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

Conseil de la concurrence. - Notice of the Competition Council on immunity from fines and reduction of fines in cartel cases I. Introduction 1. The Act on the Protection of Economic Competition, consolidated on 15 September 2006 (hereafter « the Act ») (1), contains a cartel prohibition.Cartels are agreements and/or concerted practices between two or more competitors and/or associations of undertakings, and possibly one or more other non competing undertakings and/or associations of undertakings, aimed at coordinating their competitive behaviour on the market and/or influencing the relevant parameters of competition through practices such as the fixing of purchase or selling prices, the allocation of production or sales quota, the sharing of markets (including bid-rigging), the restriction of imports or exports and/or anti-competitive actions against other competitors.

These practices are in violation of Article 2 of the Act. Article 81 of the EC Treaty also prohibits these practices in so far these might affect trade between EC Member States. 2. The Competition Council (hereafter « the Council »), as Belgian Competition Authority, may sanction these infringements of the Act and Article 81 EC Treaty by imposing fines on the companies concerned of maximum 10 % of their turnover (2). These high fines may be imposed because the above-mentioned infringements constitute very serious violations of competition law and may have a very negative impact on the Belgian and European economy. These infringements result in artificial prices and a limited choice for consumers. In the long term they lead to a loss of competitiveness and reduced employment opportunities. 3. The Council is of the opinion that it is in the general interest to provide a favourable treatment (« leniency » (3) to undertakings and associations of undertakings which cooperate with the Belgian Competition Authority.The detection and prohibition of cartels is of a greater importance to consumers and citizens than the fining of the undertakings and associations of undertakings which enabled the Belgian Competition Authority to prosecute and sanction these generally secret practices. 4. The legislator has provided in Article 49 of the Act for a specific legal basis for a Belgian leniency program in cartel cases. Article 49 of the Act reads as follows : « Immunity from fines or a reduction of fines may be granted to an undertaking or an association of undertakings which, together with others, was involved in a practice prohibited by Article 2, if this undertaking has contributed to proving the existence of the prohibited practice and to identifying the participants, inter alia by providing information which the competition authority did not have before, by delivering the evidence of a practice prohibited by Article 2 of which the existence had not yet been established, or by admitting the prohibited practice. As a consequence of the action of this undertaking or association of undertakings, the chamber of the Council which hears the case adopts, at the request of the competition prosecutor general, a leniency declaration which specifies the conditions applying to any envisaged exemption, after the undertaking or association of undertakings concerned have submitted their observations. This declaration will be sent to the undertaking or association of undertakings, but will not be published.

When the decision is taken pursuant to this article, the chamber of the Council hearing the case may, if the conditions stipulated in the leniency declaration are fulfilled, grant immunity from fines or reduction of fines in proportion to the contribution which was provided in order to prove the infringement. » 5. Article 49 of the Act states only in general terms that immunity from fines or reduction of fines may be provided to an undertaking or an association of undertakings which has contributed to proving the existence of the prohibited practice and to identifying the participants.It is for the chamber of the Council which hears the case to adopt, at the request of the competition prosecutor general, a leniency declaration in which the conditions, applying to the immunity or reduction, are specified.

Furthermore, Article 11, § 3 of the Act attributes to the Council the competence to adopt notices concerning the application of the Act.

Therefore, the Council has decided to adopt a notice on leniency (hereafter « the Notice ») in which the conditions and modalities in order to benefit from immunity from fines or a reduction of fines in cartel cases are set out and explained. 6. In drafting this Notice, the Council has taken into account the experience which was gained in applying the previous leniency notice of 30 March 2004 (4) and the European Model Leniency Programme which was issued by the European Competition Network (ECN) on 29 September 2006.(5) II. Scope of application 7. This leniency programme only applies to cartels.Cartels are agreements and/or concerted practices between two or more competitors and/or associations of undertakings, and possibly one or more other non competing undertakings and/or associations of undertakings, aimed at coordinating their competitive behaviour on the market and/or influencing the relevant parameters of competition through practices such as the fixing of purchase or selling prices, the allocation of production or sales quota, the sharing of markets (including bid-rigging), the restriction of imports or exports and/or anti-competitive actions against other competitors.

Vertical agreements and horizontal restrictions which are not cartels within the meaning of this Notice, fall outside the scope of application of this Notice. 8. In relation to cartels, the Act only foresees in sanctions for undertakings and associations of undertakings, and therefore this Notice does not apply to natural persons or legal entities which are not undertakings within the meaning of the Act.9. The granting of immunity from fines or reduction of fines to undertakings or associations of undertakings does not protect them against other consequences of their participation in the cartel.Other consequences of their cartel participation fall outside the scope of application of this Notice.

III. Immunity from fines (Type 1) III.A. Immunity Type 1 A 10. The Council will grant an undertaking or association of undertakings immunity from fines if the following conditions are fulfilled cumulatively : a) the undertaking or association of undertakings is the first to submit information and evidence which will enable the Belgian Competition Authority to carry out targeted inspections (6) in connection with an alleged cartel;b) at the time of the application, the Belgian Competition Authority did not have sufficient evidence to justify an inspection in connection with the alleged cartel or had not already carried out an inspection;and c) The general conditions attached to leniency under title V, no.20 of this Notice are met. 11. With a view to enabling the Belgian Competition Authority to carry out targeted inspections, the undertaking should be in a position to provide the following information in so far as, according to the competition prosecutor, this does not endanger the inspections : a) name and address of the legal entity submitting the leniency application, and the names and functions of the individuals which are (or have been) involved on the applicant's behalf in the cartel, b) name and address of the other undertakings who are (were) participating in the cartel, and the names and functions of the other individuals who, according to the applicant, are (were) involved in the cartel, c) a detailed description of the alleged cartel, including for example : i.the aim, activities and functioning, ii. the affected products or services, iii. the geographic scope, iv. the duration, v. the estimated market volume, vi.locations, moments, content of and participants in the alleged cartel discussions, vii. the nature of the alleged cartel behaviour, and viii. all relevant clarifications to the submitted evidence. d) information on any past or possible future leniency application to any other competition authority inside or outside the EU in relation to the alleged cartel, and e) evidence of the alleged cartel in possession of the applicant or available to him, and in particular evidence relating to the period of the infringement. III.B. Immunity Type 1B 12. The Council will grant an undertaking or an association of undertakings immunity from fines if the following conditions are fulfilled cumulatively : a) the undertaking or association of undertakings is the first to submit information and evidence which enables the Council to establish an infringement of Article 2 of the Act and, in an occurring case, of Article 81 EC Treaty in connection with the alleged cartel;b) at the time of the submission of the leniency application, the Belgian Competition Authority has not sufficient evidence to find an infringement to Article 2 of the Act, and in an occurring case, to Article 81 EC Treaty, in connection with the alleged cartel;c) no immunity from fines was granted to an undertaking or association of undertakings in connection with the alleged cartel on the basis of no.10 of this Notice, and d) the general conditions attached to leniency in title V, no.20 of this Notice are met. 13. In order to obtain immunity on the basis of no.12 of this Notice, the applicant also has to submit the kind of information as described in no. 11.

III.C. Exclusion from immunity 14. The Council does not grant immunity from fines to an applicant who took steps to coerce another undertaking or association of undertakings to participate or continue the cartel.This applicant may still be eligible for a reduction of fines if he fulfills the applicable specific and general conditions.

IV. Reduction of fines (Type 2) 15. In order to qualify for a reduction of fines, an undertaking must provide evidence of the alleged cartel which represents significant added value compared to the evidence already in possession of the Belgian Competition Authority at the time of the application. The concept of « significant added value » refers to the extent to which the evidence provided strengthens, by its very nature and/or its level of detail, the Belgian Competition Authority's ability to prove the alleged cartel. If with the help of the submitted information the alleged cartel can be proven, this information may contain significant added value. It does not necessarily have to be new information. For example, a second source which confirms the information of the first source may also have significant added value.

For the assessment, the Council will generally consider written evidence originating from the period to which the facts pertain to have a greater value than evidence subsequently created. Besides, evidence directly relevant to the facts in question will generally be considered to have a greater value than that with only indirect relevance. The extent to which confirmation by other sources is required to allow the submitted evidence to be used against other involved undertakings will also have an influence on the value of that evidence. Conclusive evidence will therefore have a higher value than statements which require confirmation if contested. 16. The undertakings and associations of undertakings may obtain the following reduction of fines : a) the undertaking is the first to submit evidence with a significant added value : a reduction between 30 % and 50 %;b) the undertaking is a later party to submit evidence with a significant added value : a reduction between 10 % and 30 %. When determining the appropriate level of the reduction of the fine within these ranges, the Council will take into account in the final decision the time at which evidence was submitted within the meaning of no.15 and also the assessment of the overall added value of that evidence. 17. When an applicant for reduction of fines is the first to submit evidence with significant added value within the meaning of no.15, which is used by the Council to prove additional facts increasing the gravity or duration of the infringement, the Council will not take into consideration these facts when determining the fine to be imposed on the undertaking which has submitted this evidence. 18. In order to obtain a reduction of fines, the applicant is required to identify his name and address and provide information concerning the parties to the alleged cartel, the affected product(s) and territory(ies), the estimated duration of the alleged cartel, the nature of the alleged cartel, and the other leniency applications in relation to the alleged cartel which are submitted or might be submitted in the future to other competition authorities, including those outside the European Union.19. Moreover, the applicant has to fulfill the general conditions concerning leniency mentioned under title V, no.20 of this Notice.

V. General conditions concerning leniency 20. In order to qualify for leniency, the applicant must satisfy the following cumulative conditions : 1) preceding the application : a.not to destroy, falsify or conceal any evidence in relation to the alleged cartel, and b. to keep secret the intention to submit a leniency application and the content of it, except for other competition authorities inside or outside the European Union.2) to end its involvement in the alleged cartel immediately following its application, save when the competition prosecutor dealing with the case finds its continued involvement to be reasonably necessary to preserve the integrity of the inspections, and 3) to cooperate fully, genuinely, promptly and on a continuous basis with the Belgian Competition Authority from the time of its application until the final decision in accordance with Article 49, § 2 of the Act.This includes inter alia for the applicant : a. to provide the Belgian Competition Authority with all relevant information and evidence that is in the applicant's possession or that is available to him;b. to remain at the disposal of the Belgian Competition Authority to reply promptly to any requests that may contribute to the establishment of relevant facts;c. to make current and, to the extent possible, former employees and directors/managers available to appear before the Belgian Competition Authority;d. not to destroy, falsify or conceal information or evidence;and e. not to disclose the leniency application or its content until the report of the competition prosecutor is notified to the Council, except if agreed otherwise with the competition prosecutor. VI. Procedure VI. A. General 21. Before submitting a formal application, the applicant may contact the College of competition prosecutors in order to request guidance in relation to the application of this Notice. VI. B. The leniency application 22. Each undertaking or association of undertakings wishing to obtain immunity from fines or a reduction of fines has to submit a full leniency application.An undertaking or association of undertakings wishing to obtain immunity Type 1A, may also submit a summary leniency application in the cases described hereinafter. Both types are considered to be a leniency application within the meaning of this Notice. 23. Full leniency applications comprise on the one hand a corporate statement which has to contain the information necessary in order to benefit respectively from immunity from fines or a reduction of fines and on the other hand the evidence.For summary applications the corporate statement is sufficient. 24. A leniency application has to be submitted to the registry of the Council to the attention of the competition prosecutor general.The application is submitted by hand in eight copies. A leniency application may also be sent via fax, e-mail or registered mail to the registry but in that case, it has to be submitted in eight copies by hand before the closing hour of the registry on the next working day. 25. Upon request by the applicant, the registry will provide a written acknowledgement of receipt.The acknowledgement mentions the date and time on which the applicant has submitted the application. 26. The corporate statement may be drafted in one of the official languages or in English.If the corporate statement is drafted in English, the translation in one of the official languages is submitted within two working days, unless otherwise agreed with the competition prosecutor. If the evidence is not submitted in one of the official languages, the competition prosecutor may request a translation from the applicant. In case of translation the text drafted in one of the official languages will be valid.

Corporate statement 27. A corporate statement is a voluntary presentation by or on behalf of an undertaking to the Belgian Competition Authority of the undertaking's knowledge of a cartel and its role therein.Such statements are specifically drawn up in order to be submitted under this Notice. Statements which are made vis-à-vis the Belgian Competition Authority in relation to this Notice, form part of the file and may thus be used as evidence. 28. Upon the applicant's request, the competition prosecutor may accept that corporate statements are made orally unless the applicant has already disclosed the content of the corporate statement to third parties.Oral corporate statements are made at the registry. 29. Oral corporate statements will be recorded and transcribed by the registry.Undertakings making oral corporate statements will be granted the opportunity to check the technical accuracy of the recording, which will be available at the registry, and to correct the substance of their oral statements within five working days.

Undertakings may waive these rights within the said time limit. After expiry of this period the recording will be deemed to have been approved. Following the explicit or implicit approval of the oral statement or the submissions of any corrections to it, the registry will invite the undertaking to check the accuracy of the transcript within five working days. After expiry of this period the transcript will be deemed to have been approved. 30. Access to the corporate statements is only granted to the addressees of a report of the competition prosecutor, provided that they commit, together with legal counsel getting access on their behalf, to solely use the information in the corporate statement to which access is being granted, for the purposes of the procedure concerned.Third parties will not get access to these corporate statements. This specific protection of a corporate statement is no longer justified when the applicant discloses to third parties the content thereof. 31. Corporate statements made under the present Notice will, pursuant to Article 71 of the Act and Article 12 of Regulation (EC) No 1/2003, only be transmitted to the European Commission and other competition authorities within the European Union, provided that the conditions set out in the ECN Notice concerning the cooperation within the network of competition authorities (7) are met and provided that the level of protection against disclosure ensured by the receiving competition authority is equivalent to the one conferred by the Belgian Competition Authority. Request for a marker 32. An undertaking or association of undertakings which is considering making an application for immunity from fines, may in a first phase apply orally or in writing for a marker.A marker protects the applicant's place in the queue for a specific period in order to allow for the gathering of the necessary information and evidence in order to meet the applicable threshold of evidence for immunity from fines. 33. The competition prosecutor may grant a marker taking into account the seriousness and the credibility of the reasons given by the applicant.On request of the applicant, this decision of the competition prosecutor will be communicated in writing. 34. To be eligible to secure a marker, the applicant must provide the competition prosecutor with its justification for the marker, and information concerning its name and address, the parties to the alleged cartel, the affected product(s) and territory(-ies), the estimated duration of the alleged cartel, the nature of the alleged cartel conduct and the other past or possible future leniency applications in relation to the alleged cartel submitted or to be submitted to other competition authorities, including the ones outside the European Union.35. Where a marker is granted, the competition prosecutor determines the period within which the applicant has to perfect the marker by submitting the information required to be eligible for immunity from fines.If the applicant perfects the marker within the determined period, then this is considered to be a full leniency application within the meaning of no. 24 and the information and evidence provided will be deemed to have been submitted on the date when the marker was granted. If the undertaking does not submit the required information within the determined period, the marker is lost and a full or summary leniency application has to be submitted in order to be eligible for any immunity from fines.

Summary application for immunity Type 1 A 36. In cases where the European Commission is particularly well placed to deal with a case in accordance with paragraph 14 and 15 of the ECN Notice (8), the applicant that has or is in the process of filing an application for immunity to the European Commission (9) may file a summary application to the registry of the Council when the applicant considers the Council might be well placed under the ECN Notice to act against the cartel.37. Summary applications should include a short description of the name and address of the leniency applicant, the other parties to the alleged cartel, the affected product(s) and territory(-ies), the estimated duration of the alleged cartel, the nature of the alleged cartel conduct, the Member State where the evidence is likely to be located, and the other past or possible future leniency applications in relation to the alleged cartel submitted or to be submitted to other competition authorities, including the ones outside the European Union.38. Should the competition prosecutor decide to request specific further information, the applicant should provide such information promptly.Should the College of competition prosecutors decide to act upon the case, the competition prosecutor will determine a period of time within which the applicant must make a full submission of all relevant evidence and information required to meet the threshold for leniency. If the applicant submits such information within the determined period, the information provided and the enclosed evidence will be deemed to have been submitted on the date when the summary application was made. 39. Summary applications are deemed to be applications within the meaning of paragraph 41 (1) of the ECN Notice (10). VI. C. Investigation and leniency declaration 40. The competition prosecutor general designates an competition prosecutor who will be responsible for the investigation of the application.The competition prosecutor may request additional information from the leniency applicant in advance of the submission of his findings to the competition prosecutor general. In his request to the chamber of the Council to adopt a leniency declaration, the competition prosecutor general mentions the conditions, imposed by this Notice, which the leniency application has to fulfill in order to be eligible for immunity from fines or reduction of fines. 41. On the basis of the investigation of the leniency application, the competition prosecutor general requests the chamber of the Council to adopt a leniency declaration.He submits his request to the registry of the Council. The leniency applicant may submit observations within a time period of eight working days from the working day following the submission of the request of the competition prosecutor general. The chamber of the Council aims at taking the decision concerning the request of the competition prosecutor general within a time period of twenty working days from the working day following the submission of the request of the competition prosecutor general. 42. In case of a summary application, the competition prosecutor general only requests a leniency declaration to the Council when the College of competition prosecutors has decided to act upon the case.43. The chamber of the Council dealing with the case, adopts the leniency declarations in order of receipt.44. When the chamber of the Council decides that the applicant does not fulfill the specific conditions for immunity from fines, the applicant may withdraw its application.The Belgian Competition Authority may always use its normal investigation powers in order to obtain the relevant information.

If the specific conditions for immunity from fines are not fulfilled, the applicant's leniency application may still be eligible as an application for reduction of fines, subject to informing the registry of this request. 45. The registry sends the leniency declaration to the applicant and to the competition prosecutor general.This declaration will not be published.

VI. D. Further procedure of the investigation and the leniency decision 46. The competition prosecutor leads the investigation concerning the alleged cartel in accordance with the procedure of the Act and the implementing decrees.In his report the competition prosecutor mentions whether the leniency applicant has fulfilled the conditions of the leniency declaration during the whole procedure. 47. When taking the decision on the merits, the chamber of the Council dealing with the case grants immunity from fines or reduction of fines, according to the case, if the conditions stated in the leniency declaration have been respected.In the decision the chamber mentions the cooperation of the undertaking or association of undertakings with the Belgian Competition Authority in order to clarify why immunity from fines or reduction of fines has been granted. 48. The Council may abstain from taking into consideration a leniency application which is filed after the submission of the report of the competition prosecutor to the chamber of the Council in accordance with Article 45, § 4 of the Act. VII. Final observations 49. This Notice will enter into force on the day of its publication in the Belgian Official Gazette. It is applicable to all leniency applications which are submitted from the date of publication of this Notice.

The leniency applications, submitted after the date of publication of this Notice in cases in which one or more leniency applications were submitted before the publication of this Notice, will be handled according to the substantial provisions of the Joint Notice of the Competition Council and the Corps of Reporters of 30 March 2004 concerning immunity from fines and reduction of fines in cartel cases (11) and according to the procedural provisions of the Act and of this Notice. The leniency applications, submitted from 1 October 2006, date of entry into force of the Act, until the date of publication of this Notice in the Belgian Official Gazette, will be handled according to the substantial provisions of the Joint Notice of the Competition Council and the Corps of Reporters of 30 March 2004 concerning immunity from fines and reduction of fines in cartel cases and by the procedural provisions of the Act. 50. The Guidelines on the method of setting fines imposed pursuant to Articles 36 to 39 of the Act on the Protection of Economic Competition, coordinated on 1 July 1999 (12), remain in force for cases where one or more leniency applications were submitted before this Notice on immunity from fines and reduction of fines in cartel cases came into force. Annex Contact details of the Registry of the Competition Council Competition Council North Plaza A Koning Albert II-laan 9 B-1210 Brussels Tel. : + 32 2 277 52 72 Fax : + 32 2 277 53 23 E-mail : raco@economie.fgov.be (1) Official Gazette, 29 September 2006, p.50.613 (coordination of the Act of 10 June 2006 on the Protection of Economic Competition, O.G. 29 June 2006, p.32.755, and of the Act of 10 June 2006 on the establishment of a Competition Council, O.G. 29 June 2006, p.32.746). (2) Articles 63 and 69 of the Act and Article 5 of EC Regulation nr. 1/2003 of the Council, O.J. L1 of 4 January 2003, p.1. (3) The term « leniency » concerns both the immunity from fines and the reduction of fines, which would normally be imposed on a participant of the cartel, in exchange for the voluntary provision of information concerning the cartel and taking into consideration the special conditions relating to the fact whether the cooperation takes place before or during the investigation phase. (4) Joint notice of the Competition Council and the Corps of Reporters concerning immunity from fines and reduction of fines in cartel cases, O.G. 30 April 2004 Ed.2, p.36.257. (5) ECN Model Leniency Programme, see http ://ec.europa.eu/comm/competition/ecn/model euro leniency euro fr.pdf (6) The assessment whether the threshold will be met, will have to be carried out ex ante, i.e. without taking into account whether a given inspection has or has not been successful or whether or not an inspection has or has not been carried out. The assessment will be made exclusively on the basis of the type and the quality of the information submitted by the leniency applicant. (7) Commission Notice on cooperation within the network of competition authorities, O.J. C101, 27 April 2004, p.4 (hereinafter, « ECN Notice »). (8) See footnote 7. (9) In accordance with the Commission Notice on Immunity from fines and reduction of fines in cartel cases, O.J. C298 of 8 December 2006, p.17. (10) See footnotes 7 and 8. (11) Published in the Belgian Official Gazette of 30 April 2004 Ed.2, p.36.257, see also footnote 4. (12) Published in the Belgian Official Gazette of 30 April 2004 Ed.2, p. 36261.