Short Reads

European Commission proposes a new Directive to empower national competition authorities to be more effective enforcers of EU competition law rules

European Commission proposes a new Directive to empower national competition authorities to be more effective enforcers of EU competition law rules

04.04.2017 EU law

On 22 March 2017, the European Commission published a proposal for a new Directive that aims to provide national competition authorities ("NCAs") with minimum instruments to detect EU competition law infringements and impose effective sanctions.

Decentralized application of EU competition law by the NCAs has become a vital pillar of enforcement since Regulation 1/2003 entered into force in May 2004. The proposed Directive follows the public consultation on empowering NCAs to be more effective enforcers of the EU competition law rules, which the Commission launched in 2015, and particularly addresses the following aspects of enforcement:

  • Independency and resources. The proposed Directive seeks to ensure that NCAs have the necessary human, financial and technical resources at their disposal and enforce EU competition law impartially and independently from political and other external influences;
  • Investigative powers. The proposal provides NCAs with the minimum effective investigative powers, most notably the power to conduct all necessary dawn raids and the power to gather evidence in either physical or digital form;
  • Decision-making powers. NCAs need to be able to adopt prohibition decisions, including the power to impose structural and behavioural remedies, commitment decisions and interim measures;
  • Fines. To ensure the effective and uniform enforcement of EU competition law, NCAs should have the power to impose effective, proportionate and deterrent fines on companies that infringe EU competition law rules. Importantly, the proposed Directive sets out that the notion of undertaking is applied in this context, meaning that parent companies and legal and economic successors of infringing undertakings cannot escape the payment of fines;
  • Leniency. The proposed Directive transposes the main principles of the European leniency programme into law. By reducing the current differences between Member States, the proposed Directive aims to increase legal certainty and thus to maintain incentives for companies to apply for leniency; and
  • Mutual assistance. The proposal ensures that NCAs can request and provide mutual assistance for the carrying out of investigative measures, the notification of decisions and the enforcement of fines.

The proposed Directive complements the system of decentralised enforcement put in place by Regulation 1/2003 and further harmonizes the procedural powers and operations of NCAs. The Directive has been forwarded to the European Parliament and Council for adoption. Once adopted, Member States will have to transpose the provisions of the Directive into national law. It will depend on the Member State whether the Directive will entail extensive changes as many of them already have systems in place that are in line with the provisions of the Directive.

This article was published in the Competition Law Newsletter of April 2017. Other articles in this newsletter:

  1. Court of Justice confirms the fine imposed on Samsung in the cathode ray tubes cartel
  2. Court of Justice rules on the Hearing Officer's competence to resolve confidentiality requests
  3. General Court annuls European Commission's merger blocking decision in UPS/TNT for procedural errors 
  4. European Commission launches anonymous whistleblower tool
  5. District Court of Gelderland denies passing-on defense in antitrust litigation related to the GIS-cartel

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