EUROMETAL Compliance Guidelines

Table of contents

Preamble

1. Basic Guidelines
2. Antitrust law-compliant conduct
3. Protection of confidential information
4. Data protection
5. Communication
6. Invitations and benefits
7. Non-discrimination
8. Integrity of documents, record keeping
9. Protection of the assets of EUROMETAL
10. Implementation

Preamble

As a Trade Association, EUROMETAL – European Federation of Steel, Tube and Metal Distribution and Trading (hereinafter: EUROMETAL) represents and promotes common interests of its members.

The main objectives of EUROMETAL are:

• To enhance the co-operation amongst its members in all matters that contribute to the development of the European steel distributors and the steel service centre business,
• To represent the common interests of its members vis-à-vis third parties, notably the institutions of the European Union and other international organisations.

While performing its corresponding activities EUROMETAL is not and shall not be involved in any commercial transaction.

EUROMETAL supports the development of a regulatory framework enabling steel distributors to best meet their economic role. EUROMETAL further serves as competent contact for any specific issues related to the steel distribution sector. Confidence of the public and the relevant decision-makers is a key factor to the success of EUROMETAL’s activities, therefore requiring both professional expertise and integrity. Any damage to the reputation of EUROMETAL has to be avoided.

The present Compliance Guidelines cover the essential rules and principles to be observed in order to ensure a legally correct and responsible conduct of activities of the organs, employees and all other persons involved in the activities of EUROMETAL.

These Guidelines, adopted by the EUROMETAL General Assembly on 02 December 2014 in Frankfurt/Mainare addressed to all persons involved in the activities of EUROMETAL.

1. Basic Guidelines

(1) The organs, employees andall other persons involved in the activities of EUROMETAL shall observe all laws and regulations applicable to their activities as well as the internal instructions and guidelines of EUROMETAL. The individual ignorance of the existence and / or the scope of legal requirements does not preserve from the negative consequences of unlawful acting. In cases of doubt, legal advice shall be consulted.

(2) The organs, employees andall other persons involved in the activities of EUROMETAL shall safeguard the reputation and reliability of EUROMETAL and of its members within the meaning of these Guidelines. They are committed to behave honestly and fair, decently and with integrity throughout their working environment.

(3) A considerable violation of these Guidelines is subject to legal consequences which might include criminal sanctions, if the violation of the rules of conduct listed in the guidelines is also a criminal offence.

2. Antitrust law-compliant conduct

EUROMETAL puts strong emphasis on the unexceptional observance of antitrust laws in all activities of the federation.

These compliance guidelines particularly act as preventive against antitrust law infringements at EUROMETAL. These compliance guidelines are accompanied by further preventive measures such as regular antitrust trainings, especially for the President and the Director General, the participation of an external compliance expert at EUROMETAL meetings if necessary and the incorporation of qualified legal advice in cases of doubt about the antitrust law legitimacy of a measure taken during the work of the federation. All these measures shall particularly serve to prevent anti-trust infringements at EUROMETAL as EUROMETAL attaches greatest importance to the unexceptional observance of antitrust rules throughout the activities of EUROMETAL.

a) Antitrust Issues

EUROMETAL activities may lead to situations where antitrust issues could arise. EUROMETAL engages in market research, monitoring industry issues and assembling of statistical data. Though coordinated with or among members, these activities are pursued within the limits of antitrust laws; they do not relate to members’ market activities but enable them to speak with one voice. EUROMETAL therefore provides a valuable legitimate service for its members.

EUROMETAL is committed to comply with European Union and national antitrust laws. EUROMETAL activities must on no account lead towards a restriction of competition between members, nor must meetings of members organised or supported by EUROMETAL be used by members to discuss or coordinate future market behaviour resulting in a restriction of competition. More generally, the platform offered by EUROMETAL to its members must not be misused for activities prohibited by antitrust rules.

b) Antitrust Rules

The main competition rule to be observed in the conduct of EUROMETAL activities is Art. 101 Treaty on the Functioning of the European Union (TFEU) (ex-Art. 81 TEC) which prohibits agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect an appreciable restriction of competition. Art. 101 TFEU applies directly in the EU member states. In the member states, national competition legislation has been enacted which is similar to EU antitrust law. Antitrust offences are subject to severe sanctions. Infringements against Art. 101 TFEU can be committed not only by agreements or decisions but also by concerted practices. A concerted practice is a form of coordination not formalised through the conclusion of an agreement but which substitutes practical cooperation for the risks of competition.

c)  Meetings

EUROMETAL representatives as well as meeting attendants from members and associations have to ensure strict adherence to the antitrust rules by everyone concerned in the framework of EUROMETAL activities.

Meetings shall not serve to create or support occasions for the attendants to discuss antitrust-relevant topics or to makeantitrust-relevant arrangements. EUROMETAL will make every effort to prevent such discussion or arrangement. To this effect, EUROMETAL representatives shall at all times observe the following standards.

Anti-trust rules have to be observed throughout the preparation, conduct and follow-up of any EUROMETAL meeting.

Prior to each EUROMETAL meeting, meeting documents such as the agenda, the list of participants and future minutes of the meeting shall be checked in regard to potential compliance issues. The chairperson will contact an external compliance expert to decide whether the meeting attendance of an expert is appropriate. If this question is answered in the affirmative, the expert shall check in advance the content of the agenda and presentations to be held and will be present at the meeting in order to monitor the contributions of the attendants in regard to potential anttrust issues. For this purpose, the agenda and other meeting documents (presentations, etc.,) shall be submitted to the designated expert in advance. The external compliance expert shall provide minutes of the meeting in regard to any compliant relevant incident.

Considering EUROMETAL’s main purpose to represent and promote the interests of distributors, stockholders and traders, the participation and contribution of representatives of the mills or other steel and metals production entities in EUROMETAL meetings require particular attention in regard to potential antitrust- relevant subject matter and / or discussion. This also applies to production representatives of such members dealing both with distribution and production.

A short training unit in antitrust issues and the correct behaviour in EUROMETAL meetings will be given by the external compliance expert to the attendants of the different types of meetings held by EUROMETAL on a regular basis.

It is prohibited to share information, lead (formal or informal) discussions and / or to make arrangements on

• Price strategy, pricing and future market behaviour;
• Individual discounts, credit notes and credit terms;
• Individual terms of sale and payment;
• Individual manufacturing costs and costs of sale, methods of cost calculation, cost accounting formulas, company figures reg. delivery costs, stocks, production, sales etc.;
• Output, restriction of output, limitation of market supply with a product;
• Relations to individual suppliers or customers
• “black lists” or boycotts against competitors, customers or suppliers;
• Allocation of customers or suppliers;
• Projects planned regarding technology, investments, design, production as well as distribution or marketing of specific products

The chairperson shall ensure there are no infringements of antitrust rules during and in the context of the meeting (e.g. during a coffee break).

The chairperson shall prohibit statements and other contributions of the attendants that are questionable regarding antitrust rules. In the event of disagreement on the antitrust relevance of a statement, the related discussion shall be adjourned until the potential antitrust implications are cleared. In the event the discussion is continued despite the intervention, the event shall be cancelled and the attendants shall leave the conference room.The incident shall in any case be recorded in the minutes of the meeting accordingly.

Furthermore, antitrust rules require that the attendants of a meeting formally and actively distance themselves from any questionable discussion. Therefore, attendants are obliged to ensure their objection against anti-trust relevant contributions is recorded in the minutes.

Following up each EUROMETAL meeting, minutes of the meeting shall be drawn by the chairperson.

d) Management of Market Information Systems

EUROMETAL is not allowed to provide any information concerning the operational or commercial activities of its member companies.

Market information reports including but not limited to statistics, serve the systematic collection, evaluation and transfer of market relevant data amongst competitors. These activities are antitrust relevant as they might lead to a restriction of competition.

– Prohibited e. g.: identifying methods, that allow conclusions about details of individual business transactions or market conduct of individual companies.

– Admissible: collecting, processing and release of publicly available data.

– Cases of doubt require an individual assessment of the information:

–  Type: the disclosure of individual prices or of combined maximum and minimum prices as well as the indication of quantities are usually considered as problematic

–  Up-to-dateness: data which are more current than 3 months are usually considered as problematic

–  Structure: usually considered as problematic:

–  less than five independent participants or few participants with an  important market share,

–  too detailed breakdown by product groups or

–  less than ten business transactions covered.

In case there are only few suppliers present on the market concerned (oligopolistic structures) particular prudence is required. The same applies where complementary sources of information are available (e.g. studies of market research institutes or statistical data) rounding out the relevant EUROMETAL information.

e) Recommendations given by EUROMETAL

A recommendation by EUROMETAL is anyexpress or implied declaration assessing an issue or an action as beneficial for the members and therefore suggesting the issue or the action to them.

Any recommendation shall be checked in advance for their legal admissibility. A recommendation supposed to circumvent the ban on cartels by concerted action is usually considered as problematic.

A recommendation suggesting to the members a certain market conduct that, if it was subject to a direct agreement between the members, would violate the ban on cartels is generally inadmissible. It is further irrelevant, if the recommendation is referred to as nonbinding, if economic, social or other pressure is put on to enforce the recommendation or if the member companies actually follow the recommendation or not.

Only such recommendation limited to the forwarding of (even critical) information and leaving the drawing of conclusions to the addressee is to be considered as uncritical.

f) Self-commitments

Self-commitment is any unilateral or joint commitment of business associations, which impose a specific conduct on the companies regularly subject to political objectives. Self-commitments are antitrust relevant as they potentially cause a restriction of competition.

g) Training and documentation

The President of EUROMETALas well as the Director Generalshall undergo regular training on „antitrust law and association work” by external compliance experts. The Director Generalshall further ensure the documentation of the training provided.

3. Protection of confidential information

All persons involved in the activities of EUROMETAL are committed to secrecy in regard to all confidential information of EUROMETAL and affiliated companies.

Confidential information is any information which is designated confidential or of which the person concerned knows or has to know, that it is not public or shall not be made public such as business or corporate secrets. In cases of doubt, the information concerned must not be passed and notice shall be given to the Director General.. He / she will then decide on the further steps.

All persons involved in the activities of EUROMETAL are obliged to handle confidential information carefully, especially by

• protecting databases at their workspace against unauthorized access;
• duplicating or copying only for official use;
• limiting their database to the essential;
• avoiding public conversations about confidential matters concerning members or EUROMETAL.

Confidential information may further be stock market relevant and therefore insider information. Insider trading is prohibited and may be prosecuted.

4. Data protection

All persons involved in the activities of EUROMETAL shall observe the applicable data protection rules and actively contribute to the effective protection of personal data against unauthorized access. Personal data shall only be collected, processed or used if and insofar as justified by the requirements of a due and specified performance of duties.

5. Communication

Any communication, whether in writing (letter, email, telefax etc.) or oral, shall be carried out according to correct manners, so that the communication is ready to be presented to third parties (e.g. authorities, courts) if necessary.

Any official EUROMETAL statement shall be comprehensible, prompt and correct.

EUROMETAL is committed to respect the professional independence of journalists and media and does not pay for the publication of editorials in print, TV and radio.

EUROMETAL members are entitled to claim immediate, profound and prompt advice as well as information on specific EUROMETAL work results.

Where private opinions are expressed on EUROMETAL relevant issues these opinions shall be marked private. Expressions that damage EUROMETAL or its reputation shall be omitted. The non-official use of EUROMETAL work results is prohibited.

6. Invitations and benefits

Presents and other benefits (e.g. hospitalities) shall be socially adequate. The value of such benefits shall remain within reasonable bounds in relation to the particular occasion as well as the function and the position of the persons involved.This applies both for benefits granted within EUROMETAL (e. g. presents for retiring persons) and external benefits (e. g. hospitality for public deputies at a corporate event).

Granting presents or other benefits to public officials shall be omitted.

The organs, employees andall other persons involved in the activities of EUROMETAL must not offer, grant or accept bribes. Active and passive corruptions are criminal offences.

7. Non-discrimination

EUROMETAL attaches particular importance to their representatives respect the dignity, privacy and other personal rights of each individual. EUROMETAL is involved with persons of different ethnic backgrounds, cultures and / or religions. EUROMETAL firmly rejects any form of discrimination, e. g. on the basis of race, age, physical ability, sexual orientation or identity, ideology and gender.

8. Integrity of documents, record keeping

Any EUROMETAL activity documentation (minutes, notes, papers, external business correspondence etc.) subject to transparency and accountability towards the members will be archived electronically ensuring data security and retrievability.

Legally relevant activities (contracts, etc.) shall be fixed in writing. The corresponding documents shall be kept safe. Any conclusion or cancellation of contracts, especially purchase, service or employment contracts shall be transparent, duly justified and comprehensible. They shall be signed by duly authorized persons only.

All documents (vouchers etc.) relevant for accountability, taxation and correct accountancy shall be sorted and kept carefully according to theapplicable legal provisions.

9. Protection of the assets of EUROMETAL

Assets of EUROMETAL are all tangible and intangible (IP incl. software products) property. All persons involved in the activities of EUROMETAL shall be responsible for the protection of these assets. They shall only be used for the purposes of EUROMETAL, on no account for unlawful purposes.

10. Implementation

EUROMETAL Director General is responsible for the implementation of as well as the compliance with these Compliance Guidelines.

EUROMETAL Director General shall ensure that all further organs, employees and other persons involved in the activities of EUROMETAL become acquainted with the content of these Guidelines. He shall further ensure that the aforementioned persons observe the rules applicable to their activity. EUROMETAL General Director shall finally ensure that third party contractors adhere to the present Guidelines.

For any question arising in regard to compliance matters EUROMETAL General Director shall seek qualified legal advice.