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Curaçao Competition Act entered into force on 1 September 2017

Curaçao Competition Act entered into force on 1 September 2017

Curaçao Competition Act entered into force on 1 September 2017

02.10.2017 EU law

On 1 September 2017, the rules of the Curaçao Competition Act (Landsverordening inzake concurrentie, "CCA") entered into force on the basis of a national decree (Landsbesluit) of 11 April 2017. The CCA addresses the three main topics of competition law: cartels, abuse of dominance and mergers. The CCA is largely in line with the Dutch and European competition rules, with a few notable exceptions described below.

Article 3.1 of the CCA follows the cartel prohibition in Dutch and European competition law (Article 6 DCA and Article 101 TFEU), albeit applicable to competition in the Curaçao market or a part thereof. Contractual provisions and agreements that are concluded contrary to the cartel prohibition are null and void. In principle, the cartel prohibition does not apply to agreements which are of minor importance (the "de minimis" exception), i.e. agreements between undertakings whose combined market share does not exceed 30% on any of the relevant markets. At the request of the undertakings concerned, the Fair Trade Authority Curaçao (FTAC) may also grant an (individual) exemption for agreements or practices whose economic and/or technical benefits outweigh their restrictions on competition and pass on a fair share of those benefits to consumers. The de minimis exception and the possibility to request an exemption do not apply to "hardcore" cartel infringements (i.e. agreements between competitors on prices or other sales conditions, "bid rigging" agreements, limitation of production or sales and market sharing).

Article 4.1 of the CCA contains the prohibition to abuse a dominant position. The CCA stipulates that an undertaking always has a dominant position if it has a market share of 60% or more. The FTAC can impose measures on undertakings with a dominant position to prevent abuse.

Pursuant to Article 5.2 of the CCA, a concentration of undertakings (in the meaning of Article 5.1 of the CCA) is subject to notification where (i) the combined worldwide turnover of the parties involved in the previous calendar year exceeded ANG 125 million (approximately EUR 60 million) and (ii) at least two of the parties achieved a turnover in Curaçao of ANG 15 million (approximately EUR 7 million) or more in the previous calendar year. A concentration must also be notified if as a result thereof the parties involved would create or reinforce a market share of 30% or more on any of the relevant markets in Curaçao. The CCA only provides for an obligation to notify and does not contain a system of merger approval. Currently the purpose of these notifications is merely to monitor concentrations and their effects. After a few years the FTAC will reconsider whether to introduce a merger approval system too.

The CCA also contains provisions on the establishment of the FTAC and its investigative powers to observe compliance with the CCA. The FTAC may impose fines up to ANG 1 million (approximately EUR 470,000) or 10% of the annual turnover of the undertaking(s) that infringed competition law. The FTAC may also impose binding instructions or incremental penalty payments if the cartel prohibition is violated or an undertaking abuses its dominant position.

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

  1. Court of Justice landmark judgment: Intel's EUR 1.06 billion fine is sent back to the General Court
  2. Court of Justice upholds fine imposed on Philips and LG in the cathode ray tubes cartel
  3. Court of Justice clarifies that a change from sole to joint control requires EU clearance only if the joint venture is "full-function"
  4. Court of Justice provides guidance on examining excessive prices as abuse of a dominant position
  5. District Court of Rotterdam dismisses Vodafone claims of abuse of dominance by KPN

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