CN02 - Scania 880 Million fine in the trucks cartel upheld by the EU General Court

On 2 February 2022, the General Court upheld the European Commission's decision to fine Scania EUR 880.5 million for its participation in the truck manufacturers' cartel.

Key takeaways

• The Commission is entitled to use a "hybrid" procedure to adopt a settlement decision with cartelists whilst following the standard procedure against another undertaking which has withdrawn from the settlement procedure.
• The Commission is not bound by the factual and legal findings made in the settlement decision and may examine afresh the evidence at its disposal.
• Long-standing misconduct at different levels of management can be seen as having formed part of an overall plan to limit competition.
• The General Court is not bound to respect confidentiality assessments by the Commission Hearing Officer: the judgment contains information which has been redacted from the published version of the Commission's decision.

Background

On 27 September 2017, Scania, a multinational truck company, was fined EUR 880.5 million by the European Commission for infringing Article 101 TFEU by participating in a cartel in the market for medium and heavy trucks, from 17 January 1997 until 18 January 2011.

Whereas Scania had initially confirmed its willingness to participate in settlement discussions along with the other five addressees of the Commission's statement of objections, it subsequently decided to withdraw from that procedure.

The Commission handled this case by following a "hybrid" procedure, combining:

• the settlement procedure with all other undertakings, resulting in a settlement decision on 19 July 2016; and
• the standard administrative procedure in cartel matters in respect of Scania alone, resulting in the fining decision of 27 September 2017.

Scania challenged the decision and disputed the legality of the use of the hybrid procedure. In particular, Scania argued that, given the adoption of the settlement decision prior to the adoption of the fining decision in a staggered way, the Commission could not adopt its decision against Scania impartially and without irreparably violating Scania's right to be heard and the presumption of innocence.

Judgment of the General Court

In its judgment upholding Scania's fine, the General Court reiterated established case-law that the hybrid procedure does not in itself entail an infringement of the presumption of innocence, the rights of defence or the duty of impartiality. The Commission is therefore entitled to make use of the hybrid procedure, on condition that those principles are fully observed. 

The Court found that whilst the Commission implicitly referred to Scania in the settlement decision, this reference at most indicates suspicion of Scania's liability, which would still have to be established. In addition, the mere fact that the settling parties admitted their participation in the infringement does not lead to an implicit recognition of Scania's liability for its possible participation in the same facts.

The Court confirmed that the Commission is not bound by the factual and legal findings in the settlement decision: it may make different factual and legal findings if it examines the evidence at its disposal afresh (the "tabula rasa" or "clean slate" principle).

The Court also confirmed the Commission's finding of a single and continuous infringement within the meaning of Article 101 TFEU: collusive contacts that took place at different levels (top management, lower headquarters and at German level) at different moments in time formed part of an overall plan aimed at achieving the single anti-competitive objective of restricting competition on the relevant market.

Comment

The Scania judgment constitutes further confirmation and endorsement by the EU Courts of the legality of hybrid procedures in cartel cases, which may lead to them being used more frequently in future.

It provides further guidance on the safeguards that the Commission must maintain in relation to parties' rights of defence and presumption of innocence. This raises the question of how, in practice, the Commission is able to "wipe the slate clean" as to liability between two procedures in the hybrid context.

The judgment also provides a helpful illustration as to what conduct may constitute a single and continuous infringement within a single undertaking: such a finding can be made regardless of the level or geographic location at which the conduct takes place within an organisation.

Interestingly, the settling parties have made confidentiality claims in respect of the infringement decision, which remain pending before the Hearing Officer. The Court assessed confidentiality in respect of its judgment independently: where it considers it necessary for an understanding of the judgment, the Court cites parts of the decision that are redacted in the provisional non-confidential version published by the Commission. This includes more information about how the cartel operated than is available in the published decision, which is likely to assist claimants in follow-on damages claims.

With thanks to Maëlle Vannet-Deprugney of Ashurst Europe for her contribution.