On September 24, 2020, the Court of Justice dismissed an appeal brought by the Italian cable producer Prysmian against a €104.6 million fine imposed by the Commission for its participation in the Power Cables cartel.[1]

In its 2014 decision, the Commission found several European, Japanese, and Korean producers of underground and submarine high-voltage power cables to have engaged in territorial and customer allocation and imposed fines totaling €302 million.[2] Most of the addressees, including Prysmian, challenged the decision before the General Court; each of them without success.[3] Of the following appeals, the Court of Justice to date rejected five.[4]

The judgment confirms the Court’s position in the Nexans v. Commission case, where the Court clarified the scope of the Commission’s inspection powers in antitrust proceedings under Article 20 of Regulation No. 1/2003.[5] In particular, with reference to the Nexans judgment, the Court recalled that the Commission was right to make copy-images of the hard drives of employees’ computers without first examining the nature and relevance of the documents contained thereon, and to examine them at the Commission’s premises in Brussels.

The Commission’s approach was justified by legitimate reasons, such as (i) the effectiveness of the inspection; and (ii) the avoidance of excessive interference with the operations of the undertaking concerned.[6] Moreover, the Court held that the Commission’s right to make copy-images of an undertaking’s hard drives did not constitute an additional power granted to the Commission, but was merely an intermediate step in the examination under Article 20 of Regulation No. 1/2003.[7]

The Court of Justice further confirmed Prysmian’s liability for the entire duration of the cartel— between 1999 and 2009—rejecting Prysmian’s claims that its fine should not cover the period before 2005, during which it was part of the Pirelli group before being acquired by a subsidiary of Goldman Sachs. Instead, the Court upheld the General Court’s finding that Prysmian was liable for the entire period of its involvement in the cartel based on the principle of “economic continuity.”[8] In particular, the Court held that the change in Prysmian’s ownership structure also led to a transfer of the economic activities that were part of the infringement, in particular because the incumbent and the new entity had been under the control of the same person and carried out the same commercial instructions.[9] The Commission’s decision therefore did not contradict the general rule that the Commission is required to impose a fine on the entity that committed the infringement where this entity continues to exist in law and to carry on economic activities.

[1]      Prysmian and Prysmian Cavi e Sistemi v. Commission (Case C-601/18 P) EU:C:2020:751. Of the €104.6 million fine, €67.3 million were imposed on Pirelli and

€37.3 million on Goldman Sachs, both jointly and severally with Prysmian.

[2]      Power cables (Case AT.39610), Commission decision of April 2, 2014. See also our previous reports in our November 2019 EU Competition Law Newsletter and July/August 2020 EU Competition Law Newsletter.

[3]      Prysmian and Prysmian Cavi e Sistemi v. Commission (Case T-475/14) EU:T:2018:448. Prysmian’s former parents Pirelli and Goldman Sachs both unsuccessfully challenged the Commission’s finding of joint and several parental liability before the General Court (cf. The Goldman Sachs Group v. Commission (Case

T-419/14) and Pirelli & C. v. Commission (Case T-455/14)). The appeals in both cases are pending before the Court of Justice.

[4]      In November 2019, the Court rendered judgments on the appeals filed by ABB Ltd and ABB AB, Silec, Brugg Kabel, and LS Cable, partially upholding ABB’s appeal while dismissing the other four entirely; see ABB Ltd and ABB AB v. Commission (Case C-593/18 P) EU:C:2019:1027; Silec Cable and General Cable v. Commission (Case C-599/18 P) EU:C:2019:966; Brugg Kabel AG and Kabelwerke Brugg AG Holding v. Commission (Case C-591/18 P) EU:C:2019:1026; and LS Cable & System Ltd v. Commission (Case C-596/18 P) EU:C:2019:1025. Most recently, on July 16, 2020, the Court of Justice affirmed the judgment of the General Court in Nexans v. Commission; see Nexans France and Nexans v. Commission (C-606/18 P) EU:C:2020:571. The other appeals remain pending before the Court of Justice.

[5]      Reported in detail in our July/August 2020 EU Competition Law Newsletter.

[6]      Prysmian judgment, para. 66; see also Nexans judgment, para. 87.

[7]      Prysmian judgment, para. 57.

[8]      Prysmian judgment, para. 86.

[9]      Prysmian judgment, para. 87.