J. Sroczyński for WuW No. 3/2009 – OCCP’s Guidelines on the criteria for imposition of fines

The Office of Competition and Consumer Protection (“OCCP”) has published, following public consultations, the Guidelines on the criteria of imposition of fines for violations related to anticompetitive concerted practices and abuses of dominance. The Guidelines are not a legal regulation sensu stricto, but constitute a one-sided commitment of the regulator to apply specific criteria while imposing financial fines.

In particular, the OCCP will first define the base amount of the fine, using such criteria as the nature of infringement and the specific qualities of the relevant market. The infringements were divided into three groups, i.e., “very serious”, such as horizontal agreements and exclusionary abuses of dominance, “serious”, such as resale price maintenance and exploitation-type of dominance abuses, and “other”, such as non-price vertical arrangements and minor abuses of dominance. The base amount of the fine will range from 1% to 3% for very serious infringements, from 0.2% to 1% for serious infringements, and from 0.01% to 0.2% for the remaining infringements. Subsequently, the base amount can be raised or decreased by up to 80%, depending on actual market effects of the violation, in particular damages incurred by other undertakings, irreversible nature of the violation, the geographical and economical scale of the violation, etc.

Long-lasting violations, i.e., those which exceed the period of one year, can be additionally fined by up to 200% increase in the case of concerted practices and up to 100% increase in the case of abuses of dominance.

The mitigating circumstances, such as passive participation in a collusion or good cooperation with the authority, and the aggravating circumstances, such as leader’s role or reprisal of other undertakings, can have the result of the fine being respectively decreased or increased by up to 50%. Finally, the fine can be increased by up to 100%, if the OCCP finds that this is necessary to discourage the undertaking from future violations. This increase will be applied, in particular, in the case of repeated violators.

If, in a given case, it will become possible to establish financial benefits obtained by the violator, the fine shall be increased up to three times the amount of those benefits.

The highest amount of fine calculated based on the principles introduced by the Guidelines may not, in any event, exceed the statutory peak of 10% annual turnover.

The OCCP expects that the Guidelines will play a meaningful role in encouraging undertakings to cease violations and, perhaps, in more commonly applying for leniency.

J. Sroczyński, Wirtschaft und Wettbewerb. Developments in national competition law, No. 3/2009.