Icap v. Commission: General Court Upholds Cartel Liability Of Facilitators, But Attempts To Rein In Commission's Approach In Settlements

On 10 November 2017, the European Union General Court (GC) handed down its judgment in Icap v Commission. The judgment serves as a reminder of the Commission's ability to impose liability for cartel infringements on "facilitators" as well as on the cartel's main participants, but equally draws the Commission's attention to its procedural obligations when it comes to settlement procedures, particularly in hybrid cases. The judgment also restates case law on the establishment of a "by object" infringement of Article 101(1) Treaty on the Functioning of the European Union (TFEU).

BACKGROUND

Icap, an interdealer broker and provider of post-trade services, was found liable as a facilitator of the Japanese Yen LIBOR cartel by the Commission in February 2015.1 In its decision, the Commission held that Icap facilitated six separate bilateral infringements of Article 101(1) TFEU of differing durations. By separate settlement decision in December 2013, the Commission had already found against five banks and another broker for participation in the cartel.2 Icap had withdrawn from the settlement procedure in November 2013.

The Commission found that Icap had facilitated the infringements by circulating spreadsheets of quotes related to JPY LIBOR rates to the participating banks, as well as other financial institutions who were members of the JPY LIBOR panel.3 These spreadsheets provided price and volume information and aimed to facilitate agreements between the participant and panel banks. In addition, the Commission found that Icap was, following instructions from participating banks, disseminating misleading information amongst panel banks.

In its judgment, the GC partially annulled the Commission's decision: one of the infringements was annulled in its entirety in light of the Commission's failure to produce adequate evidence of Icap's knowledge of such infringement,4 and four of the infringements were annulled in part due to a lack of sufficient evidence as to their duration.5 The fine imposed on Icap was in any case annulled in full, due to the Commission's lack of sufficient reasoning on the fine calculation in its decision.6

KEY FINDINGS

"Facilitation" of a Cartel as an Infringement of Article 101(1) TFEU

After the Court of Justice's judgment in AC Treuhand,7 the judgment is only the second case to deal with the question of the extent to which a third-party facilitator of a cartel can be liable for an infringement of Article 101(1) TFEU. Importantly, the judgment restates the position in AC Treuhand,8 where a consultancy firm was held liable for a cartel infringement despite its presence on a market different to that of the participants, on the basis of its essential and not merely peripheral role in organising meetings, collecting and supplying data, and acting as moderator between participants.9 As a result, the GC in Icap upheld the general proposition that an entity's active contribution to a restriction of competition will be caught even where such contribution relates to an activity outside of the market in which the cartel takes place.10

Icap argued that the Commission had incorrectly applied the "facilitation test" established in AC Treuhand and that its conduct in fact differed from the facilitator in that case. Its claims were rejected by the GC in relation to all but one of the six infringements.

As part of its analysis, the GC held that...