More Fallout Over Big Elevator Cartel in EU

(CN) - After fining elevator companies more than a billion dollars for their participation in a cartel, the European Commission can also seek compensation as a defrauded consumer, an adviser to the EU's highest court said.

ThyssenKrupp, Otis, Kone and Schindler apparently conspired to share markets, coordinate contract bidding and exchange information on installation and maintenance of elevators in Belgium, Germany, Luxembourg and the Netherlands from 1995 to 2004.

In July, the General Court upheld most of the fines levied against the companies in fines, but it gave ThyssenKrupp a 33 percent break on its portion.

Meanwhile, the commission filed a parallel action against the same companies, claiming that the cartel had caused the EU to overpay on elevators for the buildings of European institutions in Belgium and Luxembourg. In this action, which was filed in Brussels, the commission sought nearly $9 million in damages.

Reluctant to hear the case, however, Belgium's commercial court asked the EU high court whether the commission has standing to both bring actions and impose damages. It also asked if national courts must adhere to commission decisions.

Advocate General Cruz Villalon reminded the Belgian court Tuesday that the EU Court of Justice alone has the power to invalidate commission decisions.

"It is for the national courts to declare and quantify the damage suffered by the EU as the result of anti-competitive conduct established by a commission decision," according to a statement the court issued about Villalon's opinion, which is not available in English. "Moreover, if in the course of those proceedings, the national court has doubts as to the validity of the commission's decision, it will always be able to stay proceedings until the General Court or the Court of Justice confirms its validity."

Although the Belgian national court must adhere to the commission's finding of illegal cartel activity, Villalon said it is by no means restricted in its judicial review of the decision.

The EU right to "equality of arms" - equal advantage between parties - does not prevent the commission from conducting investigations, bringing actions and levying fines, the adviser added.

"There is inequality when the court has information which favors one party to the detriment of the other, without the latter having any effective means of challenging it," the court's statement says. "Thus, in the advocate general's view, the Commission - simply because it has obtained certain information during an earlier investigation which it has not made available to the court - is not necessarily in an advantageous situation that infringes the principle of equality of arms."

None of the elevator company defendants showed that the commission submitted any information other than the public version of its decision, Villalon added.

The advocate general's decision is not binding on the Court of Justice, but rather a legal solution to cases for which that court is responsible. The high court's judgment will be given at a later date.

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