COMMISSION DECISION. of the EC Treaty and Article 53 of the EEA. Organic. (Communication of Mr. Monti)

Transcription

1 Organic Belgium. Li I IT ED COMMISSION DECISION Relating to proceedings under Article 81 Agreement EC Treaty and Article 53 EEA Against Akzo Nobel Chemicals International By.. Akzo Nobel Polymer Chemicals B.V., Akzo Nobel NV.. Atotina S.A.. Degussa UK 1Io1dngs Ltd.. Perox:d Chemie GrnbH & Co. KG. Peroxdos Orgamcos S.A and AC Treuhand AG. Case no COMP;E.-2C Peroxides (only English, Spanish and German versions are auntic) (Communication Mr. Monti) introduction ii) This communication concerns a proposed Decision addressed to five undcrrakings and/or association undertakings i8 addressees) for infringement Article 81(1) Treaty and Article 53(11 EFA Agreement. The case concerns a hard/core cartel between producers Organic Peroxides (hereairer OP ). The Commission has gared evidence that from January 1971 to 1999, cartel participants agreed on market shares, on price targets, implemented price increases, allocated customers and exchanged information on sales volumes and market shares and monitored and enforced ir agreement. Some participants llaiticipated (hr shorter periods. The cartel covered LEA. The Decision deals with infringement Community, as well as in EEA since 1 January n 1. SuMM.R OF THE CASE 1.1. Origin and procedural steps taken (2) The case arose it when Akzo Nobel Chemicals International By., Akzo Nobel Polymer Chemicals B.V., Akzo Nobel NV. (hereafter Akzo) approached Cornnussion announcing a statement in winch t admitted participating in a cartel to fix prices and allocate quotas in OP and claimed beneflt (old i996 Leniency Notice. A few days later Akzo submitted a first written company statement, which was followed by supplementary information Cornmssion eropsenne, B cuxeles I Eurocese Comrnsse, Brussei. Telephone: (

2 o 0 to shortly after ACso s initial contact At itina hereattei AtwhLm suhmittcd a cornpanl ctatcir,nrt on same infifmzomeitt Arochem is part TotalFinaElf and confirmed essential parts Akzo s statement 0) After requests for information ere sent out ii Degussa OK Ltd. 1hereafter Laporte), third main participt in cartel (Laporte plc s subsidiary Peroxid Chemie Munich, hereafter PC ) submitted a company statement and asked as stell for application Leniency notice, More requests were sent out to smaller participants cartel, which took part during a limited period time or concerning specific geographical areas. These sina]ler participants arer IPerexidos OrgarncosPerorsa) S.A. Span A and AC Treuhand, a Swiss consuhanc> which helped organising cartel. (5) Vhile replying to requests for information, 6) On 27 March 2003, Commission initiated proceedings in present case and adopted a statement objections against Akzo, Atochem. Laporte and its subsidiary PC, Perosa and AC Treuhand. (7 All parties submitted wrttcn observations in response to Commission s objections arid attended oral heanng held on 26 June 2003 () During hearing, parties confirmed most essential facts. However, a number conclusions, especially concerning duration infringement and responsibility parent companies for ir subsidiaries were contested. (9) During that hearing, a ncv document evidencing an important meeting was distributed by one party. This meeting concerns a period t inch could be considered as an interruption meetings and hence as beginning a new, shorter, cartel. The hearing ficer invited parties to comment on this, which parties did after hearing. (I U) Initial suspicion again was not confirmed and investigation as regard. was not coritinuedi Jreceived a Statement Objections, hut as its rn3lvement is time barref A eccised a Statement Objections. but it could not be sho\sn that it was rehsible for behaviour its 50% joint venture Perosa. Therefore. neir io will be addressee proposed decision. (lii ti2j The present decision is also addressed to AC Treuhand, a Swiss company fering association management to or ompanies AC Treuhand aas an active organiser cartel. A second Important aspect cartel s its long duration. The cartel started in 191 and lasted until A period tension in early nineties was not considered to mark end an old cartel and beginning a new cartel (13) A third important point in decision is question to which extent parent companies are responsible for ir subsidiaries, which have actively participated in

3 irtc, This concerns Lmor:e plc i.rw reamed Deeusa LKj. narent ccunp.uu PC Munich Product. companies invohed and nature infringement. (l-l( OP are used, amongst ors, in production rubber and plastic. There is a substantial number sub-products and app]ications, such as high-polymer-, crosslinking- and rmoset-organic peroxides. The product is highly explosive, and accidents in factories are frequent. (15) The Commission estimates that annual average Organic Peroxide market value (EEA) during l99oies was around 250 million. (16) The Decision is addressed to following undertakings andior association undertakings: Akzo Nobel Chemicals International By., ALzo Nobel Polymer Cherucals B.V., Akzo Nobel NV.. Atina S.A., Degrissa LK Holdings Ltd. (formerly Laportc. Peroxid Chemie GmbH & Co. KG. Peroxidos Orgamcos S.A. (Perorsa) and AC Treuhand AG. l 71 The niengement consists participation above-mentioned addressees in a continuing agreement contrary to 81(1) EC and (from 1 ianuai 1994) Article 53i 1] LEA and covering whole EU and EEA, by which y agieed Ofl market shares. tixed prices product. aryeed on and implemented puce increases, allocated customers and set up a scilerre to monitor and enforce ir agreements. (18) The duration involvement varies: Akzo Nobel Chemicals International By,, Akzo Nobel Polymer Chemicals By, and Akzo Nobel NV., Atina S.A., Peroxid Chemie GmbH & Co. KG from 1 January 1971 to , Degissa LK floidings from 1 September 1992 to , Peroxidos Organicos S.A. from 3] 1975 to , AC Treuharid from to 3 1 i 999. (19) A main agreement started in (971, with initially three participating members (Akzo. PC and Atochern (at that time Luperox)). It consisted sub-arrangements for 11gb Polymer and Thermoset-OP. and was also split up by i-erziorial criteria. Regional suh-arraneenents concerned Prance until 1992), IJ:K (until 1992L Spain (since end 1975) and rest Europe, following main principles and rules overall aereement. For Cross-linking OP. anor sub-arrangement as made in covering as \ell most European countries. These subarrangements had a substantai oxerlap with overall agreement. e.g. period under question, mechanisms mutual control and compensation, parties, products. clients or tlie acting persons concerned can he found in each sub-arrangements. (20) The main agreement aimed at preserving market shares arid co-ordmatjng price increases and is based on a written contract from In order to achieve this objective, detailed sales data participating companies were closely monitored by an independent body (AC Treuhand), clients were allocated and, in case deviations from intended market share, compensations were applied or 3

4 clients were reallocated. Regular meetings took place in order to tine-tune working agreement. The agreement contained numerous sub-arrangements on specific products or sub-products, or concerning regions. These subarrangements have in part only lasted for a limited period time or have Leen integrated in or sub-arrangements. Two or companies Perorsa have been involved concernmgpme sub-arrangements. Perorsa was Eoiued in Spanish sub arrangement, was involved in some OP product until November (21) The cartel underwent frictions in 1992 after Akzo announced it would withdraw from agreement. Two parties consider that se frictions marked end one cartel and beginning a new one. However, it could he shown that cartel meetings continued during that period, although at lower frequency. (22) The carte! ended at end 1999, after parties attempts to agree on quotas failed. Some sub arrangements ended earlier. 2. FixEs 2.1. Basic amount (23) In fixing amount any fine Commission must have regard to all relevant crcumstances and particularly gravity and durticg infringement, which are two criteria explicitly referred torn Article 15(2i Regulation /1. Gravrm (24) According to Guidelines, Commission must take account i) nature infringement, ii) its actual impact on market and iii) size relevant geographic market. (25) The present infringement consisted mainly price-fixing practices and exchange sales information which are _th jnatirg..ysq violations Articles 81(1) Treaty and 53(1) LEA-agreement (26) The cartel agreement was carefully implemented by producers which for relevant penod covered vast majority European market for organic peroxides. It must refore have had an actual impact on organic peroxide market in EEA. 27) The carte ceerd nhole rlcornnen ma et and fd1o\ing IN cr1t1on whole LEA. Every part Common market, and later territory covered by LEA, was under its influence. For a certain duration, some regions and some sub-products were co\ ered by sub arrangements to main cartel agreement. This concerns France. UK and Spain as well as high polymer OP. rnioset OP. cross-hnking OP. (28) Taking into account nature behaviour under scrutiny, its actual impact on organic peroxide market and fact that it covered whole Common market and, following its creation, whole LEA, Commission

5 addressees infringement Article 81(1) considers that Treaty and 53(1) EEA. present Decision conmutted a very serious (29) Within category very serious proposed scale likely fines makes possible to apply differential to to take to cause damage to and to set fine at a level which ensures it has effect. This is where, like in present case, re is in size in infringement, significant (30) in t account competition sufficient deterrent considerable disparity necessary weight on infnngements. treatment effective economic capacity circumstances basic amount refore impact particularly necessary this case, which several in setting fines to rake and real competition. (3 1) It is to divide for Akzo. The second group will will Perorsa. AC (32) In proposed pm.a.ljiate include order view factor multiplying undertaking. Treuhand companies involves undertakings n order fenders undertakings participating uffending conduct three groups undertakings. account it will be specific each undertaking into on basis ir The first group will include PC, L.aporte and The third group will be product concerned. include Atochern. considered apart. to ensure that fines imposed have a effect, and iii ir extremely large size, it is in to apply a iiltjplying to fine set for Akzo and This factor will be to overall each {,33 The 81(1) least 31 until Commission starting amount Duranon Treaty related proposed has that. from until until , 1999, AC Treuhanci from 28 established Januar Akzo, Atochem. sufficient deterrent addition Atochem. world-wide turnover and PC infringed Article 1999, from at until 31 Laporte from Perorsa September 2.2. Aggravating circumstances (34) Atochem PC/Laporte fence has been fined have been fined for will be considered as previously for its ir involvement involvement aggravating circumstance. in four cartels, and in one cartel. Therefore repeat (35) No or aggravating circumstances are applicable in this case Attenuating circumstances (36) Atochem co-operated cartel. This and and supported continuous infringement which duration infringement provided information period on a frictions a long single lasted 29 years. that and hence involvement would probably Cotranssion s arguments Atochem s particularly Without information,

6 have been substantially shorter than it is in pre,ent decision. Suca a case is riot covered by leniency notice, in order to avoid that Atochern is sanctioned for its co-operation, Commission will consider effective co-operation outside lemency notice as an attenuatme circumstance for Atochem. (37) The Corrmission has not found or attenuating circumstances. 3. APPLICATION OF THE LENIENCY NOT[CE (38) Certain addressees this Decision have co-operated with Commission, at different stages investigation and in conjunction with different periods infringement under examination, in order to enjoy favourable treatment referred to in Leniency Notice. To meet relevant undertakings legitimate expectations as to mmunrtv from fines or a reduction fines in return for ir co-operation, it is necessary to consider wher those parties meet conditions set out in Leniency Notice. In present case, Leniency Notice 1996 applies, as Akzo approached Commission before 2002-Leniency Notice entered into force Non-imposition a fine or a ery substantial reduction its amount ( Section B : reduction from 75 /o to 1O0 / ) (39) (40) The Commission accordingly considers Akzo does meet conditions point B Leniency Notice and it is refore elm e for a very substantial reduction fine or its non-imposition. Substantial reduction in a fine ( Section C : reduction from 50% to 75%) (1 1) Neir or parties were first to provide Commission with decisive information on cartel, as required tinder point (h) Section B Leniency Notice. Consequently none above undertakings meet conditions as set out in Section C leniency Notice Significant reduction a fine ( Section D : reduction from 10% to 50%) (42) The Commission finds that Atocheni materially conthhuted to establishing

7 (44). S

8 - take - rake (47) In reduction Chemie. above circumstances, in amount Atoehem and Perorsa it is that it is fines for Laporte concluded appropriate (Degussa UK. Ltd.), to grant a Peroxid 4. CocLUSJON It is refore proposed that Commission by oral procedure: note and Monopolies; enclosed opinions Advisory Committee on Restrictive Practices note and Budget: Enteinse enclosed note Legal Service and positive opinions DGs - take note report Hearing Officer in this case; - Spanish and adopt draft Decision attached herewith German: and in three auntic languages, i.e. English, decide to in all ficial languages Decision, from which been removed, in Offic;al Journal publish European Comrnunties: business secrets have Enclosure.