagueness of the statement mentioned in paragraph 123 of that judgment, it is, in reality, seeking to obtain a fresh assessment of the probative value of that statement, which, according to settled case-law of the Court of Justice, falls outside the jurisdiction of the Court, save where that evidence has been distorted (judgment of 12 January 2017, Timab Industries and CFPR v Commission, C411/15 P, EU:C:2017:11, paragraph 153 and the case-law cited). Moreover, as regards the argument relating to paragraph 124 of the judgment under appeal, it is sufficient to note that that paragraph set outs a ground included for the sake of completeness, as evidenced by the introductory expression ‘in any event’. Accordingly, that argument is ineffective.

 

103    There is distortion where, without recourse to new evidence, the assessment of the existing evidence is manifestly incorrect. It is for appellants to indicate precisely the evidence which has been distorted and show the errors of appraisal which have allegedly been made (see, to that effect, judgments of 17 June 2010, Lafarge v Commission, C413/08 P, EU:C:2010:346, paragraphs 16 and 17, and of 27 April 2017, FSL and Others v Commission, C469/15 P, EU:C:2017:308, paragraphs 47 and 48).

 

116    As is expressly apparent from paragraph 160 of the judgment under appeal, without the appellant, when questioned in this respect at the hearing before the Court, casting doubt thereon, it did not dispute, before the General Court, the fact that prices were negotiated, in principle, on an annual basis. Accordingly, the argument relating to that paragraph 160 is inadmissible in accordance with the case-law cited in paragraph 97 of this judgment.

 

The second ground of appeal, alleging misapplication of Article 101 TFEU

 

138    Moreover, the General Court was in no way required to examine and establish the existence of anticompetitive effects for 2003. According to the case-law of the Court of Justice, there is no need to consider the effects of a concerted practice where its anticompetitive object is established (judgment of 4 June 2009, TMobile Netherlands and Others, C8/08, EU:C:2009:343, paragraph 30).

 

155    According to the case-law of the Court of Justice, the essential legal criterion for ascertaining whether an agreement or a concerted practice involves a restriction of competition ‘by object’, for the purposes of Article 101(1) TFEU, is the finding that such an agreement or practice reveals in itself a sufficient degree of harm to competition for it to be considered that it is not appropriate to assess its effects (see, to that effect, judgment of 27 April 2017, FSL and Others v Commission, C469/15 P, EU:C:2017:308, paragraph 104 and the case-law cited).

 

156    In order to determine whether a type of coordination between undertakings reveals a sufficient degree of harm to competition that it may be considered a restriction of competition ‘by object’, regard must be had, inter alia, to its content, its objectives and the economic and legal context of which it forms a part. When determining that context, it is also necessary to take into consideration the nature of the goods or services affected, as well as the real conditions of the functioning and structure of the market or markets in question (see, to that effect, judgments of 5 December 2013, Solvay Solexis v Commission, C449/11 P, not published, EU:C:2013:802, paragraph 36; of 19 March 2015, Dole Food and Dole Fresh Fruit Europe v Commission, C286/13 P, EU:C:2015:184, paragraph 117 and the case-law cited; and of 27 April 2017, FSL and Others v Commission, C469/15 P, EU:C:2017:308, paragraph 105 and the case-law cited).

 

160    Moreover, contrary to what the appellant suggests, classification of the exchange of sensitive information between the competitors on the market in question as a restriction of competition by object cannot depend on the frequency of the exchanges of information. Indeed, no such criterion can be inferred from the case-law cited in paragraphs 155 and 156 of this judgment.

 

172    According to the case-law of the Court of Justice, an undertaking which has participated in a single and complex infringement, by its own conduct, which meets the definition of an agreement or concerted practice having an anticompetitive object within the meaning of Article 101(1) TFEU and was intended to help bring about the infringement as a whole, may also be responsible for the conduct of other undertakings in the context of the same infringement throughout the period of its participation in the infringement. That is the position where it is shown that the undertaking intended, through its own conduct, to contribute to the common objectives pursued by all the participants and that it was aware of the offending conduct planned or put into effect by other undertakings in pursuit of the same objectives or that it could reasonably have foreseen it and was prepared to take the risk (judgments of 6 December 2012, Commission v Verhuizingen Coppens, C441/11 P, EU:C:2012:778, paragraph 42, and of 24 June 2015, Fresh Del Monte Produce v Commission and Commission v Fresh Del Monte Produce, C293/13 P and C294/13 P, EU:C:2015:416, paragraph 157).

 

173    On the other hand, if an undertaking has directly taken part in one or more of the forms of anticompetitive conduct comprising a single and continuous infringement, but it has not been shown that that undertaking intended, through its own conduct, to contribute to all the common objectives pursued by the other participants in the cartel and that it was aware of all the other offending conduct planned or put into effect by those other participants in pursuit of the same objectives, or that it could reasonably have foreseen all that conduct and was prepared to take the risk, the Commission is entitled to attribute to that undertaking liability only for the conduct in which it had participated directly and for the conduct planned or put into effect by the other participants, in pursuit of the same objectives as those pursued by the undertaking itself, where it has been shown that the undertaking was aware of that conduct or was able reasonably to foresee it and prepared to take the risk (judgments of 6 December 2012, Commission v Verhuizingen Coppens, C441/11 P, EU:C:2012:778, paragraph 44, and of 24 June 2015, Fresh Del Monte Produce v Commission and Commission v Fresh Del Monte Produce, C293/13 P and C294/13 P, EU:C:2015:416, paragraph 159).

 

The third ground of appeal, relating to the fine imposed on the appellant, and the first part of the first ground of appeal inasmuch as that part alleges a breach of unlimited jurisdiction

 

192    In the first place, it must be recalled that the General Court alone has jurisdiction to examine how in each particular case the Commission assessed the gravity of unlawful conduct. In an appeal, the purpose of review by the Court of Justice is, first, to examine to what extent the General Court took into consideration, in a legally correct manner, all the essential factors to assess the gravity of particular conduct in the light of Article 101 TFEU and Article 23 of Regulation No 1/2003 and, second, to consider whether the General Court responded to a sufficient legal standard to all the arguments raised in support of the claim for cancellation or reduction of the fine (judgment of 26 January 2017, Laufen Austria v Commission, C637/13 P, EU:C:2017:51, paragraph 58).

 

193    In the second place, according to the case-law of the Court of Justice, the unlimited jurisdiction conferred on the EU judicature by Article 31 of Regulation No 1/2003 in accordance with Article 261 TFEU empowers the competent Court, in addition to carrying out a mere review of legality with regard to the penalty, to substitute its own appraisal for the Commission’s and, consequently, to cancel, reduce or increase the fine or penalty payment imposed (judgments of 8 December 2011, Chalkor v Commission, C386/10 P, EU:C:2011:815, paragraph 63 and the case-law cited, and of 26 January 2017, Villeroy & Boch Austria v Commission, C626/13 P, EU:C:2017:54, paragraph 81).

 

194    It is true that the exercise of that jurisdiction does not amount to a review of the Court’s own motion, and proceedings are inter partes. It is, in principle, for the applicant to raise pleas in law against the decision at issue and to adduce evidence in support of those pleas (judgments of 18 December 2014, Commission v Parker Hannifin Manufacturing and Parker-Hannifin, C434/13 P, EU:C:2014:2456, paragraph 76 and the case-law cited, and of 26 January 2017, Villeroy & Boch Austria v Commission, C626/13 P, EU:C:2017:54, paragraph 83).

 

195    However, as the Advocate General observed in point 74 of his Opinion, in order to satisfy the requirements of Article 47 of the Charter of Fundamental Rights of the European Union when conducting a review in the exercise of its unlimited jurisdiction with regard to the fine, the EU judicature is bound, in the exercise of the powers conferred by Articles 261 and 263 TFEU, to examine all complaints based on issues of fact and law which seek to show that the amount of the fine is not commensurate with the gravity or the duration of the infringement (judgments of 18 December 2014, Commission v Parker Hannifin Manufacturing and Parker-Hannifin, C434/13 P, EU:C:2014:2456, paragraph 75 and the case-law cited, and of 26 January 2017, Villeroy & Boch Austria v Commission, C626/13 P, EU:C:2017:54, paragraph 82).

 

196    In the third place, the gravity of the infringement must be assessed on an individual basis (judgment of 11 July 2013, Team Relocations and Others v Commission, C444/11 P, not published, EU:C:2013:464, paragraph 102). In order to determine the amount of a fine, it is necessary to take account of the duration of the infringement and of all the factors capable of affecting the assessment of its gravity, such as the conduct of each of the undertakings, the role played by each of them in the establishment of the concerted practices, the profit which they were able to derive from those practices, their size, the value of the goods concerned and the threat that infringements of that type pose to the European Union (judgment of 8 December 2011, Chalkor v Commission, C386/10 P, EU:C:2011:815, paragraph 56 and the case-law cited).

 

197    Those factors also include the number and intensity of the incidents of anticompetitive conduct (see, to that effect, judgment of 8 December 2011, Chalkor v Commission, C386/10 P, EU:C:2011:815, paragraph 57 and the case-law cited).

 

198    However, the Court has recalled that there is no binding or exhaustive list of criteria to be taken into account when assessing the gravity of an infringement (judgments of 3 September 2009, Prym and Prym Consumer v Commission, C534/07 P, EU:C:2009:505, paragraph 54, and of 13 June 2013, Versalis v Commission, C511/11 P, EU:C:2013:386, paragraph 82 and the case-law cited).

 

199    Moreover, according to the case-law of the Court of Justice, the Commission may take into account the relative gravity of the participation of an undertaking in an infringement and the particular circumstances of the case when assessing the gravity of the infringement within the meaning of Article 23 of Regulation No 1/2003, or when adjusting the basic amount of the fine in the light of mitigating and aggravating circumstances. Granting such an option to the Commission is consistent with the case-law referred to in paragraph 196 of this judgment, since the undertaking’s individual conduct must, in any event, be taken into account when the amount of the fine is determined (see, to that effect, judgment of 11 July 2013, Team Relocations and Others v Commission, C444/11 P, not published, EU:C:2013:464, paragraphs 104 and 105).

 

205    Although, for the purpose of assessing the gravity of the infringement committed by the applicant and setting the amount of the fine, the General Court is not required to rely on the exact number of bilateral contacts found in regard to the applicant, that factor may nevertheless constitute a relevant factor among others (see, by analogy, judgments of 25 January 2007, Dalmine v Commission, C407/04 P, EU:C:2007:53, paragraph 132, and of 14 October 2010, Deutsche Telekom v Commission, C280/08 P, EU:C:2010:603, paragraph 277).

 

206    In those circumstances, the General Court was not entitled, without misconstruing the extent of its unlimited jurisdiction, to refrain from responding to the argument raised by the appellant according to which the Commission had infringed the principle of proportionality by setting the amount of the fine imposed without taking into account the small number of contacts in which the appellant participated. That conclusion is all the more compelling given that, in the present case, the General Court confined itself to confirming 5 of the 11 contacts found in the decision at issue, whilst not responding to the question whether the Commission had established the existence of the 6 other contacts found in that decision.

 

207    In so far as, in the judgment under appeal, the General Court did not review the proportionality of the amount of the fine imposed in relation to the number of contacts that it found against the appellant, and did not set out the reasons why it did not conduct such a review, it made an error of law.

 

208    That assessment is not called into question by the Commission’s arguments.

Intervention

Interim measures

Order

1.      Sets aside the judgment of the General Court of the European Union of 15 December 2016, Infineon Technologies v Commission (T758/14, not published, EU:T:2016:737), inasmuch as the General Court rejected the appellant’s claim in the alternative for a reduction of the amount of the fine that the European Commission imposed on it;

 

2.      Dismisses the appeal as to the remainder;

 

3.      Refers the case back to the General Court for it to give judgment on the claim for a reduction of the amount of the fine imposed on Infineon Technologies AG in the light of the sixth plea;

 

4.      Reserves the costs.

Fine changed

Case duration

19 months

Judge-rapporteur

Jűrimäe

Advocate-general

Wathelet

Notes on academic writings

1. Lübbig, Thomas: Judgement of 26 September 2018, Case C-99/17P, Infineon Technologies, Journal of European Competition Law & Practice 2018 Vol. 9 nº 10 p.648-649 (EN)

2.Brauneck, Jens: Infineon : Zu hohe Kartellbuβe wegen begrenzter Prüfung der Kontakte ?, Gewerblicher Rechtsschutz und Urheberrecht INT 2019 Nº4 p.327-335 (DE)

Kiran Desai

Kiran Desai

Partner at EY Law
Kiran S. Desai has over 25 years’ experience of private practice in EU competition law.He is engaged in all aspects of EU competition law, including litigation before the courts and has written extensively on EU competition law matters.He is a partner at EY Law, based in Brussels, and is the EU Competition Law Leader for the global EY Law network of firms.
Kiran Desai

About the Author

Kiran Desai

Kiran Desai

Kiran S. Desai has over 25 years’ experience of private practice in EU competition law. He is engaged in all aspects of EU competition law, including litigation before the courts and has written extensively on EU competition law matters. He is a partner at EY Law, based in Brussels, and is the EU Competition Law Leader for the global EY Law network of firms.


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