The Court of Justice (“CoJ”) gave on 10 April 2014 its judgment on appeal in the gas insulated switchgear case C-231/11 P. The dispute concerns a cartel relating to the sale of gas insulated switchgear (“GIS”), a heavy electrical equipment which is used to control energy flow in electricity grids. The case commenced with a leniency application; the Commission then initiated its investigation, which was concluded with the imposition of a fine on several undertakings. Parent undertakings were found jointly and severally liable with their subsidiaries. The Commission decision was challenged before the General Court, which in its judgment in Cases T-122/07 to T-124/07 Siemens AG Österreich a.o v Commission found, inter alia, that the Commission failed to determine the exact amount, i.e. the shares of the fine to by paid by each of the undertakings (both parents and subsidiaries) imposed severally and jointly on them. The General Court even went on to determine itself these shares of the fine to be paid by each undertaking. Its judgment was cross-appealed by the Commission and the undertakings.
The Court of Justice has handed down three judgments relating to fines imposed on a number of undertakings involved in the gas insulated switchgear cartel. There’s an interesting and distinct point in each judgment so we’ll write about them separately.
First off will be the judgment in Joined Cases C-247/11 P and C-253/11 P Areva EU:C:2014:257. That judgment contains some interesting points about what constitutes an “undertaking” and the concept of joint and several liability of a parent company for fines for infringements of competition law committed by a subsidiary in the event of succession of companies and transfer of subsidiaries between parents. Continue reading
The Court of Justice does not often reduce a fine imposed by the Commission on an undertaking for a breach of the competition rules when the amount of the fine has been upheld by the General Court. The judgment of 27 March 2014 in Case C-612/12 P Balast Nedam NV v Commission EU:C:2014:193 is, however, such a case. The Court of Justice reduced the fine on appeal not because the General Court had exercised its unlimited jurisdiction on fines improperly but because the General Court had failed to take sufficient account of a substantive problem with the Commission’s decision relating to the company’s rights of the defence.
Let us see in more detail.