Tighter cartel supervision: closer investigation, more fines and new regulations

Cartel investigations remain high on the agenda of the competition authorities. Several cartel investigations are pending at ACM and the European Commission, and dawn raids are once again the order of the day. Interesting new laws and regulations are also on the horizon. An overview is provided in this blog.

The Netherlands: new investigations

ACM has launched a number of new investigations. It is investigating, for instance, whether companies in the food processing industry have made prohibited cartelagreements. ACM has raided several companies for this purpose. It is furthermore investigating a buyer cartel in the agricultural sector. Earlier, ACM closed an investigation into companies in the home furnishing sector. An investigation into supermarkets based on an alleged wage cartel was terminated when a new collective bargaining agreement was signed.

ACM has also received signals about possible prohibited agreements on the job market. It has warned companies that agreements to refrain from recruiting or hiring another company’s staff are prohibited. ACM will undoubtedly be in search of offenders in order to fine them for making such agreements.

Last year’s fines for breach of the cartel prohibition varied from a €4 million fine for two collectors of deep-frying fat to a €39 million fine for Samsung. The latter fine was imposed because Samsung had allegedly exercised undue influence on retailers’ sales prices for televisions under the guise of “price recommendations” (see also this blog). Samsung believes that influencing prices is not the same thing as prohibited resale price maintenance and has therefore filed an objection. The decision on the objection is expected in 2022.

Fines imposed by ACM are often upheld in objection proceedings (since ACM itself then rules on those fines again). ACM also, for instance, rejected the objection to the high €82 million fine imposed on cigarette manufacturers for exchanging information via buyers on future prices of packets of cigarette. We suspect that the manufacturers have filed an appeal and that the court will have to rule on the matter.

EU: more dawn raids

The Commission is again performing many dawn raids (even at employees’ homes). The number has increased significantly since the summer of 2021 in particular. Dawn raids have taken place, for instance, at:

The Commission is also investigating an agreement between Google and Meta regarding online display advertising services. The British CMA is also investigating that matter. Meta was already under investigation for alleged improper use of advertising data.

Some of these dawn raids will undoubtedly lead to fines. The most notable fines in the recent period are the following:

  • Car manufacturers have been fined a total of €875 million for agreements on technical development in the field of nitrogen oxide cleaning.
  • Three railway companies have been fined €48 million for participating in a customer allocation system in cross-border freight transport.
  • Several banks have been fined €344 million for price-fixing in foreign exchange dealing. A similar cartel was previously fined €1.1 billion.
  • A fine of €28 million has been imposed on banks that were involved in a cartel in the trade of SSA bonds (a type of government bond).
  • Investment banks have also been fined €371 million for participating in a cartel to trade in European government bonds.
  • Conserve Italia was fined €20 million for participating in a canned vegetables cartel.

The last four fining decisions were appealed. The banks’ appeals focus in particular on the alleged single infringement. Conserve Italia and its subsidiary Conserves France argue that the fine was incorrectly calculated. It will be interesting to see whether the General Court agrees.

Laws and regulations: Commission on the road to renewal

The Commission is also busy revising the law on the application of the cartel prohibition. It is reviewing, for instance, the horizontal block exemption regulations on R&D and specialisation agreements. This will provide a renewed assessment framework for the admissibility under competition law of partnerships based on such agreements.

In the wake of this new block exemption, the Commission has also drawn up new (draft) guidelines on horizontal cooperation agreements. Those guidelines provide guidance as to which types of cooperation agreements between (competing) companies may be exempted from the cartel prohibition. There are a number of important new additions:

  • For purchasing agreements, the difference between buyer cartels and joint purchasing agreements has been clarified.
  • A new assessment framework has been included for consortium bidding in tendering procedures.
  • Guidance has been provided on commercialisation agreements in agricultural products and the risks of production restrictions.
  • More guidance has been provided on the exchange of information, including big data, and its admissibility.
  • The Commission has expanded the guidelines to include a chapter on sustainability agreements, from which it is apparent that many forms of cooperation between companies are permitted in order to achieve sustainability goals. ACM supports this proposal.

The new horizontal block exemption and the accompanying guidelines are to enter into force on 1 January 2023 and make it easier for companies to work together.

The new Vertical Block Exemption Regulation and accompanying guidelines will furthermore enter into force on 1 June 2022. We have dedicated a separate blog to that Regulation, which can be found here. The Commission has also published draft guidelines on the application of competition law to collective agreements on employment conditions for self-employed persons. The Commission has announced, among other things, that it will not intervene in certain collective agreements between self-employed persons and their counterparties. The final guidelines are expected in the second quarter of 2022. More information on these (draft) guidelines can be found in this blog.

The Commission is now toying with the idea of granting immunity from cartel damage proceedings to the first leniency applicant: leniency applications are becoming less common, although they are an effective tool for the Commission in detecting cartels. Leniency applicants have immunity from fines but do run the risk of claims for damages, which makes leniency applications less attractive. It is unknown whether this is a serious idea on the part of the Commission, or the floating of the proverbial trial balloon. We will have to wait and see, but it will undoubtedly be a source of debate.

Case law in the Netherlands and abroad: final phase of cartel claims

Competition law enthusiasts will undoubtedly be eagerly awaiting the administrative court’s judgment on the fines imposed on Samsung and the cigarette manufacturers (see above). The court's ruling in the cold storage warehouses case is also being awaited. The Trade and Industry Appeals Tribunal (unlike the court) ruled earlier that ACM was authorised to impose the fine on the cold storage warehouses. The court has therefore yet to rule on the remaining part regarding the allocation and disproportionality of the fine.

This year will undoubtedly see new judgments in civil law on the application of the cartel prohibition. A number of recent examples are given below.

  • The Amsterdam Court of Appeal denied Hudson's Bay's request for a preliminary witness examination on the grounds of alleged cartel formation.
  • Non-compete clauses are increasingly being set aside on the grounds of conflict with the cartel prohibition. The Court of Appeal of ‘s Hertogenbosch, for instance, ruled in a dispute between radiologists that the concrete effects on the market need not be substantiated in the case of restrictions by object. More information can be found in this blog. The Court of Midden-Nederland arrived at the same conclusion in other proceedings. The impact on the market need only be demonstrated in the case of a restriction by effect, including de minimis provisions, as apparent from a judgment passed by the Court of Noord-Holland.
  • In preliminary relief proceedings regarding the lawfulness of an expansion of dawn raids, the Court of The Hague ruled that ACM had done no more than skim (proportionally selected) chats and e‑mails that were relevant to the investigation of procurement agreements. In the Court’s opinion, it is not unusual for ACM to come across other (suspicious) cases in doing so. We can imagine that an appeal has been filed against that finding as well.

Cartel claims have been filed these last few years by aggrieved parties (e.g. buyers or consumers) against the cartelists, following the imposition of cartel fines by the European Commission. These cartel claims initially related to procedural questions, but will increasingly focus on the damage. A brief update on some cartel claims in the Netherlands is provided below.

  • Lifts: In the cartel claim proceedings following the lifts cartel, the court found it sufficiently plausible that loss had been incurred. The case was referred to assessment of loss proceedings.
  • Prestressing steel: The court's decision on whether Deutsche Bahn has sufficiently demonstrated its loss resulting from the prestressing steel cartel is expected this year.
  • Cathode ray tubes: An interlocutory judgment is being awaited in the cathode ray tube cartel, after which proceedings on the merits may be conducted.
  • Trucks: The General Court recently rejected an appeal by Scania against the fine in the truck cartel. It cannot be a coincidence that AB InBev filed a claim for damages against DAF Trucks and Volvo/Renault (one of the parties involved in the truck cartel) shortly afterwards. This is the umpteenth claim for damages against the truck manufacturers. The court’s decision as to whether the claimants in the earlier proceedings meet the threshold for assessment of loss proceedings is expected later this year.
  • Air freight: Late last month, the General Court upheld the fine for prohibited price-fixing in the air freight sector. Claim proceedings had already been instituted following the Commission’s fine. The latest rulings on these claims have largely been in favour of the claimants (up to and including the Court of Justice). These claims may now also gain momentum.

And not only companies are being held liable. Appeal proceeding are currently pending in the claim for damages of the real estate dealers against ACM on the grounds of an unjustly imposed fine for cartel formation. The judgment on the claim for damages against ACM following the annulment of a fine for alleged participation in the traction battery cartel is also being awaited.

It would therefore appear that ACM and the Commission will intensify the investigation and the fining of cartels, with new claims for damages in the offing. Companies, but also ACM, should therefore remain on the alert.

Information on dawn raids by ACM can be found at invalacm.nl.

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Martijn van de Hel

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Diederik Schrijvershof

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Annabel Kingma

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