The Commission sent a clear message to would-be cartel participants earlier this month by re-imposing a fine on a cartel participant over 15 years after the original offending conduct took place.  The decision demonstrates the Commission's commitment to ensuring that appropriate action is taken to stamp out cartels, even where it suffers initial setbacks.

The Commission had originally fined a number of companies in 1994 for participation in a steel beams cartel, which lasted from 1989 to 1991.  The fines totalled over €104 million spread among 14 cartel participants.  Appeals by the cartelists to the Court of First Instance led to a reduction of most of the fines in 1999 but a number of the undertakings were still dissatisfied and appealed to the European Court of Justice ("ECJ").

The ECJ annulled completely the decision of the Commission as it related to Arcelor ('Arbed SA' at the time of the Commission decision) in its judgement of October 2003.  This was because of anomalies in the Commission's original statement of objections, which did not state that Arbed could be subject to fines and indeed was not specifically addressed to the company.  This oversight by the Commission had lead to Arbed being denied a right of access to the case file.

However, the Commission decided to re-open the procedure against Arcelor following the ECJ's judgement.  It issued a new statement of objections in March of this year, amending its previous mistakes.  The new statement of objections was issued against Arcelor Luxembourg SA, Arcelor International SA, and Arcelor Profil Luxembourg SA.  It contained a fine of €10 million, which the Commission cites as generous since under normal circumstances the fine would have been closer to €20 million.  However, given that the original fine has been re-instated and that Arcelor has incurred hefty legal fees in defending itself, this new twist in the story has come as a serious setback to the company.

The lesson for companies considering, or partaking in, cartel activity is clear: you may be able to delay the Commission's pursuit where there is procedural impropriety, but it will not be deterred forever.  Arcelor has discovered this the hard way.

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