European Court of Justice: landmark ruling establishing liability of cartel facilitator (“AC-Treuhand II”)

In a long-awaited judgment the European Court of Justice (ECJ) clarified that cartel facilitators can be held liable under Article 101 of the Treaty on the Functioning of the European Union (TFEU), irrespective of whether they operated in the same market in which the anti-competitive behavior took place. In contrast to a previous (organic peroxides) case where a symbolic fine had been imposed on the company (AC-Treuhand I, T‑99/04), the ECJ confirmed with its judgment of 22 October 2015 the liability of AC Treuhand for an amount of two times EUR 174,000. 

Active role of AC-Treuhand

The ECJ confirmed the General Court’s decision to uphold the European Commission’s (Commission) fine on the Swiss consultancy firm AC-Treuhand. According to the Commission’s findings the firm facilitated an EEA-wide cartel relating to two different heat stabilizer markets between a range of undertakings in various ways for which it received remuneration: it organized and actively attended the meetings in which the undertakings fixed prices and allocated markets and customers, it provided the undertakings with relevant sensitive data and acted as moderator, inter alia, by settling disputes between the cartelists.

Anti-competitive behavior

The ECJ made two important findings. Firstly, neither the wording of Article 101(1) TFEU nor the former case law of the European courts indicate that the existence of an anti-competitive agreement or concerted practice presupposes that the participating undertakings must be active on the same, associated (upstream or downstream) or neighboring markets. According to settled case-law an undertaking’s liability is established where (i) it contributes to the common anti-competitive objective of the participants to the agreement or concerted practice, (ii) at least reasonably foresees the conduct or plan pursued to reach the common anti-competitive objective and (iii) is ready to take the risk of being detected. The ECJ found that the liability risk was reasonably foreseeable for AC-Treuhand in light of the respective case-law at the time. 

Imposition of a lump sum

Secondly, the ECJ declared the imposition of a lump sum on AC-Treuhand to be compatible with the principles of legal certainty, equal treatment and proportionality. The Commission’s Guidelines on the method of setting fines aim to provide efficient deterrence by imposing fines reflecting the economic importance of and the individual participation in the infringement. According to these Guidelines the Commission usually combines a percentage of the sales volume of the cartelized products or services with the duration of the infringement. The Commission is entitled to deviate from this calculation methodology where it deems necessary for particular reasons. To this end, the ECJ confirmed that the Commission was entitled to impose the above-mentioned lump sum on AC-Treuhand as the consultancy firm was not active on the relevant heat stabilizer markets and the calculation of the fine could not be based on any AC-Treuhand turnover directly linked to the cartelized products. According to the Commission the remuneration the consultancy firm received for providing services to the cartel members did not mirror the economic importance of the infringement and AC-Treuhand’s individual contribution thereto, so this turnover was not a valid basis for calculating the fine. 

Consequences of the decision

The judgment confirmed the Commission’s findings that AC-Treuhand did not render only peripheral services but played an essential role in the cartel and was therefore held liable. Consequently, the ECJ did not have to rule on the question at what level third undertakings, in particular consultancy firms that collect and distribute market data, (unknowingly) interacting with cartel members are exposed to liability risks for potentially facilitating anti-competitive behavior. This question might be dealt with in proceedings currently pending before the General Court (ICAP v European Commission, T-180/15). To this end, the ECJ ruling leaves some legal uncertainty, which behavior in the context of illegal activity can make an external service provider a “cartel facilitator” with the risks involved that a high fine is imposed on the firm.

Against this background and also taking into account that proceedings before the European Courts usually last for several years, it is advisable for undertakings to raise the awareness of their employees in relation to potentially anti-competitive behavior if they act as business partners and (unconsciously) contribute to third-party cartel infringements. Having said that, undertakings should seek legal advice in case of doubt in order to avoid liability and high fines as a result.

The decision of the ECJ of 22 October 2015 (case C‑194/14 P) can be found here.