The Public Consultation on Regulation 1/2003: A Stronger Institutional Infrastructure for Fostering the EU Common Competition Culture

Abstract

Any strategic vision for European antitrust enforcement rests on one fundamental pillar: the continuous development of a common competition culture shared by the European Commission and national competition authorities (NCAs). In this respect, the innovative model of institutional governance for the enforcement of European Union (EU) competition law set out by Regulation 1/2003 has proved key: the achievements accomplished within the European Competition Network have probably exceeded the initial expectations in terms of scale of enforcement, its effectiveness as well as its consistency. It is indeed on this solid basis that a more far-reaching evolution and consolidation of the ‘institutional infrastructure’ in the area of competition law enforcement can be promoted and should be achieved in the EU. To this end, the public consultation that is being carried out by the European Commission has identified three sensitive areas on which convergence should be fostered: investigative and sanctioning powers, leniency programmes, and the institutional position of NCAs. All NCAs enforce the same substantive rules, and many Member States have also voluntarily aligned their procedures with those set out for the Commission in Regulation 1/2003. Soft convergence initiatives on procedural matters within the ECN have led to the adoption of a number of valuable recommendations and should continue to be pursued in the future. However, experience shows that margins for further voluntary convergence might be rapidly eroding: soft law instruments alone are unlikely to provide all NCAs across Europe with an effective competition law toolbox. There is thus scope for further legislative harmonisation of NCAs’ investigative and decision-making powers in the application of EU antitrust rules. An objective that becomes all the more important since effective enforcement in increasingly sophisticated markets cannot be achieved with blunt investigative and enforcement tools. A minimum set of powers should therefore be granted to all NCAs, including at least: the power to carry out compulsory interviews, the power to collect digital evidence, and the power to adopt structural and behavioural remedies within the prohibition decision. NCAs should also be enabled to provide assistance to each other when serving administrative acts and enforcing fining decisions upon undertakings established in a different Member State. This is essential to ensure a level-playing field for undertakings, as well as to safeguard the effectiveness of the application of European competition rules by NCAs. There is also scope for fostering a certain degree of convergence on the quantification of antitrust fines across the EU: substantially diverging approaches on the determination of pecuniary sanctions may jeopardise the acceptability of fines in all jurisdictions, and may undermine the very legitimacy of the system of parallel enforcement competences within the ECN. The harmonisation of legal rules concerning parental liability, legal and economic succession, and the ceiling of antitrust fines may contribute to achieving this objective, at least to some extent. At the same time, as some of the relevant legal notions may be further refined by judicial interpretation, it is crucial to ensure some degree of flexibility to make room for future developments. More generally, increased harmonisation does not mean that maximum convergence of existing sanctioning regimes is necessary. In fact, it is important to be aware that antitrust sanctions are only one part of broader national sanctioning regimes, which differ significantly across Member States. The existence of possible criminal sanctions applying to the same offences, the diffusion of private enforcement, and the general level of sanctions imposed for economic offences are all elements that affect the perception of the optimal level of fines, their acceptability, and, ultimately, their fairness.