GC, 7th chamber, February 2, 2012, No T-77/08

THE GENERAL COURT (Seventh Chamber),

Background to the dispute

The applicant and the product concerned

1 The applicant, The Dow Chemical Company ('Dow'), brought the present action against Commission Decision C(2007) 5910 final of 5 December 2007 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement (Case COMP/38629 - Chloroprene Rubber) ('the decision of 5 December 2007'), as amended by Commission Decision C(2008) 2974 final of 23 June 2008 ('the amending decision of 23 June 2008'). The decision of 5 December 2007 as amended by the amending decision of 23 June 2008 will be referred to as 'the contested decision'.

2 On 1 April 1996, Dow acquired a 50% shareholding in DuPont Dow Elastomers LLC ('DDE'), a joint venture held in equal shares with EI du Pont de Nemours and Company ('EI DuPont') and which was active on the chloroprene rubber ('CR') market. Dow continued to hold the stake in DDE until 30 June 2005, when DDE ceased to be a joint venture and became DuPont Performance Elastomers LLC ('DPE LLC'), a wholly-owned subsidiary of EI DuPont. DDE's regional office for Europe, DuPont Dow Elastomers SA, became DuPont Performance Elastomers SA ('DPE SA'), a wholly-owned subsidiary of DPE LLC (see recitals 28 to 40 of the contested decision).

3 CR is a synthetic rubber which is an artificially-made polymer acting as an elastomer. It is used mainly in the manufacture of technical rubber parts, such as cables, hoses or power transmission belts, in the manufacture of adhesives, in particular for the shoe and furniture industries, such as soles, heels and coated fabrics, and in the manufacture of latex for diving equipment, bitumen modifications and the inner soles of shoes (see recitals 7 to 11 of the contested decision).

4 The other undertakings to which the contested decision was addressed are: Bayer AG, Denki Kagaku Kogyo KK, Denka Chemicals GmbH, ENI SpA, Polimeri Europa SpA, Tosoh Corp., Tosoh Europe BV, EI DuPont, DPE SA and DPE LLC.

The procedure before the Commission

5 On 18 December 2002 Bayer informed the Commission of the European Communities [confidential] (1) and expressed its willingness to cooperate with the Commission under the terms of the Commission notice on immunity from fines and reduction of fines in cartel cases (OJ 2002 C 45, p. 3; 'the 2002 Leniency Notice'). By decision of 27 January 2003 the Commission granted Bayer conditional immunity from fines (see recital 60 of the contested decision).

6 Following the communication of information from Bayer, the Commission carried out unannounced inspections at the premises of Dow Deutschland Inc. on 27 March 2003 and at the premises of Denka Chemicals on 9 July 2003 (see recitals 61 and 62 of the contested decision).

7 On 15 July and on 21 November 2003 respectively, Tosoh Corp., Tosoh Europe and DDE applied for leniency in accordance with the 2002 Leniency Notice.

8 In March 2005 the Commission sent the first requests for information to the addressees of the contested decision, pursuant to Article 18 of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 [EC] and 82 [EC] (OJ 2003 L 1, p. 1).

9 By letters of 7 March 2007 the Commission informed Tosoh Corp., Tosoh Europe and DDE that it had reached the provisional conclusion that the evidence which they had submitted presented significant added value within the meaning of point 22 of the 2002 Leniency Notice and that it therefore intended to apply a reduction to the amount of the fine to be imposed on them within one of the bands referred to in the first paragraph of point 23(b) of that notice, namely a reduction of 30 to 50% for Tosoh Corp. and Tosoh Europe and a reduction of 20 to 30% for DDE (see recitals 63 to 66 of the contested decision).

10 On 13 March 2007 the Commission initiated the procedure and adopted a statement of objections concerning an infringement of Article 81 EC and Article 53 of the Agreement on the European Economic Area ('the EEA Agreement'), addressed to 12 undertakings, including the applicant. All the addressees of the statement of objections submitted observations in writing in response to the objections raised by the Commission and exercised their right to be heard, at a hearing which took place on 21 June 2007 (see recitals 68 to 72 of the contested decision).

The contested decision

11 In the amending decision of 23 June 2008, addressed solely to EI DuPont, DPE LLC, DPE SA and Dow, the Commission explained inter alia that it had made a factual mistake in the decision of 5 December 2007.

12 It follows from the decision of 5 December 2007 that between 1993 and 2002 several producers of CR participated in a single and continuous infringement of Article 81 EC and Article 53 of the EEA Agreement, covering the entire territory of the European Economic Area (EEA), consisting of agreements and concerted practices concerning the allocation and the stabilisation of markets, market shares and sales quotas for CR, coordinating and implementing several price increases, agreeing upon minimum prices, allocating customers and exchanging competitively sensitive information (recitals 2, 3 and 81 to 122 of the contested decision). Those producers met on a regular basis several times a year, in multilateral, trilateral and bilateral meetings (see recitals 94 to 116 of the contested decision).

13 According to Articles 1 to 3 of the decision of 5 December 2007:

'Article 1

The following undertakings have infringed Article 81 [EC] and - from 1 January 1994 - Article 53 of the EEA Agreement by participating, for the periods indicated, in a single and continuing agreement and/or concerted practice in the [CR] sector:

(a) Bayer ...: from 13 May 1993 to 13 May 2002;

(b) [EI DuPont]: from 13 May 1993 to 13 May 2002; [DPE] SA, [DPE] LLC and [Dow]: from 1 April 1996 to 13 May 2002;

(c) Denki Kagaku Kogyo ... and Denka Chemicals ...: from 13 May 1993 to 13 May 2002;

(d) ENI ... and Polimeri Europa ...: from 13 May 1993 to 13 May 2002;

(e) Tosoh Corp[.] and Tosoh Europe ...: from 13 May 1993 to 13 May 2002.

Article 2

For the infringement referred to in Article 1, the following fines are imposed:

(a) Bayer ...: EUR 0;

(b) [EI DuPont]: EUR 59 250 000; of which jointly and severally with

(i) [DPE] SA: EUR 44 250 000 and

(ii) [DPE] LLC: EUR 44 250 000 and

(iii) [Dow]: EUR 48 675 000;

(c) Denki Kagaku Kogyo ... and Denka Chemicals ...: jointly and severally EUR 47 000 000;

(d) ENI ... and Polimeri Europa ..., jointly and severally: EUR 132 160 000;

(e) Tosoh Corp[.] and Tosoh Europe ..., jointly and severally: EUR 4 800 000

...

Article 3

The undertakings listed in Article 1 shall immediately bring to an end the infringements referred to in that Article in so far as they have not already done so.

They shall refrain from repeating any act or conduct described in Article 1, and from any act or conduct having the same or similar object or effect.'

14 In determining the basic amount of the fines, the Commission relied on its Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation (EC) No 1/2003 (OJ 2006 C 210, p. 2; 'the 2006 Guidelines'). It took into account a proportion of the value of the sales of CR made by each undertaking within the EEA during the 2001 calendar year, the last full year of participation in the infringement, multiplied by the number of years of infringement (see recitals 521 and 523 of the contested decision).

15 In order to determine the proportion of the value of sales to be taken into account, the Commission considered that the horizontal market-sharing and price-fixing were by their very nature among the most serious restrictions of competition (see recital 525 of the contested decision). In that regard, the Commission also considered that the combined market share of the undertakings participating in the infringement came to 100% within the EEA, that the geographic scope of the infringement was worldwide and that the infringement had been systematically implemented (see recital 526 of the contested decision).

16 The Commission decided that the proportion of the value of sales of each undertaking involved to be taken into account for the purpose of establishing the basic amount of the fine to be imposed was 21% (see recital 535 of the contested decision).

17 As the participation in the infringement had lasted for nine years for EI DuPont, Bayer, Denka Kagaku Kogyo and Denka Chemicals (together, 'Denka'), ENI and Polimeri Europa (together, 'EniChem') and Tosoh Corp. and Tosoh Europe (together, 'Tosoh'), and for six years and one month for DPE LLC, DPE SA and Dow, the Commission, in application of point 24 of the 2006 Guidelines, multiplied the starting amounts of the fines determined by reference to the value of sales by 9 for EI DuPont, Bayer, Denka, EniChem and Tosoh and by 6.5 for DPE LLC, DPE SA and Dow (see recital 536 of the contested decision).

18 In order to deter the undertakings from participating in an agreement relating to market-sharing or horizontal price-fixing agreements such as those in issue in the present case, and taking into account in particular the factors referred to at paragraph 14 above, the Commission, in application of point 25 of the 2006 Guidelines, included in the basic amount of the fines an additional amount of 20% of the value of sales (see recital 537 of the contested decision).

19 Furthermore, the Commission considered that EI DuPont and Dow, as the parent companies of the joint venture DDE, should be held jointly and severally liable for the behaviour of that joint venture during the period 1 April 1996 to 13 May 2002 (see recitals 420 to 440 of the contested decision). In addition, since, after the infringement had ceased, DPE LLC and DPE SA resumed DDE's activities on the CR market, the Commission considered that, as the successors to DDE, DPE LLC and DPE SA should also be held jointly and severally liable for DDE's conduct between 1 April 1996 and 13 May 2002 (see recitals 441 and 442 of the contested decision).

20 In the light of those factors, the basic amount of the fine to be imposed on EI DuPont was fixed at EUR 79 million, 59 million of which was to be paid jointly and severally with DPE LLC, DPE SA and Dow (see recital 539 of the contested decision).

21 As regards the adjustments to the basic amounts of the fines for aggravating circumstances, no increase was applied to the fine to be imposed on the applicant, since no aggravating circumstance was found to exist in its case.

22 The Commission then applied a specific increase to the fines of certain addressees of the contested decision in order to ensure that the fines would have a sufficiently deterrent effect, taking account for that purpose of those undertakings' turnovers beyond the goods and services to which the infringement related. The basic amount of the fine to be imposed on the applicant was multiplied by 1.1 and the basic amount of the fine to be imposed on EniChem was multiplied by 1.4 (see recitals 583 to 586 of the contested decision).

23 Accordingly, the basic amount of the fine to be imposed on EI DuPont was fixed at EUR 79 million, of which 59 million was to be paid jointly and severally with DPE LLC and DPE SA and 64.9 million jointly and severally with the applicant (see recital 587 of the contested decision).

24 As regards the application of the 2002 Leniency Notice, the Commission granted a 100% reduction in the basic amount of the fine to Bayer, 50% to Tosoh and 25% to EI DuPont, DPE LLC, DPE SA and Dow (see recitals 591 to 638 of the contested decision).

25 The amount of the fine imposed on EI DuPont was thus fixed at EUR 59.25 million, of which 44.25 million jointly and severally with DPE LLC and DPE SA and 48.675 million jointly and severally with the applicant (see recital 655 of the contested decision).

26 After giving the undertakings concerned the opportunity to submit their comments, the Commission adopted the amending decision of 23 June 2008 (see paragraph 1 above). Under that decision, the applicant was solely liable for payment of a fine of EUR 4.425 million, while the amount of the fine for payment of which EI DuPont and the applicant were held jointly and severally liable was reduced to EUR 44.25 million. That decision also states that the Commission realised that it had made a factual error in the calculation of the amount of the fine to be paid by EI DuPont, since that amount was the result of the application of the multiplier of 10% for deterrence to only the applicant's fine.

27 The amending decision of 23 June 2008 contains, in particular, the following provision:

'Article 1

In Article 2 of [the decision of 5 November 2007], the first paragraph is amended as follows:

(1) point (b) is replaced by the following:

(b) [EI DuPont]: EUR 59 250 000;

of which jointly and severally with

(i) [DPE] SA for EUR 44 250 000 and

(ii) [DPE] LLC for EUR 44 250 000 and

(iii) [Dow] for EUR 44 250 000;

(2) the following point (f) is added:

(f) [Dow]: EUR 4 425 000.'

Procedure and forms of order sought by the parties

28 By application lodged at the Court Registry on 18 February 2008 the applicant brought the present action.

29 Acting upon a report of the Judge-Rapporteur, the Court (Seventh Chamber) decided to open the oral procedure and, by way of the measures of organisation of procedure provided for in Article 64 of its Rules of Procedure, requested the Commission to produce certain documents and put written questions to it. The Commission complied with that request within the period prescribed.

30 The parties presented oral argument and their answers to the questions put by the Court at the hearing on 10 February 2011.

31 In the application, the applicant claims that the Court should:

- annul the decision of 5 December 2007 in so far as it concerns the applicant;

- in the alternative, reduce the fine imposed on the applicant;

- order the Commission to pay the costs.

32 In the reply, the applicant seeks leave to amend its principal head of claim and requests the Court to annul the contested decision, in so far as that decision concerns the applicant.

33 The Commission contends that the Court should:

- dismiss the action;

- order the applicant to pay the costs.

34 In the rejoinder, the Commission states that it has no objection to the applicant being granted leave to amend its principal head of claim in such a way as to cover the contested decision.

Law

35 As a preliminary point, it must be borne in mind that when, during the proceedings, one decision is replaced by another having the same subject-matter, this must be considered a new factor allowing the applicant to adapt its pleas in law and claims for relief. It would indeed be contrary to the due administration of justice and the requirements of procedural economy to oblige the applicant to make a fresh application (see Case T-318/01 Othman v Council and Commission [2009] ECR II-1627, and the case-law cited). The same must apply where, during the proceedings, the institution that adopted the act which is the subject of the action makes amendments to that act aimed at replacing it partially without changing its subject-matter.

36 In the present case, it is therefore appropriate to allow the applicant's request and to allow it to reformulate its claims, pleas in law and arguments in the light of the Commission's amendments to the decision of 5 December 2007. Accordingly, this action should be regarded as seeking annulment of the contested decision, in so far as it concerns the applicant and, in the alternative, as seeking the reduction of the fine imposed on the applicant by the decision of 5 December 2007, as set by the amending decision of 23 June 2008.

37 In support of its action, the applicant raises two pleas in law. The first plea alleges that the Commission made manifest errors of assessment of the facts and errors of law in concluding that the applicant had participated in the infringement committed by DDE (the joint venture owned by the applicant and EI DuPont) or in holding it liable for that infringement. The second plea, which is raised in the alternative, alleges that the Commission made manifest errors of assessment of the facts and errors of law in determining the amount of the fine imposed on the applicant.

The first plea, alleging that the Commission made manifest errors of assessment of the facts and errors of law in concluding that the applicant had participated in the infringement committed by DDE or in holding it liable for that infringement

Wording of the contested decision

38 In recital 31 of the contested decision, the Commission found that DDE had been set up in accordance with a Formation Agreement, signed on 16 January 1996, and a Limited Liability Company Agreement ('the LLC Agreement') between Dow, EI DuPont, Wenben Inc. and DuPont Elastomers Inc. The latter two companies were the parent companies of DDE and wholly-owned subsidiaries of Dow and EI DuPont respectively, and each held, by virtue of the LLC Agreement, 50% of the shares in DDE.

39 In recitals 420 and 421 of the contested decision, the Commission considered that as the parent companies of DDE, EI DuPont and Dow should be held jointly and severally liable for the conduct of DDE during the period from 1 April 1996 to 13 May 2002, since 'objective factors demonstrat[ed] that DDE did not enjoy an autonomous position but ... that Dow and [EI] DuPont exercised decisive influence on the commercial conduct and policies of the joint venture on an equal footing'.

40 First of all, in recital 422 of the contested decision, the Commission found that 'the responsibilities of the Members Committee and its composition with high level executives from the parent companies as representatives show that the power to influence the general market behaviour of DDE lay in the hands of the parent companies'. In recitals 423 to 425 of the contested decision, the Commission substantiated that finding as follows:

'(423) The parent companies set up a "Members Committee" in order to supervise the business of DDE and to approve certain matters pertaining to the strategic direction of DDE. Notably the Members Committee had powers to set the overall policy and vision of DDE, to approve the business and strategic plans and the annual operating plans of DDE, to elect or appoint the officers of DDE, to determine the banking policy of DDE and to approve all capital expenditure and borrowing by DDE above certain levels (Sections 7.4. and 9.1 of the LLC Agreement). In addition, the Members Committee had the power to amend the business scope, to liquidate or otherwise dissolve DDE or to approve the merger or consolidation of DDE (Section 6.1. of the LLC Agreement). Those tasks were expressly reserved for the exclusive authority of the Members Committee. In general, the parent companies also had the right to delegate any powers and authority required for the management of the company to the Members Committee.

(424) [EI] DuPont and Dow each had the right to appoint an equal number of Member Representatives to the Members Committee. The decisions of the Members Committee were taken unanimously, with each shareholder having an absolute right of veto. Accordingly, neither shareholder was individually able to exercise decisive influence over DDE ...

(425) The representatives of the Members Committee were not employees of DDE, but of [EI] DuPont and Dow respectively. The representatives of both Dow and [EI] DuPont came from the senior executive level ... The lack of an independent "board of directors with external representatives" was also a factor in the Court of Justice's reasoning in [Case C-286/98 P] Stora Kopparbergs Bergslags v Commission [[2000] ECR I-9925] to reject the claim of autonomous action by the subsidiary ...'

41 Next, in recitals 426 and 427 of the contested decision, the Commission stated that the Members' Committee 'had the right to appoint the officers of DDE, [who were] responsible for the day-to-day business affairs, subject to the overall direction and control of the Members Committee (Section 9.1. of the LLC Agreement)', that '[t]he persons chosen for the top management posts in DDE came from a high management level within the respective parent companies, Dow and [EI] DuPont' and that '[e]ntrusting individuals with consecutive positions in the parent companies and the joint venture constitutes a classic mechanism to keep information flow and coherence within the members of the group (in this case between the joint venture and the parents) and guarantees predictability of management and on policy aspects'.

42 Lastly, in recital 428 of the contested decision, the Commission stated that '[EI] DuPont, as a participant in the cartel until the transfer of its CR activity into DDE, was fully aware of the existence of the cartel and must have been aware of the participation of DDE in the cartel', that '[p]resumably Dow must also have been aware of the existence of the cartel' and that '[t]his [was] an additional factor demonstrating that [EI] DuPont and Dow [had] exercised a decisive influence on DDE's behaviour'.

43 In recital 432 of the contested decision, the Commission found that the joint management power of EI DuPont and Dow with respect to the commercial conduct and policy of DDE and the fact that those parent companies exercised that power on an equal footing was demonstrated on the basis of the LLC Agreement and that, accordingly, the finding that both parent companies were liable was in line with the judgment in Case T-314/01 Avebe v Commission [2006] ECR II-3085, 'Avebe'. The Commission added, in recital 434 of the contested decision, that, '[i]n the case of a joint venture it is possible to find that the joint venture and parents together form an economic unit for the purposes of the application of Article 81 [EC] if the joint venture has not decided independently upon its own conduct on the market'.

44 On the basis of the foregoing, the Commission found, in recital 442 of the contested decision, that 'Dow, [EI] DuPont, DPE [LLC] and DPE SA should be held jointly and severally liable for DDE's conduct from 1 April 1996 to 13 May 2002'.

Arguments of the parties

- The first part, alleging a manifest error of assessment of the facts and an error of law and breach of the rights of the defence as regards the applicant's awareness of the cartel

45 The applicant submits that the Commission's hypothesis that it was aware of the existence of the cartel is one of the three elements on which the Commission based its conclusion that DDE did not enjoy an autonomous position on the market and that the applicant and EI DuPont had exercised decisive influence over DDE. That hypothesis is itself based on the assumption that the Members' Committee referred to the cartel when discussing the closure of DDE's production plant in Northern Ireland. However, that is not the case. The applicant states that it had no knowledge of the existence of the cartel before 2003. In addition, the applicant maintains that the Commission did not explain in the contested decision why there must have been a reference to the cartel when the Members' Committee discussed the closure of the plant and adduced no evidence to show that the applicant was aware of the infringement. In that regard, the economic characteristics of the cartel and the regionalisation strategy are irrelevant.

46 The applicant submits that such a manifest error of assessment should entail the annulment of the contested decision, since the assumption that it must have been aware of the infringement is one of the few reasons given by the Commission for imputing liability for the cartel to the applicant.

47 According to the applicant, the minutes of the Members' Committee meeting of 16 January 1998 show that the decision to close the plant was taken on perfectly reasonable economic grounds and that those independent justifications were put forward to justify the closure of the plant to the applicant's representatives on the Members' Committee. DDE's management had no incentive to disclose its collusive activities on that occasion.

48 The applicant observes that an investigation was carried out within DDE during the administrative procedure by an independent consultant, whose statement was annexed to the response to the statement of objections. In the course of that investigation, no fact was discovered that might indicate or give reason to think that the members of the Members' Committee were aware of any unlawful activity. The applicant also requests that the consultant be allowed to give oral evidence to the Court that the applicant was not aware of the infringement committed by DDE. The credibility of that internal investigation and that statement are not vitiated, so far as the applicant is concerned, by the fact that EI DuPont and DDE subsequently adduced evidence of the existence of the cartel during a period preceding the formation of DDE. The applicant states that it became indirectly involved in the CR business only after DDE was created and it was EI DuPont that contributed that business to the joint venture. Moreover, the credibility of the investigation in question is not vitiated, as the Commission claims, by the fact that the investigation also concerned the parent companies and was supervised by them.

49 In addition, the applicant submits that, by referring, in recitals 428 and 438 of the contested decision, to matters concerning the applicant's knowledge of the cartel that did not appear in the statement of objections, the Commission breached the applicant's right to be heard, thus depriving it of the opportunity to explain what was discussed within the Members' Committee and to submit the minutes of the relevant meeting.

50 The applicant observes, lastly, that the fact that it was not aware of DDE's illegal activities is an important element that distinguishes the present case from Avebe, paragraph 43 above, and from the case that gave rise to Commission Decision C(2006) 6762 final of 24 January 2007 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement (Case COMP/F/38.899 - Gas insulated switchgear) ('the Gas insulated switchgear decision').

51 The Commission contests the applicant's arguments. In particular, it contends that it based its finding that the applicant and EI DuPont should be considered to be jointly and severally liable for the infringement committed by DDE on objective factors demonstrating that the parent companies exercised decisive influence over DDE's commercial conduct and policies on an equal footing and that, in order to establish that influence, it relied on the degree of autonomy enjoyed by DDE. The parent companies' knowledge of the existence of the cartel is merely an additional factor. The finding of the parent companies' liability would still be valid even if those parent companies were not aware of the existence of the cartel.

52 Moreover, the Commission submits that, in the contested decision, it found that it was not plausible that the Members' Committee should have discussed the closure of the plant, which constitutes a manifestation of the regionalisation strategy which was an essential element of the cartel, without making any reference to the cartel.

- Second part, alleging manifest error of assessment of the facts and an error of law as concerns the imputation of the infringement to the applicant on the ground of its involvement in the Members' Committee

53 The applicant claims, in essence, that, apart from the applicant's alleged awareness of the existence of the cartel, the Commission relies on only two points in order to impute to it the infringement committed by DDE. First, the applicant submits that the Commission considered that, in the light of the responsibilities and the composition of the Members' Committee, DDE did not enjoy an autonomous position on the market, but rather that the applicant and EI DuPont had exercised decisive influence, on an equal footing, over DDE's commercial conduct and policies (see recitals 421 and 422 of the contested decision). Second, the applicant asserts that the Commission took account of the fact that the Members' Committee had the right to appoint the officers of DDE, who were responsible for the day-to-day management of affairs, and the fact that the persons chosen for senior management posts in DDE came from a high management level of each of the parent companies (see recital 426 of the contested decision). However, the Commission itself states in the contested decision that neither of the parent companies was individually able to exercise decisive influence over DDE (see recital 424 of the contested decision) and that the responsibilities of the Members' Committee were limited to supervising the business and approving certain matters pertaining to the strategic direction (see recital 423 of the contested decision). Accordingly, the Commission had no principled basis on which to address the contested decision to the applicant holding the applicant jointly and severally liable with DDE or EI DuPont on the sole ground that it was involved in the Members' Committee.

54 The matters indicated by the Commission relate solely to supervisory functions. In order to justify the penalty in question, however, something more than mere supervisory functions is required, such as involvement in DDE's day-to-day operations in the areas relevant for the cartel. The applicant also maintains that the Commission disregarded the fact that the applicant had only negative control over DDE and failed to explain to what extent that would be sufficient to allow liability to be imputed to the applicant for DDE's conduct. It is normal practice for a joint venture to be controlled by its parent companies and such control does not preclude the autonomy of the joint venture, as shown in particular by the Commission's practice in the field of merger control. The basis for the imputation of liability is the consequence of an objective of uniform application of the concept of undertaking both for the purposes of the substantive application of the rules of Community competition law and for the purposes of the application of the rules on fines. That means that, once the autonomous nature of an entity is recognised in Community law, that autonomy must also be recognised in a coherent manner. It follows, in the applicant's submission, that the Commission cannot impute liability to the parent companies for an infringement of Article 81 EC committed by a full-function joint venture where the parent companies exercise their supervisory functions without being involved in the day-to-day operations of that joint venture, because in such a case the joint venture would be autonomous.

55 In support of this part of the plea, the applicant puts forward seven arguments. First, it claims that the Commission's position is inconsistent with Commission Decision 2006/902/EC of 21 December 2005 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement against Flexsys NV, Bayer AG, Crompton Manufacturing Company Inc. (former Uniroyal Chemical Company Inc.), Crompton Europe Ltd, Chemtura Corp. (former Crompton Corp.), 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 Rubber chemicals decision') in which it was recognised that a jointly-owned full-function joint venture could be presumed to be autonomous from its parent companies, and therefore the parent companies were not held liable. In that regard, the applicant observes that in the present case DDE was formed as a 'concentrative joint venture' - the formation of which was approved by the Commission in 1996 - held in equal shares by the applicant and EI DuPont and that DDE operated as an autonomous economic entity on the market. The fact that EI DuPont and the applicant exercised joint negative control over DDE implies only that they had a right of veto over the commercial strategy of the joint venture and not that they had the power to exercise decisive influence over the day-to-day management of the company. That does not alter the fact that DDE was an autonomous economic entity which, as a full-function joint venture, is by definition further removed from its parents than either a subsidiary or a non-full-function joint venture.

56 There is thus no legitimate basis for the Commission's assertion, in recital 434 of the contested decision, that a full-function joint venture is by its very nature similar to a normal subsidiary having separate legal personality.

57 Moreover, the case which gave rise to the Gas insulated switchgear decision (see paragraph 50 above) is not comparable with the present case, since, in that case, the joint ventures had been created by the parent companies to continue their involvement in the cartel. The applicant also observes that, in Case T-112/05 Akzo Nobel and Others v Commission [2007] ECR II-5049 ('the General Court's judgment in Akzo Nobel'), paragraphs 57 and 58, this Court stated that it was the fact that the parent company and its subsidiary constituted a unitary organisation, or a single undertaking within the meaning of competition law, that enabled the Commission to address a decision imposing fines to the parent company. That is not the position in the present case. The Court did not draw a distinction between commercial policy and strategy and that judgment makes no reference to activities limited to a supervisory function.

58 Second, the applicant submits that the Commission was wrong to rely on the judgment in Avebe, paragraph 43 above, as the circumstances of that case are not comparable with those of the present case. In the applicant's submission, unlike the joint venture at issue in that case, DDE had separate legal personality from that of its parent companies, did not rely on its parent companies in order to enter into agreements with third parties, had its own premises and did not occupy the premises of one of its parent companies and had a management independent of the management of the parent companies. Furthermore, it submits that, unlike the parent companies concerned in Avebe, EI DuPont and itself did not assume their joint venture's commitments jointly and without limitation. It follows, in the applicant's submission, that the Commission could not reasonably rely on that judgment as a basis for imposing liability on the applicant in the present case. In the particular light of the very specific facts of that judgment, the Commission is wrong to maintain that the Court has laid down a general principle that any management power can suffice to demonstrate that decisive influence was in fact exercised and thus serve to establish the liability of the parent company.

59 Third, the applicant states that none of its employees who subsequently occupied a position within DDE worked in the CR business, since the applicant was never 'involved' in that part of the business, and that none of them returned to work at the applicant when DDE was broken up. Furthermore, contrary to the Commission's suggestion, the members of its staff who occupied positions within DDE did not come from particularly high management positions within the applicant. In any event, after DDE was formed those persons no longer formed part of the applicant's staff and were under no obligation, and were not even entitled, to report to the applicant. The Commission's assertion in recital 427 of the contested decision that '[e]ntrusting individuals with consecutive positions in the parent companies and the joint venture constitutes a classic mechanism to keep information flow and coherence within the members of the group (in this case between the joint venture and the parents) and guarantees predictability of management and on policy aspects' has no factual, logical or legal basis in the present case in the light of the matters set out above.

60 Whilst acknowledging having had representatives on the Members' Committee, the applicant emphasises that the Members' Committee had only supervisory functions and was not involved in DDE's day-to-day management or in its general market behaviour. The mere exercise of supervisory functions of the type in issue here cannot in any event be characterised as a management power within the meaning of the case-law. The applicant submits that, by virtue of the case-law, the Commission was required not only to demonstrate that the applicant had the power to give instructions to DDE with respect to that behaviour, but also that the applicant exercised such power. In the applicant's submission, it is for the Commission to demonstrate, on the basis of factual evidence, that the applicant was involved in the day-to-day management of DDE, and the Commission has failed to do so.

61 Furthermore, it was the 'CR Global Business Team', composed of former EI DuPont employees who had already been active in the area of CR and in fixing the prices of that product, that was responsible for the CR business and for DDE's day-to-day operations and general market behaviour for that part of the business.

62 Lastly, the reference in recital 425 of the contested decision to the lack of an independent board of directors with external representatives and to Case C-286/98 P Stora Kopparbergs Bergslags v Commission [2000] ECR I-9925 is misleading. The lack of such a board of directors was relevant in that case in which it could be relied on to rebut the presumption raised in that judgment. However, in the present case, that presumption is not applicable.

63 Thus, the Commission's position has 'no reasonable limit' and if it were to be followed any partner or minority shareholder in a joint undertaking that participates in supervisory functions could be held liable for the cartel activities of the joint venture without the Commission being required to provide any explanations.

64 Fourth, the applicant maintains, with reference to Article 6(2) of the Convention for the Protection of Human Rights and Fundamental Freedoms, signed in Rome on 4 November 1950, on the presumption of innocence - which, according to the case-law, is a fundamental principle of European Union law, applicable to proceedings relating to infringements of the competition rules -, that it is not incumbent upon the applicant to rebut the assumptions set out, inter alia, in recital 439 of the contested decision, where the Commission alleges that the applicant exercised decisive influence over DDE's conduct or was aware of the existence of the infringement. The applicant submits that it was incumbent upon the Commission to prove that the applicant acted in a way that makes it liable for DDE's behaviour. However, the Commission failed to do so.

65 Fifth, the applicant asserts that it did not form a single economic entity with DDE. The concept of a single economic entity does not apply in the case of joint ventures. It is not possible, on the one hand, to find that the joint venture and its parent companies, or the joint venture and one or other of its parent companies, together form an economic unit, and on that ground to hold the parent companies liable for the joint venture's behaviour, and, on the other hand, at the same time to apply Article 81 EC to the agreements concluded between that joint venture and its parent companies (or one of them). Thus, either there is a single economic entity, within which Article 81(1) EC does not apply but within which liability for the infringement can be shared, or there is no single economic entity, in which case Article 81(1) EC may apply as between the parent company and the joint venture, but then the parent company cannot be held liable for the infringements committed by the joint venture. The inapplicability of Article 81 EC to the relations in question is therefore a necessary prerequisite for the imputation of liability, as the case-law shows.

66 The Commission's approach in the present case is wholly inconsistent with its previous practice when adopting decisions, where it has systematically applied Article 81 EC to situations involving joint ventures and therefore to situations in which, according to the Commission, there could be no single economic entity formed by the parent companies and the joint venture. However, it is only where a company enjoys no real autonomy when determining its course of action on the market, but carries out the instructions issued to it by another company, which therefore exercises decisive influence over it, that that other company can be held liable for its actions. That principle applies in all cases in which the companies involved have their own legal personality. Accordingly, it was not applied in Avebe, paragraph 43 above, where the joint venture had no separate legal personality from its parent companies and where it was therefore necessary to identify a natural or legal person responsible for that joint venture so that that person could answer for the joint venture's behaviour.

67 Sixth, the applicant submits that, by finding that the applicant had exercised decisive influence over DDE even though the applicant was not involved in the cartel, was not aware of it, had only a right of negative joint control and exercised that right only through the Members' Committee, the Commission gave the concept of the exercise of decisive influence an overextensive interpretation. The applicant maintains that that interpretation serves no useful purpose, such as punishment or deterrence, since the applicant did nothing wrong by participating in the formation of DDE and in its governing structure, and has only negative effects on competition, since it could, for example, deter operators from forming concentrative full-function joint ventures.

68 Seventh, the applicant submits that it cannot be held liable since it did not participate in the illegal conduct and did not exercise any decisive influence in that regard. It submits that United States law should be taken into account, under the principle of (negative) comity set out in Article 4 of the Agreement between the Government of the United States of America and the Commission of the European Communities regarding the application of their competition laws (OJ 1995 L 95, p. 47), since the Commission is attempting to impose a fine on a company established in the United States for the conduct of another company, also established in the United States. Under United States law, a parent company can be held liable for the wrongdoing of a subsidiary only if the parent company is itself a wrongdoer or if the separation between parent company and subsidiary is merely a sham, which allows the courts to 'pierce the corporate veil'. The same applies to European Union law, moreover, as the United States position is consistent with the principle of personal responsibility laid down in Case C-49/92 P Commission v Anic Partecipazioni [1992] ECR I-4125. Those conditions are not satisfied in the present case. Furthermore, the governance decisions taken by the applicant and by EI DuPont are largely a matter of United States law. The Commission identifies no conduct on the applicant's part that would have had an effect in the European Union and the Commission cannot apply stricter corporate governance standards that are inconsistent with those applied in United States corporate law.

69 The Commission disputes all the applicant's arguments.

Findings of the Court

70 By its first plea, the applicant claims that the Commission erred in imputing to it the infringement committed by DDE, the joint venture that it created with EI DuPont, and in that regard puts forward arguments which are divided into two parts.

71 First, the applicant submits that, by relying on the hypothesis that the applicant was aware of the existence of the cartel in order to impute to it liability for the infringement committed by DDE, the Commission committed a manifest error of assessment of the facts and an error of law. Second, the applicant claims that the Commission committed a manifest error of assessment of the facts and an error of law in holding it liable for DDE's infringement on the ground of its participation in the Members' Committee.

72 Given that the Commission essentially imputed liability for the infringement committed by DDE to the applicant on the basis of the applicant's involvement in the Members' Committee and that the parent companies' awareness of the infringement was relied on by the Commission as an additional factor (see in particular the wording of the contested decision set out in paragraphs 40 and 42 above), it is appropriate to examine initially the second part of this plea and subsequently the first part.

- Second part, alleging manifest error of assessment of the facts and an error of law as concerns the imputation of the infringement to the applicant on the ground of its involvement in the Members' Committee

73 According to settled case-law, the term 'undertaking' must be understood in competition law as designating an economic unit for the purpose of the subject-matter of the agreement in question even if, in law, that economic unit consists of several persons, natural or legal (Case 170/83 Hydrotherm Gerätebau [1984] ECR 2999, paragraph 11, and Case C-97/08 P Akzo Nobel and Others v Commission [2009] ECR I-8237, 'the judgment of the Court of Justice in Akzo Nobel', paragraph 55). For the purposes of applying the competition rules, formal separation of two companies resulting from their having distinct legal identity is not decisive. The test is whether or not there is unity in their conduct on the market. Thus, it may prove necessary to establish whether two companies that have distinct legal identities form, or fall within, one and the same undertaking or economic entity adopting the same course of conduct on the market (Case T-325/01 DaimlerChrysler v Commission [2005] ECR II-3319, paragraph 85 and the case-law cited). The General Court has therefore held that Article 81(1) EC is aimed at economic entities which consist of a unitary organisation of personal, tangible and intangible elements which pursues a specific economic aim on a long-term basis and can contribute to the commission of an infringement of the kind referred to in that provision (Case T-11/89 Shell v Commission [1992] ECR II-757, paragraph 311; see, also, the General Court's judgment in Akzo Nobel, paragraph 57 above, paragraph 57 and the case-law cited).

74 Where such an economic entity infringes the rules of competition, it falls to that entity, in accordance with the principle of personal responsibility, to answer for that infringement. However, the infringement of European Union competition law must be imputed unequivocally to a legal person on whom fines may be imposed. It is clear from settled case-law that the conduct of a subsidiary may be imputed to the parent company in particular where that subsidiary, despite having a separate legal personality, does not decide independently upon its own conduct on the market, but carries out, in all material respects, the instructions given to it by the parent company, regard being had in particular to the economic, organisational and legal links between those two legal entities. That is the case because, in such a situation, the parent company and its subsidiary form a single economic unit and therefore form a single undertaking for the purposes of Article 81 EC, which enables the Commission to address a decision imposing fines to the parent company, without having to establish the personal involvement of the latter in the infringement (see, to that effect, the judgment of the Court of Justice in Akzo Nobel and Others v Commission, paragraph 73 above, paragraphs 56 to 59 and the case-law cited).

75 In order to be able to impute the conduct of a subsidiary to a parent company, the Commission cannot merely find that the parent company is in a position to exercise decisive influence over the conduct of its subsidiary, but must also check whether that influence was actually exercised (see, to that effect, Case 107/82 AEG-Telefunken v Commission [1983] ECR 3151, paragraph 50).

76 In that regard, it is, as a rule, for the Commission to demonstrate such decisive influence on the basis of factual evidence, including, in particular, any management power one of the undertakings may have over the other (see, to that effect, Avebe, paragraph 43 above, paragraph 136 and the case-law cited).

77 Advocate General Kokott observed in points 89 to 93 of her Opinion in the judgment of the Court of Justice in Akzo Nobel, paragraph 73 above (ECR I-8241), to which the Court of Justice refers expressly in paragraph 73 of that judgment, that, even if the examination of the autonomy of the subsidiary is carried out in the light of its commercial policy in the narrower sense, the decisive influence of the parent company does not necessarily have to result from specific instructions, guidelines or rights of co-determination in terms of pricing, production and sales activities or similar aspects essential to market conduct. Such instructions are merely a particularly clear indication of the existence of the parent company's decisive influence over its subsidiary's commercial policy. However, autonomy of the subsidiary cannot necessarily be inferred from their absence. A parent company may exercise decisive influence over its subsidiaries even when it does not make use of any actual rights of co-determination and refrains from giving any specific instructions or guidelines on individual elements of commercial policy. Thus, a single commercial policy within a group may also be inferred indirectly from the totality of the economic and legal links between the parent company and its subsidiaries. For example, the parent company's influence over its subsidiaries as regards corporate strategy, operational policy, business plans, investment, capacity, provision of finance, human resources and legal matters may have indirect effects on the market conduct of the subsidiaries and of the whole group. In the end, the decisive factor is whether the parent company, by reason of the intensity of its influence, can direct the conduct of its subsidiary to such an extent that the two must be regarded as one economic unit.

78 It is in the light of those factors that the merits of the second part of this plea must be analysed.

79 As a preliminary point, it should be noted that the applicant does not dispute that DDE participated in a cartel in breach of Article 81 EC between 1 April 1996 and 13 May 2002. However, it claims that the Commission was not entitled to impute to it, as parent company, the infringement committed by DDE, because it did not exercise decisive influence over DDE's conduct.

80 In this respect, it should be borne in mind first of all that DDE was a joint venture held in equal shares by Dow and EI DuPont which had been created on the basis of the LLC Agreement.

81 Moreover, the Court would point out that, in the LLC Agreement, EI DuPont and Dow had set up a Members' Committee in order to supervise the business of DDE and to approve certain matters pertaining to the strategic direction of DDE. Each of the parent companies had the right to appoint an equal number of representatives to the Members' Committee, who were not employees of DDE, but of EI DuPont and Dow. The Members' Committee had powers, inter alia, to appoint the board members and the officers of DDE, who were responsible for the day-to-day business affairs, subject to the overall direction and control of EI DuPont and Dow through the Members Committee, to dismiss the board members and officers of DDE at any time with or without reasons, to set the overall policy and vision of DDE, to approve the business and strategic plans and the annual operating plans of DDE, to determine the banking policy of DDE and to approve all capital expenditure and borrowing by DDE above certain levels. The decisions of the Members' Committee were taken unanimously, with each shareholder having an absolute right of veto. Those elements are not disputed by the applicant. The fact that the shareholders held equal shares in DDE's share capital and in the associated voting rights, as described above, meant that each of DDE's parent companies could block the strategic business decisions of the joint venture. In order to ensure that the strategic business decisions of their joint venture were not thus blocked, EI DuPont and Dow were therefore required to cooperate permanently.

82 Moreover, it is apparent from the LLC Agreement that DDE's parent companies were present on the CR market only through their joint venture. Under that agreement, DDE represented Dow and EI DuPont's business interests within the 'business purpose' of the joint venture, defined as the discovery, development, design, manufacture, distribution, marketing and sale of elastomers, including CR, on a global basis. That agreement also provided for the transfer by Dow to DDE of certain technology and other assets and for the transfer by EI DuPont to DDE of its entire elastomers business, including CR, as well as the ancillary business records. Therefore, DDE produced and sold CR under the trade name Neoprene which belonged to EI DuPont. Moreover, the agreement in question specifically provided for the elimination of competition between DDE's parent companies as regards the product within the 'business purpose' of that agreement. Net profits or losses of DDE were allocated in equal proportions to the two parent companies. Those elements are not disputed by the applicant.

83 Lastly, the concentration effected by EI DuPont and Dow by the creation of DDE was notified to the Commission, which approved it by decision of 21 February 1996 (Case IV/M.663 - DuPont/Dow). In approving that concentration, the Commission formally found that the parent companies had acquired joint control of DDE for the purposes of Article 3(1)(b) of Council Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between undertakings (corrected version OJ 1990 L 257, p. 13, amended by Council Regulation (EC) No 1310/97 of 30 June 1997 (OJ 1997 L 180, p. 1)) (now Article 3(1)(b) of Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (OJ 2004 L 24, p. 1), in force at the time of DDE's creation).

84 It is apparent from Article 3(3) of Regulation No 4064/89 (now Article 3(2) of Regulation No 139/2004) that the concept of control must be understood as the possibility of exercising decisive influence over the activity of an undertaking, as a consequence of rights, contracts or any other means. The concept of joint control was clarified by the Commission in its Consolidated Jurisdictional Notice under Council Regulation (EC) No 139/2004 on the control of concentrations between undertakings (OJ 2008 C 95, p. 1), adopted on the basis of the case-law of the General Court (Case T-282/02 Cementbouw Handel & Industrie v Commission [2006] ECR II-319, paragraphs 42, 52 and 67). According to paragraphs 62 and 63 of that notice:

'Joint control exists where two or more undertakings or persons have the possibility of exercising decisive influence over another undertaking. Decisive influence in this sense normally means the power to block actions which determine the strategic commercial behaviour of an undertaking. Unlike sole control, which confers upon a specific shareholder the power to determine the strategic decisions in an undertaking, joint control is characterised by the possibility of a deadlock situation resulting from the power of two or more parent companies to reject proposed strategic decisions. It follows, therefore, that these shareholders must reach a common understanding in determining the commercial policy of the joint venture and that they are required to cooperate. As in the case of sole control, the acquisition of joint control can also be established on a de jure or de facto basis. There is joint control if the shareholders (the parent companies) must reach agreement on major decisions concerning the controlled undertaking (the joint venture).'

85 In order to demonstrate that DDE's parent companies actually exercised decisive influence over DDE's conduct on the CR market, the Commission relied, first of all, on the fact that the Members' Committee, in exercising the powers reserved to it by the LLC Agreement, appointed to the top management posts in the joint venture persons from a high management level within the parent companies. Those appointments were made throughout the existence of the joint venture. As regards the applicant, it follows from recitals 37 and 426 of the contested decision that Mr P., who was the Director of Marketing at one of the companies of the Dow group, became Vice-President - Ethylene Elastomers between 1996 and 1999 and, subsequently, Vice-President Commercial between 1999 and 2000 and that Mr R., who was the general manager of the 'France-Benelux' region at Dow, was appointed President of the European Region at DDE in 1996. Similarly, it follows from recitals 30, 37 and 426 of the contested decision that Mr D., who was the general manager of the global elastomers division of EI DuPont between 1980 and 1995, was appointed DDE's first CEO, from 1996 to 1998. Mr K., who was the European Business Manager for CR at EI DuPont, became DDE's Vice-President for the same area and was appointed CEO of DDE in February 1999. Moreover, Mr F. who was, inter alia, European Regional Manager for Chlorinated Elastomers at EI DuPont between 1992 and 1996, was appointed Vice-President of DDE as of 1996. As is apparent from recitals 132, 137, 139, 143, 145, 146, 151, 158, 163, 168, 169, 173, 177, 188, 189, 192, 194, 195, 197, 199, 205, 206, 210, 215, 224, 225, 233, 234, 255, 256, 258, 260, 262, 263, 281, 288, 289, 291 and 303 of the contested decision, without being disputed by the applicant, those persons were systematically involved in the participation in, and organisation of, the anticompetitive meetings.

86 Next, in recital 438 of the contested decision, the Commission took into consideration the fact, which was not disputed by the applicant, that the Members' Committee had agreed to the closure of a DDE CR production plant in Maydown (United Kingdom). Such a decision could not have been taken by the joint venture unless the parent companies, acting through the Members' Committee, had given their agreement. That decision therefore also constitutes an indication that the parent companies exercised decisive influence over the conduct of the joint venture on the CR market.

87 Moreover, the Commission took into consideration all the clauses of the LLC Agreement, outlined in paragraph 81 above, which reserved to the Members' Committee and, accordingly, to the parent companies, significant powers relating to the management of the joint venture (see recitals 422 to 426 and 432 of the contested decision). Given that, in the present case, DDE operated over a number of years and that the parent companies did not dispute that the LLC Agreement had been implemented in accordance with its clauses, the Commission did not err in taking the view that the Members' Committee had in fact exercised, according to the modalities laid down in the LLC Agreement, the powers reserved to it by that agreement and that, therefore, the parent companies had exercised their management power over DDE.

88 Lastly, the Court notes that, in recitals 437 and 438 of the contested decision, the Commission refers to an internal investigation carried out in 2003 within the joint venture. It is apparent from those recitals, without being disputed by the applicant, that that investigation was ordered by the parent companies in order to examine whether the joint venture might have participated in the cartel. The fact that the parent companies were engaged in the implementation of that investigation confirms that they believed that they had the means of requiring their joint venture to conduct itself in accordance with the competition rules. The conclusion must be drawn from this that the parent companies did in fact have the power to require their joint venture to adopt a specific line of conduct on the market.

89 It follows from the foregoing that, in the light of all the economic, legal and organisational links between Dow and DDE, the Commission did not err in finding that Dow, as one of DDE's parent companies, had exercised decisive influence over DDE's conduct on the CR market. The Commission did not therefore err in finding that Dow and DDE formed a single undertaking for the purposes of Article 81 EC and in holding Dow jointly and severally liable for DDE's conduct from 1 April 1996 until 13 May 2002.

90 That conclusion cannot be called into question by the applicant's arguments.

91 First, the applicant's argument, based on the Commission's conclusions relating to the autonomy of the full-function joint venture set out in the Rubber chemicals decision, according to which a full-function joint venture is necessarily an undertaking separate from its parent companies (see paragraph 55 above) must be rejected. Although the Commission must give an account of its reasoning if a decision goes appreciably further than the previous decision-making practice, economic operators have no grounds for a legitimate expectation that a previous decision-making practice, that is capable of being varied when the European Union institutions exercise their discretion, will be maintained (see Case T-151/05 NVV and Others v Commission [2009] ECR II-1219, paragraph 136 and the case-law cited). Moreover, an applicant cannot plead such an expectation to challenge findings or assessments made in a given set of proceedings by invoking findings or assessments made in the context of just one previous case (Case T-210/01 General Electric v Commission [2005] ECR II-5575, paragraph 119). Furthermore, it does not follow from the explicit obligation to state reasons imposed by the case-law that the Commission must, in addition to stating the reasons for its decision by reference to the file of the case in question, specifically set out its reasons for reaching a different conclusion than in a previous case concerning similar or identical situations or the same market participants (General Electric v Commission, paragraph 513). Thus, in the present case, the applicant cannot usefully plead, in essence, that there has been an infringement of the principle of the protection of legitimate expectations because the Commission, in an earlier decision, found that a full-function joint venture can be presumed to be independent from its parent companies, when, in recitals 420 to 440 of the contested decision, the Commission reasoned its decision explicitly by reference to the file of the case in question, to the case-law of the European Union (including, in particular, Avebe, paragraph 43 above) and to its own decision-making practice (the Gas insulated switchgear decision, paragraph 50 above).

92 The 'negative' nature of the joint control is not sufficient to preclude the exercise of decisive influence over DDE. Even if parent companies are not able to impose decisions on their joint venture, they are able to prevent their joint venture from taking certain decisions and thereby exercise decisive influence over its business strategy. As was observed in paragraphs 80 to 84 above, in the light of the joint control that the applicant and EI DuPont held over DDE and of the composition, powers and mode of operation of the Members' Committee, those parent companies had the power to reject strategic decisions regarding their joint venture. Those parent companies therefore had to reach a common understanding in determining the commercial policy of the joint venture. The 'negative' nature of the control that the applicant held over DDE did not therefore prevent it from exercising over DDE sufficient decisive influence to enable the Commission to impute to it the unlawful conduct of that joint venture.

93 Moreover, the fact that DDE was a full-function joint venture for the purposes of Regulation No 4064/89, and was deemed to perform on a lasting basis all the functions of an autonomous economic entity, cannot invalidate the conclusion that the applicant and EI DuPont had the possibility of exercising decisive influence over DDE in the CR market. It is true that a full-function joint venture, for the purposes of Regulation No 4064/89, is deemed to perform on a lasting basis all the functions of an autonomous economic entity and is, therefore, economically autonomous from an operational viewpoint. However, as the Commission made clear in paragraph 93 of its Consolidated Jurisdictional Notice under Regulation No 139/2004 (see paragraph 84 above), that autonomy does not mean that the joint venture enjoys autonomy as regards the adoption of its strategic decisions (and that it is not therefore under the decisive influence exercised by its parent companies for the purposes of the application of Article 81 EC).

94 Second, contrary to the view taken by the applicant, it is not appropriate to distinguish the circumstances of the present case from those in Avebe, paragraph 42 above, in which the joint venture did not have a legal personality separate from that of its parent companies. It is because the joint venture, on the one hand, and its parent companies, on the other, formed a single undertaking for the purposes of European Union competition law, in the context of which the unlawful conduct of the subsidiary may be imputed to the parent companies, who become liable by virtue of the fact that they in reality control its commercial policy, that the General Court held that liability for the unlawful conduct of the subsidiary could be imputed to its parent companies (Avebe, paragraph 43 above, paragraph 141). Thus, the subsidiary's absence of legal personality was not conclusive. In addition, it is apparent from the case-law cited in paragraph 73 above that the fact that DDE had its own legal personality is not sufficient to exclude the possibility of imputing its conduct to one of its parent companies. Thus, it is the fact that a parent company and a subsidiary constitute a single economic unit, and therefore a single undertaking for the purposes of European Union law, that enables the Commission to address the decision imposing fines to the parent company of a group of companies.

95 As regards the other specific circumstances of the case in Avebe, paragraph 43 above, to which the applicant refers (see paragraph 58 above), they are not capable of calling into question the principle that the unlawful conduct of a joint venture can be imputed to its parent companies where those parent companies jointly exercise decisive influence over the business strategy of their joint subsidiary, as in the present case. The applicant's reasoning that DDE had separate legal personality, based on the fact that DDE did not depend on the applicant and EI DuPont in order to enter into agreements with third parties, that DDE had its own premises, that its management was independent of the applicant and EI DuPont and that the applicant and EI DuPont were never engaged jointly and without limitation in DDE, does not call into question the fact that it had the possibility of exercising and did exercise, jointly with EI DuPont, decisive influence over DDE's conduct on the market, as was observed in paragraphs 80 to 89 above.

96 Third, the applicant's arguments alleging that it was never 'involved' in the CR business and that the members of its staff who subsequently occupied a position within DDE did not return to work at the applicant when DDE was broken up and were under no obligation, and were not even entitled, to report to the applicant seek in essence to make the case that it was not aware of the existence of the cartel. The issue of the parent company's awareness of the cartel will be examined in the first part of this plea.

97 Fourth, as regards the applicant's argument alleging breach of the presumption of innocence, it should be borne in mind that the principle of the presumption of innocence implies that every person accused is presumed to be innocent until his guilt has been established according to law. That presumption thus precludes any formal finding and even any allusion to the liability of an accused person for a particular infringement in a final decision unless that person has enjoyed all the usual guarantees accorded for the exercise of the rights of defence in the normal course of proceedings resulting in a decision on the merits of the case (judgment of 30 September 2009 in Case T-174/05 Elf Aquitaine v Commission, not published in the ECR, paragraph 196).

98 In the present case, it must be stated that the Commission has demonstrated on the basis of factual evidence that the applicant had the possibility of jointly exercising decisive influence over DDE's business strategy and did in fact exercise that influence and concluded from this that the applicant, EI DuPont and DDE formed a single economic unit for the purpose of the subject-matter of the agreement in question, thus enabling joint and several liability to be imputed for an infringement of competition law. Moreover, during the procedure before the Commission, and therefore before any formal finding of the applicant's liability, the applicant was able to present arguments in order to show that DDE had decided independently upon its own conduct on the market and that, accordingly, it did not form, with EI DuPont and DDE, a single undertaking for the purposes of Article 81 EC. In those circumstances, the applicant's argument alleging breach of the presumption of innocence cannot succeed.

99 Fifth, as regards the applicant's argument that it is not possible to apply the concept of a single economic entity to joint ventures, and that this is moreover confirmed by the practice of the Commission which has applied, in the past, Article 81 EC to agreements between parent companies and joint ventures, it should be recalled that, in Avebe, paragraph 43 above (paragraph 141), the General Court held that, in the light of the existence of joint control exercised by the parent companies, the joint venture, on the one hand, and its parent companies, on the other, formed an economic unit for the purpose of the subject-matter of the agreement in question, in the context of which the unlawful conduct of the subsidiary may be imputed to its parent companies, who become liable by virtue of the joint control that they exercise over the subsidiary's commercial policy. Moreover, as was stated in paragraphs 94 and 95 above, it is not appropriate to distinguish the circumstances of the present case from those in Avebe, paragraph 43 above. Regarding the argument that the Commission's approach is inconsistent with its previous decision-making practice, it is sufficient to recall that the applicant cannot invoke a legitimate expectation that a previous decision-making practice, capable of being varied when the European Union institutions exercise their discretion, will be maintained, when the Commission has reasoned its decision explicitly by reference to the file of the case in question (see paragraph 91 above). Consequently, the applicant's argument based on the Commission's previous decision-making practice, relating to the applicability of Article 81 EC to the relationship between a subsidiary and its parent companies, must also be rejected.

100 Sixth, as regards the applicant's argument that the Commission gave an overextensive interpretation to the concept of the exercise of decisive influence, it should be observed that in the light of the existing case-law of the Court of Justice and the General Court cited in paragraphs 73 to 77 above, the material referred to by the Commission in the contested decision is sufficient to show that DDE's parent companies had the possibility of exercising decisive influence over their joint venture's conduct and that the exercise of that decisive influence has been demonstrated to the requisite legal standard.

101 Moreover, the Court considers that as a result of the parent company's power of supervision, the parent company has a responsibility to ensure that its subsidiary complies with the competition rules. An undertaking which has the possibility of exercising decisive influence over the business strategy of its subsidiary may therefore be presumed, in the absence of proof to the contrary, to have the possibility of establishing a policy aimed at compliance with competition law and to take all necessary and appropriate measures to supervise the subsidiary's commercial management. Mere failure to do so by the shareholder with a power of supervision over such matters cannot in any event be accepted as a ground on which he can decline his liability. Accordingly, since any gains resulting from illegal activities accrue to the shareholders, it is only fair that that those who have the power of supervision should assume liability for the illegal business activities of their subsidiaries.

102 Seventh, as regards the applicant's argument that the Commission, in holding it liable for the infringement committed by DDE, cannot apply stricter corporate governance standards that are inconsistent with those applied in United States corporate law, the Court observes that, when the Commission imposes sanctions on the unlawful conduct of an undertaking, even conduct originating in an international cartel, it seeks to safeguard the free competition within the common market which constituted a fundamental objective of the Community under Article 3(1)(g) EC. On account of the specific nature of the legal interests protected in the European Union, the Commission's assessments pursuant to its relevant powers may diverge considerably from those of the competent authorities of non-member States. Moreover, there is no principle or public international law convention pursuant to which the Commission might be obliged, when imputing unlawful conduct under European Union competition law, to take account of assessments made by the competent authorities of a non-member State in the area of competition law. Next, it should be added that the Agreement between the Government of the United States of America and the Commission of the European Communities regarding the application of their competition laws of 23 September 1991, relied upon by the applicant in this respect, is limited to promoting cooperation and coordination and lessening the possibility or impact of differences between the parties in the application of their competition laws and does not relate to the imputation of a subsidiary's unlawful conduct to its parent company (see, to that effect and by analogy, Case C-289/04 P Showa Denko v Commission [2006] ECR I-5859, paragraphs 55, 58 and 59). Lastly, even if such an agreement could be invoked against the lawfulness of the contested decision, it is clear from Article 4 of that agreement that that agreement is limited to setting out the line of conduct that the parties request one another to follow when enforcing their respective competition laws. Such reciprocal requests cannot in any event be understood as entailing an obligation on the Commission to arrive at a specific result. It follows that, in any event, as the Commission points out, the applicant's argument that the contested decision disregards the terms of Article 4 of that agreement is not substantiated in any way and must therefore be rejected.

103 As regards the applicant's argument that the Commission has identified no conduct on the applicant's part that had an effect in the European Union, suffice it to note that that argument is based on the incorrect premiss that DDE was an undertaking which was separate from, and independent of, the applicant, as the Court observed in paragraphs 80 to 89 above. Moreover, the applicant does not contest the Commission's findings in recitals 59 and 374 to 379 of the contested decision that the cartel in question had an appreciable effect on trade between Member States of the European Union and between Contracting Parties to the EEA Agreement. That argument must therefore be rejected.

104 It follows from all of the foregoing that the second part of the first plea must be rejected as unfounded.

- The first part, alleging a manifest error of assessment of the facts and an error of law and breach of the rights of the defence as regards the applicant's awareness of the existence of the cartel

105 In recital 428 of the contested decision, the Commission observed that the applicant 'must also have been aware of the existence of the cartel' and that awareness of the existence of the cartel was 'an additional factor demonstrating that [the applicant and EI DuPont] exercised a decisive influence on DDE's behaviour'. Clearly, therefore, the applicant's awareness of the infringement committed by DDE was considered only to be an additional factor by the Commission and did not constitute an essential factor taken into account by the Commission against the applicant.

106 It should be observed that, according to the case-law, there is no requirement, in order to impute to a parent company liability for the acts undertaken by its subsidiary, to prove that that parent company was directly involved in, or was aware of, the offending conduct. It is not because of a relationship between the parent company and its subsidiary in instigating the infringement or, a fortiori, because the parent company is involved in the infringement, but because they form a single undertaking for the purposes of Article 81 EC that the Commission is able to address the decision imposing fines to the parent company (see, to that effect, Case T-12/03 Itochu v Commission [2009] ECR II-883, paragraph 58). Accordingly, Dow's lack of awareness of DDE's infringement, on the assumption that it is established, is not sufficient to invalidate the conclusion in paragraph 89 above that DDE's conduct on the CR market is imputable inter alia to the applicant, which, as one of DDE's parent companies, exercised decisive influence over that conduct.

107 In addition, it is appropriate to recall the case-law cited in paragraph 77 above, according to which the question whether the parent company has interfered in the day-to-day business of its subsidiary, or, equally, whether anticompetitive activities engaged in by the subsidiary were imputable to an instruction from the parent company or known to the latter, is not relevant. A parent company may exercise decisive influence over its subsidiaries even when it does not make use of any actual rights of supervision and refrains from giving any specific instructions or guidelines on individual elements of commercial policy. In the end, the decisive factor is whether the parent company, by reason of the intensity of its influence, can direct the conduct of its subsidiary to such an extent that the two must be regarded as forming part of the same economic unit.

108 It is apparent from the analysis of the second part of the first plea that the applicant, as one of DDE's parent companies, exercised a sufficient decisive influence over DDE to be able to direct DDE's conduct to such an extent that the two could be regarded as parts of the same economic unit. It is further apparent from that analysis that the Commission was correct to impute inter alia to the applicant the infringement committed by DDE during the period from 1 April 1996 until 13 May 2002. Accordingly, the applicant's arguments that the contested decision should be annulled because the Commission took account of its awareness of the cartel must be rejected as ineffective.

109 As regards the applicant's arguments submitted in this part of the plea and alleging, in essence, a breach of the rights of the defence and that the Commission breached the applicant's 'right to be heard' by referring, in recitals 428 and 438 of the contested decision, to matters concerning the applicant's knowledge of the cartel that did not appear in the statement of objections, they are not well founded.

110 In this respect, it should be borne in mind that in all proceedings in which sanctions, especially fines or penalty payments, may be imposed, observance of the rights of the defence is a fundamental principle of EU law which must be complied with even if the proceedings in question are administrative proceedings (Case C-308/04 P SGL Carbon v Commission [2006] ECR I-5977, paragraph 94, and Joined Cases C-125/07 P, C-133/07 P, C-135/07 P and C-137/07 P Erste Group Bank and Others v Commission [2009] ECR I-8681, paragraph 270). In that sense, Regulation No 1/2003 provides that the parties are to be sent a statement of objections which must clearly set out all the essential matters on which the Commission relies at that stage of the procedure. That statement of objections constitutes the procedural safeguard applying the fundamental principle of European Union law which requires observance of the rights of the defence in all proceedings. That principle requires, in particular, that the statement of objections which the Commission sends to an undertaking on which it envisages imposing a penalty for an infringement of the competition rules contain the essential elements used against it, such as the facts, the characterisation of those facts and the evidence on which the Commission relies, so that the undertaking may submit its arguments effectively in the administrative procedure brought against it (see Joined Cases C-322/07 P, C-327/07 P and C-338/07 P Papierfabrik August Koehler and Others v Commission [2009] ECR I-7191, paragraphs 35 and 36 and the case-law cited)

111 In the present case, it is apparent from recital 428 of the contested decision (see paragraph 105 above), that awareness of the existence of the cartel was taken into account by the Commission as an additional factor, supplementing its reasoning in the contested decision. In recital 438 of the contested decision, the Commission stated that 'with regard to the witness statement that [the applicant] and [EI] DuPont have submitted in their responses to the Statement of Objections and to which they refer to demonstrate that the parents/Members Committee were not aware of the infringement, the statement is about an internal investigation that concerned not only DDE, but also pre-1996 activities of [EI] DuPont in Europe, and that an important part of the investigation mandate was to help DDE obtain a favourable leniency treatment'.

112 It is therefore unequivocally clear from the contested decision that, as the Commission observed, the elements relating to the applicant's awareness of the existence of the cartel were added to the contested decision in reply to the applicant's argument in its response to the statement of objections, to the effect that it was not aware of DDE's collusive activities. It follows that the Commission did not confront the applicant, in the contested decision, with elements regarding its awareness of the existence of the cartel of which the applicant had not been informed and that the applicant was able to submit its arguments effectively in that regard in the administrative procedure, in particular by presenting the results of an internal investigation and a statement by an external consultant. However, the Commission rejected them as inconclusive. The applicant has therefore failed to establish the alleged breach of the rights of the defence.

113 It follows that the first part of this plea must be rejected as ineffective and, in any event, as unfounded in part.

114 Consequently, the first plea, alleging that the infringement committed by DDE was incorrectly imputed to the applicant, must be rejected.

115 In the light of the foregoing, it must also be held that it is not necessary to hear the witness as requested by the applicant (see paragraph 48 above). It is for the Court to appraise the usefulness of measures of inquiry for the purpose of resolving the dispute (judgment of September 2007 in Case T-448/04 Commission v Trends, not published in the ECR, paragraph 195) and, in the present case, in the light of the analysis carried out above, such a hearing would appear to serve no purpose.

Second plea: in the alternative, incorrect determination of the amount of the fine imposed on the applicant

Wording of the contested decision

116 As regards, first of all, the multiplier applied to the starting amount of the fine in order to take account of the duration of the infringement, the Commission stated, in recital 536 of the contested decision, that 'the infringement lasted for 9 years for Bayer, [EI] DuPont, Denka, Eni[C]hem and Tosoh and for 6 years and 1 month for Dow and DPE [LLC and DPE SA]' and that '[i]n accordance with point 24 of the [2006] Guidelines ..., the [starting] amount [of the fine] determined [by reference to the value of sales] should therefore be multiplied by 9 for Bayer, [EI] DuPont, Denka, Eni[C]hem and Tosoh and by 6.5 for Dow and DPE [LLC and DPE SA]'.

117 As regards, next, the specific increase applied in order to ensure that the fines would have a sufficiently deterrent effect, the Commission observed, in recital 584 of the contested decision, that 'Eni[C]hem, Dow, [EI] DuPont, and Bayer have a particularly large turnover beyond the sales of goods or services to which the infringement relates, and the turnover of each of them is, in absolute terms, much larger than that of Tosoh and Denka'.

118 In recital 586 of the contested decision, the Commission stated:

'In summary, in order to set the amount of the fines at a level which ensures that they have a sufficient deterrent effect, it is appropriate, to apply a multiplication factor to the fines to be imposed. In 2006, the financial year preceding this Decision, the total turnover of the undertakings to which this Decision is addressed was as follows: Eni: EUR 86 105 million, Dow: EUR 39 124 million, Bayer: EUR 28 956 million, [EI] DuPont: EUR 21 839 million, Tosoh: EUR 5 350 million and Denka: EUR 2 254 million. On that basis, it is appropriate not to apply any multiplier to the fines to be imposed on Bayer, [EI] DuPont, Tosoh and Denka and to multiply by 1,4 the fine to be imposed on Eni and by 1,1 the fine to be imposed on Dow.'

119 As regards, lastly, the application of the 2002 Leniency Notice, the Commission decided, in recital 637 of the contested decision, that '[EI] DuPont/DPE [LLC and DPE SA] should be granted a reduction of 25% of the fine that would otherwise have been imposed on them'.

120 In recital 635 of the contested decision, the Commission explained:

'In determining, pursuant to point 23 of the [2002] Leniency Notice, the percentage reduction of the fine for which DDE/DPE [LLC and DPE SA] qualifies within the band of 20% to 30%, the Commission takes into account the extent to which the evidence submitted by DDE/DPE [LLC and DPE SA] represents added value, as well as the time at which DDE/DPE [LLC and DPE SA] submitted that evidence. DDE/DPE [LLC and DPE SA] approached the Commission 10 months after the Commission had carried out surprise inspections at Dow and 4 months after the Commission's inspections at Denka. The added value of DDE/DPE [LLC and DPE SA's] submission is mainly linked to those instances for which corroboration was still necessary, even after Tosoh's submission, especially through the submission of direct evidence relating to the early cartel period and the further details that it confirmed or disclosed (including details on the general scope and functioning of the cartel). Without the direct evidence provided by DDE on the early years of the cartel, the Commission could only have relied on oral submissions from Bayer and Tosoh, which were partially contradictory. The documents submitted allowed the Commission to establish unambiguously the first two years of the cartel.'

Arguments of the parties

121 The applicant claims that, even if the Commission was correct to hold it liable for the infringement committed by DDE, it made manifest errors of assessment of the facts and errors of law in determining the amount of the fine which it imposed on the applicant. In that regard, it divides its second plea into three parts, concerning the application of the multiplier in respect of the duration of the infringement, the specific increase applied in order to ensure that the fine would be sufficiently deterrent and the reduction of the fine under the 2002 Leniency Notice.

122 Furthermore, as regards the amending decision of 23 June 2008, the applicant adds that, since it was held liable not for wrongdoing on its own part but for wrongdoing by DDE, it is not appropriate to impose on it a higher fine, as shareholder, or to impute to it, as shareholder, individual liability for any part of the fine.

- First part, concerning the application of the multiplier in respect of the duration of the infringement

123 The applicant claims that multiplication of the starting amount of the fine by 6.5 to take account of the duration of the fine for which it is held liable - fixed by the Commission at six years and one month (for the period during which the joint venture was in existence, 1 April 1996 to 13 May 2002) - and which amounts to treating one month as though it were half a year, even if consistent with the wording of point 24 of the 2006 Guidelines, constitutes a manifest error of assessment of the facts and breaches the principles of proportionality and equal treatment. In the reply, the applicant states that it does not claim that the 2006 Guidelines are illegal.

124 Multiplication by 6.5 constitutes a breach of the principles of proportionality and equal treatment, since the undertakings were punished for longer periods, and, in this case a considerably longer period than the duration of the infringement. In the light of Joined Cases T-101/05 and T-111/05 BASF v Commission [2007] ECR II-4949, paragraph 219, where it was held that fines are more proportionate where they are calculated in a way that reflects the precise duration of the infringement, the Commission ought to have calculated the multiplier for duration in the present case on the basis of the precise duration of the infringement.

125 The principle of equal treatment is also infringed, since the Commission did not apply a multiplier to Bayer, EI DuPont, Denka, EniChem or Tosoh that was higher than the number of years of the infringement, that is to say, nine years and 'a few hours' (from 13 May 1993 to 13 May 2002). Unlike those undertakings, which were punished by the application of a multiplier of 9, the applicant was punished by the application of a multiplier significantly in excess of the duration of its infringement.

126 In that regard, the applicant also claims that, on the assumption that the Commission were able to demonstrate that the applicant was aware of the existence of the cartel and could rely in that regard on the discussion of the closure of the plant, and on the assumption that that were relevant in order to impute DDE's conduct to the applicant, liability could be imputed to the applicant only from that time. The infringement would therefore have lasted much less than six years, as the discussion within the Members' Committee did not take place until January 1998.

127 At the hearing, the applicant put forward an argument that point 24 of the 2006 Guidelines is illegal.

128 The Commission contends that this part of the plea must be rejected as unfounded. In its view, the argument alleging that point 24 of the 2006 Guidelines may be illegal contradicts the applicant's claims in the reply and, in any event, must be rejected as out of time.

- Second part, relating to the specific increase applied in order to ensure that the fines would be sufficiently deterrent

129 The applicant reiterates that, since it has done nothing wrong, the fine imposed on it can have no deterrent effect and can have only negative effects on competition. In addition, it submits that by increasing the amount of the fine imposed on it by 10%, the Commission has made a manifest error of assessment of the facts and has breached the principle of equal treatment. The applicant observes that in Commission Decision C(2007) 5469 final of 20 November 2007 relating to a proceeding under Article 81 [EC] and Article 53 of the EEA Agreement (Case COMP/38.432 - Professional videotapes) ('the Professional Videotapes decision'), the Commission imposed a fine on Sony that was increased by the same factor of 10%, although that undertaking's worldwide turnover was more than 40% higher than the applicant's.

130 In the applicant's submission, the principle of equal treatment applies not only to the addressees of the same decision, but also between the decision referred to above and the contested decision, which were adopted within two weeks of each other. Furthermore, the Commission's argument that the relevant market in the Professional Videotapes decision (see paragraph 129 above) had different characteristics, in that the videotapes in question in that case were no longer produced, is irrelevant. In any event, the applicant claims that it is in the same position as Sony, since it no longer distributed CR at the time when the Commission adopted the contested decision. If that factor were to play a role, the contested decision would be discriminatory vis-à-vis the applicant by comparison with EniChem, which is still active in the CR sector.

131 The Commission contends that this part of the plea must be rejected as unfounded.

- The third part, relating to the reduction of the fine under the 2002 Leniency Notice

132 The applicant maintains that, by granting it a reduction of only 25% of the amount of its fine under the 2002 Leniency Notice, when the applicable band is 20% to 30% and the first applicant for leniency, Tosoh, was granted the maximum reduction provided for in the band applicable to its situation, the Commission made a manifest error of assessment of the facts and an error of law. Furthermore, the Commission failed to provide adequate reasons in that regard and, by treating the first applicant for leniency more favourably, it breached the principle of non-discrimination.

133 The applicant emphasises, in particular, that DDE's application for leniency was lodged only four months later than Tosoh's first submission, which is a small difference in the context of an investigation such as that in the present case. Furthermore, the succession in time of the leniency applications is already taken into consideration in the bands of reduction laid down in the 2002 Leniency Notice.

134 Since the evidence produced in DDE's leniency application had real added value, as the contested decision shows at several points, DDE ought to have received the maximum possible reduction in the band laid down in the 2002 Leniency Notice. The Commission ought at least to have stated why DDE, and therefore the applicant, could not be granted such a reduction. The applicant disputes the Commission's assertion that it is not required to undertake an explicit comparative analysis of the reasons why, in relative terms, one undertaking is not granted as high a reduction as another undertaking. In its submission, the Commission should be in a position to demonstrate that it complied with the principles of non-discrimination and proportionality.

135 The Commission contends that this part of the plea must be rejected as unfounded.

Findings of the Court

136 It is appropriate to analyse first of all the three parts of this plea, and subsequently the applicant's arguments relating to the amending decision of 23 June 2008.

- First part, concerning the application of the multiplier in respect of the duration of the infringement

137 It should be borne in mind that the fines that the Commission imposed in the present case are governed by Article 23 of Regulation No 1/2003, which corresponds to Article 15 of Regulation No 17 of the Council of 6 February 1962, First Regulation implementing Articles [81 EC] and [82 EC] (OJ, English Special Edition 1959-1962, p. 87), which was in force when the infringement was committed. In order to determine the amount of the fine, the Commission applied the 2006 Guidelines. Those guidelines were published before the statement of objections was sent to the applicant on 13 March 2007.

138 According to Article 23(3) of Regulation No 1/2003, in fixing the amount of the fine to be imposed on undertakings guilty of infringements of the competition rules, regard is to be had both to the gravity and to the duration of the infringement.

139 It has been consistently held that, within the limits laid down in Regulation No 1/2003, the Commission enjoys a wide discretion when exercising its power to impose such fines (Joined Cases C-189/02 P, C-202/02 P, C-205/02 P to C-208/02 P and C-213/02 P Dansk Rørindustri and Others v Commission [2005] ECR I-5425, paragraph 172, and Erste Group Bank and Others v Commission, paragraph 110 above, paragraph 123). That power is however limited; where the Commission adopts guidelines which are consistent with the Treaty and are designed to specify the criteria which it intends to apply in the exercise of its discretion, the Commission itself then limits that discretion in that it must comply with the guidelines which it has imposed upon itself (see, to that effect, Case C-413/08 P Lafarge v Commission [2010] ECR I-5361, paragraph 95, and Case T-73/04 Carbone-Lorraine v Commission [2008] ECR II-2661, paragraph 192 and the case-law cited). The Commission may not depart from the Guidelines in an individual case without giving reasons that are compatible with the principle of equal treatment (Dansk Rørindustri and Others v Commission, paragraph 209).

140 As regards the multiplier in respect of the duration of the infringement, point 24 of the 2006 Guidelines provides that, '[i]n order to take fully into account the duration of the participation of each undertaking in the infringement, the amount determined on the basis of the value of sales ... will be multiplied by the number of years of participation in the infringement' and that '[p]eriods of less than six months will be counted as half a year; periods longer than six months but shorter than one year will be counted as a full year'.

141 Moreover, it is settled case-law that the Commission may at any time adjust the level of fines if the proper application of the competition rules so requires (Joined Cases 100/80 to 103/80 Musique diffusion française and Others v Commission [1983] ECR 1825, paragraph 109, and Case T-23/99 LR AF 1998 v Commission [2002] ECR II-1705, paragraphs 236 and 237), since such an alteration of an administrative practice may then be regarded as objectively justified by the objective of general prevention of infringements of the competition rules. The increase in the level of fines cannot therefore, in itself, be regarded as unlawful under the principle that penalties must have a proper legal basis, provided that it remains within the statutory limits laid down by Article 23(2) and (3) of Regulation No 1/2003, as interpreted by the Courts of the European Union (Case T-279/02 Degussa v Commission [2006] ECR II-897, paragraph 81, and Case T-69/04 Schunk and Schunk Kohlenstoff-Technik v Commission [2008] ECR II-2567, paragraph 43).

142 Although the method of assessing the duration of an infringement by progressive thresholds each of six months may have the effect of ignoring the differences which may exist between the exact durations during which the undertakings participated in the infringement, it cannot be censured, on condition that the setting of such thresholds complies with the principle of equal treatment, which prohibits comparable situations from being treated differently and different situations from being treated in the same way, unless such treatment is objectively justified, and the principle of proportionality, which requires measures adopted by European Union institutions not to exceed the limits of what is appropriate and necessary in order to attain the objective pursued. However, the European Union Courts' review of the lawfulness of the exercise of the Commission's discretion in the matter must confine itself to checking that the thresholds set are coherent and objectively justified and the Courts must not immediately substitute their own assessment for that of the Commission (see, to that effect and by analogy, Itochu v Commission, paragraph 106 above, paragraphs 73 and 74).

143 The fact that the multiplier in respect of the duration of the infringement is not strictly proportionate to the exact duration of the infringement committed by the undertaking in question cannot be censured, since it is merely the result of the method of assessing the duration of an infringement by progressive thresholds each of six months. Even if the effect of the application of that method is that a multiplier calculated by reference to a period longer than that during which they actually participated in the infringement is applied to certain undertakings, the difference in treatment is objectively justified by the objective of general prevention and the taking of effective action against infringements of the European Union competition rules (see, to that effect and by analogy, Itochu v Commission, paragraph 106 above, paragraphs 76, 77 and 81). Moreover, in the light of the generally long duration of infringements, in particular of the most serious infringements, to which Article 81 EC is applied, the setting of progressive thresholds of six months is coherent, objectively justified and not disproportionate.

144 Thus, the Commission's choice to treat periods of less than 6 months as half a year, and therefore to treat a period of 1 month and 13 days as if it was half a year, and to treat periods of 6 months, but of less than 1 year, as a full year does not exceed the limits of the discretion which it has in that regard and does not infringe the principles of proportionality and of equal treatment.

145 Consequently, the argument put forward by the applicant at the hearing by which it sought a declaration that point 24 of the 2006 Guidelines is contrary to the principles of proportionality and of equal treatment must be rejected as unfounded, and it is not necessary to rule on its admissibility.

146 In the present case, it is common ground that DDE participated in the cartel from 1 April 1996 until 13 May 2002, that is during an infringement period of 6 years, 1 month and 13 days. Consequently, by setting the duration of the infringement at six years and one month and by multiplying the starting amount of the fine by a factor of 6.5, the Commission complied with the rules which it imposed upon itself in the 2006 Guidelines and, therefore, did not exceed the limits of its discretion.

147 As for the argument that the applicant bases on BASF and UCB v Commission, paragraph 124 above, it is sufficient to note that, in that case, it was in the exercise of its unlimited jurisdiction, and after having partially annulled the decision which was at issue, that the General Court had carried out a fresh calculation of the fine to be imposed on BASF and that the General Court had chosen to fine-tune the amount of the fine in such a way as to reflect the exact duration of BASF's participation in the infringement in question, whilst pointing out that the Guidelines are without prejudice to the assessment of the amount of the fine by the Courts of the European Union, which have unlimited jurisdiction in that regard in accordance with Article 17 of Regulation No 17 (now Article 31 of Regulation No 1/2003).

148 Thus, first, it does not follow from that judgment, contrary to what the applicant suggests, that the Commission is required, in order for the principle of proportionality to be observed, to ensure that the multiplier applied in respect of the duration of the infringement reflects the exact duration of the participation of each undertaking in that infringement. Second, in the present case, it is not incumbent upon the Court, at this stage, in the absence of any finding that the contested decision is unlawful - as was the case in BASF and UCB v Commission, paragraph 124 above - to recalculate the amount of the fine imposed on the applicant; the Court is merely required to review the legality of the Commission's application of the 2006 Guidelines to their situation. The argument that the applicant bases on BASF and UCB v Commission, paragraph 124 above, must therefore be rejected.

149 As regards the argument that, by multiplying the starting amount of the fine determined by reference to the value of sales by 9 for Bayer, EI DuPont, Denka, EniChem and Tosoh in respect of an infringement which lasted nine years and 'a few hours', and by multiplying that amount by 6.5 in the applicant's case in respect of an infringement which lasted significantly less than six and a half years, the Commission infringed the principle of equal treatment, it should be noted that, in recital 515 of the contested decision, the Commission found that the applicant's infringement established from 1 April 1996 until 13 May 2002 had lasted six years and one month. Similarly, as regards the other undertakings, the Commission found that their infringement established from 13 May 1993 until 13 May 2002 had lasted nine years. It follows that, when calculating the duration of the infringement, the Commission took into consideration only whole years and months and did not take account of days. Accordingly, when determining the duration of the infringement, the Commission applied the same method of calculation in respect of all the participants and did not infringe the principle of equal treatment.

150 Moreover, on the assumption that it were established that the other undertakings' participation in the infringement did indeed exceed nine years, and even if the Commission erred in those undertakings' favour by applying to the starting amount of their fines only a multiplier of 9, that fact cannot constitute a valid reason for reducing the fine imposed on the applicant, since no one may rely on an unlawfulness committed in favour of another party (see, to that effect, Case T-241/01 Scandinavian Airlines System v Commission [2005] ECR II-2917, paragraph 170). That argument must therefore also be rejected.

151 As regards the argument that the applicant's participation in the infringement could have started only from the time that it became aware of that infringement, it is sufficient to note, as is apparent from the analysis of the first plea, that the applicant's liability results from the fact that it had the possibility of exercising decisive influence over its subsidiary's business strategy and did in fact exercise that decisive influence, and not from its possible awareness of the cartel in question. That argument must therefore be rejected.

152 In the light of the foregoing, the first part of this plea must be rejected as unfounded.

- The second part, concerning the specific increase applied in order to ensure that the fines would be sufficiently deterrent

153 It should be noted that point 30 of the 2006 Guidelines provides that '[t]he Commission will pay particular attention to the need to ensure that fines have a sufficiently deterrent effect; to that end, it may increase the fine to be imposed on undertakings which have a particularly large turnover beyond the sales of goods or services to which the infringement relates'.

154 The applicant puts forward two arguments in this respect, both of which must be rejected.

155 First, as regards the argument that the fine cannot have any deterrent effect in respect of the applicant because it 'did nothing wrong', it is sufficient to observe that such reasoning is based on the premiss that no finding was made that the applicant had committed an infringement. However, it is clear from recitals 420 to 440 and Articles 1 and 2 of the contested decision that the applicant was held individually liable for an infringement which it is deemed to have committed itself on account of its close legal and economic links with DDE, by which it was able to determine DDE's conduct on the market. As is apparent from the analysis of the first plea, the infringement committed by DDE is imputable to the applicant on account of the decisive influence that the applicant exercised over DDE's conduct on the CR market. That argument must therefore be rejected.

156 Second, as regards the applicant's argument that it is the victim of a breach of the principle of equal treatment because it was treated differently from another undertaking referred to in an earlier Commission decision and of a manifest error of assessment by the Commission in that regard, it must also be rejected. It is true that the principle of equal treatment is a general principle of law which the Commission is required to observe in a proceeding initiated pursuant to Article 81 EC and it prevents comparable situations from being treated differently and different situations from being treated in the same way, unless such difference in treatment is objectively justified. However, in the context of calculating fines imposed under Article 23(2) and (3) of Regulation No 1/2003, the European Union Courts have recognised that, in order to attain the aim of deterrence, a certain difference in the treatment of the undertakings concerned by a Commission decision is inherent in the application of the method chosen by the Guidelines (Case T-43/02 Jungbunzlauer v Commission [2006] ECR II-3435, paragraph 238). Furthermore, it follows from a consistent body of case-law that the Commission's practice in previous decisions does not itself serve as a legal framework for the fines imposed in competition matters and that decisions in other cases can give only an indication for the purpose of determining whether there is discrimination (JCB Service v Commission, paragraph 91 above, paragraph 205). Any lessons to be learnt from that practice can give only an indication, since the facts of the cases, such as the markets, products, countries, undertakings and periods concerned, are not the same (JCB Service v Commission, paragraph 91 above, paragraph 201). It follows from the foregoing that the fact that the Commission imposed on Sony a fine which was 10% higher, whilst its worldwide turnover was more than 40% higher than the applicant's, is not, in the present case, evidence of discriminatory treatment against the applicant and cannot be relied on in the present case, contrary to the applicant's submission. Furthermore, given the Commission's broad discretion when setting fines (see paragraph 139 above), the applicant has also failed to establish the manifest error of assessment alleged. The argument must therefore be rejected, as must the second part of this plea.

- The third part, concerning the reduction of the fine under the 2002 Leniency Notice

157 It should be borne in mind that, as is apparent from paragraphs 138 and 139 above, although the Commission enjoys a wide discretion when setting fines, the exercise of that discretion is however limited, inter alia by rules of conduct which the Commission has imposed on itself, not only in the Guidelines on the method of setting fines, but also in the 2002 Leniency Notice (see Lafarge v Commission, paragraph 139 above, paragraph 95 and the case-law cited).

158 In the 2002 Leniency Notice, the Commission set out the conditions under which undertakings cooperating with it during its investigation into a cartel may be exempted from a fine or be granted a reduction in the fine which would otherwise have been imposed on them.

159 Point 8 of the 2002 Leniency Notice states as follows:

'The Commission will grant an undertaking immunity from any fine which would otherwise have been imposed if:

(a) the undertaking is the first to submit evidence which in the Commission's view may enable it to adopt a decision to carry out an investigation in the sense of Article 14(3) of Regulation No 17 ... in connection with an alleged cartel affecting the Community; or

(b) the undertaking is the first to submit evidence which in the Commission's view may enable it to find an infringement of Article 81 EC ... in connection with an alleged cartel affecting the Community.'

160 Point 20 of the 2002 Leniency Notice states that '[u]ndertakings that do not meet the conditions [for exemption from fines] under Section A above [Immunity from fines] may be eligible to benefit from a reduction of any fine that would otherwise have been imposed' and point 21 states that '[i]n order to qualify, an undertaking must provide the Commission with evidence of the suspected infringement which represents significant added value with respect to the evidence already in the Commission's possession and must terminate its involvement in the suspected infringement no later than the time at which it submits the evidence'.

161 As regards the concept of added value, the following explanation is given at point 22 of the 2002 Leniency Notice:

'The concept of "added value" refers to the extent to which the evidence provided strengthens, by its very nature and/or its level of detail, the Commission's ability to prove the facts in question. In this assessment, the Commission will generally consider written evidence originating from the period of time to which the facts pertain to have a greater value than evidence subsequently established. Similarly, evidence directly relevant to the facts in question will generally be considered to have a greater value than that with only indirect relevance.'

162 Moreover, the Commission, once it has found that the evidence represents significant added value within the meaning of point 21 of the 2002 Leniency Notice, still has a margin of assessment when it is required to determine the exact level of the reduction of the fine to be granted to the undertaking concerned. The first paragraph of point 23(b) of the 2002 Leniency Notice provides for fine-reduction bands for the various categories of undertakings concerned:

'- first undertaking to meet point 21: a reduction of 30-50%;

- second undertaking to meet point 21: a reduction of 20-30%;

- subsequent undertakings that meet point 21: a reduction of up to 20%'.

163 In addition, according to the second paragraph of point 23(b) of the 2002 Leniency Notice:

'In order to determine the level of reduction within each of these bands, the Commission will take into account the time at which the evidence fulfilling the condition in point 21 was submitted and the extent to which it represents added value. It may also take into account the extent and continuity of any cooperation provided by the undertaking following the date of its submission.'

164 According to the case-law, the Commission has a wide discretion as regards the method of calculating fines and it may, in that regard, take account of numerous factors, including the cooperation provided by the undertakings concerned during the investigation conducted by its departments. In that context, the Commission is required to make complex assessments of fact, such as those relating to the cooperation provided by the individual undertakings concerned (Case C-328/05 P SGL Carbon v Commission [2007] ECR I-3921, paragraph 81). Moreover, the Commission has a certain discretion in determining whether the cooperation in question was 'decisive' in facilitating its task of finding the existence of an infringement and putting an end to it and it is only where it manifestly exceeds that discretion that it may be criticised (see Case T-410/03 Hoechst v Commission [2008] ECR II-881, paragraph 555 and the case-law cited). Accordingly, the review carried out by the General Court of the Commission's assessment of the added value of the evidence provided by an undertaking in the context of the leniency programme is limited.

165 In the present case, the applicant claims that DDE ought to have received the maximum possible reduction in the band laid down in the 2002 Leniency Notice, since Tosoh, the first leniency applicant, was granted the maximum possible reduction in the band applicable to its situation. In the applicant's submission, the evidence produced by DDE's leniency application had real added value and that application was submitted only four months after Tosoh's statement.

166 In that regard, it must first be observed that the applicant does not contest that DDE's cooperation falls within the second indent of the first paragraph of point 23(b) of the 2002 Leniency Notice, as the Commission found in the contested decision, and that, on that basis, it was entitled to a reduction in its fine of between 20 and 30%. The reduction in the fine of 25% granted to the applicant in respect of DDE's cooperation therefore complies with the band laid down for that purpose by the 2002 Leniency Notice.

167 Moreover, although, in assessing the cooperation given by members of a cartel, the Commission cannot disregard the principle of equal treatment (Case T-116/04 Wieland-Werke v Commission [2009] ECR II-1087, paragraph 124), which prevents comparable situations from being treated differently and different situations from being treated in the same way, unless such difference in treatment is objectively justified (see Case C-101/08 Audiolux and Others [2009] ECR I-9823, paragraph 54 and the case-law cited), the assessment of the added value of the material contained in a leniency application is carried out by reference to the evidence already in the Commission's possession.

168 First, it is perfectly clear from the uncontested findings in recital 635 of the contested decision that, even though DDE satisfied the conditions laid down in point 21 of the 2002 Leniency Notice relatively shortly after the statement of the first leniency applicant, the fact remains that the evidence relating to the cartel that was provided by DDE and that give rise to the reduction of the fine was only notified to the Commission 10 months after the Commission's inspections at Dow, 4 months after the inspections at Denka and 4 months after Tosoh applied for leniency.

169 Second, since Tosoh's cooperation preceded DDE's, the Commission already possessed more evidence at the time DDE submitted its leniency application than when Tosoh submitted its application. Moreover, Tosoh had provided several self-explanatory and unambiguous documents drafted at the time the infringement took place which allowed the Commission to establish facts which it could not have otherwise established and corroborated various instances for which the incriminating value of the available evidence was not obvious (see recital 622 of the contested decision), whereas the added value of DDE's submission was mainly linked to those instances for which corroboration was still necessary, especially relating to the early cartel period (see recital 635 of the contested decision). Moreover, it is not disputed that Tosoh provided the Commission with significant evidence relating to the cartel only a week after the inspections at Denka.

170 It follows that the Commission, by taking into account, under the second paragraph of point 23(b) of the 2002 Leniency Notice, the time at which the evidence was submitted, without even having regard to the quality and the usefulness of the evidence submitted by DDE and, consequently, by granting it a reduction in the fine of 25% in respect of its cooperation for the purposes of establishing the existence of the cartel, did not, contrary to the applicant's assertion, manifestly exceed its discretion in that regard. Moreover, since the situations of Tosoh and DDE are not comparable, the Commission did not infringe the principle of equal treatment in granting Tosoh the maximum possible reduction in the band applicable to its situation (which fell within the first indent of point 23(b) of the 2002 Leniency Notice) and DDE a reduction in the middle of the band applicable to its situation (which fell within the second indent of point 23(b) of the 2002 Leniency Notice).

171 Lastly, as regards the argument that the Commission did not provide adequate reasoning for its decision to adopt that approach, it should be borne in mind that, according to settled case-law, although, in stating the reasons for the decisions which it takes to enforce the rules on competition, the Commission is not required to discuss all the issues of fact and law and the considerations which have led it to adopt its decision, it is none the less required under Article 253 EC to set out at least the facts and considerations having decisive importance in the context of the decision in order to make clear to the European Union Courts and the persons concerned the circumstances in which it has applied the Treaty (see Joined Cases T-374/94, T-375/94, T-384/94 and T-388/94 European Night Services and Others v Commission [1998] ECR II-3141, paragraph 95 and the case-law cited). In the present case, it is apparent from the analysis carried out in paragraphs 165 to 171 above that the Commission gave proper reasons for its decision. The applicant's argument alleging infringement of the obligation to state reasons must therefore be rejected.

172 The third part of this plea must therefore be rejected as unfounded.

- The amending decision of 23 June 2008

173 As regards the amending decision of 23 June 2008, the applicant 'believes that since it is not being held liable for something it did wrong, but for something DDE did, it is not appropriate to impose a higher fine on the shareholder or to hold the shareholder individually liable for any part of the fine' (see paragraph 122 above).

174 None of the arguments put forward by the applicant against the amending decision of 23 June 2008 permits the conclusion that that decision is vitiated by illegality.

175 In that regard, It should be recalled that it is apparent from the amending decision of 23 June 2008 that the Commission realised that it had made an error in holding EI DuPont jointly and severally liable with the applicant for payment of EUR 4.425 million, since that amount was the result of the application of the multiplier of 10% for deterrence to only the applicant's fine. Under the amending decision of 23 June 2008, the applicant became solely liable for payment of a fine of EUR 4.425 million, and the amount of the fine for payment of which EI DuPont and the applicant were held jointly and severally liable was reduced from EUR 48.675 million to EUR 44.250 million (see paragraphs 26 and 27 above).

176 It should also be recalled that, as is apparent from the analysis of the first plea, the applicant, EI DuPont and DDE formed part, for the purpose of the subject-matter of the cartel in question, of a single economic unit and therefore formed one and the same undertaking for the purposes of Article 81 EC, which adopted the same course of conduct on the CR market and participated in a single and continuous infringement of Article 81 EC and Article 53 of the EEA Agreement, covering the entire territory of the EEA. It is also apparent from that analysis that the infringement committed by DDE was imputed to the applicant on account of the decisive influence that the applicant exercised over DDE's conduct on the CR market. The applicant was therefore held individually liable for an infringement which it is deemed to have committed itself on account of its close legal and economic links with DDE, by which it was able to determine DDE's conduct on the market in question.

177 The consequence, under European Union competition law, of the existence of an economic unit, consisting of several legal persons, is that an infringement committed by a subsidiary may be imputed to its parent company where that parent company has a real possibility of exercising decisive influence over its subsidiary's conduct and where the Commission shows that the parent company did in fact exercise that decisive influence. The Commission may then regard the parent company as jointly and severally liable for payment of the fine imposed on its subsidiary (see, to that effect, the judgment of the Court of Justice in Akzo Nobel, paragraph 73 above, paragraphs 60 and 61; see also, to that effect, Dansk Rørindustri and Others v Commission, paragraph 139 above, paragraphs 118 to 130, and Case T-65/89 BPB Industries and British Gypsum v Commission [1993] ECR II-389, paragraph 154). Under the same conditions, the Commission may also choose to impose a fine jointly and severally on the parent company and its subsidiary (Joined Cases 6/73 and 7/73 Istituto Chemioterapico Italiano and Commercial Solvents v Commission [1974] ECR 223, paragraph 41).

178 It follows that the applicant's argument that it 'did nothing wrong' is based on the incorrect premiss that no finding of an infringement was made as regards the applicant; as this is not the case, that argument must be rejected.

179 As regards the applicant's argument that it was not appropriate to impose on it 'a higher fine, [as] shareholder', it must be stated that, contrary to what it suggests, the Commission did not increase the amount of its fine by the amending decision of 23 June 2008. It is true that it became solely liable for payment of a fine of EUR 4.425 million, but the amount of the fine for payment of which it is held jointly and severally liable with EI DuPont was reduced from EUR 48.675 million to EUR 44.250 million. The maximum amount that the Commission can claim from the applicant therefore remains EUR 48.675 million.

180 As regards the applicant's argument that it was not appropriate to 'to hold [it, as] shareholder[,] individually liable for any part of the fine', it is sufficient to note that, in the light of the case-law cited in paragraph 177 above, the Commission was entitled to impose on it a fine for the infringement committed by the joint venture of which it was one of the parent companies. In addition, even though the Commission's choice of imposing a fine on one of the parent companies, namely EI DuPont, and of holding jointly and severally liable for the payment of a part of the amount of that fine the other parent company, namely the applicant, does not appear to be the most appropriate choice in the light of the Commission's intention of applying also a multiplier for deterrence to only the applicant, the Commission, in rectifying the decision of 5 December 2007, did not manifestly exceed its discretion in relation to the setting of fines.

181 Lastly, it should be recalled that it is true that the power of unlimited jurisdiction conferred on the General Court in competition matters by Article 31 of Regulation No 1/2003 in accordance with Article 229 EC authorises that court, beyond a simple review of legality, which merely permits dismissal of the action for annulment or annulment of the contested measure, to vary the contested measure, even without annulling it, by taking into account all of the factual circumstances, so as to amend the amount of the fine (see Case C-534/07 P Prym and Prym Consumer v Commission [2009] ECR I-7415, paragraph 86 and the case-law cited). However, in the present case, the Court takes the view that there is no reason to reduce the amount of the fine under that power.

182 It follows that the second plea must be rejected.

183 It follows from all of the foregoing that the action must be dismissed in its entirety.

Costs

184 Under Article 87(2) of the Rules of Procedure, 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 applicant has been unsuccessful, it must be ordered to pay the costs, in accordance with the form of order sought by the Commission.

On those grounds,

THE GENERAL COURT (Seventh Chamber)

hereby:

1. Dismisses the action;

2. Orders The Dow Chemical Company to pay the costs.