The Finnish Supreme Administrative Court has recently issued its awaited decision in the largest cartel case tried to date in Finland, dismissing the asphalt companies’ appeals of the Market Court’s decision of 2007 and approving to a significant extent the appeal by the Finnish Competition Authority.
In its decision of 29 September 2009, the Court ruled that virtually all major undertakings in the field, i.e., Lemminkäinen Oyj, Valtatie Oy, Skanska Asfaltti Oy, NCC Roads Oy, SA-Capital Oy, Rudus Asfaltti Oy and Super Asfaltti Oy, had participated between 1994 and 2002 in a nationwide cartel aiming at the removal of effective competition from the Finnish asphalt market, where the largest customers were municipalities and other public bodies.
The total amount of fines, EUR 82.5 million, imposed by the Court is significantly higher than the fine of total of EUR 19.4 million imposed by the Market Court some two years earlier, and represents only a slight reduction from the amount originally proposed by the Finnish Competition Authority.
Apart from the unprecedented level of competition infringement fines imposed on cartel participants, the Court noted that it can be difficult to obtain evidence on cartel behaviour and that evidence presented in cases relating to alleged competition infringements cannot be subject to the same requirements as in criminal cases. Consequently, the Court, most notably, established that evidence must be looked at as a whole without having to prove each single event/action forming a cartel. The Court accepted in this respect that similar events and similar market behaviour taking place at approximately the same time as well as other circumstantial evidence, in the absence of any other plausible explanation, can amount to sufficient evidence of a competition infringement. When assessing the length of a competition infringement, the Court concluded that it was sufficient to show evidence that timewise closely relates to the established facts of the case in order to be able to reasonably conclude that the competition infringement has continued without interruptions between the commencement and the termination thereof.
Therefore, whilst it was established that the Finnish Competition Authority had not been able to obtain conclusive evidence, either geographically or timewise, on all events that had taken place in the relevant market, the Court reasoned that similar events and behaviour by various cartel participants in the market could not have occurred merely by coincidence. Consequently, in the absence of any other plausible evidence or explanation, the Court ruled that the cartel was nationwide and not confined to certain geographical areas nor did it only cover certain segments in the Finnish asphalt market.
The Court’s ruling represents a departure from the approach adopted by the Market Court and facilitates the follow-on claims for damages which have been pending before various local courts waiting for the Court’s ruling.
Going forward, this ruling can be seen to set clearer boundaries as to what is required in terms of sufficient evidence to show the existence of a cartel. The ruling is also bound to induce a change of strategy for cartel participants, both in terms of assessing leniency as an alternative and considering defense strategies.
For further information, please contact any of your usual contacts at our competition team.