Cartel Regulation: The Application Of Competition Regulation In 48 Jurisdictions Worldwide - 2013
LEGISLATION AND JURISDICTION
1 Relevant legislation
What is the relevant legislation and who enforces it?
The Dutch Competition Act (the Act) entered into force on 1 January 1998 and is modelled closely on European Union competition law. The cartel prohibition contained in the Act is a copy of article 101 of the Treaty on the Functioning of the European Union (ex article 81 of the EC Treaty), excluding the effect on interstate trade criterion. An English-language version of the Act is available on the Dutch Competition Authority's website.
On the same date, the Dutch Competition Authority (NMa) started its operations. On 1 January 2013 the NMa merged with the Independent Post and Telecommunications Authority (OPTA) and the Consumer Authority (CA) into a single regulator, the Autoriteit Consument en Markt (ACM), headed by chairman Chris Fonteijn. This organisation has the task of applying and enforcing the Act. The ACM also applies article 101 TFEU in relation to agreements and concerted practices affecting competition in the Netherlands. The ACM has approximately 400 employees, up from 70 in 1998.
The ACM has independent status from the Ministry of Economic Affairs, Agriculture and Innovation. The minister for economic affairs, agriculture and innovation (the minister) is empowered to set out general policy rules, and can instruct the ACM to undertake activities in relation to EU and international competition issues. However, the minister is prohibited from giving instructions to the ACM with respect to any specific case.
2 Proposals for change
Have there been any recent changes or proposals for change to the regime?
On 3 December 2011, legislation entered into force lowering the bar for agreements to fall under the de minimis exemption of article 7 of the Act. As a result, the national de minimis clause is no longer in line with the thresholds of the European Commission's guidelines on the effect on trade concept. One of the main hold-ups of the bill was whether this would constitute an infringement of European law, since it would mean that certain hard-core cartels caught by article 101 TFEU, due to an appreciable effect on interstate trade, would be exempted under national law. In a letter of 9 September 2010, the European Commission's director-general for competition indicated that the revised de minimis clause would lead to the exemption of hard-core restrictions, which could affect interstate trade and could thus be prohibited under EU law. The bill was subsequently amended to introduce an additional condition reading that the restrictive agreement at hand may not have an appreciable effect on interstate trade.
In addition, on 1 July 2012 legislation entered into force introducing rules against unfair competition by public authorities.
On 1 January 2013 the NMa merged with the Independent Post and Telecommunications Authority (OPTA) and the Consumer Authority (CA) into a single regulator, the ACM, headed by chairman Chris Fonteijn. A bill is in preparation containing provisions concerning the powers of the ACM, which are intended to take effect on 1 January 2014. To the extent the proposed changes are significant these will be addressed at the relevant subsections below.
A bill introducing the possibility of imposing prison sentences on individuals infringing the cartel rules, as well as disqualification possibilities, has been in preparation for some years. However, it is believed that these plans have been shelved.
3 Substantive law
What is the substantive law on cartels in the jurisdiction?
According to article 6 of the Act, which, as noted above, mirrors article 101 TFEU, agreements, decisions and concerted practices are prohibited if they have as their object or effect the prevention, restriction or distortion of competition on the whole or a part of the Dutch market. The prohibition covers all types of behaviour, horizontal or vertical, irrespective of whether they are based on formal, oral or tacit agreements or concerted practices.
Article 6 does not provide specific examples of restrictive clauses. In practice any agreement that fixes prices, limits output or divides markets, customers or sources of supply will almost inevitably be considered to infringe article 6. Horizontal price-fixing agreements, collective vertical price fixing, collective boycotts and horizontal agreements aimed at partitioning markets or quota schemes (including limitation of sales and prohibited tendering agreements – 'bid rigging') are regarded by the ACM as very serious infringements of the competition rules.
As in EU competition law, agreements restricting competition are only prohibited if they affect competition to an appreciable extent.
Article 7 provides for an exemption for restrictive agreements, including hard-core cartels, where no more than eight participants with an aggregate turnover of less than e5.5 million (for companies involved in the supply of goods) or e1.1 million (for other companies) are involved. As per 3 December 2011, an additional exemption is available for any restrictive agreement between (any number of) undertakings whose combined market share on any relevant market does not exceed 10 per cent and which agreement does not appreciably affect interstate trade.
As noted above, article 101 TFEU also forms part of the substantive law on cartels in the jurisdiction, having direct effect in relation to agreements and concerted practices affecting competition in the Netherlands where there is also an effect on interstate trade.
4 Industry-specific offences and defences or antitrust exemptions Are there any industry-specific offences and defences or antitrust exemptions?
There are no industry-specific offences under the Act. The competition rules apply across the board, including in regulated sectors such as telecommunications. The Act provides for non-application of the cartel prohibition to collective labour agreements, sector agreements on pensions between employers' organisations and employees' organisations and (under certain conditions) agreements or decisions on occupational pension schemes by an association of practitioners of a liberal profession.
At present, there are various non-industry-specific exemptions from the cartel prohibition, such as agreements benefiting from an EU exemption (falling under a block exemption), which are exempt from the cartel prohibition. However, under the Act as amended in line with article 29(2) of Regulation No. 1/2003, the ACM has the express power to declare an EU block exemption non-applicable in the Netherlands.
In addition, various categories of agreement can be exempted from the cartel prohibition by general administrative order. Such 'national block exemptions' have been issued for:
agreements offering temporary protection from competition to undertakings in new shopping centres; and certain cooperation agreements in the retail trade. Restrictive practices necessary for the operation of services of general economic interest may also fall outside the scope of the cartel prohibition.
As of 1 August 2004, individual exemptions can no longer be granted by the ACM. Today, companies must self-assess agreements in light of the same criteria, but these are now contained in a new clause (3) in article 6 of the Act, which mirrors article 101(3) TFEU. The Dutch rules have therefore been aligned with the EU rules under Regulation No. 1/2003, providing for self-assessment in the place of applications for the grant of individual exemptions. To assist in the self-assessment, the ACM has issued guidelines on, inter alia, the application of article 6(3), on the cooperation between companies and on competition in the health-care sector. In addition, policy guidelines on consortia arrangements entered into force on 1 October 2009, which are largely based on the Commission guidelines on horizontal agreements and on the application of article 101(3) TFEU.
In general, the ACM will not provide written advice (comfort letters) as to whether an agreement fulfils the criteria of article 6(3). However, similar to the Commission, it will provide advice in 'novel' cases. Informal advice has been given in, for example, the collective sale of football match broadcast rights, on joint preferential policies proposed by a group of health insurers for medicine suppliers and on a chip-card payment system for public transport tickets. More and more parties prefer an informal discussion with the ACM over informal advice. On its website the ACM has published 4 informal advices in 2011, mainly on concentration control issues. Its most recent informal advice relating to the cartel prohibition was in 2011, relating to a plan by the Dutch shrimp-fishing industry to make shrimp fishing sustainable. The ACM took a favourable view towards most of the plans, drawn up by the Dutch producer organisation and the Dutch Fishing Association, but did not approve of the proposed catch limitations aimed to protect the brown shrimp population. According to the ACM, 'there is no need for such limits, as studies have revealed that the proposed catch limits would go beyond what is necessary'.
5 Application of the law
Does the law apply to individuals or corporations or both?
The cartel prohibition applies to undertakings and associations of undertakings. The term 'undertaking' is construed broadly and – in accordance with the case law of the Court of Justice of the European Union – is generally defined by the ACM as 'every entity engaged in economic activity, regardless of its legal status and the way in which it is financed'. Therefore, the Act may also apply to individuals running an unincorporated undertaking. Publicly owned entities may also qualify as undertakings. Intention to make profit is not required.
Agreements concluded between undertakings belonging to the same group of companies are, for the purposes of the Act, considered as agreements within one single economic entity and are...
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