Brussels, 15th December 2010
Antitrust: Commission welcomes General Court ruling on E.ON breach of seals case
The European Commission welcomes the judgment of the EU General Court (case T-141/08), dismissing E.ON's appeal against a €38 million fine the Commission imposed on it in 2008 for the breach of a seal during an inspection (see IP/08/108 and MEMO/08/61). The judgment sends a clear signal to companies that any steps, be they intentional or negligent, that undermine the integrity and effectiveness of inspections will not be tolerated.
The Court has upheld a fine which the Commission had imposed on E.ON Energy AG ("E.ON") because a seal affixed by Commission inspectors to secure documents was broken during an inspection carried out at the premises of E.ON in May 2006 (see MEMO/06/220). E.ON denied breaking the seal, but could not explain the reason for the broken seal.
The Court clarified that the Commission was right to assume at the very least a negligent breach of the seal in the present case, and that it is not necessary for the Commission to prove how the seal was actually broken or that evidence had actually been manipulated after the breach of the seal to impose a fine. It also stressed that the level of the fine was not disproportionate, taking into account the size of the company and the importance of the deterring effect of fines for procedural obstructions in antitrust cases.
The Commission welcomes the Court's findings, because obstructions of the Commission's investigations can severely undermine competition enforcement. The judgement makes clear that the Commission is entitled to impose appropriate and deterrent sanctions for companies' attempts to destroy evidence in order to escape fines for antitrust infringements.
It is the Commission's practice to seal rooms when carrying out unannounced inspections, to make sure that no documents can be removed during the inspection team's absence (e.g. at night). The objective of the use of seals is to prevent the effectiveness of inspections from being undermined. Breaches of seals are therefore serious infringements of EU competition law.
Under the antitrust Regulation 1/2003, the Commission can impose a fine of up to 1% of the company's total turnover for a seal broken intentionally or negligently. When fixing the amount of the fine for E.ON, the Commission took into account the fact that it was the first time that a seal has been broken by a company subject to an inspection and that a fine would be imposed for obstruction or interference with a Commission antitrust investigation.