On 12 January 2017, the Court of Justice fully dismissed the appeal of Timab and its parent company Roullier (the "Roullier group") against an earlier General Court ("GC") ruling in the animal feed phosphate cartel.
Initially, the Commission opened settlement discussions for all participants in the cartel. However, Timab decided to pull out of the settlement procedure after the Commission communicated the fine range it intended to impose. Ultimately, following an extended procedure, the Commission fined Timab EUR 20 million more than the amount proposed during the settlement discussions, despite reducing the infringement's duration by 15 years. Timab's higher fine for a shorter period can be explained by the Commission's inability to rely on evidence Timab submitted with regard to the excluded infringement period. That evidence warranted a higher reduction of the fine during the settlement procedure but was of less relevance for the infringement established in the ordinary procedure. The Commission's approach was upheld by the GC [see our June 2015 Newsletter]. The Roullier group appealed this judgment.
The Court of Justice upheld the GC's conclusion that the appellants' procedural rights were not violated when they switched to the ordinary procedure. In its reasoning, the Court emphasized that Timab had gained procedural rights inherent to the ordinary procedure, such as getting full access to the evidence file, receiving a full statement of objections and the right to an oral hearing. "Consequently, the appellants were in no way legally harmed by that approach, in which the elements, described as ‘new’, [...] were taken into account." The Court confirmed that the appellants could not rely on any legitimate expectation that the estimated fine communicated to them during the settlement procedure would be maintained in the ordinary procedure.
The ruling of the EU's highest Court on the first "hybrid" settlement case underlines the risks of pulling out of settlement discussions. The distinct nature of both procedures allows the Commission to take additional and new information into account when determining the gravity and duration of the infringement in the course of the ordinary procedure and on this basis depart from the (maximum) fine ranges communicated during the course of the settlement procedure.