On 17 September 2015, the Court of Justice ("ECJ") issued two judgments on the appeals by Total SA and its wholly-owned subsidiary, Total Marketing Services, against two judgments of the General Court ("GC") in relation to the paraffin wax cartel.
In 2008, the European Commission found that Total SA and Total Marketing Services had participated, along with other undertakings, in a cartel on the EEA paraffin wax market (from 1992 to 2005) and the German slack wax market (from 1997 to 2004). Based on the principle of imputing liability from a subsidiary to its parent company, Total SA was held jointly and severally liable with Total Marketing Services to pay a fine of over €128 million. Both entities subsequently asked the GC to annul the Commission's decision in two separate appeals. In September 2013, the GC reduced Total Marketing Services' fine, but dismissed Total SA's application (see VBB on Competition Law, Volume 2013, No. 9, available at www.vbb.com).
On the first appeal to the ECJ, the ECJ ruled that the GC had erred in not reducing the fine imposed on Total SA to reflect the reduction granted to Total Marketing Services. The ECJ noted that in a situation where the liability of a parent company is purely derived from that of its subsidiary and where no other factor individually reflects the conduct for which the parent company is held liable, the liability of the parent company cannot exceed that of its subsidiary. Accordingly, where a parent company and its subsidiary each bring parallel applications with the same object, the parent company must, "in principle, benefit from any reduction in the liability of its subsidiary which had been imputed to it".
The ECJ therefore set aside the judgment of the GC insofar as it did not bring the fine imposed on Total SA into line with the fine imposed on Total Marketing Services. In exercising its powers of amendment, the ECJ set the fine imposed on Total SA jointly and severally with Total Marketing Services at just under €125.5 million.
For its part, Total Marketing Services also claimed a further reduction in the fine imposed on it on the ground that it had ceased to participate in the cartel from May 2004 and that it had not been involved in the cartel from May 2000 to June 2001.
Significantly, the ECJ held that the GC had erred in law in considering that public distancing by an undertaking from a cartel was the only way to prove that the undertaking had ceased participation in the cartel, even in the case where that company had not participated in anti-competitive meetings.
Nonetheless, the ECJ reasoned that the GC's error of law could not lead to setting aside the judgment in relation to Total Marketing Services' participation in the infringement during the relevant periods, as there was objective and consistent evidence showing that the company's participation in the cartel was not interrupted and had actually continued. The ECJ held that although Total Marketing Services had not actually participated in the last three cartel meetings between 12 May 2004 and 29 April 2005, it had not ceased to participate in the cartel altogether and, moreover, had not distanced itself publicly from it.
Furthermore, the ECJ held that objective and consistent evidence showed that Total Marketing Services' participation in the cartel was not interrupted between May 2000 and June 2001. The rushed departure of Total Marketing Services' representative from a meeting in May 2000 could not be construed as an expression of the company's intention to distance itself from the cartel, especially since, after the representative's replacement by another employee, Total Marketing Services continued to participate in the collusive meetings. The ECJ therefore dismissed the appeal by Total Marketing Services in its entirety.
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