CARTELS AND LENIENCY APPLICATIONS
We check whether agreements between businesses are competition-proof. That is important because clauses that are contrary to the prohibition of cartels are invalid. Examples include arrangements on pricing, customer allocation, market-sharing, or non-competition clauses. The worst case scenario is for the whole agreement to be invalid.
Both cooperation agreements between competitors and those between suppliers and customers (distribution agreements) may violate the cartel ban.
We act for companies involved in cartel investigations by the ACM or the European Commission. We assist with (multi-jurisdictional) leniency applications to both the ACM and the European Commission and act in cartel settlement negotiations.
Your company – or you personally – may be unexpectedly confronted by ACM or EC inspectors on the doorstep. Such “dawn raids” usually take place early in the morning. The inspectors then want access to your premises and records, they want to make digital copies of your computer systems, and they want to question you and your employees.
We are available 24/7 to assist in the event of a dawn raid. It is very important for you and your employees to know what to do – and what not to do – if this happens. We have assisted during dawn raids by both the ACM and the European Commission.
We ensure distribution agreements such as exclusive or selective distribution agreements, agency, franchise and licence agreements (technology transfer), and R&D agreements are in line with competition law and regulation. Some agreements, for example technology transfer and R&D agreements, are subject to specific EU rules. Various practical questions are involved, for example: is a supplier allowed to charge different prices to physical stores (“bricks”) and online stores (“clicks”)? What requirements can be imposed on selective distributors? When can one speak of an actual agent? Are you permitted to include a non-competition clause? All these issues are very important commercially and are affected by competition law.
Following the inquiry into potential competition problems in the e-commerce sector, the European Commission began efforts in February 2017 to remove existing barriers. It announced three studies focusing on violation of the EU’s cartel ban through price constraints imposed on retailers, geo-blocking, and discrimination based on location. The ACM is closely following the EC’s actions in this field.
ABUSE OF DOMINANT POSITION
Companies with a dominant position in the market are not permitted to abuse that position, for example by imposing discriminatory conditions, tying arrangements, loyalty discounts, or unfair contracts. Such abuse is prohibited. We assist both firms that face a competitive disadvantage due to the conduct of dominant players and dominant market players themselves.
Companies involved in agreements that restrict competition or abusive conduct are running a significant risk. Competition authorities such as the ACM and the European Commission have far-reaching powers, including as regards imposing penalties. Individuals can also be subject to penalties in their private capacity. In cases like this, there is often a lot at stake for the companies involved, for example damage to their reputation or claims for damages from customers.
MERGERS AND ACQUISITIONS (“CONCENTRATIONS”)
A proposed merger or acquisition often requires notification to be made to the ACM. Sometimes, that also has to be done in several Member States or – in the case of large-scale mergers and acquisitions – to the European Commission. We assist companies with the notification process and ensure timely approval of the concentration, so that the envisaged closing date can be met. We conduct due diligence investigations for a proposed merger or acquisition so as to identify any potential competition issues.
Failing to report a (notifiable) merger or acquisition or closing a transaction prematurely may result in substantial penalties.
Some sectors are subject not only to general competition law but also to sector-specific regulations. These include public transport (rail, bus, tram, metro), healthcare, energy, telecom, and the food sector.
The ACM, NZa, NVWA, and EC also carry out sector-specific regulation.
We have a great deal of experience in the field of regulation, particularly as regards healthcare, food, and public transport.
The state aid rules are more directly relevant than most companies often think. State aid plays a role when a company enters into a contract with a central or local government body (for example a municipality), a university, or a public research institution. Financial transactions between local government bodies and companies quickly involve state aid elements.
When such a body provides state aid, it may constitute “prohibited state aid” under EU law. Examples may include grants, guarantees, loans, reduction of the financial burden for specific companies, and the sale or leasing of land or buildings. In many cases, the EC must be notified of the provision of state aid and must decide whether to approve it. Failure to comply with these obligations may result in the recipient (i.e., the company) needing to repay the aid provided.
We assist both companies and public authorities (central and local) in the event of state aid investigations and proceedings before both the civil courts and the European Commission.
We provide training sessions and workshops, and set up compliance programmes for companies, thus raising awareness of the competition rules.
MARKET AND GOVERNMENT
Companies may find themselves at a competitive disadvantage due to activities by government bodies. Examples include when carparks or bicycle parking facilities are operated by a municipality or when real estate is leased out by the authorities.
When engaging in such activities, government bodies are required by the Public Enterprises (Market Activities) Act to observe certain rules of conduct, with the aim of preventing unfair competition from the authorities. The ACM monitors compliance with those rules.
CARTEL DAMAGE CLAIMS
Consumers and businesses that have sustained loss or harm due to a cartel (for example a price-fixing cartel) can claim damages. European agreements on this have been included in Dutch legislation since 10 February 2017. These new rules mean that a ruling by the ACM on cartel agreements can be used as evidence in claim proceedings. Indirect damage can also be recovered more easily. It is also easier to obtain evidence regarding a cartel from the ACM. A claim can be filed independently or via a claims organisation or sector association. Implementation of the EU rules in Dutch legislation has made it easier for businesses and consumers to claim cartel damages.
The new rules make clear what evidence can be requested, in what situation, and how consumers and businesses can do so. A company or consumer that has sustained direct or indirect loss/harm due to a prohibited cartel agreement between companies can go to court to claim damages. Companies can institute proceedings either individually or collectively. Consumers will usually do so via a collective. Investigations and decisions by the European Commission and the ACM are the starting point for recovering damages. We assist businesses with filing civil claims for damages or defend them against such claims.