Global Competition Law is primarly a practitioner's guide presenting the most salient aspects of the major competition laws country by country, giving an overview of their structure and most charasteristic elements.
Global Competition Law also provides insight into possible future developments in the field.

Global Competition Law

The German leniency program was recently enshrined by the 10th Amendment, and largely corresponds to the FCO's previous leniency program. Pursuant to Section 81(h) GWB, full or partial immunity may be granted where an undertaking contributes to the discovery of a cartel. 

The leniency program allows immunity from fines for an undertaking that has entered into a cartel agreement subject to four co …

Leniency

The GWB provides for administrative sanctions in the form of cease and desist orders. Section 32 of the GWB generally empowers the competition authorities to prohibit all behavior contrary to the GWB. The 8th Amendment to the GWB of June 2013 now empowers the FCO to impose structural remedies on undertakings involved in anticompetitive practices and to order them to divest parts of the undertakings. However, the principle of proportionality applies and structural measures must only be imposed where they are more effective than behavioral measures. The Act also enables the FCO to require the undertakings to repay the illegal proceeds of their actions to the victims.

Moreover, victims of the behavior or any association of undertakings demonstrating a legal interest can request an injunction as regards the prohibited behavior and seek damages where such injunction is not respected (Section 33 GWB).

Cease and desist orders

Administrative fines are ordered when an administrative offense is committed. Violation of the prohibition on horizontal restraints, on vertical restraints, on abuse of dominance, abuse of economic dependency and the failure to provide correct information are all considered administrative offenses. In order to be subject to a fine, the offense must have been committed willfully or negligently. The calculation of the fine is made in two stages. A basic amount is first calculated, depending on the severity and duration of the offense, then, taking account of the factors which may lead to an increase or a decrease, the final amount is fixed. For undertakings, the fine can even go up to 10% of the annual global world turnover of the undertaking or the group forming an economic unit. In June 2013, the FCO published new Guidelines for the assessment of fines in cartel offense proceedings, replacing its 15 September 2006 guidelines. According to the new guidelines, the 10% amount of the undertaking's overall turnover will be considered as a maximum value within the range of fines. The maximum amount of the fine will be based on the overall turnover of the company for the fiscal year prior to the decision. The size of the business will be a decisive factor in the determination of the individual amount of the fine. Therefore, the new rules may be to the advantage of single-product SMEs while aggravating the risks incurred by large companies operating in different product markets. 

Since the 8th Amendment of June 2013, criminal offenses committed with intent may also be fined up to EUR 10 million (EUR 1 million previously) and criminal offenses committed negligently may be fined up to EUR 5 million (EUR 500,000 previously).

Procedures applicable to administrative offenses are set out in the Administrative Offenses Act (Gesetz über Ordnungswidrigkeiten-OWiG). Further, continued violation of the decision of the FCO prohibiting a cartel agreement gives the latter the right to appropriate any illegal gains resulting from such practice following the adoption of the decision (Section 34 GWB).

Before 2013, a successor undertaking was not automatically liable for infringements carried out by the transferor and could escape the infliction of fines. This has been remedied to some extent by the 8th Amendment to the GWB: full or partial successors of the legal entity having committed the infringement and having ceased to exist now can be fined up to the value of the assets transferred. However, there remained a loophole in the system as only legal successors were liable, not economic successors. The 9th amendment to the GWB of March 2017 remedies this situation by providing for the liability of either the legal or economic successor of the infringing undertaking. In addition, the amendment sets up a system of group liability similar to the system currently enforced by the Commission, under which a parent company may be liable for the actions of its subsidiary whether or not it has itself participated in the infringement, insofar at it exerts a decisive influence over that company.

Since the 11th Amendment to the GWB, the FCO's powers have been strengthened in relation to profit skimming. If a company deliberately or negligently infringes competition law and thereby gains an economic advantage, the FCO can skim those profits and require the company to make a corresponding payment to the Treasury. The 11th amendment makes the conditions for implementing this mechanism more flexible, by providing for a two-fold assumption. Henceforth, the FCO must be able to assume firstly that the said competition law violation causes additional profit, and secondly that the relevant profit amounts to at least 1% of the revenue that the company generated with the affected products or services.

Fines

The German leniency program was recently enshrined by the 10th Amendment, and largely corresponds to the FCO's previous leniency program. Pursuant to Section 81(h) GWB, full or partial immunity may be granted where an undertaking contributes to the discovery of a cartel. 

The leniency program allows immunity from fines for an undertaking that has entered into a cartel agreement subject to four conditions: (1) full disclosure and cooperation in clarifying the facts, (2) the undertaking must end its participation in the cartel immediately after filing its leniency application unless otherwise requested by the competition authority, (3) the cooperation must be genuine, continuous and expeditious, and (4) the undertaking must not have destroyed, falsified or concealed information or evidence, and must not have disclosed the fact it was considering applying for leniency (Section 81(j)).

Where an undertaking is the first to apply for leniency and meets the above criteria, full immunity will be granted (Section 81(k)). Where an undertaking submits additional evidence of a cartel while meeting the same conditions but is not the first to apply for leniency, the administrative fine is reduced (Section 81(l)).

The Whistleblower Protection Act of 31 May 2023 (BGBl. 2023 I No. 140) entered into force on 2 July 2023. It implements Directive (EU) No 2019/1937 of 23 October 2019 on the protection of persons who report infringements of Union law.This act covers the protection of persons who, in the course of their professional activities, become aware of breaches of EU law, but also of breaches under domestic law (Section 2).The 2023 Act thus covers breaches of domestic and European antitrust laws, as well as breaches of the DMA. The German Federal Cartel Office assumes the function of an external reporting channel. All the violations mentioned in Section 2 can be reported to the Federal Cartel Office through its existing electronic whilsteblower system. The 2023 Act also sets out an obligation for companies with more than 50 employees to set up internal reporting channels (Section 12). However, each individual still retains the right to use internal or external channels.

Global Competition Law

323. Leniency

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise

Les notions juridiques connexes

323. Leniency

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les notions juridiques connexes

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise