Exchange of information between companies operating on different markets does not constitute per se an infringement

In 2010 the European Commission (“Commission”) fined 17 bathroom equipment manufacturers for price fixing in six European countries for at least 12 years. The fine totaled an amount of EUR 622 Mio.

In its original decision the Commission argued that where it characterized agreements constituting a single infringement it was not obliged to prove a distortion of competition on each sub-group of the products covered by the single infringement.

Contrary to the view of the Commission, the General Court ruled on 16. September 2013 in Case T-380/10, Wabco Europe and others vs Commission, that (i) an infringement cannot be established if there is no distortion of competition affecting each of the markets relating to the information exchange and that (ii) exchange of sensitive information between competitors on a market, in which they do not compete on, does not per se distort competition. Therefore the infringement on the ceramics market could be established only for 11 months, instead of 11 years. In addition, as the companies’ cooperation as leniency applicants was not fully reflected in the reductions granted by the Commission, the General Court reduced the fine imposed to Wabco, Trane and Ideal Standard, who were held jointly and severally liable for the conduct of the Ideal Standard brand, from EUR 326 Mio to EUR 113 Mio.

Further on Masco Corporation (“Masco”), who had received immunity, appealed the Commission’s decision arguing that the agreements on three different markets should be addressed as three separate infringements. However, the General Court dismissed this appeal in Case T-378/10, Masco Corp vs Commission, arguing that the Commission had shown that the participants acted as part of an overall plan and shared a single anti-competitive objective.

Authors

Dr. Christina Hummer
Ori Kahn