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IP/06/1851

Brussels, 20th December 2006

Competition: Commission re-adopts "alloy surcharge" cartel decision and fines ThyssenKrupp Stainless AG €3 168 000

The European Commission has re-adopted a decision on a cartel in the stainless steel sector and fined ThyssenKrupp Stainless AG (formerly Krupp Nirosta GmbH) a total of €3 168 000. The infringement consisted in the participation of Thyssen Stahl GmbH (formerly Thyssen Stahl AG) in a cartel fixing an important part of the price of stainless steel ("the alloy surcharge") between 1993 and 1994 in violation of Article 65 of the (now lapsed) ECSC Treaty. The re-adoption follows a judgement of the Court of Justice of 14 July 2005, confirming the Court of First Instance’s partial annulment, on procedural grounds, of the Commission decision of 21 January 1998 insofar as the fine imposed on ThyssenKrupp Stainless AG for the infringement committed by Thyssen Stahl GmbH was concerned.

Competition Commissioner Neelie Kroes said: "Today's decision shows again that the Commission will correct any procedural mistake made so that companies can rest assured that they will not escape cartel fines for procedural reasons."

In its decision of 21 January 1998 (IP/98/70), the Commission found that eight stainless steel producers, including Thyssen Stahl GmbH, had agreed on a general price increase in the stainless steel sector, known as the “alloy surcharge”. The alloy surcharge was calculated on the basis of the prices of alloys (nickel, chromium and molybdenum) and was added to the basic price for stainless steel. The cost of the alloys used by stainless steel producers formed a very large proportion of the total production costs.

In the 1998 decision the Commission imposed a fine on ThyssenKrupp Stainless AG for its participation in the cartel and also for the participation of Thyssen Stahl GmbH during the years 1993/1994 on the basis of a declaration from ThyssenKrupp Stainless AG that it took over liability for the cartel behaviour of Thyssen Stahl GmbH during that period. The Courts, however, partially annulled the fine imposed by the Commission decision as the Commission had not explicitly invited ThyssenKrupp Stainless AG to give its views on the cartel behaviour of Thyssen Stahl GmbH for which it was fined.

Following the Court's judgement of 14 July 2005, the Commission decided to re-open the procedure against ThyssenKrupp Stainless AG issuing a Statement of Objections to it on 5 April 2006. In this Statement of Objections, the Commission invited ThyssenKrupp Stainless to give its views on the cartel behaviour of Thyssen Stahl GmbH, thereby correcting the procedural error as indicated by the Courts.

The 1998 decision was adopted under Article 65 of the ECSC Treaty, which enacted a specific competition regime for the steel sector. The ECSC Treaty expired in July 2002. In the present case, the infringement was committed while the ECSC Treaty was in force. Therefore, the substantive rules of the ECSC Treaty continue to apply whereas the procedural rules to be applied are those applicable at the time of the procedure (i.e. Council Regulation 1/2003).

Fine

In its 1998 decision, the Commission imposed a fine of €3 564 000 on ThyssenStainless AG for the behaviour of Thyssen Stahl GmbH, taking into account the gravity of the infringement, the duration, an attenuating circumstance and a 10% reduction for the co-operation of the company under the 1996 Leniency Notice. On appeal, the Court of First Instance decided in favour of another company in similar circumstances that a reduction of 20% is warranted under the 1996 Leniency Notice. In today's decision the Commission has, therefore, also applied this 20% reduction so that the fine amounts to €3 168 000.

Action for damages

Any person or firm affected by anti-competitive behaviour as described in this case may bring the matter before the courts of the Member States and seek damages, submitting elements of the published decision as evidence that the behaviour took place and was illegal. Even though the Commission has fined the companies concerned, damages may be awarded without these being reduced on account of the Commission fine. A Green Paper on private enforcement has been published (see IP/05/1634 and MEMO/05/489).

For more information on the Commission’s action against cartels, see MEMO/06/503.


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