C-29/83

JUDGMENT OF 28. 3. 1984 — JOINED CASES 29 AND 30/83

behaviour of the two undertakings specific non-member country con­ was the result of concerted action by stitute an infringement of Article 85 them. of the Treaty when they are es­ sentially designed to prevent the re­ export of the goods to the country of production so as to maintain a system That requirement is not satisfied of dual prices and restrict competition where the undertakings concerned are within the common market. able to prove that facts which the Commission considered could not be explained other than by a concerted practice can be satisfactorily explained 5. However a reciprocal assistance in a way which does not involve such contract between producer under­ a practice. takings might generally be evaluated in relation to the prohibitions con­ tained in Article 85 of the Treaty, 3. In order to determine whether an such a contract is prohibited if it agreement has as its object the appears that the conditions for its restriction of competition, it is not application are so wide and so vague necessary to inquire which of the two that they may be used to restrict contracting parties took the initiative competition. in inserting any particular clause or to verify that the parties had a common intent at the time when the agreement was concluded. It is rather a question That is the case, for example, where of examining the aims pursued by the the undertakings, to provide mutual agreement as such, in the light of assistance do not just relate to cases the economic context in which the of force majeure and comparable agreement is to be applied. situations, but to all cases of "serious disruption", of whatever kind and from whatever source, particularly if 4. Export clauses inserted in a contract the contract is concluded for an of sale which oblige the dealer to indeterminate period and if large export the goods in question to a quantities of products are involved.

applicant in Case 30/83, v

COMMISSION OF THE EUROPEAN COMMUNITIES, represented in Case 29/83 by its Legal Adviser, Giuliano Marenco, and in Case 30/83 by its Legal Adviser, Norbert Koch, acting as Agents, with an address for service in Luxembourg at the office of Oreste Montako, Jean Monnet Building, Kirchberg,

defendant, APPLICATION for a declaration that, to the degree set out in the conclusions of the applicants, Commission Decision 82/866/EEC of 14 De­ cember 1982 relating to a proceeding under Article 85 of the EEC Treaty (IV7/29.629 — Rolled zinc products and zinc alloys — Official Journal L 362, p. 40) is void,

THE COURT (Fourth Chamber)

composed of: T. Koopmans, President of Chamber, K. Bahlmann, P. Pescatore, A. O'Keeffe and G. Bosco, Judges,

Advocate General: S. Rozès Registrar: J. A. Pompe, Deputy Registrar

III — Submissions and arguments of the parties 1688 1. The liability of Rheinzink for the behaviour of its predecessor 1688 2. The infringement of procedural rules 1689 3. The concerted practices between CRAM and RZ 1690 (a) The arguments of CRAM 1690 (b) The arguments of Rheinzink 1691 (c) The Commission's defence 1692 4. The agreement between RZ and Schütz 1694 5. The reciprocal assistance contract between CRAM, RZ and VM 1695 6. The amount of the fines 1697

IV — Oral procedure 1697

Facts and Issues

CRAM AND RHEINZINK / COMMISSION

14 December 1982 — 82 / 866 / EEC — contests all of the above-mentioned parts relating to a proceeding under Article 85 of the decision. of the EEC Treaty (Official Journal L 362, p. 40). That decision records various infringements of Article 85 3. The contested decision committed by five undertakings pro­ ducing rolled zinc, including the applicants. The latter contest only part of For the purposes of the present ap­ that decision. plications, the relevant provisions of the decision are as follows:

Rheinisches Zinkwalzwerk GmbH & In its application CRAM, the applicant Co., a fine of 500 000 (five hundred in Case 29/83, contests the decision in thousand) ECU, i. e. DM 1 157 230. question in so far as it relates to the concerted action taken in 1976. Rheinzink, the applicant in Case 30/83, 2. ...

JUDGMENT OF 28. 3. 1984 — JOINED CASES 29 AND 30/83

Article 3 German markets were higher than those charged in the other countries of the The reciprocal assistance contract dated Community. Noticeable price differences 5 August 1974 between CRAM, RZ and also existed in comparison with the VM constitutes an infringement of prices charged in certain non-member Article 85 of the Treaty. countries. However, the prices charged by the two applicant undertakings in one (...) and the same country differed from each other only slightly. Article 6

The parties referred to in Article 7 are In order to benefit from those price hereby ordered to bring to an end differences, the German company forthwith the infringements established Kestermann, arranged with Schütz, a and to refrain in future from any con­ Belgian importer of sanitary equipment, tractual provision or concerted practice that the latter would buy rolled zinc having the same effect. products from CRAM and RZ, on the terms applied by those producers to their sales in Belgium; and then sell the Article 7 products to Kestermann with a view to their disposal in the Federal Republic of This Decision is addressed to : Germany.

1. In its entirety: Compagnie Royale Asturienne des At the beginning of 1975, with a view to Mines carrying out such parallel imports, 42 Avenue Gabriel Schütz ordered rolled sheets from F-Paris Cedex 08; CRAM. CRAM refused to supply them on the ground that, although the 2. As regards Articles 1, 2 and 3: dimensions requested were widely sold in Rheinisches Zinkwalzwerk GmbH & Germany and France, there was no Co. demand for them in Belgium. Sub­ Bahnhofstraße 90 sequently, Schütz tried to obtain the D-4354 Datteln; same sheet metal by informing CRAM that it was intended for re-export to 3. ... Egypt. On that express condition, CRAM agreed to supply the goods 4. ... requested and quoted Schütz a price even lower than that offered in Belgium.. 5. ...

more, in various items of corres­ products ordered from CRAM and RZ pondence, Schütz was reminded of its were stored at the port of Antwerp, only undertaking and asked to prove that it was to be loaded shortly afterwards on to being complied with by sending the rel­ lorries bound for Germany. So that the evant documents. change of destination could not be discovered by examination of the foreign trade statistics, Schütz declared the goods to the customs authorities as "double galvanized sheet metal". From April to October 1976, Schütz used the same stratagem vis-à-vis RZ. Again under the pretext of exporting to the Middle East and in particular to Egypt, Schütz ordered a total of 1 252 tonnes of rolled zinc products from RZ. This system of parallel imports came to an end in October 1976. Those orders were fulfilled by RZ at the prices then charged by that firm for its sales in Belgium, which were, at least initially, 19% lower than those which it charged on the German market. The contested decision points out that Between 8 September and 11 October initially, at least, RZ delivered goods to 1976, CRAM accepted three further Schütz at prices identical to those orders from Schütz for 240 tonnes and charged at the time by CRAM for its 631 tonnes of rolled zinc intended for deliveries to Schütz. Egypt and 44 tonnes of rolled products to be re-exported to Iran. Those orders were confirmed. On 13 October 1976, CRAM started to deliver the orders at the rate of about two lorry-loads a day. As in the case of orders from CRAM, The deliveries continued until 20 RZ's supplies were granted to Schütz on October, when they were suspended the express condition that they were re­ without any explanation. At that date, 20 exported to the Middle East, and this is tonnes out of the new order for 240 confirmed by certain telex messages from tonnes of rolled products intended for RZ quoted in the contested decision. Egypt remained to be delivered. That destination was accepted by Schütz, which, for example, confirmed, by telex message of 26 October 1976, an order for 550 tonnes accompanied by the following instructions: "Delivery, one On 21 October 1976, the date on which tonne pallet free-at-port Antwerp Dock CRAM suspended its deliveries, RZ 130 at the premises of our charterer accused Schütz of not having observed 'United Stevedoring'. Ask for 'John'. the condition relating to export to Egypt. Each pallet must be marked 'Genoa- RZ made its last delivery to Schütz on Alex'. Destination: via Genoa to 28 October 1976. Following visits made Alexandria and Iran". by two of its employees on 27 October to Schütz and on 29 October to Kestermann, RZ considered that it had proof that its rolled products were being re-imported into Germany. On 29 However, instead of being loaded on to October 1976, therefore, it decided to ships bound for the Middle East, the cease dealing with outstanding orders.

On Monday 8 November 1976, CRAM telephoned Schütz, accusing it of having The Commission then refers to the telex diverted to Germany all or part of of 26 October 1976 in which RZ the goods intended for Egypt. On 12 informed CRAM of its reduction in November, CRAM called upon Schütz prices of about 3 % on the German by telex to settle eleven outstanding market; that notification was devoid of invoices for October. That telex also purpose as between competitors other included the following message : than as part of a concerted effort to combat together parallel exports to that market. Finally, the Commission states " 2 . You will have to furnish proof that that it is significant that CRAM awaited the 240 tonnes have been exported the outcome of the inquiries conducted to Egypt, as you promised in your by RZ in regard to Schütz and orders of 7 September 1976 and Kestermann before demanding from

CRAM AND RHEINZINK / COMMISSION

Schütz, on 8 November 1976, payment The contract was valid until 31 De­ of the sums which were owed to it. It cember 1976 and was to be renewed for concludes that, in those conditions, successive periods of one calendar year concerted action cannot be doubted. unless terminated in writing at least .six months before the end of a calendar year by one or two contracting parties. At the B — The reciprocal assistance contract end of 1979, none of the three under­ between CRAM, R2 and Vieille takings had availed itself of its right to Montagne (hereinafter referred to terminate the agreement. as " VM ")

JUDGMENT OF 28. 3. 1984 — JOINED CASES 29 AND -30/83

5. Procedure JI — Conclusions of the parties

A — In Case 29/83 By application lodged at the Court Registry on 23 February 1983, CRAM The applicant claims that the Court instituted proceedings against the should: Commission's Decision of 14 December 1. Declare void Article 1 (1) of the 1982, seeking a declaration that Article 1 Commission Decision of 14 December (1) of the said decision is void. By an 1982; application registered at the Court on 25 February 1983, Rheinzink instituted 2. Declare void or, at the very least, proceedings against the above-mentioned reduce the fine imposed on the decision in so far as it was concerned by applicant by Article 2 (1) of the said it. decision; 3. Order the Commission to pay the The written procedure followed its costs. normal course in both cases. However, in Case 29/83 the applicant waived its The Commission of the European right to reply. Communities, the defendant, contends that the Court should: By order of 23 November 1983 the 1. Dismiss the application as unfounded; Court assigned both cases to the Fourth Chamber, pursuant to Article 95 (1) of 2. Order the applicant to pay the costs. the Rules of Procedure. B — In Case 30/83 Upon hearing the report of the Judge- Rapporteur and the views of the The applicant claims that the Court Advocate General the Court decided to should: open the oral procedure without any 1. Declare void Articles 1, 2, 3, 6 and 7 preparatory inquiry. However, it re­ of the Commission Decision of 14 quested the Commission to reply in writing to the following question: December 1982, which concern the company RZ ;

the applicant in Case 30/83, is that the the absence of formal legal succession, acts described by the Commission in its be held liable where the operation in decision of 14 December 1982 were question involves economic succession committed by its predecessor, the (Joined Cases 40 to 48, 50, 54 to 56, company RZ. The applicant considers 111, 113 and 114/73, Suiker Unie and that, as it became the successor to RZ on Others v Commission of the European 1 October 1981, that is to say, before the Communities, cited above). The Com­ notification of the said decision, it is mission adds, in its rejoinder, that only liable for the obligations of RZ the applicant is putting forward an which arose during that company's erroneous interpretation of the above- existence. If the Commission had mentioned judgment. The Suiker Unie imposed the fine at a date when RZ still case concerned two distinct companies existed, the applicant would certainly be which had coexisted for a certain period liable as its successor. That is not so in of time. There being no legal succession, the present case. Consequently, the an additional element was considered applicant cannot be sued on a debt necessaiy for the acts of one company incurred in respect of a fine subsequent to be imputed to the other, namely to the legal transformation. It adds, in its continuity between the companies con­ reply, that an undertaking which carries cerned. In the present case, the applicant on the commercial activity of its prede­ lias continued the commercial activity of cessor cannot have the latter's behaviour its predecessor without any modification. imputed to it. No such principle of law Under those circumstances there can be exists. In that connection, the applicant no doubt that Rheinzink is liable for the refers to the judgment of the Court of 16 infringements committed by RZ. December 1975 (Joined Cases 40 to 48, 50, 54 to 56, 111, 113 and 114/73, Suiker Unie and Others v Commission of the European Communities, [1975] ECR 1663, particularly at p. 1950 et seq.), in which it was held that the successor is 2. The infringement of procedural rules only liable for the behaviour of its pre­ decessor where there is "obvious continuity". In the present case, there is no such continuity. In its second submission, again on a pre­ liminary issue, Rheinzink, the applicant in Case 30/83, claims that its right to a fair hearing has been infringed by the Commission inasmuch as the latter did In its defence, the Commission of the not allow it to examine, during the European Comnumities, the defendant, administrative procedure, all the docu­ maintains that the acts committed by RZ ments on which the contested decision are imputable to the applicant, because was based. the two undertakings are, in competition law, two successive legal forms of one and the same undertaking. RZ has simply changed its name and its legal form, while its objects, its registered The applicant states that it did not have office and its management have knowledge of all the documents relating remained unchanged. According to the to the delivery agreements between Commission, the Court has accepted the CRAM and Schlitz even though principle that the successor may, even in CRAM's attitude is being invoked

against RZ. After notification of the arguments which can be summarized as contested decision, it asked the follows. Commission to allow it to consult all the supporting documents which the Commission had used. The Commission only allowed it to consult the documents submitted by RZ itself and the (a) The arguments of CRAM correspondence between RZ and the Commission. All these documents were already known to the applicant. The Commission should have given it the (A) The Commission was wrong to opportunity to consult and evaluate the consider that CRAM had stopped documents which it had obtained from deliveries to Schütz on 20 October 1976 third parties. without any explanation. In fact, deliveries were interrupted at that date quite simply because the order to which they related, namely the order for The defendant replies that this submission 240 tonnes of rolled zinc products, had is manifestly unfounded. As far as been entirely fulfilled. Consequently, 20 CRAM's conduct is concerned, the facts tonnes of rolled products did not remain on which the contested decision was to be delivered on 20 October 1976, as based were the cessation of deliveries by the Commission claims in its decision. CRAM to Schütz on 21 October 1976 Thus, the cessation of deliveries on the and the pressure put on Schütz by above-mentioned date was in no way CRAM, such as, in particular, the telex abnormal. message from CRAM to Schütz on 12 November 1976, calling upon the latter to cease its exports to the Federal Republic of Germany. The Commission points out that those facts were (B) The Commission was wrong to communicated to the applicant in the suggest, in the contested decision, that statement of objections. It adds that there was some connection between the neither the cessation of deliveries by cessation of CRAM's deliveries to Schütz CRAM nor the contents of the on 20 October 1976, on the one hand, aforementioned telex communication and the complaint made to Schütz by RZ have been contested by the applicant. on 21 October 1976 that the former had failed to observe the clause concerning exportation to Egypt, on the other. According to CRAM, there was no relationship between those two events. Furthermore, the Commission has not 3. Concerted action between CRAM and proved that CRAM knew of the RZ complaint made by RZ to Schütz.

nothing to do with the behaviour of According to CRAM, the observations CRAM towards Schütz. set out above demonstrate that its behaviour towards Schütz had nothing to do with concerted action with.RZ. What is more, examination of the "various signs" relied upon by the Commission in support of its complaint of concerted action shows that they do not support that complaint. (D) The Commission was wrong in considering that CRAM· awaited the outcome of the inquiries conducted by RZ in regard to Schütz and Kestermann before demanding from Schütz, on 8 November 1976, payment of the sums which were owed to it. In fact, on 14 October 1976, CRAM had sent a telex communication to Schütz demanding, (b) The arguments of Rheinzink inter alia, payment of six outstanding invoices for September 1976. Schütz responded to that telex message by promising to pay the invoices before the end of October 1976. However, on 31 October 1976, CRAM found that three of the six invoices were still outstanding. Consequently, it sent Schütz another telex message, on 2 November, de­ (A) If CRAM's.cessation of deliveries manding payment of the sums due. What to Schütz on 21 October 1976 was due is more, Schütz also showed itself to be to concerted action with RZ, as the unable to meet invoices relating to Commission claims in its decision, it is deliveries made between 13 and 20 hard to understand why RZ did not October 1976 which were due for immediately stop deliveries to Schütz payment at the beginning of November instead of waiting until 29 October 1976. 1976. With regard to those, it proposed In fact, on 26 October, RZ had received to CRAM, by telex message of 9 No­ and confirmed another order made by vember 1976, that it would pay one half Schütz. The same day RZ gave instruc­ by means of a draft and the other by tions to fulfil that order, worth about means of an irrevocable credit, on DM 250 000. If RZ had known of condition in both cases that CRAM fulfil Schiltz's operations from 21 October, it the two other orders of 11 October would have had every interest in 1976. It was in response to that message blocking all deliveries to Schütz. that CRAM, on 12 November 1976, formally requested Schütz to pay the eleven outstanding invoices for October without further delay. The Commission's view that there is some connection between the inquiries carried out by RZ in regard to Schütz and Kestermann on 27 and 29 October 1976 and CRAM's formal request for payment on 12 November 1976 is thus without foun­ (B) RZ's telex message to CRAM on dation. 26 October 1976 had no connection with

(C) RZ stopped deliveries to Schütz because the latter had deceived it and because the re-export of goods to the Federal Republic of Germany was likely (c) The Commission's defence to damage it. The behaviour of RZ could thus, without difficulty, be explained solely by reference to its own interest. CRAM's cessation of deliveries on 21 October 1976 played no role in this context. In its reply to CRAM's observations, the Commission of the European Communities, the defendant in both cases, observes first of all that, in its decision, it assumed incorrectly that on 20 October 1976, the date of CRAM's last delivery to Schütz, there remained undelivered 20 (D) The contested decision is based on tonnes of rolled products from the order the idea that a concerted practice Ís for 240 tonnes of 8 September 1976. proved by the simple fact that two under­ CRAM has proved, in its application, takings react in the same way to the that in reality, with the delivery of same events. According to the applicant, 20 October 1976, all of that order had this approach does not conform to the been delivered. However, that is only Court's case-law, which requires, to a mistake of detail. CRAM has not prove a concerted practice, "coordi­ contested that, by 20 October 1976, it nation", "practical cooperation" know­ had accepted the other two orders from ingly substituted for the risks of Schütz, namely an order for 631 tonnes competition and "contact" between the for Egypt and an order of 44 tonnes for undertakings (see, for example, judgment Iran, to be delivered before the end of of 16 December 1975, Joined Cases 40 November 1976. Those two orders were to 48, 50, 54 to 56, 111, 113 and 114/73, never fulfilled. As regards CRAM's Suiker Unie and Others v Commission of cessation of deliveries on 20 October

1976, the contested decision, according that CRAM awaited the outcome of the to the Commission, retains its sig­ inquiries conducted by R2 in regard nificance. Even if the order for 240 to Schütz and Kestermann before tonnes had been entirely fulfilled, there demanding from Schütz, on 8 November were still 675 tonnes of rolled products 1976, payment of the sums which were to be delivered. The Commission adds owed to it was incorrect. The Com­ that the mistake in question was already mission adds, however, that this passage contained in the statement of objections of the decision still holds good. The and that CRAM did not point it out decision merely sought, on this point, either in its written reply or in the course to refute CRAM's explanation of its of the hearing. cessation of deliveries, which was based on the question of outstanding invoices. In this connection, CRAM's statement is not convincing, because it ignores the fact that, even after the invoices had been paid, Schiltz's two other orders of October 1976 were not fulfilled. Further­ As regards RZ's telex message to CRAM more, CRAM's telex message to Schütz on 26 October 1976, the Commission of 12 November 1976 disclosed the real emphasizes that this is one of several reason, which was the failure to observe factors which allowed it to conclude that the clause concerning exportation to a concerted practice existed between the Egypt. The attempt to explain the two undertakings. It was the totality of cessation of deliveries by reference to the those factors, and not each one taken in invoice problem was thus doomed to isolation, which allowed that conclusion failure. to be reached. The Commission adds that the telex message of 26 October 1976 is interesting not only because of its contents, but also because of the confused replies which the two under­ takings provided at the hearing, when invited to explain it. The transcript of the hearing shows that R2 claimed that In the light of the above observations, exchanges of price information between the Commission continues to argue that, producers were not unusual in this in 1976, concerted action was taken by industry. CRAM, for its part, obvserved CRAM and RZ with a view to protecting that, in the Federal Republic of Ger­ the German market against parallel many, such exchanges, without being imports of rolled products being made by unusual, were rather rare. Schütz.

message of 26 October 1976 can be delivered to Schütz was not part of the explained only when seen against the obligations which RZ imposed, by background of concerted action between contract, on Schütz. That condition was the two undertakings of the kind in fact formulated on its own initiative to indicated in the decision. obtain delivery of the goods in question at more favourable export prices. The applicant adds that RZ delivered at parti­ cularly low prices because Schütz gave it false information. If RZ had known from In its reply, Rheihzink, the applicant in the start that Schütz would re-export Case 30/83, answers that the only proof the goods to the Federal Republic of the Commission has of concerted action Germany, it would certainly have is the telex message of 26 October 1976. demanded the German market price. However, the defendant has not proved any connection between that telex message and the alleged concerted action to protect the German market. (B) There is thus no question of an agreement whose object or effect is to restrict competition. Restriction of com­ In its rejoinder, the Commission, the petition is the object of an agreement defendant in both cases, reiterates that RZ only when the two contracting parties and CRAM put pressure on Schütz from have decided upon such an object. That 21 October 1979 to discontinue its is not so in the present case. exports to the Federal Republic of Furthermore, the agreements concluded Germany. It is clear that RZ and CRAM with Schütz did not have the effect of reacted in a concerted manner from the restricting competition, since Schütz fact that the cessation of deliveries exported all the goods it bought from coincided with RZ's communication to RZ to Germany. CRAM concerning the increase in its selling prices in Germany.

emerges clearly from the text of the the disputed agreement, the attitude of declarations of offer and acceptance Schütz, which never intended to observe which are attached to the application. the agreement, is certainly pertinent in the present case. According to the Court's case-law, it must be clear that The Commission then states that the even the party subject to the competitive object of an agreement must be restriction actually had that restriction in determined by reference to the aims mind (see, for example, the judgment of objectively pursued by that agreement as the Court of 29 October 1980 in Joined they appear to an observer, in the light Cases 209 to 215 and 218/78, van of the economic context in which the Landewijck v Commission, [1980] ECR agreement must be applied. In the 3125). That was never so in the present present case, the objective aim of the case. agreement in dispute was to compel Schütz to sell the rolled zinc products outside the European Community and more particularly in Egypt and Iran. In its rejoinder, the Commission replies There is thus no need to consider that it is in flat contradiction of the whether the agreement did or did not general principles of civil law to have the effect of restricting competition. consider, as the applicant does, that the intention of one of the parties to a contract can determine its purpose. Furthermore, the application of Article Finally, the Commission contests the 85 of the Treaty to deliberate restrictions view that the agreement made with on competition would, if the applicant's Schütz had no appreciable effect either view was accepted, be subject to sub­ on competition or on trade between the jective considerations arising from the Member States. It points out first of all decision-making process within the that the circumstances which constitute a undertaking, a situation which by its very disruption of trade between the Member nature would exclude any form of veri­ States do not include a requirement that fication. there should actually be an appreciable effect. It is sufficient if an agreement is of such a nature as to be likely appreciably to affect such trade (see, for example, the judgment of the Court of 5. The reciprocal assistance contract be- 1 February 1978, Case 19/77, Miller v tween CRAM, RZ and VM Commission, [1978] ECR 131). It points out in this connection that, if the agreement in question had not existed, the applicant would not have been able Finally, the applicant complains that the to sell rolled products at low prices Commission has wrongly considered the to buyers outside the Federal Republic reciprocal assistance contract of 5 August of Germany without undermining the 1974 to be a restriction on competition higher price level in its home market. It within the meaning of Article 85 (1) of is thus legitimate to think that trade the Treaty. In support of that view, it between the Member States would have puts forward three arguments which can developed differently were it not for the be summarized as follows. disputed agreement.

The Commission then observes that the (B) Even if the contract at issue was question whether the restriction on capable of producing the effects competition is appreciable is not to be attributed to it by the Commission, it has resolved, as the applicant claims, by not caused appreciable damage either to reference to the number and size of the competition or to trade between Member deliveries actually made between the States. In fact, the Commission itself parties to the contract. The decisive could only find three periods, in 1977, factor is rather the latent unavailability during which deliveries took place on the of the production capacity for other uses. basis of the contract. Moreover, those It is the potential importance of the deliveries were of limited size. disputed contract which is decisive for the purposes of Article 85 of the Treaty.

(C) Furthermore, among the disrup­ Finally, the Commission claims that the tions noted by the Commission, two applicant has mistakenly described the were due to strikes. The contract at issue disputed contract as an agreement to is thus, to a large extent, an agreement provide assistance in the event of a to provide assistance in the event of a strike. The object of the contract is, strike. An obligation to provide mutual according to Clause 1, a reciprocal ob-

CRAM AND RHEINZINK / COMMISSION

Rheinzink takes the same view on this In its rejoinder, the Commission replies point, adding that the Commission has that RZ was a member of the Metall­ not even stated whether R2 acted gesellschaft group at the time when the deliberately or merely by negligence. facts at issue took place and that that Furthermore, it observes that Schiltz's was the material time for the purpose of behaviour is a mitigating circumstance fixing the fine. which justifies a reduction of the fine imposed.

IV — Oral procedure As regards CRAM, the Commission replies that the fine is less than 0.5% of the total turnover of that undertaking. Such a fine cannot be considered excessive, given the seriousness of the The parties presented oral argument at offence. the sitting on 14 December 1983.

As regards Rheinzink, the Commission The Advocate General delivered her observes first of all that the amount of opinion at the sitting on 1 February the fine represents less than 1.5% of that 1984.

JUDGMENT OF 28. 3. 1984 — JOINED CASES 29 AND 30/83

Decision

1 By applications lodged at the Court Registry on respectively 23 and 25 February 1983, the Compagnie Royale Asturienne des Mines, SA, whose registered office is in Paris, and the company Rheinzink GmbH, whose registered office is in Datteln (Federal Republic of Germany), brought actions, pursuant to the second paragraph of Article 173 of the EEC Treaty, seeking a declaration that the Commission Decision of 14 December 1982 relating to a proceeding under Article 85 of the EEC Treaty (IV/29.629 — Rolled zinc products and zinc alloys), which was notified to the applicants and published in the Official Journal (L 362, p. 40), is partially void.

7 Rheinzink admits that it is the sole legal successor of the dissolved company, the latter having been transformed into a limited liability company under the name Rheinzink. It refers, however, to Article 15 (2) of Regulation No 17, which allows the Commission to impose fines only on those undertakings which have committed infringements of Article 85 of the Treaty, in support of the view that the legal succession which took place could not make Rheinzink liable for the acts of another company which in the meantime had ceased to exist.

s The Commission contends that, for the purposes of competition law, Rheinzink and Rheinisches Zinkwalzwerk GmbH & Co. are two successive legal forms of one and the same undertaking. The subjects of competition law are undertakings. The undertaking in question changed its name and its legal form at the moment of the transformation, but its objects, registered office and management remained unchanged. Consequently, the acts committed by the dissolved company may be imputed to Rheinzink as the sole legal successor of that company.

9 The Commission's argument must be accepted. Rheinzink has not contested that not only is it the legal successor of Rheinisches Zinkwalzwerk GmbH & Co., but it has continued the economic activities of that company. For the purposes of Article 85 of the Treaty, a change in the legal form and name of an undertaking does not create a new undertaking free of liability for the anti-competitive behaviour of its predecessor, when, from an economic point of view, the two are identical.

n It is also agreed that this practice continued until the end of October 1976, that two employees of Rheinzink discovered, at that time, that the products delivered to Schütz were being re-exported to Germany, and that both

CRAM AND RHEINZINK. / COMMISSION

Rheinzink and Asturienne discontinued their deliveries to Schütz between 21 and 29 October 1976.

H According to the contested decision, the cessation of deliveries to Schütz by the two undertakings could not be explained other than by an exchange of information between them with a view to taking parallel action against Schütz as part of a concerted practice protecting the level of prices on the German market, in particular by preventing parallel imports or the reintroduction of rolled zinc products originating in Germany.

is In arriving at that conclusion, the decision relies on the following factors :

On 21 October 1976, the date on which Asturienne suspended its deliveries to Schütz "for no apparent reason", Rheinzink accused Schütz of not complying with the clause concerning exportation to Egypt. The Commission maintains that it cannot be regarded as a coincidence that those events occurred on the same date.

is In those circumstances, the cessation of deliveries to Schütz by Asturienne, and the moment at which that cessation tock place, can be explained by considerations arising from the financial relations between Asturienne and Schütz.

i9 The fact that on 26 October 1976 Rheinzink sent a telex communication to Asturienne concerning the reduction of prices on the German market does not, in itself, constitute evidence establishing the existence of a concerted practice, not least because the Commission has not proved or even alleged that this had an effect on the prices charged by Asturienne.

20 It follows from the foregoing that the Commission has not produced sufficiently precise and coherent proof to justify the view that the parallel behaviour of the two undertakings in question was the result of concerted action by them.

CRAM AND RHEINZINK / COMMISSION

21 Consequently , the applications of the two applicants must be granted on this point , and Article 1 (1) of the contested decision must be declared void.

22 Article 2 of the decision, which imposes fines on the two undertakings solely by reason of their having committed the infringements referred to in Article 1 (1) must , as a consequence , also be declared void.

JUDGMENT OF 28. 3. 1984 — JOINED CASES 29 AND 30/83

to inquire which of the two contracting parties took the initiative in inserting any particular clause or to verify that the parties had a common intent at the time when the agreement was concluded. It is rather a question of examining the aims pursued by the agreement as such, in the light of the economic context in which the agreement is to be applied.

27 In that connection, the decision — the findings of which have not been contested on this point — states that Schiltz's first order to Asturienne, made at the request of a German buyer, was for rolled sheets in dimensions common in Germany and that Asturienne objected that such dimensions, while widely sold in Germany and in France, were not in demand in Belgium. Following that incident, Schütz obtained the same sheets from Asturienne and Rheinzink by leading them to believe that the sheets were to be re-exported to the Middle East and in particular to Egypt. The prices charged by the two producers were, however, almost identical to, or very close to, those which the same producers charged for their sales intended for the Belgian market.

28 In those circumstances, the conclusion cannot be avoided that the export clauses were essentially designed to prevent the re-export of the goods to the country of production so as to maintain a system of dual prices and restrict competition within the common market.

29 Rheinzink also claims that the agreement has had no appreciable effect either on competition or on trade between the Member States.

30 It does not however contest that, as far as production of zinc sheet is concerned, there are only six rolling mills of various sizes in the common market, of which Rheinzink is the only one in the Federal Republic of Germany. In that kind of market situation, it is impossible to accept the argument that a restriction of competition consisting of the isolation of the German market would not be appreciable.

34 Rheinzink does not contest the facts found by the decision on this point. It considers, however, that the Commission has made an incorrect assessment of the reasons for the contract and its practical consequences. The three undertakings simply wished to reduce the risk of not being able to supply their regular customers in exceptional circumstances likely to interfere with

JUDGMENT OF 28. 3. 1984 — JOINED CASES 29 AND 30/83

production. The practical utility of the contract became apparent in a few exceptional cases where the contract served as a basis for occasional deliveries by one undertaking to another.

39 In Case 29 / 83 the defendant , having failed in its submissions, must be ordered to pay the costs.

40 In Case 30 / 83 the parties , having each failed in some of their submissions, must bear their own costs.

CRAM AND RHEINZINK / COMMISSION

On those grounds,

THE COURT (Fourth Chamber)

hereby:

Delivered in open court in Luxembourg on 28 March 1984.

J. A. Pompe T. Koopmans Deputy Registrar President of the Fourth Chamber