SERVICE PUBLIC FEDERAL ECONOMIE, P.M.E., CLASSES MOYENNES ET ENERGIE

Communication conjointe du Conseil de la concurrence et du Corps des rapporteurs sur l'immunité d'amendes et la réduction de leur montant dans les affaires portant sur des ententes. - Addendum Translation of the French and Dutch texts published in the Belgian Bulletin of Acts, Orders and Decrees on the 30th of April 2004 Ed 2, p. 36257 and 5th of May 2004 Ed 2, p.36912 Joint notice of the Competition Council and the Corps of Examiners on immunity from fines and reduction of fines in cartel cases A. INTRODUCTION 1) This notice concerns secret cartels between undertakings aimed at fixing prices, production or sales quotas, sharing markets including bid-rigging or restricting imports or exports.2) By artificially restricting the competition that would normally prevail between them, undertakings exactly avoid those pressures that lead them to innovate, both in terms of products development and of implementing more efficient production methods.Such practices also lead to more expensive raw materials and components for Belgian or European companies that purchase from such producers. In the long term they impair competitiveness, reduce employment opportunities and have a negative effect on the maintenance and the increase of consumer purchasing, on the quality and the quantity of the available products and on the consumer's choice of those products. Such practices are among the most serious restrictions of competition encountered by the competition authorities and ultimately result in increased prices and reduced choice for the consumer. They also harm European as well as Belgian industry. 3) Article 5 of EC Council Regulation No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the EC Treaty states that the competition authorities of the Member States shall have the power to apply Articles 81 and 82 of the EC Treaty in individual cases.For this purpose, acting on their own initiative or on a complaint, they may take the following decisions : - requiring that an infringement must be brought to an end, - ordering interim measures, - accepting commitments, - imposing fines, penalty payments or any other penalty provided for in their national law.

EC Council Regulation No 1/2003 comes into force on 1st May 2004 and brings about a close cooperation between the European Commission and the competition authorities of the Member States, and between the competition authorities of the Member States themselves. 4) A leniency program has already been introduced at European Community level (see Commission notice on immunity from fines and reduction of fines in cartel cases - 2002/C45/03 - OJ C 45 of 19 February 2002) and in a number of other EC Member States.The introduction of such a program in Belgium seems to be necessary and also shows the willingness of the Competition Council to make strike against illegal agreements between undertakings a priority. 5) The Competition Council is aware that some undertakings involved in this type of illegal agreements are willing to put an end to their participation and inform the Council of the existence of such agreements, but are refrained from doing so by the high fines to which they are potentially exposed.Under Article 36 of the Act on the Protection of Economic Competition, coordinated on 1 July 1999 (hereinafter APEC), the Competition Council may in fact condemn each of the undertakings involved with fines that do not exceed 10 % of their aggregate turnover achieved in the previous financial year in the domestic and export markets. The Council may also, in the same decision, impose penalty payments for non-compliance with its decision on a daily basis of maximum 6,200 euro per undertaking involved. 6) Consequently, the Competition Council decided to adopt a notice on the conditions for the immunity or reduction of fines in cartel cases. Following the example of the European Commission and a number of other national competition authorities, it considered that it is in the interest of national and Community economy to grant favourable treatment to undertakings that cooperate with the competition authorities. The interests of consumers and citizens in ensuring that secret cartels are detected and prohibited outweigh the interest in fining those undertakings that enable the Competition Council to detect and punish such practices. 7) Considering the allocation of powers between the Belgian competition authorities, the Corps of Examiners is involved in the present notice that determines and regulates the procedure for the practical implementation of this leniency programme.Article 14 APEC states that the examiners shall in particular lead and organise the investigation, give mission orders to the civil servants of the Office, draw up and present the investigation report to the Competition Council, which is the court having power of decision. 8) The present notice specifies the conditions for granting immunity from a fine or reduction of a fine and the way in which the Competition Council can perfectly be informed of the degree of openness and cooperation of the undertaking that intends to make use of this procedure.The Corps of Examiners is best placed to verify if all conditions for granting immunity from a fine or reduction of a fine are fulfilled. After the investigation, the Competition Council examines and decides notably on the basis of the investigation report if the conditions are fulfilled and grants immunity from fines or reduction of fines. 9) The Competition Council considers that the collaboration of an undertaking in the detection of the existence of a cartel has an intrinsic value.The Corps of Examiners also shares this opinion. A decisive contribution to the finding of an infringement accompanied with evidence revealing the existence of a cartel may justify the granting of immunity from any fine to the undertaking in question, on condition that certain additional requirements are fulfilled.

Moreover, cooperation by one or more undertakings not fulfilling the conditions to be granted immunity from fines may justify a reduction of the fine which would otherwise have been imposed by the Competition Council. Any reduction of a fine must reflect an undertaking's actual contribution to the establishment of the infringement. Reductions must be limited to those undertakings that provide the Belgian authorities with evidence that adds significant value to that already in their possession. 10) The Competition Council and the Corps of Examiners will be able to examine whether it is necessary to modify the present notice once sufficient experience in applying it has been acquired. B. IMMUNITY FROM FINES 11) The Competition Council will grant an undertaking immunity from any fine which would otherwise have been imposed if : a) the undertaking is the first to submit evidence which may enable the Competition Council to find an infringement of Article 81 of the EC Treaty and/or Article 2 APEC affecting the Belgian territory;b) the Belgian competition authorities did not have, at the time of the submission of those elements, sufficient information and evidence to find an infringement of Article 81 EC and/or Article 2 APEC in connection with the alleged cartel;c) the undertaking fully cooperates with these authorities on a continuous basis and expeditiously throughout the procedure and provides them with all evidence that comes into its possession or is available to it relating to the suspected infringement.In particular, it remains at their disposal to answer swiftly any request that may contribute to the establishment of the facts involved; d) the undertaking ends its involvement in the suspected infringement no later than the time at which it submits its request for immunity from fines to the Competition Council;e) the undertaking did not take steps to coerce other undertakings to participate in the infringement.12) In order to qualify for immunity from fines the undertaking having exposed its participation in a cartel and having submitted evidence that proves the existence of this cartel will not be able to dispute the facts set out in its submitted request. C. REDUCTION OF A FINE 13° Undertakings that do not meet the conditions under section B may be eligible to benefit from a reduction of any fine that would otherwise have been imposed if : a) the undertaking provides evidence of the suspected infringement which represents significant added value with respect to the evidence already in the possession of the Belgian competition authorities;b) the undertaking ends its involvement in the suspected infringement no later than the time at which it submits its request for a reduction of fines to the Competition Council;c) the undertaking fully cooperates with the Belgian competition authorities on a continuous basis and expeditiously throughout the procedure and provides them with all evidence that comes into its possession or is available to it relating to the suspected infringement.In particular, it remains at their disposal to answer swiftly any request that may contribute to the establishment of the facts involved. 14) In order to qualify for a reduction of fines, the undertaking having exposed its participation in a cartel and having submitted evidence that proves the existence of this cartel will not be able to dispute the facts set out in its submitted request.15) The concept of « added value » refers to the extent to which the evidence provided strengthens, by its very nature and/or its level of detail, the Belgian authorities' ability to prove the facts in question.16) In any decision adopted at the end of the procedure, the Competition Council will determine, notably on the basis of the elements set out in the examiner's investigation report relating to the conditions imposed for the granting of a reduction of fines : a) whether the evidence provided by an undertaking represented significant added value with respect to the evidence in the competition authorities' possession at that time;b) the level of reduction of the fine an undertaking will benefit from relative to the fine which would otherwise have been imposed by the Competition Council, as follows.For the : - first undertaking to meet the conditions under point 13 : a reduction of from 30 to 50 %; - second undertaking to meet the conditions under point 13 : a reduction of from 20 to 30 %; - subsequent undertakings that meet the conditions under point 13 : a reduction of from 5 to 20 %.

If, at any stage of the procedure, one of the requirements under sections B or C is not met, the undertaking involved may loose any favourable treatment set out therein. It will however still be able to benefit from a reduction of a fine of from 5 to 15%, provided that it does not dispute the facts revealed by the evidence that it has submitted.

In addition, if an undertaking provides evidence relating to facts previously unknown to the Belgian competition authorities which have a direct bearing on the gravity or duration of the suspected cartel, the Competition Council will not take these elements into account when setting any fine to be imposed on the undertaking which provided this evidence.

D. PROCEDURE 17) An undertaking wishing to benefit from immunity from a fine or a reduction of a fine should file a written application with the Competition Council and simultaneously provide it with all evidence that is already available to it relating to the suspected infringement.It should also submit a copy of the application and of the evidence in question to the Corps of Examiners. The request will be deemed submitted after the Competition Council and the Corps of Examiners have received those documents. 18) The undertaking will receive an acknowledgement of receipt of the application for immunity from fines or a reduction of fines and of the submitted evidence from the Competition Council and the Corps of Examiners.The acknowledgement of receipt mentions the date and time of submission of the request as well as the conditions required by the present notice to benefit from immunity from fines or a reduction of fines. 19) If the conditions for the granting of immunity are not met, the Corps of Examiners will immediately inform the undertaking thereof.20) If an undertaking does not meet the conditions for benefiting from immunity from fines referred to in point 11, its request will automatically be converted into a request for reduction of fines.The latter will be deemed submitted on the date of the request for immunity. 21) The examiner will indicate in its investigation report the elements that are useful to the Competition Council to take a decision with regard to the undertaking(s) having requested immunity from fines or a reduction of fines.22) If, at the end of the procedure, the undertaking meets the conditions mentioned in the present joint notice, the Competition Council will grant it immunity from fines or a reduction of fines. E. GENERAL CONSIDERATIONS 23) The undertaking having requested immunity from fines or reduction of fines commits itself to keeping its request secret until the investigation is closed.Any disclosure of information would in that case be regarded as a lack of cooperation. 24) The Competition Council is aware that this notice will create legitimate expectations on which undertakings may rely when disclosing the existence of a cartel to the Council.In order to encourage undertakings to end existing illegal agreements, any application for a reduction of fines filed before 1 July 2004 and meeting the conditions under section C will, as a departure from point 16, b) of this notice, qualify for a reduction of a fine of 50%. 25) The fact that an undertaking cooperated with the Belgian competition authorities during the procedure will be indicated in any decision of the Competition Council, so as to explain the reason for the immunity or reduction of the fine.The fact that immunity or reduction in respect of fines is granted cannot protect an undertaking from the civil law consequences of its participation in an infringement of Article 81 of the EC Treaty and/or Article 2 APEC. 26) The Competition Council generally considers that disclosure, at any time, of documents received in the context of this notice would undermine the protection of the purpose of inspections and investigations. Any written statement or communication made vis-à-vis the competition authorities in relation to this notice forms part of the Competition Council's file..It may not be disclosed or used for any other purpose than the enforcement of Article 81 of the EC Treaty and/or Article 2 APEC 27) This joint notice was adopted on 30 march 2004 by the Competition Council at its general meeting and by the corps of examiners.The joint notice is operational from the 5th working day following the publication in the Belgian Bulletin of Acts, Orders and Decrees.