CJEC, 5th chamber, October 2, 2003, No C-179/99

THE COURT (Fifth Chamber),

1 By application lodged at the Court Registry on 14 May 1999, the association Eurofer ASBL brought an appeal under Article 49 of the ECSC Statute of the Court of Justice against the judgment of the Court of First Instance of 11 March 1999 in Case T-136-94 Eurofer v Commission [1999] ECR II-263 (`the judgment under appeal'), by which the Court of First Instance dismissed its application for partial annulment of Commission Decision 94-215-ECSC of 16 February 1994 relating to a proceeding pursuant to Article 65 of the ECSC Treaty concerning agreements and concerted practices engaged in by European producers of beams (OJ 1994 L 116, p. 1) (`the contested decision'). By that decision, the Commission found that the appellant had infringed Article 65 (1) of that Treaty and ordered it to put an immediate end to that infringement.

Facts and the contested decision

2 According to the judgment under appeal, the European steel industry underwent, from 1974 onwards, a crisis characterised by a fall in demand giving rise to problems of excess supply and capacity and low prices.

3 In 1980, after having attempted to manage the crisis by way of unilateral voluntary commitments given by undertakings as regards the amount of steel put on the market and minimum prices (`the Simonet Plan') or by fixing guide and minimum prices (`the Davignon Plan', the `Eurofer I' agreement), the Commission declared that there was a manifest crisis within the meaning of Article 58 of the ECSC Treaty and imposed mandatory production quotas for, inter alia, beams. That Community system came to an end on 30 June 1988.

4 Long before that date, the Commission had announced in various communications and decisions that the quota system was to be abandoned, pointing out that the end of that system would mean a return to a market characterised by free competition between undertakings. However, the sector continued to be affected by excess production capacity which, according to expert opinion, had to undergo a sufficient and rapid reduction to enable undertakings to meet world competition.

5 From the end of the quota system, the Commission set up a surveillance system involving the collection of statistics on production and deliveries, monitoring of market developments and regular consultation with undertakings on the market situation and trends. The undertakings in the sector, some of which were members of the trade association which is the present appellant, thus maintained regular contact with DG III (Directorate-General for the `Internal Market and Industrial Affairs') of the Commission (`DG III') by way of consultation meetings. The surveillance system came to an end on 30 June 1990 and was replaced by an individual and voluntary information scheme.

6 At the beginning of 1991, the Commission carried out a series of inspections in the offices of a number of steel undertakings and associations of undertakings in the sector. A statement of objections was sent to them on 6 May 1992. Hearings were held at the beginning of 1993.

7 On 16 February 1994, the Commission adopted the contested decision, by which it found that 17 European steel undertakings and the appellant had participated in a series of agreements, decisions and concerted practices designed to fix prices, share markets and exchange confidential information on the market for beams in the Community, in breach of Article 65 (1) of the ECSC Treaty. By that decision, it imposed fines on 14 undertakings for infringements committed between 1 July 1988 and 31 December 1990.

8 With respect to the appellant, the contested decision states in recital 317 of its grounds:

`Contrary to what some parties have argued in this case, associations of undertakings can infringe the competition rules of the ECSC Treaty (see Article 48, first paragraph). Article 65 (1) contains a prohibition applicable to decisions of associations of undertakings. While Article 65 (5) only provides for fines to be imposed upon undertakings, an infringement committed by an association will expose the undertakings which belong to it to the risk of a fine. In the absence of special circumstances undertakings must take responsibility for the actions of an association under their control, in proportion to their influence over the association.

In this case, Eurofer facilitated the implementation of infringements of Article 65 of the ECSC Treaty by its members, by organising an exchange of some of the necessary confidential information. However, since those members are already being fined in respect of the infringements, including exchanges of confidential information in connection with price fixing and market sharing, the Commission does not consider it necessary to impose any additional fines on them for the behaviour of their association.'

9 Articles 2 and 3 of the contested decision are worded as follows:

`Article 2

Eurofer has infringed Article 65 of the ECSC Treaty by organising an exchange of confidential information in connection with the infringements committed by its members and listed in Article 1.

Article 3

The undertakings and associations of undertakings mentioned in Articles 1 and 2 shall henceforth bring to an end the infringements referred to in Articles 1 and 2 to the extent that they have not already done so. To this end, the undertakings and associations of undertakings shall refrain from repeating or continuing any of the acts or behaviour specified in Article 1 or as the case may be Article 2 and shall refrain from adopting any measures having equivalent effect.'

The proceedings before the Court of First Instance and the judgment under appeal

10 On 1 April 1994, the present appellant brought an action before the Court of First Instance for partial annulment of the contested decision.

11 By the judgment under appeal, the Court of First Instance dismissed the present appellant's action.

Forms of order sought by the parties

12 The appellant claims that the Court should:

- set aside the judgment under appeal;

- having regard to the form of order sought at first instance, annul Article 2 of the contested decision and the part of Article 3 of that decision which concerns the appellant;

- order the Commission to pay the costs.

13 The Commission contends that the Court should:

- dismiss the appeal;

- order the appellant to pay the costs.

The grounds of appeal

14 The appellant raises four grounds of appeal:

1. infringement of Article 65 (1) of the ECSC Treaty by reason of misinterpretation of the concept of `decisions by associations of undertakings' used in that article;

2. infringement of the first paragraph of Article 15 of the ECSC Treaty by reason of erroneous and contradictory grounds which exceed the limits of the Court of First Instance's jurisdiction ratione materiae, as regards the finding in Article 2 of the contested decision that the appellant organised an exchange of confidential information in connection with the infringements committed by its members;

3. infringement of Article 65 (1) of the ECSC Treaty and failure by the Court of First Instance to respect the limits of its jurisdiction ratione materiae by reason of its misinterpretation of the requirement arising from the use in that provision of the words `tending ... to' when applying that test to the allegedly anti-competitive effects of the exchange of information organised by the appellant;

4. infringement of the first paragraph of Article 15 and Article 65 (1) of the ECSC Treaty by reason of misinterpretation of the requirement arising from the use in Article 65 (1) of the words `restrict or distort normal competition' and of contradictory reasoning in the application of that test to the exchange of information organised by the appellant.

15 The paragraphs of the judgment under appeal challenged by each of the grounds of appeal will be indicated as those grounds are examined.

The appeal

16 It is appropriate to examine, first of all, the first ground of appeal, then the second and fourth grounds together and, finally, the third ground.

The first ground of appeal

17 The first ground of appeal alleges infringement by the Court of First Instance of Article 65 (1) of the ECSC Treaty by reason of misinterpretation of the concept of `decisions by associations of undertakings' used in that article.

18 The appellant submits that the Court of First Instance was wrong to conclude, in paragraphs 109 to 120 of the judgment under appeal, that there had been a decision by an association of undertakings even though no formal decision had been taken by the organs of the appellant. In so doing, it misinterpreted the concept of `decisions by associations of undertakings' in Article 65 (1) of the ECSC Treaty, which covers only acts which also bind those members of the association which voted against their adoption, did not express any view on them or did not participate in their adoption. This concept is merely subsidiary to that of an agreement between undertakings in the sense that, where there is such an agreement, it is unnecessary to examine whether there has also been a decision by an association.

19 Furthermore, the Court of First Instance was also wrong to apply, in paragraph 130 of the judgment under appeal, Article 65 (1) of the ECSC Treaty to activities performed within an association of undertakings and to confirm, in paragraphs 137 to 139 of that judgment, that the Commission was competent to adopt Article 2 of the contested decision even though an association can infringe the prohibition of cartels only if it conducts itself as an undertaking.

20 The Commission takes the view that the first head of complaint is unfounded since the Court of First Instance based its conclusion, in paragraphs 110 to 118 of the judgment under appeal, that there had been a decision by the appellant on a series of facts which were not denied by the appellant. Moreover, in paragraphs 112 and 204 of that judgment, the Court of First Instance found that the appellant had organised an exchange of information which was implemented at the same time as the exchange of information between undertakings in the committee called the `Poutrelles Committee'. The Court of First Instance was therefore right to find that there had been both a decision by the association and an agreement between undertakings. According to the Commission, Article 65 of the ECSC Treaty cannot be interpreted as prohibiting a decision by an association only where there is no agreement between undertakings on the same matter, as otherwise only decisions which have not been adopted unanimously by the undertakings of which the association is composed could constitute decisions by associations within the meaning of that article.

21 Similarly, as the Court of First Instance ruled in paragraph 131 of the judgment under appeal, Article 65 (1) of the ECSC Treaty applies to specific activities of associations of undertakings and not only to the activities of such associations which are similar to those of undertakings, as otherwise it would have been superfluous for Article 65 (1) to refer expressly to those associations.

Findings of the Court

22 Article 65 (1) of the ECSC Treaty expressly prohibits decisions by associations of undertakings which tend, directly or indirectly, to prevent, restrict or distort normal competition within the common market

23 Article 65 (1) therefore applies to associations to the extent that their own activity or that of their member undertakings tends to produce the effects to which it refers (Case 67-63 Sorema v High Authority [1964] ECR 151, at p. 162).

24 There is nothing in Article 65 (1) to indicate that the prohibition laid down in it with respect to associations of undertakings is applicable only in the alternative, that is to say, where no agreement between undertakings can be identified.

25 Similarly, Article 65 (1) of the ECSC Treaty does not state that it covers the activity of an association of undertakings only to the extent to which it conducts itself as an undertaking. In any event, if an association of undertakings were to conduct itself as an undertaking, it would be regarded as such for the purposes of applying that provision, which would render a prohibition applying specifically to such associations pointless.

26 It follows that the Court of First Instance was entitled to find, in paragraphs 130 to 133 of the judgment under appeal, that associations of undertakings could be covered by the prohibition laid down in Article 65 (1) of the ECSC Treaty and to reject, in paragraphs 137 to 139, the appellant's argument that the Commission was not empowered to adopt Article 2 of the contested decision.

27 The Court of First Instance concluded that there was a decision by an association of undertakings which was attributable to the appellant after having examined, in the judgment under appeal, the objectives laid down in the appellant's statutes (paragraph 111) and its activity of gathering, compiling and circulating the statistics at issue (paragraph 112), inferred from the actions of its staff that they had been authorised by the competent organs or, at least, received the express or tacit approval of its members (paragraph 113) and observed that the undertakings which had participated in the exchange of information at issue were affiliated to the appellant (paragraph 114).

28 Having regard to all of the elements referred to, the Court of First Instance was right to find, in paragraph 115 of the judgment under appeal, that the Commission was entitled to conclude, in the contested decision, that the exchange of information at issue could not have been effected without a `decision' by the appellant.

29 It follows that the first ground of appeal is unfounded.

The second and fourth grounds of appeal

30 The second ground of appeal alleges infringement of the first paragraph of Article 15 of the ECSC Treaty by reason of erroneous and contradictory grounds which exceed the Court of First Instance's jurisdiction ratione materiae, as regards the finding, in Article 2 of the contested decision, that the appellant had organised an exchange of confidential information in connection with the infringements committed by its members.

31 The fourth ground alleges infringement of the first paragraph of Article 15 and Article 65 (1) of the ECSC Treaty by reason of misinterpretation of the requirement arising from the use in Article 65 (1) of the words `restrict or distort normal competition' and of contradictory reasoning in the application of that test to the exchange of information organised by the appellant.

32 It is appropriate to consider these two grounds together.

33 The second ground is directed against paragraphs 169 to 208 of the judgment under appeal and, more specifically, paragraph 191, which is worded as follows:

`The fact that the system was set up in 1986 at the latest, in the context of the quota system then being administered by the applicant, indicates that the initial purpose of the system was to monitor compliance with the quotas allocated to each of the participant undertakings, in a context in which the Commission was pursuing a policy of stabilising "traditional flows" ... . The fact that the exchange in question continued after the quota system ended on 30 June 1988 (see documents nos 3482 and 3483) made it possible for the undertakings to monitor the extent to which each of them was continuing to comply with the traditional markets which had served as the basis for the quota system. By its very nature, such an exchange of information tended to maintain the compartmentalisation of the markets with reference to traditional flows.'

34 The appellant complains that, in paragraph 191 of the judgment under appeal, the Court of First Instance exceeded the limits of its jurisdiction ratione materiae by referring to new facts and, in particular, by finding that the quota system had been continued even though it had come to an end on 30 June 1988 and even though that finding is not substantiated by the facts as they are presented in the contested decision or even in the judgment under appeal itself.

35 The appellant also complains that the Court of First Instance contradicted itself in finding, in paragraphs 179 and 202 of the judgment under appeal, that the exchange of information organised by the appellant was a separate infringement but, in paragraph 191, that it served to monitor compliance with the quotas.

36 By the fourth ground of appeal, which is directed against paragraphs 185 to 196 of the judgment under appeal, the appellant again complains that, in paragraph 202 of the judgment under appeal, the Court of First Instance treated the exchange of information organised by the appellant as a separate infringement, and yet, when stating the reasons for its finding that there had been a restriction of competition in paragraph 191, relied on the use of that exchange of information to monitor a cartel aimed at ensuring compliance with domestic markets and thus acknowledged that the exchange was accessory and not autonomous in nature.

37 In addition, the appellant denies that the exchange of information as such could have restricted competition. The data exchanged were neither recent enough nor sufficiently detailed - particularly as regards the products and customers concerned - to be capable of restricting the freedom of action of the undertakings concerned.

38 The Commission submits, first of all, that the appellant has misread paragraph 191 of the judgment under appeal, which does not state that the undertakings continued to operate the quota system after 30 June 1988. That paragraph merely points out that the exchange of information in question enabled the undertakings to monitor the extent to which each of them was continuing to comply with the traditional markets which had served as the basis for that system.

39 The Commission claims that the appellant's argument that the Court of First Instance erred in law in treating the exchange of information in question as a separate infringement is inadmissible because it calls into question the establishment and assessment of facts, particularly as regards the homogeneity of the products, on which the Court of First Instance based its finding, in paragraphs 185 to 194 of the judgment under appeal, that the information exchanged was capable of appreciably influencing the participants' conduct.

40 The Commission also submits that the appellant raises the issue of contradictory reasoning only in relation to paragraph 191 of the judgment under appeal, which it has misread. Irrespective of whether there was a pricing and market-sharing agreement, the exchange of information at issue was, as such, capable of appreciably influencing the undertakings' conduct on the market.

Findings of the Court

41 According to the case-law relating to the tractor market (Case T-34-92 Fiatagri and New Holland Ford v Commission [1994] ECR II-905, Case T-35-92 John Deere v Commission [1994] ECR II-957, Case C-7-95 P John Deere v Commission [1998] ECR I-3111, and Case C-8-95 P New Holland Ford v Commission [1998] ECR I-3175), in which the Court of First Instance and the Court of Justice first examined an agreement on the exchange of information in the context of the EC Treaty and the general findings of which can be applied to the ECSC Treaty, such an agreement is incompatible with the rules on competition if it reduces or removes the degree of uncertainty as to the operation of the market in question with the result that competition between undertakings is restricted (see, in particular, Case C-7-95 P John Deere, cited above, paragraph 90).

42 The criteria of coordination and cooperation necessary for determining the existence of a concerted practice, far from requiring an actual `plan' to have been worked out, are to be understood in the light of the concept inherent in the provisions of the EC and ECSC Treaties on competition, according to which each trader must determine independently the policy which he intends to adopt on the common market and the conditions which he intends to offer to his customers (see Case C-7-95 P John Deere, paragraph 86, and the case-law cited therein).

43 While it is true that this requirement of independence does not deprive traders of the right to adapt themselves intelligently to the existing or anticipated conduct of their competitors, it does, however, strictly preclude any direct or indirect contact between such traders, the object or effect of which is to create conditions of competition which do not correspond to the normal conditions of the market in question, regard being had to the nature of the products or services offered, the size and number of the undertakings and the volume of the said market (Case C-7-95 P John Deere, paragraph 87, and the case-law cited therein).

44 In order to establish whether the information exchange system organised in this case by the appellant had the effect of restricting competition, the Court of First Instance examined a variety of factors. It thus noted in the judgment under appeal that the figures exchanged were confidential (paragraph 186), that they had been sent only to a certain number of manufacturers (paragraph 187), that the products in question were homogenous (paragraph 188), that the structure of the market was oligopolistic (paragraph 189), that the information at issue made it possible for the undertakings to know very precisely the market share of each of their competitors (paragraph 190) and, therefore, made it possible to monitor the activities of those competitors (paragraph 191), that the figures gave rise to discussions and criticism (paragraph 192) and that the figures were up to date (paragraph 194).

45 In paragraph 195 of the judgment under appeal, the Court of First Instance concluded from those factors that the information received by the undertakings under the information exchange system at issue was capable of appreciably influencing their conduct.

46 The findings made in paragraphs 186 to 195 of the judgment under appeal are findings of fact, which are not subject to review by the Court in appeal proceedings. As is clear from Article 32d(1) CS and Article 51 of the ECSC Statute of the Court of Justice, an appeal lies on a point of law only. Therefore, the Court of First Instance has sole jurisdiction to find and appraise the relevant facts and to assess the evidence, except where those facts and that evidence have been distorted (see, to that effect, Case C-136-92 P Commission v Brazzelli Lualdi and Others [1994] ECR I-1981, paragraphs 49 and 66; Joined Cases C-238-99 P, C-244-99 P, C-245-99 P, C-247-99 P, C-250-99 P, C-251-99 P, C-252-99 P and C-254-99 P Limburgse Vinyl Maatschappij and Others v Commission [2002] ECR I-8375, paragraph 194; and Case C-312-00 P Commission v Camar and Tico [2002] ECR I-11355, paragraph 69).

47 In the light of those findings of fact, the Court of First Instance was entitled to find, in paragraph 196 of the judgment under appeal, that the information exchange system at issue tended to prevent, restrict or distort normal competition within the meaning of Article 65 (1) of the ECSC Treaty by enabling the participant undertakings to substitute practical cooperation between them for the normal risks of competition.

48 With particular regard to paragraph 191 of the judgment under appeal, it cannot, contrary to what the appellant claims, be concluded that the Court of First Instance found in that paragraph that the quota system had been continued beyond 30 June 1988. The Court of First Instance in fact merely stated that the exchange of information at issue enabled the undertakings to monitor one another and that, by its very nature, that exchange tended in itself to maintain the compartmentalisation of the markets with reference to traditional flows.

49 Since paragraph 191 makes no reference to an agreement on quotas and deals only with the effects of the exchange of information as such, the Court of First Instance did not contradict itself in finding, in paragraph 202 of the judgment under appeal, that the exchange of information in question was a separate infringement.

50 It follows from these findings that the second and fourth grounds of appeal are in part inadmissible and in part unfounded.

The third ground of appeal

51 The third ground of appeal alleges infringement of Article 65 (1) of the ECSC Treaty and failure by the Court of First Instance to observe the limits of its jurisdiction ratione materiae by reason of misinterpretation of the requirement arising from the use in that provision of the words `tending ... to' when applying that concept to the allegedly anti-competitive effects of the exchange of information organised by the appellant.

52 The appellant submits that the Court of First Instance erred in law in taking into consideration the effects which the exchange of information had on competition (paragraphs 191, 195 and 196 of the judgment under appeal) whereas Article 65 of the ECSC Treaty covers only agreements `tending ... to' restrict competition, which, in both the German version of that Treaty (`abzielen') and the French version (`tendraient'), requires the pursuit of an objective. In so doing, the Court of First Instance infringed Article 65 (1) of the ECSC Treaty.

53 The appellant also maintains that the Court of First Instance exceeded the limits of its jurisdiction ratione materiae by replacing the term `effects' of the exchange of information, which was used in recital 283 of the grounds of the contested decision, with the wording that the exchange of information `tended to' affect normal competition and by thus altering its legal characterisation.

54 The Commission contends that paragraphs 191 and 196 of the judgment under appeal contain the Court of First Instance's assessment of previously established facts.

55 The Commission denies that the Court of First Instance infringed Article 65 (1) of the ECSC Treaty, arguing that the expression `tending ... to' used in that provision corresponds to the wording `have as their object or effect' used in Article 85 of the EC Treaty (now Article 81 EC). Moreover, the expression `to tend to' also means `to have a tendency to' or `to evolve in such a way as to'. It is therefore sufficient for a course of conduct to tend objectively to restrict competition for Article 65 (1) of the ECSC Treaty to be applicable.

56 In the Commission's view, the Court of First Instance cannot be criticised for not contenting itself with finding that the exchange of information at issue was merely capable of appreciably influencing the conduct of the undertakings but for going a step further in its assessment and concluding from the facts established that the information exchange system tended specifically to compartmentalise the markets (paragraph 191 of the judgment under appeal) and generally to prevent, restrict or distort normal competition (paragraph 196 of that judgment).

Findings of the Court

57 As is clear from paragraph 145 of the judgment under appeal, the appellant claimed before the Court of First Instance that the purpose of the decision by an association of undertakings which was the subject of complaint was to achieve, by way of an exchange of information, greater market transparency and that this objective could not be regarded as anti-competitive.

58 However, the appellant's suggestion as to how the term `tending ... to' in Article 65 (1) of the ECSC Treaty should be defined is too restrictive. Both the French expression and the equivalent wording used in the German version of this provision may be used to express an attempt to achieve a certain end but, equally, may describe the objective situation of a factor which leads in a certain direction, regardless of whether it is intended or not.

59 As is clear from the case-law referred to in paragraphs 41 and 42 of this judgment, the alleged aim of achieving greater market transparency does not preclude conduct from being treated as having an anti-competitive purpose where the conduct at issue reduces or removes the degree of uncertainty as to the operation of the market in question and gives rise to conditions in which traders do not determine independently the policy which they intend to adopt on that market.

60 It follows that the Court of First Instance was correct and did not exceed the limits of its jurisdiction ratione materiae in examining, in paragraphs 191 and 195 of the judgment under appeal, the effects of the exchange of information at issue on the conduct of the traders which participated in that system and in concluding, in paragraph 196 of that judgment, that the information exchange system tended to prevent, restrict or distort normal competition within the meaning of Article 65 (1) of the ECSC Treaty.

61 Consequently, the third ground of appeal is unfounded.

62 It follows from all of the above findings that the appeal must be dismissed.

Costs

63 Under Article 69 (2) of the Rules of Procedure, which is applicable to the appeal procedure by virtue of Article 118 of those Rules, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. Since the Commission has applied for costs to be awarded against the appellant and since that party has been unsuccessful in all of its grounds of appeal, it must be ordered to pay the costs.

On those grounds,

THE COURT (Fifth Chamber)

hereby:

1. Dismisses the appeal;

2. Orders Eurofer ASBL to pay the costs.