Fujikura v Commission (Competition - European market for power cables - Judgment) [2018] EUECJ T-451/14 (12 July 2018)

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(Competition — Agreements, decisions and concerted practices — European market for power cables — Decision finding an infringement of Article 101 TFEU — Single and continuous infringement — Proof of the infringement — Duration of participation — Calculation of the fine — Gravity of the infringement — Unlimited jurisdiction)

Fujikura Ltd, established in Tokyo (Japan), represented by L. Gyselen, lawyer,

European Commission, represented by A. Biolan, C. Giolito and H. van Vliet, acting as Agents, and by M. Johansson, lawyer,

ACTION pursuant to Article 263 TFEU for annulment of Commission Decision C(2014) 2139 final of 2 April 2014 relating to a proceeding under Article 101 [TFEU] and Article 53 of the EEA Agreement (Case AT.39610 — Power cables) in so far as it concerns the applicant and, in the alternative, an application for a reduction of the fine imposed on the applicant in that decision,

composed of A.M. Collins, President, M. Kancheva (Rapporteur) and R. Barents, Judges,

having regard to the written part of the procedure and further to the hearing on 2 May 2017,

1 The applicant, Fujikura Ltd, is a Japanese company active in the underground and submarine power cable production and sales sector. With effect from 1 October 2001, it transferred part of its activities in the power cable sector to a joint venture named Viscas Corp., which it owned in equal shares with another Japanese company in the same sector, namely Furukawa Electric Co. Ltd.

2 Submarine power cables are used under water and underground power cables are used under the ground for the transmission and distribution of electrical power. They are classified in three categories: low voltage, medium voltage, and high and extra high voltage. High voltage and extra high voltage power cables are, in the majority of cases, sold as part of projects. Such projects consist of a combination of the power cable and the necessary additional equipment, installation and services. High voltage and extra high voltage power cables are sold throughout the world to large national grid operators and other electricity companies, principally through competitive public tender procedures.

3 By letter of 17 October 2008, the Swedish company ABB AB provided the Commission of the European Communities with a series of statements and documents concerning restrictive commercial practices in the underground and submarine power cable production and supply sector. Those statements and documents were provided in support of an application for immunity submitted in accordance with the Commission Notice on Immunity from fines and reduction of fines in cartel cases (OJ 2006 C 298, p. 17, ‘the Leniency Notice’).

4 From 28 January to 3 February 2009, further to the statements made by ABB, the Commission carried out inspections at the premises of the Italian companies Prysmian SpA and Prysmian Cavi e Sistemi Energia Srl and the French companies Nexans SA and Nexans France SAS.

5 On 2 February 2009, the Japanese companies, Sumitomo Electric Industries Ltd, Hitachi Cable Ltd and J-Power Systems Corp. submitted a joint application for immunity from fines, in accordance with point 14 of the Leniency Notice, or, in the alternative, for a reduction of their amount, in accordance with point 27 of the Leniency Notice. They then supplied the Commission with further oral statements and documentation.

6 During the course of the investigation, the Commission sent several requests for information to undertakings in the underground and submarine power cable production and supply sector, 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 [101] and [102 TFEU] (OJ 2003 L 1, p. 1) and point 12 of the Leniency Notice.

7 On 30 June 2011, the Commission opened a procedure and adopted a statement of objections against the following legal entities: Pirelli & C. SpA, Prysmian Cavi e Sistemi Energia, Prysmian, The Goldman Sachs Group, Inc., Nexans, Nexans France, Sumitomo Electric Industries, Hitachi Cable, J-Power Systems, Furukawa Electric, Viscas, SWCC Showa Holdings Co. Ltd, Mitsubishi Cable Industries Ltd, Exsym Corp., ABB, ABB Ltd, Brugg Kabel AG, Kabelwerke Brugg AG Holding, nkt cables GmbH, NKT Holding A/S, Silec Cable SAS, Grupo General Cable Sistemas SA, Safran SA, General Cable Corp., LS Cable & System Ltd, Taihan Electric Wire Co. Ltd and the applicant.

8 Between 11 and 18 June 2012, all the addressees of the statement of objections, with the exception of Furukawa Electric, took part in an administrative hearing before the Commission.

9 By judgments of 14 November 2012, Nexans France and Nexans v Commission (T‑135/09, EU:T:2012:596), and of 14 November 2012, Prysmian and Prysmian Cavi e Sistemi Energia v Commission (T‑140/09, not published, EU:T:2012:597), the Court partly annulled the inspection decisions addressed, first, to Nexans and Nexans France and, second, to Prysmian and Prysmian Cavi e Sistemi Energia, in so far as they concerned power cables other than high voltage submarine and underground power cables and the material associated with such other cables, and dismissed the action as to the remainder. On 24 January 2013, Nexans and Nexans France brought an appeal against the first of those two judgments. By judgment of 25 June 2014, Nexans and Nexans France v Commission (C‑37/13 P, EU:C:2014:2030), the Court of Justice dismissed that appeal.

10 On 2 April 2014, the Commission adopted Decision C(2014) 2139 final relating to a proceeding under Article 101 [TFEU] and Article 53 of the EEA Agreement (Case AT.39610 — Power cables) (‘the contested decision’).

11 Article 1 of the contested decision states that several undertakings participated, over various periods of time, in a single and continuous infringement of Article 101 TFEU in the ‘(extra) high voltage underground and/or submarine power cable sector’. In essence, the Commission found that, from February 1999 to the end of January 2009, the main European, Japanese and South Korean producers of submarine and underground power cables had participated in a network of multilateral and bilateral meetings and established contacts aimed at restricting competition in connection with (extra) high voltage submarine and underground power cable projects in specific territories, by allocating markets and customers among themselves, thereby distorting the normal competitive process (recitals 10 to 13 and 66 of that decision).

12 In the contested decision the Commission found that the cartel consisted of two main configurations, which formed a composite whole. More specifically, according to the Commission, the cartel comprised:

– the ‘A/R cartel configuration’, which included the European undertakings, generally referred to as the ‘R’ members, the Japanese undertakings, referred to as the ‘A’ members, and lastly the South Korean undertakings, referred to as the ‘K’ members. That configuration made it possible to achieve the objective of allocating territories and customers among the European, Japanese and South Korean producers. That allocation followed an agreement relating to ‘home territory’, under which the Japanese and Korean producers would refrain from competing for projects in the European producers’ ‘home territory’, while the European producers stayed out of the Japanese and South Korean markets. In addition, the parties allocated projects in the ‘export territories’, namely the rest of the world with the notable exception of the United States. For a time that allocation was based on a ‘60/40 quota’, meaning that 60% of the projects were reserved for the European producers and the remaining 40% for the Asian producers; and

– the ‘European cartel configuration’, which involved the allocation of territories and customers by the European producers for projects to be implemented within the European ‘home’ territory or allocated to the European producers (see Section 3.3 of the contested decision and, in particular, recitals 73 and 74 of that decision).

13 The Commission found that the participants in the cartel had established obligations to exchange information, so as to enable the allocation agreements to be monitored (recitals 94 to 106 and 111 to 115 of the contested decision).

14 The Commission classified the cartel participants in three groups, according to the role each of them had played in implementing the cartel. First, it defined the core group of the cartel to include the European undertakings Nexans France, the subsidiary undertakings of Pirelli & C., formerly Pirelli Spa, which participated successively in the cartel, and Prysmian Cavi e Sistemi Energia, and the Japanese undertakings Furukawa Electric, the applicant and their joint venture Viscas, as well as Sumitomo Electric Industries, Hitachi Cable and their joint venture J-Power Systems (recitals 545 to 561 of the contested decision). Next, it identified a group of undertakings which were not part of the core group but which nevertheless could not be regarded as merely fringe players in the cartel. In this group it placed ABB, Exsym, Brugg Kabel and the entity constituted by Sagem SA, Safran and Silec Cable (recitals 562 to 575 of that decision). Lastly, the Commission considered that Mitsubishi Cable Industries, SWCC Showa Holdings, LS Cable & System, Taihan Electric Wire and nkt cables were fringe players in the cartel (recitals 576 to 594 of that decision).

15 The applicant was found liable on the basis of its participation in the cartel from 18 February 1999 to 28 January 2009. According to the Commission, that participation was direct during an early period, from 18 February 1999 to 30 September 2001, and was pursued through Viscas, over which it had a decisive influence, from 1 October 2001 to 28 January 2009 (recitals 811 to 853 and 955 of the contested decision).

16 Under Article 2(o) of the contested decision a fine of EUR 8 152 000 was imposed on the applicant for its direct participation in the cartel. Under Article 2(p) of the contested decision a fine of EUR 34 992 000 was imposed on the applicant jointly and severally with Viscas and Furukawa Electric for its participation in the cartel from 1 October 2001 to 28 January 2009.

17 In calculating the amount of those fines, the Commission applied Article 23(2)(a) of Regulation No 1/2003 and the methodology set out in the Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) (OJ 2006 C 210, p. 2, ‘the 2006 Guidelines on the method of setting fines’).

18 In the first place, as regards the basic amount of the fines, after establishing the appropriate value of sales, in accordance with point 18 of the 2006 Guidelines on the method of setting fines (recitals 963 to 994 of the contested decision), the Commission selected the proportion of the value of sales which would reflect the gravity of the infringement, in accordance with points 22 and 23 of those guidelines. In that regard, it considered that the infringement, by its nature, constituted one of the most harmful restrictions of competition, which justified a gravity percentage of 15%. The Commission also increased the gravity multiplier by 2% for all addressees on account of their combined market share and the almost worldwide reach of the cartel, which included, inter alia, all of the European Economic Area (EEA). The Commission also considered, in particular, that the conduct of the European undertakings had been more detrimental to competition than that of the other undertakings, inasmuch as, in addition to their participation in the ‘A/R cartel configuration’, the European undertakings had shared cable projects among themselves in the context of the European cartel configuration. For that reason, the Commission set the proportion of the value of sales to reflect the gravity of the infringement at 19% for the European undertakings and at 17% for the other undertakings (recitals 997 to 1010 of that decision).

19 As regards the multiplier relating to the duration of the infringement, for the applicant, the Commission applied a multiplier of 2.58 for the period from 18 February 1999 to 30 September 2001, and of 7.25 for the period from 1 October 2001 to 28 January 2009. For the applicant, it also included in the basic amount of the fine an additional amount, namely the ‘entry fee’, of 17% of the value of sales. That amount thus calculated came to EUR 8 152 000 for its direct participation in the cartel. In parallel, with regard to Viscas, the Commission adopted, as a multiplier for the duration of the cartel, a multiplier of 7.25 for the period between 1 October 2001 and 28 January 2009. The basic amount of the fine for Viscas, to which no additional amount was added, thus came to EUR 34 992 000 (recitals 1011 to 1016 of the contested decision).

20 In the second place, as regards adjustments to the basic amount of the fines, the Commission found there to be no aggravating circumstances that could affect the basic amount of the fine of each of the cartel participants, with the exception of ABB. By contrast as regards mitigating circumstances, it decided to reflect in the amount of the fine the role played by the various undertakings in the implementation of the cartel. Accordingly, it reduced the basic amount of the fine to be imposed on the fringe cartel participants by 10% and the basic amount of the fine to be imposed on the undertakings whose involvement in the cartel had been moderate by 5%. The Commission also granted Mitsubishi Cable Industries and SWCC Showa Holdings an additional reduction of 1%, in respect of the period preceding the creation of Exsym, and LS Cable & System and Taihan Electric Wire on account of the fact that they had been unaware of certain aspects of the single and continuous infringement and were not liable for them. By contrast, no reduction in the basic amount of the fine was granted to the undertakings belonging to the core group of the cartel, which includes the applicant (recitals 1017 to 1020 of the contested decision). Moreover, pursuant to the 2006 Guidelines on the method of setting fines, the Commission granted Mitsubishi Cable Industries an additional reduction of 3% of its fine on account of its effective cooperation outside the scope of the Leniency Notice (recital 1041 of that decision).

21 Furthermore, the Commission decided to grant ABB immunity from fines and to reduce the amount of the fine imposed on J-Power Systems, Sumitomo Electric Industries and Hitachi Cable by 45%, to take account of the cooperation of those undertakings under the Leniency Notice.

22 By application lodged at the Court Registry on 16 June 2014, the applicant brought the present action.

23 By document lodged at the Court Registry on 29 October 2014, Viscas applied for leave to intervene in support of the form of order sought by the applicant.

24 By a separate document lodged at the Court Registry on 5 December 2014, the Commission requested, in accordance with Article 116(2) of the Rules of Procedure of the General Court of 2 May 1991, that certain information contained in an annex to the defence be excluded from the file communicated to Viscas, in the event that its application for leave to intervene was granted. Accordingly, the Commission produced a non-confidential version of the document in question.

25 By order of 25 June 2015, the President of the Eighth Chamber granted Viscas’s application for leave to intervene.

26 The intervener lodged its statement in intervention on 18 September 2015. On 28 October 2015, the Commission submitted its observations on the intervener’s statement in intervention.

27 On 28 September 2016, under the measures of organisation of procedure provided for in Article 89 of its Rules of Procedure, the Court put a written question to the Commission. The Commission complied with the Court’s request by letter of 28 October 2016.

28 As a result of changes to the composition of the Chambers of the General Court, pursuant to Article 27(5) of the Rules of Procedure, the Judge-Rapporteur was attached to the Eighth Chamber (new composition), to which the present case has, in consequence, been assigned.

29 On 13 February 2017, by way of measures of organisation of procedure provided for under Article 89 of the Rules of Procedure, the Court asked the applicant to submit written observations on the Commission’s reply to the question put by the Court on 28 September 2016. The applicant replied to the Court’s request by letter of 28 February 2017.

30 Acting upon a proposal of the Judge-Rapporteur, the Court decided to open the oral part of the procedure. The parties presented oral argument and answered the questions put to them by the Court at the hearing on 2 May 2017.

– reduce the amount of the fine imposed on it in Article 2(o) of the contested decision for its direct participation in the cartel between 18 February 1999 and 30 September 2001;

– annul Article 2(p) of the contested decision in so far as it holds the applicant ‘jointly and severally’ liable for the fine imposed on Viscas for the period between 1 January 2005 and 28 January 2009;

33 In its application, the applicant puts forward a claim for annulment of the contested decision as well as a claim for a reduction in the amount of the fine imposed on it for its direct participation in the cartel.

34 The claim for annulment seeks to obtain the annulment of Article 2(p) of the contested decision, by which the Commission imposed a fine on the applicant ‘jointly and severally’ with Furukawa Electric and Viscas, for its participation in the cartel from 1 October 2001 to 28 January 2009.

35 The applicant puts forward a single plea in law in support of its claim for annulment. That plea in law alleges infringement of Article 101(1) TFEU and Article 53 of the EEA Agreement, in so far as the Commission failed to take into account that the applicant was not capable of exercising a decisive influence on Viscas as from January 2005.

36 By that plea in law, the applicant claims that the Commission erred in holding it liable for the infringement, as one of the two parent companies of Viscas, for the period from 1 January 2005 to 28 January 2009. According to the applicant, during the period in question, it no longer exerted a decisive influence over Viscas’s conduct.

37 First, the applicant notes that the initial joint venture agreement concluded in 2001 with Furukawa Electric (‘the 2001 JVA’) was amended in 2004 by a new agreement (‘the 2004 JVA’), with the result that Viscas became a full function joint venture as from 1 January 2005. To that end, the parent companies each appointed two full-time directors who were not representatives of the parent companies on Viscas’s board of directors and who did not receive instructions from the applicant. Their only role was to ensure the transition from a joint venture dependent on its parent companies to a full function joint venture. The part-time directors, who worked both at Viscas and the parent companies, played a minor role on Viscas’s board of directors and, moreover, had responsibilities unrelated to power cables at Fujikura. All the directors were linked by a duty of confidentiality towards Viscas which prevents them from reporting that company’s actions to the parent companies.

38 Second, the applicant claims that the 2004 JVA limited the reporting obligation set out in the 2001 JVA. Under the new agreement, that obligation was limited to the monthly and annual reports on matters within the scope of supervision exercised by a normal shareholder and lost all of its previous character. Furthermore, the right of the parent companies to carry out inspections on Viscas’s premises was included in the 2004 JVA at the request of Furukawa Electric and the applicant never used it to monitor Viscas.

39 Third, the applicant submits that the fact that much of Viscas’s staff was made up of employees seconded to Viscas does not mean in any way that it had a decisive influence over that company. On the one hand, such secondment is common in Japan and, on the other hand, the employees seconded from the applicant were bound by an obligation of loyalty and confidentiality towards Viscas throughout the period of secondment.

40 Fourth, the fact that, in accordance with the 2004 JVA, the parent companies were required to provide Viscas with guarantees for its borrowing at the request of the lending bank is not proof of the effective exercise of a decisive influence over Viscas. It is a common solution, which does not go beyond what shareholders typically would do in order to secure their investments.

41 Fifth, the applicant maintains that its participation in the process which led to the creation of a production joint venture between Viscas and Nexans France was justified by the fact that that new undertaking was required to operate a factory belonging to the applicant in Futtsu (Japan) and prevent its closure, which was planned for 2008. Consequently, the applicant’s involvement was not to exercise a decisive influence over Viscas but rather to help it to achieve results which would restore the value of that factory.

42 Sixth, the applicant claims that all the evidence it put forward in the context of its pleadings before the Court, as summarised above, confirms that the links existing between it and Viscas were weaker than the links existing between The Dow Chemical Company and EI du Pont de Nemours and Company, on the one hand, and their joint venture DuPont Dow Elastomers LLC, on the other hand, in the case giving rise to the judgment of 26 September 2013, EI du Pont de Nemours v Commission (C‑172/12 P, not published, EU:C:2013:601). Furthermore, contrary to what the Courts of the European Union stated in that case, none of the employees seconded by the applicant to Viscas who participated in collusive activities on behalf of Viscas participated in the cartel on behalf of the applicant before the creation of the joint venture.

43 The Commission disputes the applicant’s arguments and contends that the present plea in law should be rejected.

44 In that regard, it must be recalled that, according to settled case-law, the term ‘undertaking’ must be understood as designating an economic unit for the purpose of the object of the agreement in question, even if in law that economic unit consists of several persons, natural or legal. For the purposes of applying competition law, formal separation of two companies, resulting from their having distinct legal identities, is not decisive. The test is whether or not there is unity in their conduct on the market. It may therefore be necessary to ascertain whether two companies with distinct legal identities form, or fall within, one and the same undertaking or economic entity adopting the same course of conduct on the market. Article 101(1) TFEU is therefore aimed at economic units which consist of a unitary organisation of personal, tangible and intangible elements which pursue 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 (see judgment of 2 February 2012, EI du Pont de Nemours and Others v Commission, T‑76/08, not published, EU:T:2012:46, paragraph 58 and the case-law cited).

45 When such an economic entity infringes the competition rules, it falls, according to the principle of personal responsibility, to that entity to answer for that infringement. Nevertheless, the infringement of EU competition law must be imputed unequivocally to a legal person on whom fines may be imposed. It is settled case-law that the conduct of a subsidiary may be imputed to the parent company in particular where, although having a separate legal personality, that subsidiary 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 having regard 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 101(1) TFEU, 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 judgment of 2 February 2012, EI du Pont de Nemours and Others v Commission, T‑76/08, not published, EU:T:2012:46, paragraph 59 and the case-law cited; see also, to that effect, judgment of 19 July 2012, Alliance One International and Standard Commercial Tobacco v Commission, C‑628/10 P and C‑14/11 P, EU:C:2012:479, paragraphs 42 to 44).

46 It must also be noted that in order to be able to impute the conduct of a subsidiary to the 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 (judgment of 26 September 2013, EI du Pont de Nemours v Commission, C‑172/12 P, not published, EU:C:2013:601, paragraph 44).

47 In that regard, it is for the Commission to demonstrate such a decisive influence, taking into account all the relevant factors relating to the economic, organisational and legal links which tie that subsidiary to the parent company, which may vary from case to case and cannot therefore be set out in an exhaustive list (judgments of 19 July 2012, Alliance One International and Standard Commercial Tobacco v Commission, C‑628/10 P and C‑14/11 P, EU:C:2012:479, paragraph 45, and of 26 September 2013, EI du Pont de Nemours v Commission, C‑172/12 P, not published, EU:C:2013:601, paragraph 43).

48 As regards the relevant factors, the case-law indicates that 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. By contrast, 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 exercises an influence that is sufficient to direct the conduct of its subsidiary to such an extent that the two must be regarded as one economic unit (see, to that effect, judgment of 2 February 2012, EI du Pont de Nemours and Others v Commission, T‑76/08, not published, EU:T:2012:46, paragraph 62).

49 It is in the light of those principles that the Court must determine whether the present plea in law is well founded.

50 In recitals 824 to 852 of the contested decision, the Commission set out the reasons why it found that, during the period from 1 October 2001 to 28 January 2009, the applicant and Furukawa Electric had jointly exercised a decisive influence over Viscas, so that they constituted, with the latter, an undertaking within the meaning of Article 101(1) TFEU.

51 In those recitals, on the one hand, the Commission observed that, according to the 2001 JVA, Viscas acted as a foreign sales agent for its parent companies and not as a company with an independent market presence and that it was accordingly subject to the decisive influence of those companies. The applicant did not dispute those findings either during the procedure before the Commission or in the present proceedings before the Court.

52 On the other hand, the Commission stated that the 2004 JVA, which took effect on 1 January 2005, expanded the scope of Viscas’s activities to include the manufacture and sale of cables to all customers of the parent companies with the exception of sales to Japanese domestic companies other than the national electricity companies, which were retained by the parent companies (recital 828 of the contested decision). The Commission also stated that although the 2004 JVA had weakened the relationship between Viscas and its parent companies, the latter companies did not cease to exercise a decisive influence over the former (recital 850 of the contested decision).

53 In that regard, in the first place, as regards the legal relationships between Viscas and its parent companies, the Commission found that, according to Article 7 of the 2004 JVA, each parent company had the power to appoint half of Viscas’s directors. The parent companies were also obliged to exercise their voting rights at the general shareholders’ meeting so that the directors nominated by each of them were elected (recitals 828 and 829 of the contested decision). It is also apparent from the contested decision that there were overlaps between members of Viscas’s board of directors and the entities of its parent companies. Certain members of the board were employed by Viscas on a part-time basis and carried out senior roles with the applicant at the same time (recital 839 of the contested decision).

54 The Commission also indicated various mechanisms contained in the 2004 JVA allowing Viscas’s parent companies to monitor the strategic decisions made by that company. First, under Article 10 of the 2004 JVA, the resolutions of the board of directors concerning certain strategic matters for Viscas required the de facto agreement of the directors appointed by the applicant and Furukawa Electric. This included, inter alia, resolutions on matters to be reported at the general shareholders’ meeting, resolutions concerning fundamental business policy, the execution of material agreements, material personnel matters, capital investments, investment, borrowing, debts and loan guarantees over at least 100 million Japanese yen (JPY) or the transfer of assets above JPY 100 million (recital 833 of the contested decision). Second, the 2004 JVA introduced a notification mechanism between Viscas and its parent companies which included an obligation to report on settlement of accounts and business review, annual budget, annual capital investment plans, annual research and development plans and annual personnel plans. The Commission stated, in that regard, that the applicant had confirmed, first, the existence of reports provided by the president of Viscas to its parent companies in accordance with Article 10 of the 2004 JVA and second, that it gave instructions to Viscas regarding the performance of the reporting obligation in respect of the nature of the information to be submitted, the recipients of that information and when it was to be sent. It is also apparent from the contested decision that Viscas’s directors reported to the applicant and Furukawa Electric on an ad hoc basis at their request (recitals 835 and 836 of the contested decision). Third, the parent companies reserved the right to inspect Viscas’s activities and the status of its assets whenever they considered such inspections necessary (recital 837 of the contested decision). The 2004 JVA also provided that Viscas was subject to examination by the auditors of its parent companies. Although the applicant did not carry out any inspections, it confirmed that meetings between its auditors and those of Viscas had taken place from time to time in order to obtain a ‘high-level overview’ of Viscas’s operating results, management issues and potential risk factors (recital 838 of the contested decision).

55 In the second place, as regards the organisational links, aside from the overlaps between the staff of Viscas and that of its parent companies, referred to in paragraph 53 above, the Commission found that several directors, managers and other employees occupying senior posts at Viscas were not permanent employees of Viscas but were seconded by Furukawa Electric and the applicant, throughout the period of the infringement. Some of the seconded directors simultaneously occupied management posts in the parent companies. The salaries of the seconded employees were paid by the applicant and Furukawa Electric and consultation with the parent companies was required for any disciplinary measure concerning those employees. The Commission found, in that regard, that Mr T., at least, of the employees seconded by the applicant, had participated in cartel activities on Viscas’s behalf. In addition, the 2004 JVA gave Furukawa Electric and the applicant the right to determine the working conditions of Viscas’s staff (recital 840).

56 In the third place, as regards the economic links, on the one hand, the Commission indicated that Viscas depended economically on its parent companies, in so far as they guaranteed its liabilities, both concerning the performance of its projects and its financial debt (recital 844 of the contested decision). The Commission stated, in that regard, that the entirety of Viscas’s financial debt between the 2004 and 2008 financial years was guaranteed by its parent companies. On the other hand, the Commission found that Viscas depended on its parent companies for the provision of raw materials and that, following the transfer of their manufacturing facilities, Furukawa Electric and the applicant became customers of Viscas which produced the power cables which they subsequently sold to their reserved customers in Japan (see paragraph 52 above) (recitals 845 and 846 of the contested decision).

57 Moreover, the Commission found that the negotiations preceding the creation of the joint venture between Viscas and Nexans France supported its finding that the applicant and Furukawa Electric exercised a decisive influence over Viscas. According to the Commission, when Nexans France proposed the creation of a joint venture with Viscas, it first contacted the applicant and Furukawa Electric, which, initially, did not accept its proposal. The subsequent negotiations took place between Nexans France, on the one hand, and Furukawa Electric, Fujikura and Viscas, on the other (recital 849 of the contested decision).

58 It follows from the evidence relied on by the Commission, summarised in paragraphs 53 to 57 above, that Viscas was not capable of determining its own conduct on the market in an independent manner, not only, as the applicant maintains, during the period in which the 2001 JVA was valid, but also after the 2004 JVA came into effect.

59 Accordingly, first, Viscas’s parent companies dominated its board of directors, and, on account of the supervision mechanisms established in the 2004 JVA, they had a continuing right of co-determination over most of its decisions and policies. They influenced both strategic decisions, such as the decision to start a new production unit under a joint venture agreement between Viscas and Nexans France, and decisions relating to everyday management, such as the purchase of raw materials or human resources management.

60 In that regard, even if it were established that, as the applicant claims, the legal, organisational and economic links between the applicant and Viscas, were weaker than those between the joint venture of DuPont Dow Elastomers and its parent companies EI Du Pont de Nemours and Company and The Dow Chemical Company, that does not affect the lawfulness of the contested decision. It follows from the case-law referred to in paragraph 47 above that the relevant evidence for the purpose of assessing the economic, organisational and legal links between a subsidiary and a parent company varies from case to case and requires individual and detailed examination.

61 Second, several overlaps between members of Viscas’s staff, including its board of directors, and the applicant’s staff ensured that information passed between the applicant and Viscas throughout the latter’s participation in the cartel.

62 In that regard, on the one hand, it must be stressed that it is clear from the notes of an employee of J-Power Systems relating to the A/R meeting of 5 September 2001 that an employee of the applicant, Mr T., was present and informed the other participants that the joint venture set up by Furukawa Electric and the applicant would begin to operate as planned on 1 October 2001 and would be called Viscas. It must be noted that Mr T., who had occupied the role of Director-General of the ‘1st International Trade Division, Overseas Marketing and Projects’ for the applicant before acting as Director-General of the ‘Overseas Marketing and Project Department’ at Viscas from the time of its creation, represented Viscas at cartel meetings, as is clear from Annex I to the contested decision (see Annex I and Annex II, p. 9 of the contested decision).

63 In addition, it must be held that it is apparent from the contested decision (see footnote 1199) that Mr T. participated in the meeting of 5 September 2001 in order to make the transition between the applicant and Viscas, which the applicant indeed confirmed at the hearing. The applicant’s claim in its application that Mr T. participated in that meeting only in his capacity as a future employee of Viscas, in order to be ‘initiated’, as the applicant submitted at the hearing, demonstrates not only that Mr T. ensured the transition between the applicant and Viscas in the context of the cartel but also that the applicant knew that a member of its staff, who was subsequently seconded to Viscas, participated in cartel meetings.

64 On the other hand, it must be noted that certain of the applicant’s employees were involved in collusive activities during their secondment to Viscas before returning to their roles with the applicant at the start of 2006.

65 It is apparent from Annex II to the contested decision, which lists the persons concerned by the contested decision, that at least two of Viscas’s employees involved in the cartel, Mr I. and Mr M., returned to the applicant in April 2006.

66 It follows from the contested decision, and from the explanations provided by the Commission in reply to a written question put by the Court concerning the nature and level of involvement of those persons in the cartel, which were not disputed by the applicant, first, that Mr M., who occupied a management role at Viscas between October 2001 and March 2006, before returning to the applicant in April 2006, participated in several cartel meetings between January 2002 and June 2004. In particular, it is apparent from Annex I to the contested decision that, during the period of his secondment to Viscas, Mr M. participated in the A/R meetings of 30 January and 14 November 2002, 11 September 2003 and 9 June 2004. It is also apparent from that annex that either Mr M. or Mr I. participated in an A/R meeting on 15 November 2002. It is also clear from Annex I to the contested decision that, during that period, Mr M. was involved in contact concerning the allocation of power cable projects in various EEA Member States, namely the United Kingdom, the Netherlands, Greece, Italy and Norway. Mr I., for his part, worked for Viscas between May 2004 and April 2006, before returning to the applicant in April 2006, his direct superior being Mr M.

67 That evidence suffices to refute various arguments by which the applicant claims that the links between its own staff and that of Viscas cannot show that it exercised a decisive influence over that company. First, Mr T.’s participation in the A/R meeting of 5 September 2001 on behalf of the applicant and his subsequent transfer to Viscas confirm that there is no reason to distinguish the applicant’s situation from the facts of the cases giving rise to the judgments of 26 September 2013, EI du Pont de Nemours v Commission (C‑172/12 P, not published, EU:C:2013:601), and of 2 February 2012, EI du Pont de Nemours and Others v Commission (T‑76/08, not published, EU:T:2012:46). Next, the transfer of that employee confirms the existence of information channels between Viscas and the applicant and renders ineffective the applicant’s arguments that, first, the directors who were employed both by the applicant and by Viscas had only a minor role in managing Viscas and, second, those directors were bound by an obligation of loyalty and confidentiality in respect of Viscas, and not in respect of the applicant. Finally, as the Commission correctly submits, the fact that the secondment of workers to a subsidiary is a common practice in Japan is irrelevant for the purpose of the Commission’s assessment, the question being whether such secondment enabled the parent company to exercise a decisive influence over the conduct of its subsidiary, in particular, by establishing information channels between the two companies.

68 Third, in the contested decision, the Commission indicated circumstances demonstrating Viscas’s high level of economic dependency on its parent companies and the fact that those three companies were perceived as a unit from an economic point of view.

69 Contrary to what the applicant claims, the fact that the parent companies guaranteed the commitments of Viscas confirms the existence of economic links between those three companies and thus corroborates the Commission’s finding that Furukawa Electric and the applicant exercised a decisive influence over Viscas. Likewise, the high level of involvement of the parent companies in the process of creating a joint venture between Viscas and Nexans France confirms that even their competitors perceived Viscas, Furukawa Electric and the applicant as an economic unit.

70 It follows that the Commission was right to find that, despite the changes made by the 2004 JVA, the applicant, acting together with Furukawa Electric, had exercised a decisive influence over Viscas during the period from 1 January 2005 to 28 January 2009. Consequently, the Commission did not err in finding that, during that period, the applicant had participated in the cartel and, accordingly, in imposing, in Article 2(p) of the contested decision, a fine on it for which it is liable ‘jointly and severally’ with Furukawa Electric and Viscas.

71 The present plea in law must therefore be rejected and the applicant’s claim for annulment must therefore be rejected.

The claim for a reduction in the amount of the fine imposed on the applicant for its direct participation in the cartel

72 Before examining the applicant’s claim for a reduction in the amount of the fine imposed on it for direct participation in the cartel, it is necessary to recall that the review of legality is supplemented by the unlimited jurisdiction which the Courts of the European Union were afforded by Article 31 of Regulation No 1/2003, in accordance with Article 261 TFEU. That jurisdiction empowers the competent Court, in addition to carrying out a mere review of legality with regard to the penalty, to substitute its own appraisal for the Commission’s and, consequently, to cancel, reduce or increase the amount of the fine or penalty payment imposed. It must, however, be pointed out that the exercise of unlimited jurisdiction is not equivalent to an own-motion review and that proceedings before the Courts of the European Union are inter partes. With the exception of pleas involving matters of public policy which the Courts are required to raise of their own motion, such as the failure to state reasons for a contested decision, it is for the applicant to raise pleas in law against that decision and to adduce evidence in support of those pleas (judgment of 8 December 2011, KME Germany and Others v Commission, C‑389/10 P, EU:C:2011:816, paragraphs 130 and 131).

73 By its claim for a reduction in the amount of the fine imposed on the applicant for its direct participation in the cartel, the applicant asks the Court to reduce the amount of the fine imposed on the applicant by Article 2(o) of the contested decision, for its direct participation in the cartel between 18 February 1999 and 30 September 2001.

74 In support of that claim, the applicant raises two pleas in law. In the first plea in law, the applicant complains that the Commission made an error of assessment in applying point 13 of the 2006 Guidelines on the method of setting fines by including sales made by it and by Furukawa Electric in 2004 in the value of sales used to determine the basic amount of the fine imposed on it for its direct participation in the cartel from 18 February 1999 to 30 September 2001. In support of the second plea in law, the applicant claims that the Commission, in essence, infringed the principle of proportionality and the principle of equal treatment, by overestimating the relative weight of the Japanese and South Korean members of the cartel, as compared with that of the European members of the cartel in calculating the amount of the fine.

75 Before examining the applicant’s various objections, it is necessary to recall the principles governing the calculation of the amount of the fine, and the way in which the Commission acted in the present case.

The principles governing the calculation of the amount of the fine and their application in the present case

76 According to the case-law, it follows from Article 49(3) of the Charter of Fundamental Rights of the European Union that the severity of penalties must not be disproportionate to the offence in question and that, pursuant to Article 23(3) of Regulation No 1/2003, in fixing the amount of the fine, regard is to be had both to the gravity and to the duration of the infringement. The principle of proportionality and the principle that the penalty must be appropriate to the offence also require that the amount of the fine imposed must be proportionate to the gravity and the duration of the infringement (judgment of 12 December 2014, H & R ChemPharm v Commission, T‑551/08, EU:T:2014:1081, paragraph 308 and the case-law cited).

77 In particular, the principle of proportionality requires the Commission to set the fine proportionately to the factors taken into account for the purposes of assessing the gravity of the infringement and also to apply those factors in a way which is consistent and objectively justified (see judgment of 12 December 2014, H & R ChemPharm v Commission, T‑551/08, EU:T:2014:1081, paragraph 309 and the case-law cited).

78 In addition, when determining the amount of the fine, according to the case-law, objective factors such as the content and duration of the anticompetitive conduct, the number of incidents and their intensity, the extent of the market affected and the damage to the economic public order must be taken into account. The analysis must also take into consideration the relative importance and market share of the undertakings responsible and also any repeated infringements. In the interests of transparency, the Commission adopted the 2006 Guidelines on the method of setting fines in which it indicates the basis on which it will take account of one or other aspect of the infringement and what this will imply as regards the amount of the fine ((judgment of 12 December 2014, H & R ChemPharm v Commission, T‑551/08, EU:T:2014:1081, paragraph 310 and the case-law cited).

79 It is apparent from points 19 to 26 of the 2006 Guidelines on the method of setting fines that the basic amount of the fine consists of a variable amount of up to 30% of the sales in question of a given undertaking in the EEA, depending on the degree of gravity of the infringement and multiplied by the number of years of infringement, and, if necessary, an additional amount, the ‘entry fee’, of between 15% and 25% of that value of the undertaking’s relevant sales, irrespective of the duration.

80 Pursuant to point 13 of the 2006 Guidelines on the method of setting fines, in determining the basic amount of the fine to be imposed, the Commission will take the value of the undertaking’s sales of goods or services to which the infringement directly or indirectly relates. To that end, the Commission will normally take the sales made by the undertaking during the last full business year of its participation in the infringement.

81 Point 18 of the 2006 Guidelines on the method of setting fines, however, provides as follows:

‘Where the geographic scope of an infringement extends beyond the EEA (e.g. worldwide cartels), the relevant sales of the undertakings within the EEA may not properly reflect the weight of each undertaking in the infringement. This may be the case in particular with worldwide market-sharing arrangements.

In such circumstances, in order to reflect both the aggregate size of the relevant sales within the EEA and the relative weight of each undertaking in the infringement, the Commission may assess the total value of the sales of goods or services to which the infringement relates in the relevant geographic area (wider than the EEA), may determine the share of the sales of each undertaking party to the infringement on that market and may apply this share to the aggregate sales within the EEA of the undertakings concerned. The result will be taken as the value of sales for the purpose of setting the basic amount of the fine.’

82 The basic amount of the fine thus calculated may be adjusted. It may therefore be increased if there are aggravating circumstances, such as those laid down in point 28 of the 2006 Guidelines on the method of setting fines or reduced where the Commission finds the existence of mitigating circumstances, such as those referred to in point 29 of those guidelines.

83 The Commission may also, by virtue of point 30 of the 2006 Guidelines on the method of setting fines, increase the amount of 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 in order to ensure that the fine is deterrent.

84 In any event, for each undertaking, the total amount of the fine may not exceed 10% of its total turnover in the preceding business year, in accordance with Article 23(2) of Regulation No 1/2003.

85 In the present case, it is apparent from the contested decision that, in order to determine the value of sales, constituting the starting point for calculating the basic amount of the fine, the Commission decided to depart from the method arising from point 13 of the 2006 Guidelines on the method of setting fines and to apply the method laid down in point 18 of those guidelines on the ground that the sales made by certain undertakings belonging to the cartel within the EEA did not properly reflect their weight in the infringement, the territory covered by the cartel was wider than the EEA and all parties to the cartel were major producers active on a worldwide basis (recital 968 of the contested decision).

86 Moreover, the Commission also decided to use the value of the sales of the undertakings concerned in 2004, and not the value of those made in each of the undertaking’s last full year of participation. In order to justify that approach, first, the Commission stated that the sales of power cables at both EEA and worldwide level increased significantly as from 2006. The sales of the last full business year were therefore not sufficiently representative of the infringement period, particularly for those undertakings whose participation in the cartel ended after 2006. According to the Commission, using the sales made by all undertakings in 2004 provides a more accurate approximation of the economic importance of the infringement throughout its duration as well as of the relative weight of the relevant undertakings in the infringement. Second, the Commission stated that the use of the 2004 sales made it possible to avoid discriminatory treatment between the undertakings that ended their direct participation in the cartel earlier and those that continued. According to the Commission, it is apparent from point 13 of the 2006 Guidelines on the method of setting fines that, in that situation, it may decide not to use the preceding year’s sales. The Commission added that the choice of a single reference year was preferable for the purposes of applying point 18 of the 2006 Guidelines on the method of setting fines. According to the Commission, accepting different reference years for all the participants would seriously undermine, in the present case, the purpose and the application of point 18 (recitals 965 and 966 of the contested decision).

87 Consequently, in accordance with the method described in point 18 of the 2006 Guidelines on the method of setting fines, the Commission, first, determined the value of the sales of submarine power cables and the value of sales of underground power cables concerned as a whole made by all the members of the cartel in 2004 worldwide, except for the United States. Next it identified the shares of those sales made by each of the undertakings participating in the cartel (recital 991; Table 4 of the contested decision). Finally, it applied the share percentages thus established to the value of the sales of submarine power cables and to the value of the sales of underground power cables made by the cartel members in 2004 in the EEA. Finally, in order to take into account the territorial expansion of the EEA, the Commission decided to establish three sales values: for the EEA comprising 18 members, the EEA comprising 28 members and the EEA comprising 30 members (recitals 967 and 990; Tables 5 to 7 of the contested decision).

88 The Commission then applied a coefficient corresponding to the gravity of the infringement to each of those three sales values. That comprised 15% for all undertakings which took part in the cartel, plus 2% for the cumulative market share held by those undertakings and the geographical scope of the cartel. An additional coefficient of 2% was imposed on the European undertakings which took part in the ‘A/R cartel configuration’ and the ‘European cartel configuration’. Next, the Commission applied the multiplier corresponding to the duration of the infringement committed in the EEA of 18 members (from 18 February 1999 to 30 April 2004), 28 members (from 1 May 2004 to 31 December 2006), and 30 members (from 1 January 2007 to 28 January 2009) to the figure obtained for each of those periods.

89 In order to determine the basic amount of the fine for each participant in the cartel, under point 25 of the 2006 Guidelines on the method of setting fines, the Commission added an ‘entry fee’ corresponding to a proportion of the value of sales of between 17% and 19%, to the figure obtained after applying the multiplier. That additional amount, however, was not applied to the joint ventures.

90 Finally, after finding that there were no aggravating circumstances, the Commission took into account, as mitigating circumstances, the limited participation of several undertakings in the cartel and, for some, their lack of awareness of specific aspects of the cartel, reducing the total amount of their fine by 5% to 10%. The Commission did not find any mitigating circumstance with regard to the applicant. Moreover, the Commission did not consider it necessary to increase the amount of the fines imposed in order to confer a deterrent effect within the meaning of point 30 of the 2006 Guidelines on the method of setting fines.

91 More particularly as regards setting of the value of sales of the Japanese undertakings for the purposes of applying point 18 of the 2006 Guidelines on the method of setting fines, first, the Commission found that the participation of those undertakings in the cartel was divided into two periods, namely, a first period of direct participation in the cartel by Sumitomo Electric Industries, Hitachi Cable, Furukawa Electric, the applicant, SWCC Showa Holdings and Mitsubishi Cable Industries, and a second period during which those undertakings participated in the cartel through their respective joint ventures, J-Power Systems, Viscas and Exsym. The Commission found that, since the parent companies continued to participate in the cartel through their respective joint ventures, it would be artificial to use a different reference year to establish the value of sales taken into account for the purposes of calculating the amount of the fine for the first period and for the second period. Accepting a different reference year would discriminate between the Japanese undertakings and the other addressees of the contested decision, simply because the Japanese undertakings had decided to form joint ventures (recitals 977 and 978 of the contested decision).

92 Second, the Commission stated, with reference in that regard to its observations in the statement of objections, that the sales to be taken into account, as regards the joint ventures and their parent companies, included not only the 2004 sales made by each joint venture to third parties but also the sales of their parent companies to third parties that were maintained as reserved customers during the joint venture period. The Commission noted, in that regard, that, during the administrative procedure, the applicant, Furukawa Electric and Viscas had claimed that that approach was contrary to point 13 of the 2006 Guidelines on the method of setting fines, in so far as the sales of the applicant and Furukawa Electric made after Viscas was formed are not directly or indirectly related to the infringement. The Commission rejected their arguments, noting, in recital 980 of the contested decision, that the sales that prior to the formation of the joint ventures had been cartelised were afterwards shared between the parent companies and the joint ventures according to clear criteria based on types of customers and geographic scope. The Commission added that, through the application of the ‘home territory agreement’, all the sales made by the parent companies after the formation of the joint ventures were equally protected by the collusive agreements through the participation of those joint ventures in the cartel.

93 Third, in order to reflect each parent company’s economic strength and weight in the infringement during the period prior to the formation of the joint ventures, the Commission decided to share the sales made by each joint venture among the parent companies proportionally to the individual sales achieved by each parent company in the full business year prior to the formation of their joint venture (recitals 981 and 982 of the contested decision).

The plea in law alleging an error of assessment in the application of point 13 of the 2006 Guidelines on the method of setting fines

94 The applicant, supported by Viscas, claims that the Commission erred in including in the value of sales used to determine the basic amount of the fine, imposed on it by Article 2(o) of the contested decision for its direct participation in the cartel from 18 February 1999 to 30 September 2001, not only the sales made by Viscas in 2004, but also those made in the same year to the customers retained by it and by Furukawa Electric.

95 The applicant maintains in that regard that, as from 1 October 2001, it ceased to participate directly in the cartel, was no longer bound to observe the ‘home territory’ agreement and that the European producers were, reciprocally, no longer bound not to approach its retained customers. It follows that the sales made by the applicant and those made by Furukawa Electric to their retained clients were no longer covered by the cartel. According to the applicant, the Commission may not make use of a fiction that the applicant and Furukawa Electric continued to participate directly in the cartel in order artificially to inflate the value of the sales used to calculate the basic amount of the fine imposed on it for its direct participation in the cartel.

96 According to the applicant, if the Commission had excluded, as it ought to have done, the sales made in 2004 by the parent companies of the joint ventures of the Japanese producers, the applicant’s global market share would have been 7.7% rather than 13.04% for high voltage underground cables and 1.47% rather than 6.86% for high voltage submarine cables. Consequently, the applicant’s fine would have been approximately EUR 4 500 000 rather than EUR 8 150 000.

98 In that regard, it must be borne in mind that, in accordance with the case-law, where two parent companies each have a 50% shareholding in a joint venture which has committed an infringement of the rules of competition law, it is only for the purposes of establishing liability for participation in the infringement of that law and only in so far as the Commission has demonstrated, on the basis of factual evidence, that both parent companies did in fact exercise decisive influence over the joint venture, that those three entities can be considered to form a single economic unit and therefore form a single undertaking for the purposes of Article 101 TFEU (judgments of 26 September 2013, TheDow Chemical Company v Commission, C‑179/12 P, not published, EU:C:2013:605, paragraph 58; of 27 September 2006, Avebe v Commission, T‑314/01, EU:T:2006:266, paragraphs 137 and 138; and of 27 September 2012, Shell Petroleum and Others v Commission, T‑343/06, EU:T:2012:478, paragraph 45).

99 It follows from the analysis of the single plea in law put forward in support of the claim for annulment of that action (see paragraphs 36 to 71 above) that, during the period of Viscas’s participation in the cartel, as a result of the close legal, organisational and economic links which bound it to Viscas, the applicant, acting jointly with Furukawa Electric, exercised a decisive influence over Viscas. On the one hand, the applicant does not dispute that it exercised such influence during the validity period of the 2001 JVA, from 1 October 2001 to 31 December 2004. On the contrary, it claims that, from the time that the 2004 JVA came into effect, on 1 January 2005, it ‘no longer’ exercised such influence. On the other hand, as was held in the context of the examination of the single plea in law, the applicant’s arguments that it did not exercise a decisive influence over Viscas during the period from 1 January 2005 to 28 January 2009 must be rejected in their entirety.

100 Thus, contrary to the applicant’s claim that it ended its involvement in the cartel in question as from 30 September 2001, it follows from the analysis of the single plea in law put forward in support of the claim for annulment of that action that, during the period from 1 October 2001 to 28 January 2009, the applicant, Furukawa Electric and Viscas formed part, from the point of view of the object of that cartel, of a single economic unit and, accordingly, constituted a single undertaking for the purposes of Article 101(1) TFEU, which adopted the same course of conduct on the high and extra high voltage submarine and underground power cable market. That undertaking certainly therefore participated in the single and continuous infringement, during the relevant period, in breach of Article 101(1) TFEU and Article 53 of the EEA Agreement.

101 The fact that, as the applicant maintains, the Commission stated, in recital 818 of the contested decision, that, from the time of Viscas’s creation, the applicant and Furukawa Electric were not involved directly in the cartel does not in any way prevent recognition of the applicant’s personal liability for the infringement in question. As is apparent from the case-law cited in paragraph 45 above, the applicant’s direct participation in collusive activities is not necessary in order to hold it liable for an infringement of Article 101(1) TFEU. In the present case, the applicant was personally condemned for an infringement which it is deemed to have committed itself because of its close economic and legal links with Viscas, which enabled it to determine the latter’s conduct on the market in question.

102 In such a situation, it cannot be held that the Commission was not entitled, in principle, to take into account sales made by the applicant and Furukawa Electric in order to calculate the hypothetical value of sales made by Viscas in the EEA under point 18 of the 2006 Guidelines on the method of setting fines.

103 It must be noted that point 6 of the 2006 Guidelines on the method of setting fines states that ‘the combination of the value of sales to which the infringement relates and of the duration of the infringement is regarded as providing an appropriate proxy to reflect the economic importance of the infringement as well as the relative weight of each undertaking in the infringement’. In accordance with point 13 of those guidelines, the value of the undertaking’s sales of goods or services to which the infringement directly or indirectly relates must be taken into account.

104 It is true that, in general, the Commission takes into account only sales directly or indirectly relating to the infringement made by the joint venture for the purposes of calculating the fine ultimately imposed ‘jointly and severally’ on the parent companies, provided that it is shown that they have exercised a decisive influence on their subsidiary.

105 However, in the present case, Furukawa Electric and the applicant did not merely transfer all the activities covered by the cartel to their subsidiary, but also retained some of those activities themselves.

106 The Commission stated that, during the period from 1 October 2001 to 31 December 2004, Viscas was a foreign sales agent for its parent companies. It follows from recital 825 of the contested decision, which is not disputed by the applicant, that, during that period, the applicant and Furukawa Electric transferred to Viscas their respective sales of submarine and underground power cables outside Japan to non-Japanese undertakings. The manufacturing facilities and the sales activities in Japan, including in respect of Japanese companies outside Japan, were retained by the parent companies. It follows from recital 828 of the contested decision that, following the changes introduced by the 2004 JVA, as from 1 January 2005, Viscas’s activities included the manufacture and sale of cables to all customers of its parent companies with the exception of Japanese domestic companies other than the national electricity companies, which were retained by the parent companies.

107 Thus, the sales made by the applicant to its reserved customers covered, first, during the period in which the 2001 JVA was valid, sales to Japanese companies both in and outside Japan and, second, during the period in which the 2004 JVA was valid, sales to Japanese domestic companies other than the national electricity companies. In addition, those sales indeed concerned high and extra high voltage submarine and underground power cables manufactured initially by the applicant and Furukawa Electric then by Viscas itself. Accordingly, during the period of activity of the joint venture, sales were shared between the parent companies and the joint venture according to clear criteria based on types of customers and geographic scope (recital 980 of the contested decision).

108 In accordance with the case-law, the proportion of the overall turnover deriving from the sale of products in respect of which the infringement was committed is best able to reflect the economic importance of that infringement. Accordingly, the Commission was entitled to take into account the sales of the parent companies because they had been made in a market affected by the cartel (judgment of 23 April 2015, LG Display and LG Display Taiwan v Commission, C‑227/14 P, EU:C:2015:258, paragraphs 55 and 56) and were moreover the sales of an undertaking to which the applicant belonged (see, to that effect, judgment of 19 March 2015, Dole Food and Dole Fresh Fruit Europe v Commission, C‑286/13 P, EU:C:2015:184, paragraphs 149 and 150).

109 The applicant’s argument that those sales were not affected by the cartel, since, as from 1 October 2001, it was no longer bound by the collusive agreements cannot succeed. As is apparent from paragraphs 49 to 70 above, during the period from 1 October 2001 to 28 January 2009, the applicant participated in the cartel since, by way of the close legal, organisational and economic links which bound it to Viscas, it exercised a decisive influence over the latter.

110 The sales of high and extra high voltage submarine and underground cables by the applicant for the benefit of its reserved customers therefore fell within the scope of the collusive agreements, in particular the ‘home territory agreement’, where it concerned sales made to Japan and the ‘export territories’ agreement, where it concerned sales outside Japan. Those sales must therefore be classified as sales to which the infringement directly or indirectly relates, within the meaning of point 13 of the 2006 Guidelines on the method of setting fines.

111 Moreover, it must be held that Viscas’s argument that, when the Commission uses the combined sales of the applicant, Furukawa Electric and Viscas as the basis for calculating the amount of the amount of the fine imposed on each of them, Viscas’s parent companies become equally liable for a fine calculated on basis of the presumed actions of each of those companies, even if those companies obviously did not have the ability to exercise decisive control each over the other, results from a misreading of the contested decision.

112 As was recalled in paragraph 93 above, as regards the fine imposed on the parent companies for the period preceding the creation of their joint ventures, the Commission divided the sales made by each joint venture in 2004 between its parent companies in proportion to the individual sales made by each of the parent companies in the full financial year preceding the creation of their joint venture. It follows that, contrary to Viscas’s claim, the inclusion of the sales made by Furukawa Electric in 2004 in the value of sales used to calculate the basic amount of the fine imposed on the applicant for its direct participation in the cartel did not result in the latter being deemed responsible for sales made by an undertaking over which it was not in a position to exercise control.

113 Accordingly, it must be held that, by including those sales in the value of sales used to determine the basic amount of the fine, the Commission did not infringe point 13 of the 2006 Guidelines on the method of setting fines. The present plea in law must therefore be rejected as unfounded.

The plea in law alleging an infringement of the principles of proportionality and equal treatment in the calculation of the amount of the fine imposed on the applicant for its direct participation in the cartel

114 In the context of that plea in law, the applicant claims, in particular, that the application of point 18 of the 2006 Guidelines on the method of setting fines led to the fines imposed on the European producers being much lower than they would have been if their calculation had been based on the actual sales made in the EEA and, conversely, the fines imposed on the Japanese and South Korean producers being much higher than they would have been if they had been calculated on the basis of those sales. In addition, it complains that the Commission failed to take into account, when assessing the gravity of the infringement, the fact that, in the light of the significant barriers to entry to the EEA market, the commitment of the Japanese and South Korean producers to observe the European ‘home territory agreement’ had only a limited effect on competition in the EEA.

– The application of point 18 of the 2006 Guidelines on the method of setting fines for the purpose of determining the value of sales

115 According to the applicant, supported by Viscas, the application of the methodology laid down in point 18 of the 2006 Guidelines on the method of setting fines in the present case favoured the European undertakings by comparison with the Japanese undertakings.

116 More specifically, the applicant and Viscas claim that the application, in the present case, of the method of calculating the value of sales described in point 18 of the 2006 Guidelines on the method of setting fines has a perverse effect, since it leads to the fines imposed on the European suppliers being lower than they would have been if the Commission had applied the method laid down in point 13 of those guidelines. Thus, despite the fact that the Commission considered that the conduct of the European producers was more harmful — since they participated in two elements of the cartel — it paradoxically reduced the fine imposed on them by transferring the actual sales made by the European producers to the Asian producers in order to determine theoretical sales in the EEA. The Commission accordingly failed to reflect the real weight of the involvement of each undertaking in the cartel in the amount of the fine.

117 Viscas claims that the most suitable way of remedying the unequal treatment to which the Japanese producers were subject is to apply at least a 44% reduction to the notional value of sales used to determine the fine — a reduction which mirrors the reduction in the amount of the fines received by the European producers as a result of the application of point 18 of the 2006 Guidelines on the method of setting fines as compared with the fine that would have been imposed on them if the Commission had applied point 13 of those guidelines.

119 In that regard, it must be held that, in the present case, since the applicant participated in a market-sharing agreement designed, inter alia, to reserve access to the EEA market for European producers, the Commission was right to find that it would not be appropriate to apply a methodology based on its actual sales in the EEA. As the Commission pointed out, that would amount to not penalising the applicant for the degree of its participation in the cartel.

120 Next, in the light of the nature of the infringement in question, a methodology which takes into account the worldwide market shares is appropriate for reflecting the weight of the cartel participants in the infringement (judgment of 21 May 2014, Toshiba v Commission, T‑519/09, not published, EU:T:2014:263, paragraph 282).

121 Finally, as the Court has already held in respect of a market-sharing agreement between undertakings competing at a worldwide level, the worldwide market shares give the best adapted representation of the capacity of those undertakings to cause significant damage to other operators in the European market and give an indication of their contribution to the effectiveness of the cartel as a whole or, conversely, of the instability which would have affected the cartel had they not participated (see, to that effect, judgments of 29 April 2004, Tokai Carbon and Others v Commission, T‑236/01, T‑239/01, T‑244/01 to T‑246/01, T‑251/01 and T‑252/01, EU:T:2004:118, paragraph 198, and of 15 June 2005, Tokai Carbon and Others v Commission, T‑71/03, T‑74/03, T‑87/03 and T‑91/03, not published, EU:T:2005:220, paragraph 186).

122 Having regard to the extremely harmful nature of a market-sharing agreement, one of the most serious infringements of Article 101 TFEU, the imposition of sufficiently dissuasive penalties against non-European producers which undertake not to compete with European producers in their territory is justified (judgment of 21 May 2014, Toshiba v Commission, T‑519/09, not published, EU:T:2014:263, paragraph 284).

123 The suitability of the methodology used by the Commission in the present case to calculate the amount of the sales made in the EEA attributed to the various participants in the cartel cannot be called into question by the arguments of the applicant and Viscas.

124 The applicant and Viscas do not dispute, as Viscas submitted at the hearing, the Commission’s ability to apply the method laid down in point 18 of the 2006 Guidelines on the method of setting fines in order to reflect the relative weight of the participants in a cartel when, as was the situation in the case giving rise to the judgment of 21 May 2014, Toshiba v Commission (T‑519/09, not published, EU:T:2014:263), the European producers, on the one hand, and the Asian producers, on the other hand, agreed not to enter each other’s domestic markets. They claim, however, that the application of that method does not correctly reflect the relative weight of the participants in the cartel where, as in the present case, the European producers did not merely abstain from entering the domestic market of the Asian producers, but also divided the market in the EEA among themselves. In the applicant’s view, in such a scenario, the application of point 18 of the 2006 Guidelines on the method of setting fines would lead to the weight of the European producers in the cartel being undervalued and, accordingly, the weight of the Japanese producers being overvalued, which constitutes an infringement of the principle of equal treatment in determining the amount of the fine.

125 It must be observed that the applicant’s view rests on the premiss that the application of the methodology laid down in point 18 of the 2006 Guidelines on the method of setting fines favoured the European producers by reducing the share of the sales actually made in the EEA which had been allocated to them pursuant to point 13 of those guidelines. However, it must be held that such a premiss is incorrect since, having regard to the nature of the infringement, which consisted, inter alia, of restricting access by the Japanese producers to the EEA market, the share of sales actually made by the European producers in the EEA could not be used as the basis for assessing their weight in the infringement as provided for in point 13 of the 2006 Guidelines on the method of setting fines. The use of the share of sales actually made by the European producers in the EEA would have led, in the present case, to their weight in the cartel being overvalued and their being penalised in excess of their participation in that cartel. It cannot therefore be held, as the applicant and Viscas maintain, that the difference between the amount of the sales actually made by the European producers in the EEA and that allocated to them pursuant to point 18 of the 2006 Guidelines on the method of setting fines demonstrates an advantage conferred on them by the Commission.

126 Accordingly, it must be held that, contrary to what the applicant claims, by applying the methodology laid down in point 18 of the 2006 Guidelines on the method of setting fines for the purpose of determining the value of sales to be taken into account in calculating the fine, the Commission did not infringe the principles of proportionality and equal treatment.

– The failure to take into account the existence of barriers to entry to the EEA market in determining the basic amount of the fine

127 The applicant, supported by Viscas, claims that, unlike the facts that gave rise to the judgments of 12 July 2011, Hitachi and Others v Commission (T‑112/07, EU:T:2011:342), and of 12 July 2011, Toshiba v Commission (T‑113/07, EU:T:2011:343), in the present case, in the light of the significant barriers to entry to the EEA market, the commitment of the Japanese and South Korean producers to observe the ‘home territory’ agreement was not capable of having a significant enough effect on competition in the EEA to be regarded as a condition for the effectiveness of the ‘European cartel configuration’ and did not, in itself, permit the European participants in the cartel to obtain a dominant position on the market in the EEA. According to the applicant, the limited role played by the ‘home territory’ agreement in the operation of the European cartel configuration is confirmed by the statements made by ABB and Nexans France. Consequently, in order to reflect correctly the relative weight of the Japanese and South Korean producers in the infringement, the Commission should have limited the proportion of the value of sales used with regard to them for the gravity of the infringement to 15% or, at most 16%, in accordance with the practice it had adopted in several earlier decisions concerning cartels comparable to that in question in the contested decision.

129 At the outset, it must be recalled that, as was set out in paragraphs 81 to 87 above, in the present case, the Commission used, pursuant to point 18 of the 2006 Guidelines on the method of setting fines, an approach based on the shares of the worldwide market of the undertaking, within the meaning of Article 101(1) TFEU, formed by the applicant, Furukawa Electric and Viscas. It must be held that, as the Court has previously held, an approach based on the applicant’s worldwide market shares takes into account, even if only in aggregated form, the possible barriers to entry that may exist in the various geographic segments of the worldwide market (judgment of 21 May 2014, Toshiba v Commission, T‑519/09, not published, EU:T:2014:263, paragraph 288).

130 Moreover, it must be noted that the applicant and Viscas do not claim that the barriers to entry to the EEA market were insurmountable to the extent that they excluded all potential competition on the part of the Japanese and South Korean producers, but that, given the significance of those barriers, the commitment of those producers to observe the ‘home territory’ agreement, had merely a limited effect on competition in the EEA and did not, in itself, enable the European producers participating in the cartel to represent virtually all of the market, which the Commission should have taken into account when assessing the gravity of the infringement.

131 It must be held that that line of argument is based on an incorrect premiss.

132 It must be noted that the Guidelines on the method of setting fines imposed pursuant to Article 15(2) of Regulation No 17 and Article 65(5) [CS] (OJ 1998 C 9, p. 3), applicable in the cases giving rise to the judgments of 12 July 2011, Hitachi and Others v Commission (T‑112/07, EU:T:2011:342), and of 12 July 2011, Toshiba v Commission (T‑113/07, EU:T:2011:343), expressly provided, in the first indent of Section 1 A thereof, that, when assessing the gravity of an infringement, the Commission had to consider its actual impact on the market where it appeared that that impact could be measured.

133 It apparent from point 22 of the 2006 Guidelines on the method of setting fines, applicable to the facts of the present case, that, among the factors which the Commission has undertaken to appraise in order to decide whether the proportion of the value of sales in relation to the infringement, to be taken as a basis for determining the basic amount of the fine, should be at the lower end or at the higher end of the scale mentioned in point 21 of the Guidelines, which rises to 30%, only the criterion of the implementation of the infringement is expressly included (judgment of 14 May 2014, Donau Chemie v Commission, T‑406/09, EU:T:2014:254, paragraphs 71 and 73).

134 By contrast, the 2006 Guidelines on the method of setting fines do not provide for the actual impact of the infringement on the market to be taken into account in the determining the basic amount of the fine. Point 5 of the Guidelines, according to which ‘the duration of the infringement ... necessarily has an impact on the potential consequences of the infringement on the market’, cannot lead to any different conclusion, since that point is made solely to justify the fact that the proportion of the value of sales decided on in accordance with points 19 to 23 of the 2006 Guidelines on the method of setting fines will, in accordance with point 24 thereof, be multiplied by the number of years of the infringement’s duration (judgment of 14 May 2014, Donau Chemie v Commission, T‑406/09, EU:T:2014:254, paragraph 71).

135 It follows that, irrespective of the significance of the barriers to entry to the EEA market during the period in which the applicant participated in the infringement, it cannot criticise the Commission for failing to take account of the actual effect of the commitment of the Japanese and South Korean producers to observe the ‘home territory’ agreement when assessing the gravity of the infringement.

136 Moreover, the applicant has failed to show that compliance with the ‘home territory’ agreement by the Japanese and South Korean producers was not a condition for the effectiveness of the ‘European cartel configuration’.

137 It merely claims that, in its oral statements made in the context of its application for immunity, ABB did not refer to the decisive nature of compliance by the Japanese and South Korean producers with the ‘home territory’ agreement for the effectiveness of the ‘European cartel configuration’ and that, at the administrative hearing before the Commission, Nexans France maintained that there was no firm agreement excluding the Asian producers from the EEA and that, for technical reasons, they were not regarded as serious competitors in the EEA. Those mere statements do not suffice to support the applicant’s contention.

138 Accordingly, on the one hand, the fact that ABB only referred in its statements to the ‘home territory’ agreement in the sense that the European producers were not to compete for projects located in the ‘home territory’ of the cartel’s Japanese and South Korean producers does not mean that it was unaware that conversely the Japanese and South Korean producers were to refrain from competing for projects located in the ‘home territory’ of the European cartel members and that the latter obligation was irrelevant to the effectiveness of the ‘European cartel configuration’.

139 On the other hand, the statements of Nexans France at the administrative hearing, whose purpose may be legitimately considered to be to mask the extent of the infringement for which the Commission intended to hold it liable, are directly contradicted by the content of an email referred to in recital 437 of the contested decision. In that email, dated 7 March 2008, Mr J., of Nexans France, wrote to Mr I., of Viscas, that ‘we have noted with surprise A (JP) [JPS] involvement through a company called Eclipse in a (UK) SM [submarine] project Ormonde [United Kingdom] … Please clarify’. It is apparent from that email that the coordinator of the European side of the cartel is indicating to the coordinator of the Asian side that he was surprised to learn that another Japanese undertaking was competing for a submarine cable project located in the European ‘home territory’ and asks him to provide explanations in that regard. That shows that the European producers expected the Asian producers to observe their commitment not to compete for projects located in the European ‘home territory’ and that they reacted when that was not the case. It must be held that the European producers would not have adopted that approach if they had considered that observance of the ‘home territory’ agreement was not particularly significant for the effectiveness of the ‘European cartel configuration’.

140 Furthermore, it must be noted that the applicant does not dispute the evidence on which the Commission based its finding in recital 534 of the contested decision that the ‘European cartel configuration’ was subordinate to the ‘A/R cartel configuration’ and gave effect to it.

141 In the same way, it is necessary to reject the applicant’s contention that compliance by the Asian producers with the ‘home territory’ agreement did not enable the European producers to obtain a very significant cumulative market share in the EEA. It must be noted that an influence over the market shares of the European producers is irrelevant for the purpose of determining the gravity of the infringement, inter alia, in the light of the fact that potential competition may exert technological and economic pressure without that being reflected in their market shares.

142 It is also necessary to reject the applicant’s argument alleging that the Commission, in several earlier decisions relating to infringements of Article 101 TFEU comparable to that at issue in the contested decision, limited the proportion of the value of sales for the gravity of the infringement to 15% or 16%. In that regard, first, it must be recalled that, according to settled case-law, the Commission’s practice in previous decisions does not itself serve as a legal framework for fines imposed in competition matters and decisions in other cases can give only an indication for the purpose of determining whether there is discrimination (see judgment of 11 July 2013, Ziegler v Commission, C‑439/11 P, EU:C:2013:513, paragraph 134 and the case-law cited).

143 Second, it must be noted that the facts giving rise to the Commission decisions relied on by the applicant differ significantly from those which gave rise to the adoption of the contested decision. Accordingly, it must be noted that, in the case giving rise to the Commission decision of 15 October 2008 (Case COMP/39188 — Bananas), in which the Commission applied a percentage of the value of sales of 15% for the gravity of the infringement, the practices in question were restricted to a few Member States and did not extend to the whole of the EEA. In the same way, it must be noted that, in the cases giving rise to the Commission decisions of 19 October 2011 (Case COMP/39.605 — CRT glass), of 8 December 2010 (COMP/39.309 — Liquid Crystal Displays [LCD]), of 30 June 2010 (Case COMP/38.344 — Prestressing Steel), of 19 May 2010 (Case COMP/38.511 — DRAMs) and of 7 October 2009 (Case COMP/C.39129 — Power Transformers), in which the Commission applied a percentage of 16% for the gravity of the infringements, although the infringements extended to the whole of the territory of the EEA, the cumulative market share owned by the participants in the cartel in the EEA was limited and did not justify an increase in that percentage, contrary to the situation in the present case.

144 Furthermore, it must be recalled that, as the Court has previously held, the difficulty in determining an exact percentage on the scale of 0 to 30% is reduced to a certain extent in the case of secret horizontal price-fixing and market-sharing agreements, as in the present case, in which the proportion of the value of sales taken into account will generally be set ‘at the higher end of the scale’, with the result that, for the most harmful restrictions, the rate should, at the very least, be above 15% (see judgment of 14 May 2014, Reagens v Commission, T‑30/10, not published, EU:T:2014:253, paragraph 220 and the case-law cited).

145 Accordingly, the applicant’s complaint that the Commission should have limited the proportion of the value of sales applied with regard to the Asian producers for the gravity of the infringement to 15% in order properly to take account of their relative weight in that infringement must be rejected as unfounded.

147 In the light of the foregoing considerations and in the absence of additional evidence capable of justifying a reduction in the amount of the fine imposed on the applicant for its direct participation in the cartel, the applicant’s claims in that regard must be rejected and, accordingly, the action dismissed in its entirety.

148 Under Article 134(1) 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 Commission has applied for costs and the applicant has been unsuccessful, the latter must be ordered to bear its own costs and to pay those incurred by the Commission. The intervener must bear its own costs.

2. Orders Fujikura Ltd to bear its own costs and to pay those of the European Commission;

The claim for a reduction in the amount of the fine imposed on the applicant for its direct participation in the cartel

The principles governing the calculation of the amount of the fine and their application in the present case

The plea in law alleging an error of assessment in the application of point 13 of the 2006 Guidelines on the method of setting fines

– The application of point 18 of the 2006 Guidelines on the method of setting fines for the purpose of determining the value of sales

– The failure to take into account the existence of barriers to entry to the EEA market in determining the basic amount of the fine

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	Court of Justice of the European Communities (including Court of First Instance Decisions)
You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Fujikura v Commission (Competition - European market for power cables - Judgment) [2018] EUECJ T-451/14 (12 July 2018) URL: http://www.bailii.org/eu/cases/EUECJ/2018/T45114.html Cite as: ECLI:EU:T:2018:452, [2018] EUECJ T-451/14, EU:T:2018:452

Court of Justice of the European Communities (including Court of First Instance Decisions)