On 12 January 2023, the European Court of Justice (“ECJ”) published its long-awaited judgment in C‑883/19 P HSBC v Commission.

The ECJ confirmed that HSBC had engaged in anti-competitive conduct but partially overturned the General Court’s (“GC”) judgment on procedural grounds. The judgment provides critical guidance on the nature of anticompetitive information exchanges in the financial services sector and sets out important procedural aspects regarding “hybrid” cartel investigations.

The ECJ, having considered the points of appeal, exercised its discretion to issue a final judgment, in place of the GC’s judgment.


In 2016, the Commission fined HSBC and others for participating in a cartel relating to the manipulation of Euro Interest Rate Derivatives (“EIRDs”). HSBC had declined to participate in a 2013 settlement decision, resulting in a staggered hybrid procedure. The Commission found that the banks had exchanged information, explored alignment and coordinated in other ways, to reduce potential liability or to increase their profit under the EIRDs.

HSBC appealed the Commission’s decision to the GC, arguing that the Commission had erred in finding an infringement by object and a single and continuous infringement, and that the Commission had infringed HSBC’s presumption of innocence, right to good administration, and rights of defence.  Although the GC rejected all of those pleas, it ultimately agreed with HSBC’s additional argument that the Commission had given insufficient reasons for the reduction factor applied in calculating the fine. The GC therefore annulled the imposition of a fine on HSBC.

Relevant Points of Appeal

The ECJ confirmed that HSBC had infringed EU competition rules but agreed with HSBC that the GC had erred on certain procedural points.  The GC’s full annulment of the fine was not subject to appeal.

Four findings of the ECJ are particularly noteworthy.

  • Creating anticompetitive informational asymmetry between market participants suffices to find a by object infringement, even if there is no effect on prices for consumers

HSBC had participated in the manipulation of the three-month tenor (“3m”) of the Euribor but argued that this had not actually resulted in harm to competition for EIRDs.  HSBC argued that the mere possibility that the cartelists might offer better conditions than non-cartel competitors was not sufficient to give rise to a by object infringement.

The ECJ found that it was irrelevant that there might have been no direct connection between the exchange of information among traders and prices for consumers. The relevant aspect was that the manipulation reduced the degree of uncertainty between the participants as regards the timing, extent and details of certain modifications to a certain part of the Euribor index. As such, the conduct in and of itself amounted to a distortion of the competitive process that constituted an infringement by object, regardless of the commercial interests of the traders.

  • Procompetitive effects of exchanges should be taken into account in the analysis of infringements by object

HSBC argued that the GC should have assessed its arguments as to the procompetitive effects of specific exchanges between traders under the case law relating to restrictions by object under Article 101(1) TFEU rather than the doctrine of “ancillary restraints”.

The ECJ agreed that the GC had erred in law by holding that, except for ancillary restraints, procompetitive effects can only be taken into account in the context of the assessment of Article 101(3) TFEU. This led the GC to not examine HSBC’s arguments that those procompetitive effects called into question the characterisation of those exchanges as a restriction by object.  The GC incorrectly held that the burden was on HSBC to show that the discussions were directly related and necessary to the functioning of the EIRD market or that they met the conditions in Article 101(3) TFEU.

  • The presumption of innocence applies even in hybrid procedures where a prior settlement decision has already been adopted

The GC had rejected HSBC’s arguments that the hybrid procedure caused its liability to be prejudged, which impaired HSBC’s right to be heard.  On appeal, HSBC argued that the GC had applied an incorrect legal test in holding that any irregularities relating to a lack of impartiality by the Commission could only lead to the annulment of the decision if those irregularities would have changed that decision.

The ECJ confirmed that the GC had erred in rejecting HSBC’s argument on the basis that the content of the decision would have been the same despite the alleged procedural irregularities.  The presumption of innocence requires that the GC should have assessed in detail whether in the settlement decision the Commission had prejudged HSBC’s liability. Although the Commission may objectively need to address facts relating to participants in the ordinary procedure as part of the settlement decision, it must preserve the presumption of innocence of the undertakings in the ordinary procedure. However, as regards the substance of the decision, the ECJ found that the Commission had taken adequate drafting precautions to preserve the presumption of innocence with regard to HSBC.

  • Public statements by a Commissioner did not infringe HSBC’s right to good administration

HSBC also argued that public statements by the Commissioner in charge of the case at the time infringed HSBC’s right to good administration. The Commissioner had made statements: (i) in 2012, before the adoption of the settlement decision (for example, “[t]he evidence we have collected is quite telling, so I’m pretty sure this investigation will not be closed without results”), and (ii) in 2014, following the settlement decision (for example, statements to the effect that the investigation was not the most difficult in the world, and that there certainly was a cartel).

The ECJ held that the 2012 statements had remained general and did not constitute an expression of bias or prejudice as to culpability. The ECJ acknowledged that “some of [the 2014] statements are couched in language which does not reflect the caution which would have been expected of the member of the Commission in charge of competition policy in the context of an ongoing case”. However, it held that ultimately these statements did not call into question the Commission’s impartiality during the investigation. The statements were therefore insufficient to vitiate the legality of the decision and did not suggest bias or prejudice as to the culpability of the HSBC companies.

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Photo of Johan Ysewyn Johan Ysewyn

Johan Ysewyn is widely respected as a highly skilled European competition lawyer, advising on complex competition issues, including on merger control, anti-cartel enforcement, monopolisation cases and other conduct investigations. He acts as Co-Head of the firm’s Global Competition group and as Managing Partner…

Johan Ysewyn is widely respected as a highly skilled European competition lawyer, advising on complex competition issues, including on merger control, anti-cartel enforcement, monopolisation cases and other conduct investigations. He acts as Co-Head of the firm’s Global Competition group and as Managing Partner of the Brussels office.

Clients turn to Johan when they need cutting-edge competition and regulatory advice. He has been advising some of the world’s leading companies for over 30 years on their most complex competition issues. Johan is “an exceptional lawyer who is solution-oriented, has a remarkable ability to rapidly understand our business and has excellent reactivity.” (Chambers Global) Johan “attracts considerable praise for his reliable practice, as well as his great energy and insight into cartel proceedings.” (Who’s Who Legal)

Johan represents clients from around the world in dealings with competition authorities as well as in court litigation. He has in-depth knowledge of regulatory procedures and best practices as well as longstanding relationships with key regulators, in particular at the European Commission. He has also an active advisory practice covering a range of areas of interest to corporates, including the interplay between ESG goals and competition law, the impact of competition law enforcement on digital markets and broad strategic compliance issues.

Johan’s experience spans many industry sectors, with recent experience in telecoms and information technology, media, healthcare, consumer goods, retail, energy and transport. He has advised on several of the most major merger investigations in recent years. In addition, he has represented clients in many conduct investigations.

Johan’s practice also has a strong focus on global and European cartel investigations. He has acted for the immunity applicants in the bitumen and marine hose cartels, and acted for defendants in alleged cartels in financial services, consumer goods, pharmaceuticals, chemicals, consumer electronics and price benchmarking in the oil sector. He has acted for the European Payments Council in the first European Commission investigation into standardisation agreements in the e-payments sector. Johan has written and lectured extensively on international cartel and leniency-related issues. He co-authors the loose-leaf European Cartel Digest and lectures on cartel law and economics at the Brussels School of Competition.

Johan is also one of the leading experts on EU State aid issues, working both for beneficiaries and governments. He has advised a number of leading banks and governments, as well as represented major European airlines. From the cases that can be publicly disclosed, he has been involved in the Fortis, KBC, Dexia, Arco, Citadele, airBaltic and Riga Airport State aid cases.

Tomos Griffiths

Tomos Griffiths is a Trainee. He attended Durham University.