The General Court of the European Union has upheld the bulk of the European Commission’s 2021 decision which exposed a cartel in the European government bonds sector between seven major investment banks.
According to Brussels, traders from UBS, Natixis, Unicredit, Nomura, Bank of America, Portigon (formerly WestLB) and Natwest (formerly RBS) collaborated and exchanged information between 2007 and 2011 in order to obtain competitive advantages on the trading conditions of government bonds on the primary and secondary markets. According to the Court of First Instance, this practice “had an impact on the entire market in the European Economic Area.”
The European Commission imposed a fine of €371m on three institutions: Nomura, UBS and Unicredit. The others got off scot-free: Natixis and Bank of America because the statute of limitations had expired; Natwest because it had reported the infringement; and Portigon because its negative turnover for the year had led the European Commission to cap its fine at zero euros.
Two reduced fines
But six of the seven banks--with the exception of Natwest--contested the decision. On 26 March, the verdict came down, confirming the European Commission’s interpretation. Yes, it was a single and continuous infringement, seriously undermining competition. The court also confirmed that the practices observed--exchanges of information, price agreements, customer allocation--were intrinsically harmful, for which “the commission was not required to investigate or demonstrate the effects of the traders’ conduct in dispute on competition.”
Two institutions nevertheless saw their fines reduced slightly. Nomura had its fine reduced after the General Court “found that the commission had erred in the determination of one of the elements of the fine by refusing to use the exact data which that bank had provided to it.” And with regards to the case of Unicredit, “the General Court found that the anticompetitive conduct began 17 days later than the date indicated by the commission.” However, the fine imposed on UBS remains unchanged.
This article was originally published in French.
