J. Sroczyński for WuW No. 6/2017 – The President of the OCCP launches proceedings against Volkswagen Group Polska

The President of the Office of Competition and Consumer Protection (“OCCP”) initiated proceedings against Volkswagen Group Polska, under charge of manipulating the exhaust emissions data for VW, Audi, Seat and Skoda cars. The OCCP has established that Volkswagen was using since 2008 the software which enabled to decrease the level of nitrogen oxide emissions in test conditions. The actual emissions in traffic conditions deviated from the figures announced by Volkswagen to the consumers. As a result, the consumers could have been misled by the wrong information. The OCCP has also challenged the manner in which Volkswagen was handling consumers’ complaints.

The proceedings may lead to a prohibition decision and imposition of fine up to 10% of turnover.

The OCCP has fined 720,000 euro two Polish companies of SCA, a Swedish producer of away-from-home hygiene products sold under the Tork brand, for setting minimum resale prices with six local distributors. The distributors received more moderate fines, ranging from 4,500 to 38,000 euro, except one distributor who had successfully applied for leniency, available also in vertical cases. The minimum prices were enforced through a price list and so-called 8 Tork Main Rules. The rules required a distributor which wanted to decrease the price to pre-notify SCA. This could potentially lead to a reduction of rebates for the notifying distributor. SCA claimed the rules were of instructive character only and the distributors were free to set their own prices. SCA also provided extensive economic study of the theory of harm and the procompetitive effects of the inter-brand competition. The OCCP stated in the decision that the effects of an anti-competitive agreement do not have to be assessed if its object was anti-competitive.

In two related cases of resale price maintenance on the watch distribution market, the Court of Appeals quashed the OCCP prohibition decisions on formal grounds, stating that the OCCP issued its decisions to one undertaking only, while several undertakings participated in the arrangements. The Court ruled that while it is possible to conduct proceedings only against one undertaking, it is nevertheless necessary to precisely define the circle of participants. It is also necessary to assess market shares of all participants in the relevant market which, according to the Court, was not defined properly by the OCCP.  

The OCCP has unconditionally cleared the acquisition of four coal mines in the Silesia region by the Polish Mining Group. The OCCP defined the relevant geographic market as at least European, in consideration of the lack of trade barriers and high exports and imports within the European Union. On such defined market, the combined share of the Polish Mining Group and the four mines is not so high as to threaten competition.

The Council of Ministers adopted a bill of the new private enforcement law, prepared by the Ministry of Justice in cooperation with the OCCP. The law will enable persons and undertakings damaged by illegal anticompetitive practices to seek compensation from the violators. The law introduces presumptions of guilt of the violator and existence of the damage. Claims can be raised in absence of a previous prohibition decision of the OCCP or in relation to such decision. In the latter case, the final decision of the OCCP will be treated as a prejudicate. Claimants can request violators to disclose the necessary evidence, which can also be obtained from the OCCP. The OCCP may assist the courts in the assessment of the value of damages. Limited evidence can only be disclosed in pending, leniency and settlement cases. Leniency applicants can be sued only by entities from the same chain of production or services, while other damaged entities will only have subsidiary standing. Small and middle-size undertakings will also benefit from specific exceptions from being sued.

J. Sroczyński, Wirtschaft und Wettbewerb. Developments in national competition law, No. 6/2017.