Société Générale EURIBOR cartel fine reduction highlights right to appeal in settlement cases


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Summary: On 6 April, the European Commission reduced the fine previously imposed on Société Générale under the Commission’s settlement procedure for participating in the EURIBOR cartel. This development demonstrates that an appeal of an infringement decision can effectively succeed even where the settlement procedure has been applied. It also serves as a useful reminder of the importance of providing accurate turnover data in cartel investigations.


Société Générale was fined €445m in December 2013 for colluding with three other international banks in relation to pricing components for Euro-denominated interest rate derivatives linked to the EURIBOR and/or the EONIA.  It subsequently made legal history by being the first party fined under the Commission’s settlement procedure to appeal to the General Court.  In its appeal, Société Générale challenged the way in which the Commission established the value of sales relevant to the cartel, a key component of how its fine was calculated. 

Société Générale announced last month that it expected its fine to be cut and simultaneously withdrew the appeal.  The Commission has now announced that Société Générale’s fine has been reduced to €227m – slightly over half of the original amount.  The Commission’s press release states that the turnover data submitted to it by Société Générale, based on which its original fine was calculated, was incorrect.  The reduced fine has been calculated based on revised data, but applying the same methodology. 

Implications for settlement procedure

This development has important implications for future appeals of settlement decisions.  Although the appeal itself was dropped, Société Générale has achieved a huge reduction in the level of its fine and its decision to appeal will therefore be viewed as a success.

While settlement decisions are subject to a right of appeal, like other infringement decisions, the general expectation has been that settling parties will not appeal (as indeed no settling party had yet done, until Société Générale brought its appeal).  This is because, as part of the settlement procedure, cartelists are required to admit liability and agree to a maximum level of possible fine (i.e. the top end of the fining range indicated by the Commission during settlement negotiations).

The fact that Société Générale appealed the level of its fine in this case was an unexpected development at the time and the reduction of its fine will undoubtedly influence the approach of cartelists in other investigations.  Cartelists are incentivised to settle by the prospect of a 10% reduction in the level of their fine, a shorter timeframe for the investigation and typically a more concise infringement decision – a significant benefit in the event of subsequent damages actions.  Following Société Générale’s success in this case, settling and appealing may no longer be regarded as mutually exclusive options in practical terms.

Incorrect turnover data

Société Générale’s case also highlights the importance of ensuring that turnover data submitted to the Commission in an investigation, which will provide the starting-point in calculating any fine subsequently imposed, is comprehensive and accurate.  The fact that an error in the turnover data provided by Société Générale served almost to double the amount of its fine, necessitating an appeal to the General Court, will serve as a cautionary tale to others involved in investigations. 

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