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05 April 2012
On December 19 2011 the Competition Council adopted a new set of fining guidelines, which entered into force on January 18 2012. The new guidelines apply to all cases in which no hearing has been held before January 18 2012.
The adoption of the guidelines follows a public consultation. Although reactions to the guidelines were mainly positive, areas of concern included several terminological inconsistencies and procedural issues. A number of respondents also suggested that compliance programmes be considered as a mitigating circumstance. The text that was ultimately published in the Official Journal reflects some of these concerns, as well as the council's jurisprudence and developments in the determination of fines at EU and national level.
The guidelines state that the gravity and duration of competition law infringements are the most important factors in the calculation process. The calculation of a fine will be based on the company's turnover realised from the sale of the products or services to which the infringement relates during the last full year of the infringement. The so-called 'gravity factor' is set at between 0% and 30% of this turnover. For minor infringements, a gravity factor of up to 15% will be applied. For serious and very serious infringements (ie, cartels, including hub-and-spoke cartels, and hardcore vertical restrictions), a gravity factor of 15% to 30% will be applied. An additional 'duration factor' - equal to 10% to 30% of the gravity factor - will then be added for each year of infringement to calculate the basic amount.
The council can increase or reduce the basic amount on the basis of aggravating or mitigating circumstances. Compliance programmes are not expressly listed among the mitigating circumstances, but the council acknowledges that the list of mitigating circumstances mentioned in the guidelines is not exhaustive and that it may consider other circumstances, thereby indirectly providing for the possibility of compliance programmes being taken into account.
The guidelines also provide for a correction mechanism, allowing the fine to be adjusted on the basis of proportionality and equity. In this context, the guidelines refer to the council's ability to acknowledge the undertaking's weak financial situation or the 'inability to pay' factor.
The final amount may not exceed 10% of the undertaking's Belgian turnover (ie, the turnover realised on the Belgian market or through export from Belgium).
Although the guidelines aim to improve transparency for undertakings and associations of undertakings under investigation by the competition authorities, the council clearly retains significant discretion when determining the size of a fine. Therefore, it remains to be seen whether the guidelines will bring the much hoped-for transparency.
For further information on this topic please contact Carmen Verdonck or Jenna Auwerx at ALTIUS by telephone (+32 2 426 1414), fax (+32 2 426 2030) or email (firstname.lastname@example.org or email@example.com).
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