C-283/98

OPINION OF MR MISCHO — CASE C-283/98 P

O P I N I O N OF ADVOCATE GENERAL MISCHO delivered on 18 May 2000 *

1. On 24 July 1998 Mo och Domsjö AB 4. In its appeal the appellant submits that ('MoDo') lodged at the Registry of the the Court of Justice should: Court of Justice an appeal against the judgment of the Court of First Instance of 14 May 1998 in Case T-352/94 Mo och Domsjö v Commission 1 ('the contested judgment') which had ruled on its applica- tion for annulment of Commission Deci- sion 94/601/EC of 13 July 1994 relating to '(i) annul the judgment of the Court of a proceeding under Article 85 of the EC First Instance of 14 May 1998 in Case Treaty (IV/C/33.833 — Cartonboard) 2 T-352/94 at least in part; ('the decision').

(ii) annul Commission Decision 94/601/ 2. In that decision the Commission EC of 13 July 1994 relating to a imposed fines on 19 manufacturers which proceeding under Article 85(1) of the supplied cartonboard in the Community. EC Treaty (IV/C/33.833 — Carton- The fine imposed on MoDo was fixed at board) in so far as it relates to the ECU 22 750 000. While the Court of First appellant at least in part; Instance upheld the application in part, it did not reduce the fine.

(iii) cancel or at least reduce the amount of the fine imposed on the appellant; 3. For the background to the proceedings, the material passages in the decision, and the reasoning of the Court of First Instance, I refer you to the contested judgment.

* Original language: French. (iv) order the Commission to pay the 1 — Case T-352/94 Mo och Domsjö v Commission [1998] ECR II-1989. appellant's costs before the Court of 2 — OJ 1994 L 243, p. 1. Justice and the Court of First Instance.'

8. As MoDo is the only undertaking to have submitted just those two pleas, I will deal in this opinion with those issues as a '(i) uphold the judgment in its entirety; whole, that is to say, I will also examine the

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arguments submitted by other undertakings 13. MoDo does not expressly appeal in support of those two pleas. against that rejection. Its grounds of appeal relate only to the passages in the contested judgment concerning the level of the fine. It does not allege that the Court of First Instance wrongly applied or interpreted Community law in upholding Article 1 of the decision. 9. In my opinions relating to the appeals of those other undertakings, I will therefore merely refer to the present opinion.

14. Nor, most significantly — again in the Commission's view — does MoDo chal- lenge the ruling of the Court of First Instance in paragraph 34 of the contested judgment that some of MoDo's arguments could concern only the level of the fine Admissibility of the appeal which had been imposed on it and, conse- quently, could not, even if founded, lead to the annulment of the decision itself as a whole. Those pleas are submitted once more in the appeal. 10. The Commission considers that there are serious doubts as to the admissibility of the appeal in two respects. 15. In my view, the Commission's descrip- tion of the situation is correct.

11. First, the Commission submits as fol- lows. 16. The appeal must therefore be rejected as inadmissible inasmuch as it seeks annul- ment of the whole of the contested judg- ment.

the view that the Commission had proved 21. Furthermore, one other appellant, Cas- only in part the effects of the infringements cades SA ('Cascades'), has submitted the found in the decision. same plea, presenting it as a question of interpretation of the concept of 'effects of the infringement' and of the relative impor- tance to be attributed to the effects on the market of an infringement in comparison with the objects pursued by the members of a cartel and the means they have adopted. 18. The Commission submits that the In my opinion, that is a question of law. Court of Justice has made it clear that, in the context of an appeal, it is not for it to examine the assessment by the Court of First Instance of the appropriate level of a fine when the Court of First Instance 22. I therefore propose that the Court of exercises the unlimited jurisdiction con- Justice should not uphold the second plea ferred on it by Article 172 of the EC Treaty of inadmissibility raised by the Commis- (now Article 229 EC) and by Article 17 of sion. Regulation No 17 of 6 February 1962, First Regulation implementing Articles 85 and 86 of the Treaty. 3

The first plea

19. Although that is correct, the Court of Justice stated in the judgment in Ferriere 23. MoDo and eight other appellants sub- Nord, 4which the Commission also cites, mit that the Court of First Instance erred in that it had 'jurisdiction to consider whether law in finding that the fact that the the Court of First Instance has responded to Commission has not set out in the decision a sufficient legal standard to all the argu- the factors which it had systematically ments raised by the appellant with a view taken into account in order to fix the to having the fine abolished or reduced'. amount of the fines was not an infringe- ment of the obligation to state reasons which justified the annulment in whole or in part of the decision.

27. Next, the Court of First Instance examines the statement of reasons in the decision and makes the following findings: The decision sets out both the criteria taken into account in order to determine the 25. It notes that the scope of the obligation general level of the fines and the amount of to state reasons for a decision imposing the individual fines (points 168 and 169 of fines on several undertakings for infringe- the decision). Moreover, as regards the ment of the Community competition rules individual fines, the Commission explains must be assessed in the light of the fact that in point 170 of the decision that the under- the gravity of infringements falls to be takings which had participated in the meet- determined by reference to numerous fac- ings of the 'Presidents Working Group' tors including, in particular, the specific ('the PWG') were, in principle, regarded as circumstances and context of the case and 'ringleaders' of the cartel, whereas the the deterrent character of the fines and other undertakings were regarded as that, as the Court of Justice explained in its 'ordinary members'. Lastly, in points 171 order of 25 March 1996 in SPO and and 172 of the decision, the Commission Others v Commission, 6 n o binding or states that the amounts of the fines imposed exhaustive list of criteria to be applied has on Rena Kartonfabrik A/S ('Rena') and been drawn up. Stora Kopparbergs Bergslags AB ('Stora') must be considerably reduced in order to take account of their active cooperation with the Commission and that eight other undertakings were also to benefit from a reduction in the fine, although to a lesser extent than Stora and Rena, owing to the fact that in their replies to the statement of 26. Still setting out the relevant case-law, it objections they did not contest the essential stresses, referring to its judgment in Marti- factual allegations on which the Commis- sion had based its objections. 5 — Case T-49/95 Van Megen Sports v Commission [1996] ECR II-1799, paragraph 51. 6 — Case C-137/95 P SPO and Others v Commission [1996] 7 — Case T-150/89 Martinelli v Commission [1995] ECR ECR I-1611, paragraph 54. II-1165, paragraph 59.

— that the fines were calculated on the basis of the turnover of each under- taking on the Community cartonboard market in 1990; 32. However, although it might have been thought that those findings would have appeared to it to suffice to reject the plea that there was an inadequate statement of reasons in the decision as regards the fixing — that the basic rate applied to those of the fine, the Court then sets out further turnover figures was 9% for the 'ring- considerations. It thus states that 'where, as leaders' and 7.5% for the Ordinary in the present case, the amount of each fine members'; is determined on the basis of the systematic application of certain precise figures, the indication in the decision of each of those factors would permit undertakings better to assess whether the Commission erred when fixing the amount of the individual fine and also whether the amount of each individual — that the reduction given to Stora and fine is justified by reference to the general Rena for their cooperation was of two criteria applied' (paragraph 275 of the thirds and the rate of reduction given to contested judgment). It then states that, as the eight other undertakings was of one the final amount of each individual fine third. was not the result of a strictly mathematical

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application of the factors taken into respect of the cartel on the welded steel account, the disclosure of those factors mesh market 8 ('the welded steel mesh would not have posed problems from the judgments') that the Court of First Instance point of view of Article 214 of the EC had stressed for the first time 'that it is Treaty (now Article 287 EC) in regard to desirable for undertakings to be able to business secrets, as was also attested by the ascertain in detail the method used for fact that this disclosure was made at a press calculating the fine imposed without hav- conference held on the very day on which ing to bring court proceedings against the the decision was adopted. Commission's decision in order to do so' (paragraph 277 of the contested judgment).

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38. That line of reasoning is severely criti- 41. The Commission answers the appel- cised by the applicants, who point to a lant's argument by making a distinction contradiction in it. They claim that the between the various considerations set out Court of First Instance could not, without by the Court of First Instance. erring in law, find that a number of figures were missing from the decision, confirm its case-law that the Commission must, where as in the present case it has systematically taken certain factors into account, make 42. In the Commission's view, in paragraph the addressees of the decision aware of 273 of the contested judgment, 9the Court those figures, and at the same time reach basically held that the statement of reasons the conclusion that the failure to set out for the decision was in accordance with the that information in the decision does not requirements of Article 190 of the Treaty, call its validity into question. its subsequent statements having to be regarded as mere obiter dicta. Moreover, those dicta do not present any problem for the Commission, because following the welded steel mesh judgments it had 39. However, again according to the appel- adopted already in January 1998, that is lants, apart from that contradiction the to say before delivery of the judgments in reasoning of the Court of First Instance also the cartonboard cartel cases, guidelines on infringes the principles laid down by the the method of setting fines imposed pur- case-law of the Court of Justice. suant to Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty so as to bring its practice into line with the Court's wishes.

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the facts — to be able to determine in 45. Lastly, the Commission considers that, detail, in accordance with a system which even if a decision imposing a fine were not the Commission might consider appropri- to contain all the information which the ate, the method of calculation of the fine Court of First Instance has held to be imposed upon them by a decision for desirable, that could not constitute an infringement of the rules on competition, infringement of the principle of sound without being obliged, in order to do so, to administration which could, by itself, jus- bring court proceedings against the Com- tify annulment. There is therefore no mission decision. That applies a fortiori inconsistency in the reasoning of the Court. where, as here, the Commission has used detailed arithmetical formulas to calculate the fines. It is desirable in such a case that the undertakings concerned and, if need be, the Court should be in a position to check that the method employed and the steps 46. What assessment should be made of the followed by the Commission are free of arguments developed by the Court of First error and compatible with the provisions Instance in rejecting the appellants' conten- and principles applicable in regard to fines, tion that the Commission had not given and in particular with the principle of non- reasons, in accordance with the require- discrimination' (paragraphs 626 and 627). ments of Article 190 of the Treaty, for the fine imposed on them?

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forward by the Court in order to show that received a reduction of one third (instead of they are wholly rational, and by the rather fines 'reduced to a lesser extent'). The laboured adjustment made in British Steel v Commissioner added that other undertak- Commission, cited above. ings had received a fine of 'around 9% of their turnover in the Community'. (The figure of 7.5% was not given.) Lastly, he mentioned the amount of the various fines imposed on the various undertakings.

49. However, it must be stated that the Commission placed the Court of First Instance in an uncomfortable position in supplying the press with specific informa- tion as to the way in which the various fines had been fixed, information which had not been set out in the decision addressed to the undertakings that were required to pay 52. It must therefore be stated that the those fines. Nevertheless, it is important additional information, compared with not to exaggerate the importance of that that in the decision, is not of the magnitude additional information. claimed by the appellants.

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54. The first phase, which reaches its exceptional circumstances restricted to the conclusion in paragraph 273 of the con- law relating to the employment of Com- tested judgment, 12 is not truly criticised by munity officials, a defect in the statement of the appellants and it would be difficult to reasons cannot be remedied by additional do so. The second phase, which ends in information supplied ex post facto before paragraph 279 of the contested judg- the Court. Second, it is settled law that the ment, 13 on which the appellants' criticisms limitation of the temporal scope of an are centred and which the Commission interpretation given by the Court can only considers to be a mere obiter dictum, is, on be the exception and must be justified by the other hand, clearly problematical from overriding considerations relating to the the point of view of its consistency. It is requirements of legal certainty and, more- difficult to see how one can reconcile the over, can be made only in the judgment statement that when certain basic factors which supplies that interpretation. Those have been systematically taken into conditions are manifestly not satisfied in account in order to fix the fines the the welded steel mesh judgments. Commission must set them out in the body of the decision 'in order to enable the addressees of the decision to verify that the level of the fine is correct and to assess whether there has been any discrimination'; the finding that in the present case the fines 56. Consequently, if the Commission's duty were indeed fixed in that way; the finding to state reasons in fact required that the that the factors in question are not indi- information referred to by the Court in cated in the decision; and the conclusion paragraph 272 of the contested judgment, that the decision is not vitiated by an and the corresponding paragraphs of the inadequate statement of reasons. other judgments, should have appeared in the body of the decision, the Court should have found that the decision contained an inadequate statement of reasons.

information for it to ascertain whether the as stressed in the order in SPO and Others decision is well founded or whether it may v Commission, cited above, 14 and cited by be vitiated by some defect enabling its the Court of First Instance, 'the gravity of validity to be challenged, that is to say, to infringements must be determined by refer- provide it with the necessary information ence to numerous factors, such as... the for it to assess the expediency of seeking its particular circumstances of the case, its review by the Court of First Instance. It context and the dissuasive element of fines; must also, quite obviously, allow the Court moreover, no binding or exhaustive list of to review the legality of the decision. That the criteria which must be applied has been review must itself respect the wide discre- drawn up'. tion which is, according to the relevant case-law, enjoyed by the Commission. It is not therefore logical to require such a decision to contain a particularly detailed statement of reasons, since, even if known, the grounds on which the Commission 61. What is striking on reading that deci- relied could not be admitted by the Court sion is that the Court of Justice did not as grounds for annulling the decision. wish to confine the Commission within a rigid framework, even as regards the nature of the criteria to be taken into considera- tion.

67. In my opinion, they are the points on which a statement of reasons in the deci- sion is absolutely necessary and which must satisfy the needs of the undertaking and of 64. Moreover, it is important that the fines the Court of First Instance. The Commis- should not become foreseeable, that is to sion is, of course, free to include in its say that the undertakings could, on the decision a statement of reasons which basis of the mathematical criteria adopted exceeds those minimum requirements if it by the Commission in previous decisions, so wishes and, as the Court of First Instance calculate the cost/benefit by attempting, held, that may be desirable in certain cases. before deciding to set up a cartel, to However, as long as that minimum stan- determine the fines which they might incur dard is observed one should not and and compare them with the benefits which cannot, in the light of the case-law of the might be gained from market sharing or the Court of Justice, take the view that there is fixing of common prices. an infringement of Article 190 of the Treaty and, in my view, the Court of First Instance wrongly set out to compare the statement of reasons in the decision with the more demanding standards which it had thought it could lay down in the 65. Admittedly, the general principles of welded steel mesh judgments. Community law continue to apply. Thus, when it imposes fines on undertakings which participated in the same infringe- ment the Commission must observe the principle of equal treatment, which means 68. I have yet to establish whether the that identical situations should be treated Court of First Instance ought not to have identically and different situations should taken the view that in the present case the be treated differently. minimum requirements flowing from Arti- cle 190 of the Treaty were not satisfied. In that regard, I consider that the decision is quite clear as to the Commission's assess- ment of the gravity of the infringement (points 167 and 168) and I note that in 66. The Commission will therefore have to points 169 to 172 of the decision the explain its reasons for drawing a distinction distinctions drawn between undertakings between the various participants in one and and the justifications for them are ade- the same cartel when it fixed the amount of quately explained. The fact that slightly the fines. However, the Commission cannot more precise information was disclosed

subsequently in the circumstances which I The second plea have recalled is not of such a nature as to call into question the Court's finding that the statement of reasons in the decision itself satisfies the requirements of Arti- cle 190 of the Treaty. 71. MoDo and the other appellants which have relied on this plea 16 contend, in essence, that the Court of First Instance erred in law in finding that its own conclusion that the Commission had not proved all the alleged effects of the in- fringement could not materially affect its 69. Admittedly, if the Commission does not assessment of the gravity of the infringe- see any drawbacks in disclosing certain ment and, therefore, could not lead to a mathematical factors, it must disclose them reduction in the fine. in the decision itself. The fact that in the present case it gave limited additional information in a press conference certainly merits censure, but that does not justify the conclusion that the statement of reasons was insufficient or that the fines should be reduced. 72. One of the appellants, Cascades, adds that the Court of First Instance misinter- preted the concept of 'effects of the in- fringement on the market' which it took into account in determining the amount of the fines. Furthermore, it alleges that the Court made a legally incorrect classifica- 70. The fact that, in my opinion, certain tion of certain 'effects' alleged by the grounds in the contested judgment should Commission. not be confirmed does not mean that the contested judgment should be annulled. It follows from the case-law of the Court of Justice that '[i]f the grounds of a judgment of the Court of First Instance reveal an infringement of Community law but the 73. In any event, it argues, even if the operative part appears well founded on Court of Justice were to consider that the other legal grounds, the appeal must be interpretation by the Court of First Instance dismissed'. 15 The plea of alleged infringe- of the concept of 'effects of the infringe- ment of Article 190 of the Treaty which the ment on the market' was correct, the Court of First Instance is claimed to have contested judgment should be annulled committed in not finding that the statement because it infringed the principle of pro- of reasons for the decision was inadequate portionality by retaining the level of the in regard to the amount of the fines must, fine even though the Court itself accepted therefore, be rejected.

76. In points 133 and 134 of its decision 79. Next, in point 168 of the decision, the Commission considered the objective containing the statement of reasons for pursued by the members of the cartel, the general level of the fines, the Commis- which was, in its view, 'artificially and sion listed seven considerations in order to secretly to regulate the market and coordi- justify the general level of the fines. nate their behaviour in such a way as to Amongst them, in last place, is the fact ensure that their concerted price initiatives that 'the cartel was largely successful in would be successful'. achieving its objectives'.

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86. What approach did the Court of First Instance adopt in evaluating whether or not 83. Lastly, the Court of First Instance did the general level of the fines was still not uphold the Commission's assertion justified? As we have already seen in regard 'that the level of transaction prices would to the first plea, the Court based its have been lower if there had been no reasoning on the settled case-law of the collusion between the producers' (para- Court of Justice, according to which 'the graph 304 of the contested judgment). In gravity of infringements falls to be deter- that context, the Court also took the view mined by reference to numerous factors that the reference made by the Commission including, in particular, the specific circum- to the statements of the producers them- stances and context of the case and the selves was insufficient for a conclusion that deterrent character of the fines, and no

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binding or exhaustive list of criteria to be — the cartel was operated in the form of a applied has been drawn up'. 17 system of regular institutionalised meetings which set out to regulate in explicit detail the market for carton- board in the Community,

87. The Court of First Instance pointed out that the Commission had determined the general level of fines by taking into account the duration of the infringement and the following considerations (point 168 of the decision): — elaborate steps were taken to conceal the true nature and extent of the collusion (absence of any official min- utes or documentation for the PWG and JMC; discouraging the taking of notes; stage-managing the timing and '— collusion on pricing and market shar- order in which price increases were ing are by their very nature serious announced so as to be able to claim restrictions on competition, they were "following", etc.),

89. It also pointed out that the Commission vious decisions, in particular the Polypro- had been correct in stating that, on account pylene decision, should have provided. of the specific circumstances of the present case, no direct comparison could be made between the general level of the fines adopted in the decision and those adopted in the Commission's previous decisions, in particular in Commission Decision 86/398/ EEC of 23 April 1986 relating to a pro- ceeding under Article 85 of the EEC Treaty 92. On the basis of those factors, the Court (IV/31.149 — Polypropylene) 19 ('the of First Instance considered that the criteria Polypropylene decision'). Unlike in the case set out in point 168 of the decision (cited in of the Polypropylene decision, no general paragraph 87 above) justified the general mitigating circumstances could have been level of fines set by the Commission taken into account in the present case in (paragraph 358 of the contested judgment). order to reduce the general level of the fines.

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any reduction in the general level of fines fringement has to be assessed by reference set by the Commission.' 21 to the actual results which occur on the market, that is to say, by reference to the harm caused to purchasers of the relevant products.

The significance to be attributed to the effects of an infringement on the market 97. Next, it must be pointed out that when assessing the gravity of the infringe- Cascades is wrong in submitting that it ment follows 'from a multitude of cases... that the gravity of an infringement is deter- mined according to a certain number of factors and in particular to the effects of that infringement on the market'. 22 94. A first finding is called for: it is indisputably clear from the contested judg- ment that the Court of First Instance answered in a detailed and qualified man- ner all the appellant's arguments claiming cancellation or reduction of the fine. 98. The decisive judgments, also cited by the Court of First Instance, indicate the contrary. Already in 1983, in Musique Diffusion Française and Others v Commis- sion 2 3 the Court of Justice had stated that 'in assessing the gravity of an infringement 95. Second, I also consider that in the for the purpose of fixing the amount of the course of its reasoning the Court of First fine, the Commission must take into con- Instance did not err in law as regards the sideration not only the particular circum- interpretation to be given to the notion of stances of the case but also the context in 'effects of the infringement on the market' which the infringement occurs and must or the importance to be attributed to it ensure that its action has the necessary when assessing the gravity of an infringe- deterrent effect, especially as regards those ment, where that infringement, as in the types of infringement which are particu- present case, has been committed deliber- larly harmful to the attainment of the ately and has the characteristics described objectives of the Community'. by the Court.

Nord v Commission, cited above, the Court 102. However, in the present case, the anti- of Justice clarified that formula by stating competitive object of the agreement is that 'the gravity of infringements must be indisputable and the Court of First Instance determined by reference to numerous fac- found definitively that the undertakings tors, such as, in particular, the particular actually announced the agreed price circumstances of the case, its context and increases and that the announced prices the dissuasive element of fines; moreover, served as a basis for fixing individual no binding or exhaustive list of the criteria transaction prices. The undertakings there- which must be applied has been drawn up.' fore did all that they could to give concrete effect to their intentions. What then hap- pened at the level of the market prices actually obtained was liable to be influ- enced by other factors outside the control of the members of the cartel, such as the evolution of the economy in general, 100. Those decisions not only do not place changes in demand in that particular sector, any particular stress on the effects of the supply from non-member countries or infringements on the market, but do not customer resistance. even expressly mention them. It is true, as MoDo points out, that in another para- graph of the judgment in Musique Diffu- sion Française and Others v Commission, cited above (paragraph 129), the Court of Justice mentions amongst 'all the factors capable of affecting the assessment of the gravity of the infringements' also 'the profit 103. Thus, even though the Court of First which [the undertakings] were able to Instance finds, on the basis of the report of derive from those practices'. London Economics ('the LE Report'), that the 'second type of effect', namely 'a close linear relationship' between the announced price increase and the market prices existed only for part of the period covered by the infringement, it adds that the temporal 101. The effects on the market may there- price variations 'were closely linked to fore be taken into account amongst 'the variations in demand' (see paragraph 301 numerous factors', but they are crucial only of the contested judgment). when one is dealing with agreements, decisions or concerted practices which do not directly have as their object the pre- vention, restriction or distortion of compe- tition and which are not therefore liable to fall within the scope of application of Article 85 of the Treaty except as a result of their actual effects. Moreover, the actual 104. As regards customer resistance, the effects on the market also play a major role decision itself refers to a specific case where when it is a question of evaluating the one of the price increases had to be abusive nature of conduct by an under- postponed on some markets with respect taking in a dominant position. to major customers who had objected to

109. However, that would amount to mak- ing hypothetical calculations based on economic 'models', whose infallibility is in no way proved, as the decisive factor in 106. I cannot therefore accept MoDo's order to decide whether or not a fine contention, in paragraph 64 of its appeal, should be imposed in respect of a cartel. that 'price levels raised by infringing activ- ity are the key market effects which laws prohibiting cartels are directed against'. 24 I also disagree with the statement made by Cascades in paragraph 47 of its appeal that 'the gravity of the infringement refers to its harmfulness to customers of members of 110. I would like to point out in passing the cartel, and ultimately to consumers. that the line of argument adopted by the The harmfulness of a concerted practice, Court of First Instance in that regard is from the point of view of its effects, does somewhat ambiguous. While it rejected the not depend on the attitude of the under- Commission's assertion that the level of takings which took part in it (and whether transaction prices would have been lower if they implemented the collusion), but rather there had been no collusion between the the specific effect of that collusion on producers, the Court stated that the analy- market conditions.' sis in the LE report 'does not justify a finding that the concerted price initiatives did not enable the producers to achieve a 24 — Emphasis added. level of transaction prices above that which

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would have resulted from the free play of 113. Lastly, as regards the judgments cited competition. As the Commission pointed by the applicants in support of their out at the hearing, it is possible that the contention, I consider that they are not of factors taken into account in that analysis such a nature as to prove that in circum- were influenced by the existence of collu- stances such as those of the present case sion' 25 (paragraph 304 of the contested decisive weight should be attributed to the judgment). fact that the cartel did not 'broadly' 26 but only partially succeed in achieving its objectives in regard to prices.

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the general problem of the importance to agreement with an anti-competitive object be attributed to the effects of the agree- it is necessary to prove that there is in fact ments on market conditions, in particular an abuse, since the dominant position itself on prices. does not constitute an infringement.

116. On the contrary, the Court of Justice 119. MoDo also relies on the judgment of confirmed that a clause prohibiting resel- the Court of First Instance in SIV and lers' from advertising prices which defied Others v Commission. 30 any competition or were 'unbeatable' was unlawful (paragraph 49 of the judgment in Hasselblad v Commission, cited above). It also confirmed that a prohibition on sales between authorised dealers was a restric- 120. However, in that case, the very exis- tion of their economic freedom and, con- tence of a cartel was in doubt (see para- sequently, a restriction of competition, and graph 315 of the judgment). The Court that the fact that the applicant had never found that the Commission had not proved impeded exports by its dealers was not to the requisite legal standard the objection sufficient to preclude the existence of a that there was a general agreement between clear prohibition of exports (paragraph 46 the three producers resulting in uniform of that judgment). prices and discount scales (see, for exam- ple, paragraphs 324 and 334 of that judgment).

122. MoDo also cites part of paragraph 621 of the judgment in Suiker Unie and Others v Commission, 32 but fails to take Has there been an infringement of the account of the fact that in that case the principle of proportionality? Commission itself had not alleged that the parties concerned had made a concerted or abusive increase in the prices charged. 125. Those same reasons lead me also to suggest that the Court of Justice should not uphold the plea, submitted by several appellants, of infringement of the principle 123. As regards the judgments of the Court of proportionality. of First Instance in the Polypropylene cases, and in particular Petrofina v Commis- sion, 33 it is not, in my opinion, possible to conclude from them that the Court there implicitly accepted that if the Commission had not already taken account of the fact 126. In that part of its appeal, Cascades that the cartel had not fully achieved its states that 'the amount of the fines imposed objectives when fixing the resultant fine, must be in proportion to the impact which the Court would have taken the view that a the infringement has on the pursuit of the reduction in the fine would have been Community's objectives'. justified on that ground. 34 I take the view, rather, that the Court wished to state that the problem raised by the applicant did not arise and not that, if it had arisen, the Court would have decided on it in the sense advocated by the applicant. 127. Like the Commission, I accept that this statement is correct. However, it in no way follows from it that the amount of the 31 — Emphasis added. fines should have a quasi -mathematical 32 — Joined Cases 40/73 to 48/73, 50/73, 54/73 to 56/73, relationship with the price increase actually 111/73, 113/73 and 114/73 Suiker Unie and Others v Commission [1975] ECR 1663. achieved under the contracts concluded by 33 — Case T-2/89 Petrofina v Commission [1991] ECR II-1087, the members of the cartel with their paragraph 276. 34 — See, for example, paragraph 48 of MoDo's appeal. customers.

'Although every producer is free to change his prices, taking into account in so doing the present or foreseeable conduct of his competitors, nevertheless it is contrary to the rules on competition contained in the 132. Already in 1983, in the judgment in Treaty for a producer to cooperate with his AEG v Commission, 36 the Court of Justice competitors, in any way whatsoever, in adopted a basic policy to that effect. It order to determine a coordinated course of stated in paragraph 136 of that judgment as action relating to a price increase and to follows: ensure its success by prior elimination of all uncertainty as to each other's conduct regarding the essential elements of that action, such as the amount, subject-matter, date and place of the increases.' 'It is clear from the foregoing considera- tions that AEG's systematic conduct in the improper application of the selective dis- tribution system must be regarded as hav- ing been sufficiently proved in law. The fact 130. Let me repeat once again, where it is a that the Commission has not succeeded in question of an agreement which indisputa- proving a number of individual cases does bly has as its object the prevention of not call in question the systematic nature of competition, the amount of the fines must AEG's improper conduct and does not be proportional to the efforts made by the affect the scope of the infringement as undertakings to that end and not propor- determined by the Commission in its deci- tional to the price increase actually sion of 6 January 1982.' 37 extracted from customers.

— that the decision is valid: in which case the fine will remain as it is; 137. It is apparent from the judgment in Baustahlgewebe v Commission 38'that the Court of First Instance alone has jurisdic- tion to examine how in each particular case the Commission appraised the gravity of unlawful conduct. In any appeal, the pur- pose of review by the Court of Justice is, — that the decision is invalid: in which first, to examine to what extent the Court case the fine will be extinguished ipso of First Instance took into consideration, in facto. a legally correct manner, all the essential factors to assess gravity of particular con- duct in the light of Article 85 of the Treaty and Article 15 of Regulation No 17 and, second, to consider whether the Court of First Instance responded to a sufficient legal standard to all the arguments raised by the appellant with a view to having the fine 134. If 'unlimited jurisdiction' is to have cancelled or reduced (see, on the latter any meaning, it must therefore mean that point, Case C-219/95 P Fernere Nord v apart from those two cases the Court may Commission [1997] ECR I-4411, para- itself fix the amount of the fine which, in its graph 31).' opinion, is merited by the facts which it considers to have been proved. That means that it must also be entitled to assess whether the matters which it has found are still sufficiently serious to justify the fine imposed by the Commission.

138. I consider that it follows from all the foregoing arguments that the contested judgment fulfils those conditions. 135. The Court of First Instance must, of course, give reasons to the requisite legal standard for that finding, which it has in 38 — Case C-185/95 P Baustahlgewebe [1998] ECR I-8417, the present case. paragraph 128.

'As regards the allegedly disproportionate nature of the fine, it must be borne in mind that it is not for the Court of Justice, when ruling on questions of law in the context of an appeal, to substitute, on grounds of 143. Defining a competition policy is fairness, its own assessment for that of the above all fixing a desirable level of compe- Court of First Instance exercising its unlim- tition, on the basis of which an assessment ited jurisdiction to rule on the amount of will be made of, for example, merger plans, fines imposed on undertakings for infringe- identifying the types of agreements which ments of Community law.' 39 are to benefit from a block exemption, fixing the priorities by reference to which complaints will be examined, laying the foundation for effective cooperation between the Community authorities and the national authorities with competence in matters of competition, laying down cri- teria for the admissibility of State aid, 140. Lastly, MoDo's argument that 'the fixing the thresholds below which a de Court of First Instance chose to take upon minimis rule may be applied. itself the Commission's policy-making role and impose what is in practice a higher penalty for a lesser infringement' seems to me to be wholly unreasonable for at least two reasons. 144. The Court of First Instance also has a presence in those various areas, but it carries out only a review of pure legality, precisely because it is a matter of defining a policy and that is not its task.

141. First, the Court of First Instance in no way increased the fine. It merely gave slightly different weight than the Commis- sion to the various factors which together determine the gravity of the infringement. 145. So far as concerns the fixing of the amount of the fines, one is more at the level of giving specific enunciation to a policy 39 — Paragraph 129. than of its elaboration, even though an

(2) declare it unfounded in so far as it seeks annulment in part of the judgment of the Court of First Instance in Mo och Domsjö v Commission;

(3) order the appellant to pay the costs.

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