On 14 February 2022 the Competition and Consumer Protection Commission (CCPC) announced that it would be conducting a series of consultations on the competition law enforcement powers contained in the Competition (Amendment) Bill 2022 (Bill). (For further information on the Bill see our previous article here).  The Bill proposes to transpose the ECN+ Directive into Irish law which empowers EU Member State competition authorities to be more effective in the enforcement of competition law.

The first round of consultations, which closed 11 March 2022, sought submissions on the following areas:

• New Administrative Leniency Policy (ALP) for cartels;
• Guidance on the interaction between the Cartel Immunity Programme (CIP) and the ALP for cartels; and
• Guidance on the CCPC’s choice of enforcement regime for breaches of competition law.

It is understood that further consultation papers regarding administrative financial sanctions and additional guidance on leniency are due to open for submission in the coming weeks. The consultation process affords stakeholders the opportunity to provide information and different perspectives on the proposed issues.

New Administrative Leniency Policy for Cartels

The new ALP outlines the policy of the CCPC in considering applications for leniency from undertakings that disclose their participation in cartels.  It also sets out the necessary requirements to qualify for leniency under the Competition Acts 2002 to 2017 (Competition Acts).  Leniency in this context refers to immunity from administrative financial sanctions (Type 1) or reduction in administrative financial sanctions (Type 2).  A cartel under section 3 (1) of the Competition Acts, is defined as an agreement or concerted practice between two or more competing undertakings aimed at coordinating their competitive behaviour on the market or influencing the relevant parameters of competition through practices.  Cartels are prohibited by section 4 of the Competition Acts and Article 101 of the Treaty on the Functioning of the European Union (TFEU).

As set out in the ALP, to qualify for leniency, the applicant shall:

• End its involvement in the alleged cartel;
• Cooperate fully with the CCPC; and
• Not destroy, falsify, or conceal any evidence within the scope of the application.

In addition to meeting the above requirements, it is notable that:

• Immunity from administrative financial sanctions is only available to the first participant in a  cartel; and
• A possible reduction of up to 50% of any administrative financial sanctions that would otherwise be imposed, is available to a second or subsequent participant in the same cartel that applies for leniency.

Guidance on the Interaction between the Cartel Immunity Programme and the ALP for Cartels

The CCPC also sought submissions on guidance on the interaction between the CIP and the ALP. The CIP outlines the policy of both the CCPC and the DPP in considering applications for immunity from prosecution for criminal cartel offences under the Competition Acts.

The decision as to whether ALP or CIP will apply is a matter for undertakings to consider.  An undertaking granted leniency under the ALP will not automatically be immune from criminal prosecution. The same applies for immunity under the CIP – this will not entitle the undertaking to an automatic right to administrative leniency where the CCPC pursues administration enforcement proceedings against it.

Therefore, the CCPC has expressed its expectation that undertakings in need of protection may wish to apply under both the CIP and ALP to obtain immunity from criminal prosecution and leniency regarding  administrative financial sanctions. Applications received under both the ALP and CIP will be dealt with concurrently by the CCPC, as far as practicable.

Guidance on the CCPC’s choice of enforcement regime for breaches of competition law

Competition law in Ireland is regulated by the Competition Acts and the TFEU.  Under the Bill, it is proposed that the CCPC may impose administrative financial sanctions on undertakings and associations of undertakings for breaches of competition law, including cartel offences, subject to Court confirmation.  This is a key change proposed under the Bill.  The CCPC will continue to have the power to impose criminal sanction pursuant to sections 6, 7, 7A and 8 of the Competition Acts.

The CCPC will exercise its statutory discretion to decide the appropriate enforcement mechanism on a case-by-case basis. The preferred mechanism will be communicated to the parties at the CCPC’s earliest convenience, however the CCPC retains a discretion to select a different enforcement mechanism at a later stage.

If you wish to discuss any aspect of this article in more detail, or need advice on competition law in Ireland, please contact Paul Convery, Laura Murdock, or your usual William Fry contact.

Contributed by Louise Coughlan