The General Court annuls fines totaling €790 million to airlines participating in a cartel

The General Court annuls fines totaling €790 million to airlines participating in a cartel

(Judgments of the General Court of 16 December 2015 in Cases T-9/11, T-28/11, T-36/11, T-38/11, T-39/11, T-40/11, T-43/11, T-46/11, T-48/11, T-56/11, T-63/11, T-62/11, T-67/11 Air Canada v Commission)

In February 2006, following an earlier application for immunity under the 2002 Leniency Notice, the European Commission carried out unannounced inspections to several airlines that had participated in a cartel. This led to the adoption of a decision in November 2010, declaring that the infringing companies had coordinated their behaviour as regards the pricing of freight services.

Certain of these infringements were committed by all airlines whereas others only by some of them. Whereas the Commission indicated four infringements in the operative part of the decision in relation to different periods and routes, the grounds made reference to a one single and continuous worldwide infringement covering all the routes. The Commission imposed fines on all participants, with the exception of Lufthansa and its subsidiaries, which had been granted immunity.

The companies concerned challenged the decision before the General Court that has upheld their claim.  

The Court first reminded that based on the principle of effective judicial protection the operative part of a Commission shall be particularly clear and precise so that the infringing companies are able to understand and to contest their liability and the penalty.

Then the General Court confirms that there is a contradiction between the grounds of the decision and its operative part, rejecting the argument that the differences between the grounds and the operative part can be explained by the fact that the airlines which were not mentioned in certain articles of the operative part did not operate the routes referred to in those articles.

Moreover, the companies were held liable for the entirety of the infringement with no distinction between the routes which were operated by those carriers and those which were not.

The General Court has also found that that the grounds were not internally consistent since they contained assessments which are difficult to reconcile with the existence of a single cartel covering all routes as referred to in the operative part. In this sense, the Court has concluded that such inconsistencies were liable to infringe the concerned companies’ rights of defence and prevent the Court itself from correctly exercising its power of review; and therefore has annulled the Commission’s decision.

As a result of this judgment the following airlines have seen their fines annulled: