Pursuant to Article 23 of Regulation 1/2003, the European Commission has the power to impose fines in competition law infringements. These must be high enough to fulfill their key objective: the deterrence of anti-competitive behaviour. Indeed, fines and the application of Articles 101 and 102 TFEU are intrinsically linked (Opinion of AG Mengozzi in X, C-429/07, para. 38).

Although the Commission’s methodology for calculating fines has been formally structured in its 2006 Guidelines, its deterrent impact has been weakened by the CJEU’s recent case law – particularly in the financial sector – which has exposed significant inconsistencies.

The Commission’s 2021 decision on the European Government Bonds cartel, which was upheld in the General Court’s (‘GC’) judgement on March 26^th 2025 (T-441/21, T-453/21, T-455/21, T-456/21 and T-462/21), illustrates the discrepancies in fine calculation.

On the one hand, Nomura, UBS, and UniCredit faced fines totaling €371 million. However, Nomura contested the Commission’s refusal to use the exact data it had provided and UniCredit demonstrated that its involvement started 17 days later than the Commission claimed. Thus, the GC reduced their fines on these grounds, which begs the question of the robustness of the Commission’s methodology if such calculation errors can materially alter fines.

On the other hand, Bank of America and Natixis were not fined because the Commission’s power to impose financial penalties was time-barred. Moreover, NatWest applied for leniency and received total immunity from fines. Although leniency programs serve a legitimate purpose, the flagrant contrast in penalties between those that were fined and those that were not creates a perception of randomness rather than fairness.

In addition, in the SSA Bonds cartel case (T-386/21 and T-406/21), the Commission imposed a fine on Bank of America (€12.6 million), Credit Suisse (€11.9 million) and Crédit Agricole (€3.9 million) but granted immunity from fines to Deutsche Bank due to its cooperation during the investigation. Rather than using the usual methodology which is based on the turnover of the undertakings (meaning direct revenue figures), the Commission opted to calculate fines on a proxy for that turnover. This proxy was derived from the notional amounts of the SSA bonds traded and an adjustment factor linked to spreads between the purchase price and the sale price of representative categories of SSA bonds acquired and then resold by each bank.

The Commission justified its approach by stating that its objective was to reflect the specific nature of financial markets. Crédit Agricole and Credit Suisse contested this methodology as it introduces an element of arbitrariness, leading to fines that did not reflect their actual economic benefit from the infringement.

Nonetheless, the GC endorsed the Commission’s methodology, although it annulled part of the decision concerning the timeline of Crédit Agricole’s participation in the cartel. This divergence from the usual methodology for calculating fines challenges the robustness of the latter.

Finally, the unpredictability of fine calculation was further illustrated in the Euro Interest Rate Derivatives (EIRD) case against HSBC ((T-561/21).

In 2016, the Commission initially fined HSBC €33.6 million but its decision was annulled by the GC due to inadequate reasoning. In 2021, the Commission reissued a revised fine of €31.7 million, prompting yet another legal challenge.

HSBC argued that the fine was imposed outside of the period prescribed for doing so, but the GC rejected this claim by holding that the appeal to the CJEU lodged by the Commission had suspensory effect.

This case highlights the legal uncertainty surrounding fine imposition, where companies can never be certain whether a fine will stand, be reduced, or be annulled entirely.

Conclusion

The Commission’s fine calculation framework is built on sound deterrence principles but its effectiveness is diminished in practice by the legal uncertainty caused by the use of arbitrary proxies, frequent judicial revisions and unpredictable reductions. This may lead to an increase in legal challenges, as companies may see fines as negotiable penalties that can be challenged, reduced or even annulled with the right legal strategy. Thus, reform is needed – through clearer guidelines or greater reliance on economic analysis possibly – to ensure fines are seen as true deterrents.

However, the impact of the flawed methodology of fine calculation on the deterrence of anticompetitive behaviour must be nuanced: the imposition of fines by the Commission is only “one of the means conferred on the Commission in order to enable it to carry out [its] task of supervision” (Cases 100/80 to 103/80, Musique Diffusion française, para. 105). According to J.P. Christienne, it is a common misconception that imposing fines is the only effective tool of deterrence at the disposal of the Commission to prevent anticompetitive behaviour (“Article 23: Fines – Commentary”, Regulation 1/2003 and EU Antitrust Enforcement: A Systematic Guide, 2022). The Commission’s ability to identify violations of Articles 101 and 102 TFEU serves as a preventive measure against future infractions, as the publication of infringement decisions in the Official Journal personally impacts the concerned undertaking. This has a deterrent effect and discourages recidivism, as the mere finding of a previous infringement– regardless of past fines – could serve as an aggravating circumstance for a repeated infringement. In addition, the Commission’s leniency policy in cartel cases – which can offer total immunity from a fine – makes cartel members more wary of each other than of random investigations by the Commission.

The General Court’s (‘GC’) judgement of February 9^th 2022 (T-791/19) deals with, for the first time, the impact of systemic or generalised deficiencies in the rule of law in a Member State for the determination of the authority best placed to examine a competition complaint. This major decision ignited critical discussions on the judicial scrutiny of complaint rejections in EU competition law.

Facts of the case

In 2016, the Polish company Sped-Pro lodged a complaint with the European Commission against PKP Cargo (a company controlled by the Polish State), claiming that the latter had abused its dominant position on the market for rail freight transport services in Poland.

In 2019, the Commission rejected Sped-Pro’s complaint, considering that the Polish NCA was best placed to examine it.  However, Sped-Pro had sought to dissuade the Commission from rejecting its complaint on this ground, arguing that both the Polish NCA and national courts lacked independence.

Consequently, Sped-Pro brought an action for annulment of the Commission’s decision before the GC. The latter upheld Sped-Pro’s complaint that the Commission was best placed to examine its complaint, considering widespread and systemic rule-of-law concerns in Poland (Sped-Pro, para. 106). However, it rejected Sped-Pro’s other arguments that the Commission had infringed Sped-Pro’s right to have its case examined within a reasonable time (para. 35) and that the Commission had failed to properly appreciate the EU’s interest in investigating the complaint (para. 69). The contested decision was therefore upheld by the GC.

I – The Commission’s limited discretion to reject complaints

Pursuant to Article 105(1) TFEU, the Commission has discretion on the cases to pursue to ensure the application of Articles 101 and 102 TFEU. Under Article 7 of Regulation 773/2004, the Commission may reject a complaint due to the lack of any EU interest in the matter complained of (Notice on the handling of complaints, pt. 28). In assessing the EU interest raised by a complaint, however, the Commission is obliged to examine carefully the factual and legal elements brought to its attention by the complainant (Automec II, T-24/90, para. 79).

The review of rejection decisions by the CJEU is limited (Koelman v. Commission, T-575/93, paras. 41-43). It is not for the Court to substitute its own assessment of the EU interest for that of the Commission (EFIM v. Commission, C-56/12 P, para. 36).

However, the Sped-Pro ruling sets a critical limit on the Commission’s discretionary power, reinforcing that it must be exercised in a manner consistent with fundamental rights and effective judicial protection.

II – The exception to the principle of mutual trust to strengthen judicial review

The GC draws an analogy to the 2018 LM ruling where it provided an exception to the principle of mutual recognition : a judicial authority must refrain from executing the European Arrest Warrant when there are substantial grounds to believe that there is a real risk in that particular situation of a breach of his fundamental right to a fair trial under Article 47 of the Charter, on account of systemic or generalised deficiencies concerning the independence of the judiciary of the issuing Member State (LM, C-216/18 PPU, paras. 60 and 74). The GC subsequently established a two-step test for assessing judicial independence (paras. 77-81).

Such an analogy may seem surprising given the factual differences of these cases, yet they are both linked by the principle of mutual trust. Indeed, Regulation 1/2003 and the Commission’s Notice on cooperation within the Network of Competition Authoritiesestablish a system of close cooperation between the competent competition authorities based on the principles of mutual recognition, mutual trust and loyal cooperation (Sped-Pro, paras. 83-88).

While NCAs are assumed to operate under conditions of legal certainty and judicial independence, the GC concludes that systemic rule-of-law deficiencies in a Member State must be considered when determining the best-placed authority to handle a competition case (para. 92).  

III – The concrete and substantive assessment of the rule of law concerns before the rejection of a complaint

A crucial takeaway from Sped-Pro is that judicial review of complaint rejections must be substantive rather than merely procedural. The GC found the Commission’s reasoning for rejecting Sped-Pro’s complaint to be overly abstract, merely stating that the rule-of-law concerns raised by the complainant were unsubstantiated and without engaging with the detailed evidence presented (para. 104-105).

The GC concluded that the Commission’s approach was insufficient.  As a result, the GC upheld Sped-Pro’s complaint that considering widespread and systemic rule-of-law concerns in Poland, the Commission was best placed to examine its complaint rather than the Polish NCA.

Conclusion

The Sped-Pro judgement underscores the growing need to strengthen judicial scrutiny of the Commission’s discretion to reject competition complaints. The Commission must conduct a proper assessment of systemic rule-of-law concerns, as effective competition enforcement cannot be divorced from the protection of fundamental rights and the rule of law.

This case exposes the fragility of mutual trust in decentralized EU competition enforcement, setting a precedent that could be invoked in future cases where complainants allege that rule-of-law concerns threaten the fairness of NCAs’ decisions. If systemic deficiencies in national competition enforcement persist, there may be increased pressure on the Commission to take direct action rather than deferring to potentially compromised NCAs. This could shift the balance of competition law enforcement back toward the Commission, whose accountability is intensified to safeguard competition law’s effectiveness.