EU ANTITRUST: HOT TOPICS & NEXT STEPS

EU ANTITRUST: HOT TOPICS & NEXT STEPS 2022

Prague, Czechia

The law on the Protection of Competition states that the Office shall, when imposing fines, take into account the seriousness of the anticompetitive conduct, the behaviour of the competitors during the proceedings before the Office and their efforts to remedy consequences. Thus, the discretion of the Office when imposing fines for anticompetitive conduct is broad and it would be difficult for competitors to estimate the consequences of their conduct. To increase foreseeability, the Office issues guidelines which give the competitors a rough insight of what fine to expect. This is also desirable for the prevention of anticompetitive conduct because the competitors can at least roughly calculate the costs of their actions and consider if they pay off or not. Of course, this means that to achieve deterrence, the costs must be higher than profits and that the fines must be imposed efficiently. The new Sentencing Guidelines which came into effect on 24 April 2018 and apply to proceedings commenced after this date, take into account mainly the seriousness of anticompetitive conduct and the duration of it. Horizontal cartel agreements (e.g., price-fixing, market sharing, bid rigging) belong to the most serious anticompetitive conduct for which the fine of 5% – 15% of relevant turnover can be imposed. In comparison with the previous guidelines from 2006 which enabled the office to impose a fine of up to 3% of the relevant turnover for the most serious anticompetitive conduct, the new guidelines represent a significant increase. Also, the new guidelines consider the individual seriousness of the anticompetitive conduct, for example if the anticompetitive agreement was actually implemented or not. This enables the Office to really determine, case by case, what is the optimal fine, taking into account the individual circumstances of each case. Further, the duration of anti-competitive conduct matters because it directly influences the seriousness of such an action. Time coefficient is set as follows: T = f (x) = x/12, where x is the number of months for which the cartel lasted. In case that x is less than 1, T equals to 1. The maximal value of T is 10 even for cartels lasting for more than 10 years. Again, this means a significant increase in imposed fines compared to the previous guidelines which limited a coefficient of time to 3 as a maximum for the longest cartels. We see that the Office is currently entitled to impose a base fine up to 150% of the relevant turnover for very serious and long infringements whereas according to the previous guidelines the base fine was limited to 9% of the relevant turnover. By comparison the EU sentencing guidelines (Guidelines on the method of setting fines imposed pursuant to Article 23(2)(a) of Regulation No 1/2003 (2006/C 210/02)) set the basic fines up to 30% of the relevant turnover for the last finished accounting period which is further multiplied by number of years for which the infringement lasted. The EU Commission can thus impose a fine up to 300% of the relevant turnover in case of the most serious infringements lasting 10 years. This suggests that the fines

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