Antitrust Enforcement (Arts. 101-102 TFEU)

Question 1

Regulation 1/2003

Answer 1

• Parallel application of nat’l and EU competition law: nat’l courts or NCAs that apply nat’l comp law must also apply 101-102 TFEU if trade between MS affected
• NCA and national courts cannot rule against EC decisions
• NCA can only state there has are “no grounds of action”

Question 2

Public enforcement: procedural stages

Answer 2

• pre-investigation phase (6 m)
• investigation phase (2-3 y): request for information
• (actual) procedure (6 m)
– statement of objections
– access to file
– written/oral procedure, incl. hearing
– special: commitment/settlement
• decision (6 m)
• appeal possible (GC 2-3 y, ECJ 2 y)

Question 3

Public enforcement: decision outcomes

Answer 3

• end infringement (‘injunction’) (e.g. Google shopping)
• fine
• commitments
• settlement
• interim measures

Question 4

Number of EU Art. 101 cartel decisions (with fines)

Answer 4

from 1990-2019: more than 135 cartel decisions (fines imposed appr. 30 billion euros)

Question 5

EU fining guidelines

Answer 5

Basic amount:

• value of sales concerned (last year of infringement, multiplied with number of years; 30% addition depending on gravity of infringement)
• factor for deterrence: up to 25% of value of sales

Adjustments:

• aggravating circumstances
• mitigating circumstances
• specific (!) increase for deterrence

Legal maximum/fine cap: 10% of annual turnover in year of decision announcement

Impact of post-infringement facts:

• inability to pay
• leniency

(additional) fines for breach of procedure: 1% of total turnover

Question 6

Leniency

Answer 6

Strategic decision:
– immunity from fines: conditions
– reduction of fines

Risks:
– not being first or no ‘significant added value’
– investigations by NCAs other than EC (esp. third countries) still possible
– criminal liability still possible
– civil liability still possible
– conflict of interest company employees

Question 7

Leniency: Conditions for immunity of fines

Answer 7

1. undertaking first to submit contemporaneous, incriminating (information and) evidence, enabling EC to carry out targeted inspection or to find infringement
2. disclose participation in cartel
3. EC did not already have sufficient evidence + no other undertaking was granted conditional immunity
4. undertaking cooperates genuinely, fully, on a continuous basis and expeditiously (not destroy, falsify or conceal relevant information or evidence, not disclose leniency application except to other authorities)
5. flexible termination of involvement in infringement
6. not having coerced other undertakings to participate or to remain in cartel (but reduction of fine is then still possible)

Question 8

Leniency: Conditions for reduction of fines

Answer 8

– provision of evidence with ‘significant added value’ to evidence already in EC’s possession
– disclose participation in cartel
– termination of involvement in infringement
– first undertaking 30-50%, second 20-30%, subsequent up to 20%

Question 9

New developments

Answer 9

– ‘undercover’
– apply for ranking first, file later
– individual leniency (if fines for individuals)
– give applicants share of the fine?

Question 10

Commitments (Art. 9)

Answer 10

– promise to end an infringement and never infringe again
– strategic decision how much to commit

risks:
– transparency
– excessive reliance >< legal certainty
– procedural issues, incl. rights of third parties (but: market testing, consultation,…)
– balancing efficiency and deterrence
– EC can reopen proceedings

Question 11

Settlement

Answer 11

Acknowledgment of participation and liability in exchange for 10% fine reduction

– different from commitments: intention to fine
– different from leniency: evidence has already been obtained
– but possibility of leniency + settlement reward
– no right to settle
– only in cartel cases

Question 12

Interim measures (Art. 8)

Answer 12

• urgency due to the risk of serious and irreparable damage to competition
• EC can take initiative on prima facie findings
• e.g. Broadcom case 2019

Question 13

Public enforcement of competition law

Answer 13

EU or national public authorities order end to infringement/fine (or accept commitments, settlements,…) in the public interest

Question 14

Private enforcement of competition law

Answer 14

National judges award (damages) claims to private parties acting in their private interest

Question 15

Nullity and damages in private enforcement

Answer 15

• Nullity of restrictive practices (Art. 101 (2) TFEU)
• Damages:
  • right to full compensation but no overcompensation
  • final decisions of NCAs or review courts bind courts
  • generous limitation periods, only start when claimant can reasonably be expected to know