The European Commission (EC) and the European Courts continue to provide plenty of reasons for maintaining robust and suitable EU competition law compliance programmes, covering cartels and other risks. Recent cases highlight:
- Yet again, the potential dangers of trade association membership. On 28 March 2012 nine producers of window fittings were fined a total of EUR86 million by the EC for a price-fixing cartel which covered the whole of the EU. According to the EC, the cartel was for many years organised in informal meetings which took place before the official annual meetings of a German trade association. This is just the most recent example of contacts at trade association meetings appearing in an EC fining decision.
- The need to cooperate fully during a dawn raid. Also on 28 March the EC imposed a EUR2.5 million fine for obstructing a dawn raid. The company in question had failed to block an email account and had diverted some incoming emails during the raid. It is clear that companies must closely monitor how their employees behave during a raid. It cannot be business as usual for those few days.
- The importance of taking a holistic approach to compliance. This was demonstrated recently when the EC published the detailed text of its decision concerning a fine for a bananas cartel. The text indicates that the investigation was at least partly instigated as a result of documents received by the EC from the Italian tax police. Those documents “had been collected in the course of an inspection in the home and the office of an employee of [one of the cartelists] in the framework of a national [tax] investigation”. It is clearly good compliance practice to review documents seized by authorities in other contexts for the purpose of identifying any competition law concerns that they might raise.
- That companies cannot ignore their partly owned subsidiaries. On 2 February 2012 the EU’s General Court confirmed that two parent companies in a 50/50 joint venture can be held liable and therefore fined for cartel activity carried out by the JV in the EU. The court made its finding despite the fact that the JV was “full-function” for the purposes of merger control (so treated as an autonomous economic entity for that purpose) and that control by the parents was only negative.
All companies, of whatever size, should implement a competition law compliance programme in the EU. One size does not fit all, however, and the programme can and should be tailored to fit the particular risks faced by the company and group in question.