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EU court annuls part of EU decision authorising raids

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EU has no sufficiently serious indications for earlier

period

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Regulators cannot use as evidence some information seized

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Court decision could impact size of potential fines

(Updates July 9 story with Michelin comment)

By Foo Yun Chee

BRUSSELS, July 9 (Reuters) - French tyre maker Michelin

won a partial court victory against the EU on

Wednesday over last year's dawn raids looking into a possible

cartel, a decision that could reduce the scope of the

Commission's investigation and any potential fines.

Europe's second-highest court said EU antitrust regulators

did not have sufficiently serious indications for part of the

duration of the alleged price fixing and cannot use any

information seized covering that time period.

The Court did not specify which time period, nor did the

European Commission in its 2024 statement announcing the raids.

Michelin said the court ruling highlighted the validity of

its legal action.

"The General Court of the European Union partially annulled

the European Commission's inspection decision, considering that

the Commission could not prove any of the alleged presumptions

over an entire part of the period in question," a Michelin

spokesperson said.

The Commission said it would study the ruling and reflect on

possible next steps.

"The judgment confirms that the inspection decision was

neither arbitrary nor disproportionate in respect of the

suspected infringement during the main period. The inspections

carried out at other premises were neither challenged, nor

annulled," a Commission spokesperson said.

Michelin, together with Italy's Pirelli, Germany's

Continental and Finland's Nokian Tyres was part of a

group of tyre manufacturers raided by the European Commission on

suspicion of breaching EU rules against cartels.

The raids targeted the companies' offices and several

executives, while regulators also copied the contents of

computers, phones and tablets.

The investigation is ongoing and will likely take years to

conclude. Fines for operating a cartel in the EU can be as much

as 10% of a company's global annual revenue.

Michelin's fight is an example of a growing willingness to

challenge EU regulators. In February, U.S. chipmaker Nvidia ( NVDA )

sued regulators, alleging they overstepped their merger

powers in its acquisition of AI startup Run:ai, even though they

did secure the EU's green light for the deal in the end.

Luxembourg's largest brewery Brasserie Nationale lost a court

challenge in July against EU scrutiny of its proposed

acquisition of wholesale drinks distributor Boissons Heintz.

Michelin had argued in its case that the EU competition

enforcer lacked justification for its raids.

The Court partly backed Michelin.

Judges said the Commission had sufficiently serious

indications only concerning the suspected coordination during

the main period, but not for the earlier period referred to in

the contested decision, which must therefore be partially

annulled.

Michelin and the Commission can appeal on matters of law to

the Court of Justice of the European Union (CJEU).

The case is T-188/24 Compagnie générale des établissements

Michelin v Commission.