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Publication

Repeat offender

John Cassels
13/12/2013

Locations

United Kingdom

In EU cartel cases, recidivism is an aggravating factor which means that the Commission can increase any fine imposed by up to 100%.

In EU cartel cases, recidivism is an aggravating factor which means that the Commission can increase any fine imposed by up to 100%.  The Fining Guidelines state that the fine can be increased by 100% for “each such infringement established”.

The EU Courts have ruled that an increase should be applied only where infringing behaviour takes place mostlyafter a previous adverse decision.  However, the Commission's practice has exhibited worrying anomalies:

Cartel

Undertaking

Recidivism increase

Previous cartels which Commission appears to have concluded count towards recidivism increase

Synthetic rubber (cartel: 1996-2002, decision 19/11/2006) ENI 50% 2 (polypropylene cartel decision: 23/04/86; PVC cartel decision: 14/09/94)
  Bayer 50% 1 (citric acid cartel decision: 05/12/01)
Chloroprene rubber (cartel: 1993-2002, decision: 05/12/2007) ENI 60% “The Commission increased the fines for ENI and Bayer by 60% and 50% respectively because they had already been fined several times for cartel activities in previous Commission decisions”
  Bayer 50% As above
Synthetic rubber (cartel: 1996-2002, decision: 23/01/2008) Baker 50% “The fine for Bayer was increased by 50% because it had been fined for cartel activity in a previous Commission decision”
Sodium chlorate (cartel: 1994-2000, decision: 11/06/2008) Arkema 90% 3 (peroxygen cartel decision: 23/11/84; polypropylene cartel decision: 23/04/86; PVC cartel decision: 14/09/94)
Paraffin wax (cartel: 1992-2005, decision: 01/10/2008) ENI 60% 2 (polypropylene cartel decision: 23/04/86; PVC cartel decision 14/09/94)
Car glass (cartel: 1998-2003, decision: 12/11/2008)  Saint Gobain 60% 2 (flat glass Benelux cartel decision: 23/07/84; flat glass Italy cartel decision: 07/12/88)
Calcium carbide (cartel: 2004-2007, decision: 22/07/2009) Akzo Nobel 100% 4 (sodium gluconate cartel decision: 19/03/02; organic peroxide cartel decision: 10/12/03; choline chloride cartel decision: 09/12/04; MCAA cartel decision: 19/01/05)
  Evonik Degussa 50% 1 (animal feed cartel decision: 02/07/02)

 

Bayer’s participation in the 2006 synthetic rubber cartel (implemented over the period 1996-2002), the 2008 synthetic rubber cartel (implemented over the period 2000-2002) and the chloroprene rubber cartel (implemented over the period 1993-2002) occurred mostly before the decision in the citric acid cartel of December 2001.  In particular, in the 2006 synthetic rubber and 2007 chloroprene rubber cases, the majority of Bayer’s cartel participation occurred before the citric acid decision.  Yet, a 50% increase was applied in each of the rubber cartel decisions.

There has also been no public acknowledgment of a limitation or exhaustion period after which previous infringements are disregarded.  In the car glass cartel, the fine applied to Saint Gobain was increased by 60% on the basis of the Benelux and Italian flat glass decisions, which were taken 15 years and 10 years before the infringing behaviour in car glass started.  However, in the flat glass cartel decision of 2007, the Commission did not apply an increase for recidivism where infringing behaviour occurred in 2004-2005, around 20 years after the infringement decisions in Benelux and Italian flat glass.  

If you would like to discuss any of these issues please do not hesitate to contact us.

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