On 24 March 2016, the Industry Appeals Tribunal (the "Tribunal"), the highest Dutch administrative appeal court in competition law matters, upheld a judgment of a lower court confirming that the Dutch Competition Authority (the "DCA") can rely on an undertaking's EU-wide turnover to calculate a fine for cartel infringements and that it does not have to limit itself to the turnover generated by that company in the Netherlands.
In May 2012, the DCA imposed an aggregate fine of over €9 million in an onion cartel case. The DCA found that five undertakings growing and processing onions agreed, inter alia, on the maximum area of land that each of them would farm, thereby limiting production and aiming to increase selling prices (see VBB on Competition Law, Volume 2012, No. 6, available at www.vbb.com). The fines imposed were, for the first time, based on the EU-wide turnover of the undertakings involved. According to the DCA, sales to customers outside the Netherlands, which were affected by the cartel, could have had an impact on the competitive process and structure of the onion industry in the Netherlands. In setting the fine, the DCA took into account the fact that neither the European Commission nor other Member States would initiate an investigation concerning the same cartel.
On appeal, the lower court held that Regulation 1/2003 provided the DCA the competence to enforce EU competition rules and to impose fines on the basis of the EU-wide turnover of the infringing companies (see VBB on Competition Law, Volume 2014, No. 3, available at www.vbb.com ).
The Tribunal concurred with the lower court and held that the DCA's competence to impose fines on the basis of Regulation 1/2003 is not limited by the territorial scope of the EU internal market. The Tribunal considered, on the basis of the European Court of Justice's judgment in case C-231/14 Innolux, that the competence to impose fines must be distinguished from the territorial jurisdiction to enforce the prohibition of restrictive agreements. According to the Tribunal, Dutch law determined whether a cartel fine could be imposed on the basis of the turnover generated by sales to customers outside the Netherlands, since Regulation 1/2003 was silent in this regard. The Tribunal considered that the DCA's applicable fining guidelines did not stipulate that the fine must be based solely on the turnover generated by the infringing companies in the Netherlands. Consequently, for the purpose of calculating the fine, the DCA was allowed to also take into account the turnover from sales that were not made in the Netherlands.
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