On 23 January 2014, the General Court (“GC”) handed down judgments on three appeals from the calcium carbide and magnesium reagents cartel for SKW, Degussa and AlzChem, and Gigaset (formally known as Arques Industries). With regard to the first, the General Court dismissed the appeal. However, it reduced the fine in the cases: Evonik Degussa and AlzChem v Commission (T-391/09) and Gigaset v Commission (T-395/09). Degussa and AlzChem's fines were reduced due to the Commission’s error in applying a recidivism multiplier, while Gigaset saw its fine reduced because the Commission had incorrectly set the duration multiplier.

The Commission had applied a recidivism multiplier on AlzChem, which the appellants complained was an error, given that AlzChem was not part of the Degussa group of undertakings that had been fined previously (in the animal feeds case). The Commission decided that a multiplier for recidivism could be applied to a subsidiary of one group on the basis of a previous infringement of another subsidiary in the same group. However, the General Court disagreed. It based its reasoning on the Court of Justice decision in the Aristrain case (C-196/99). In that case the Court of Justice held that the “simple fact” that two separate companies had share capital held by the same family is “insufficient, in itself, to establish that those two companies are an economic unit” which would result in vicarious liability. The GC went further to reject the application of recidivism as an aggravating circumstance to a subsidiary that had not been penalized by the Commission and was not an addressee of the statement of objections, given that it had not had an opportunity to object to a finding that it formed an economic unit with the infringing subsidiary (thereby confirming the GC judgment in ThyssenKrupp joined cases T-144/07).

In addition, the GC accepted the appeal ground that the Commission had breached the principle of equal treatment. The Commission imposed joint and several liability on SKW, for the whole of the amount imposed on SKW Holding and Gigaset. However, it imposed joint and several liability in relation to Degussa and AlzChem only for part of the fine. The GC agreed that the Commission was correct in stating that, given its purpose, an undertaking should only bear once the cost of the deterrence imposed on the basic fine. However, this did not preclude a finding of SKW jointly and severally liable with Degussa and AlzChem for the totality of the fine.

equal treatment when it calculated the fine. The Commission had applied a multiplier of 2.5 to both SKW and Arques for the duration of the infringement, although SKW was found to have participated in the cartel for a longer period.

A relevant element in this judgment was the Commission’s application of a multiplier of 0.5 for periods of over three months, even though the 2006 Fining Guidelines state that a multiplier of 0.5 will be used for every period of less than six months. The GC held that such deviations are only allowed if they are in accordance with general principles of law, including the principle of equal treatment. By treating two different situations in an equal manner, without basing it on objective and reasonable criteria, the Commission had breached the principle of equal treatment.

The GC rejected the Commission's argument that on the basis of case law (SCA Holding v Commission T- 327/94 and HFB and Others v Commission T-9/99), Arques could not benefit from an illegality committed in favor of SKW. The GC dismissed the Commission's argument by stating that a deviation from the guidelines cannot be regarded as a breach of the law in the sense of the aforementioned case law. In that respect the GC noted that the Commission has the ability to deviate from guidelines and that under the 2006 Fining Guidelines, the Commission furthermore can use a different calculation method in specific circumstances. In addition, guidelines are not a legal norm but a standard of conduct that is to be followed by the Commission and that should be in line with the principle of equal treatment. Therefore, the GC not only considered that the Commission breached the principle of equal treatment, but that this inequality of treatment should be remedied by reducing the multiplier.