Competition law was introduced relatively late in the Netherlands. By now, it has become abundantly clear to most businesses that not a single sector will be able to escape it. Competition law not only affects private businesses; since the implementation of the Public Enterprises (Market Activities) Act (Wet Markt en Overheid) and as a consequence of the EU rules on state aid and public tenders, it has further extended its reach to central and local government. It has also curtailed the role of sectoral and professional organisations.
The powers of the European Commission and the Netherlands Authority for Consumers & Markets (ACM), have been considerably enhanced in recent years. For example, ACM can impose fines on managers and directors as well as on businesses for breaching competition law. The competition authorities are also making more frequent use of the possibilities to settle cartel cases or to accept a commitment.
Prohibited practices and agreements
The prohibition of anti-competitive practices and agreements (cartel prohibition) is of paramount importance in competition law and even encompasses information-exchange between competing businesses about prices or customers. Competition authorities currently focus in particular on the exchange of competition-sensitive information via distributors or customers (hub-and-spoke).
Competition law comes into play when you set up a purchasing organisation, a distribution system or a franchise formula, but it also extends to (consumer) price recommendations adopted by suppliers and to retail store shelves (category management). Distribution through traditional brick-and-mortar stores and e-tailers are being closely watched at the moment by the competition authorities. Openings (or lack thereof) for dual pricing are a hot topic.
Prohibition on the abuse of dominant positions
Every business is at liberty to decide how it behaves in the market, but some businesses have such considerable sizes that limits are set even for unilateral dealing. Companies with a dominant market position have a special responsibility. In practice their commercial policy may not go as far as that of their rivals. They must be cautious with their price and discount policy. Competitors may not be excluded from the market by unfair advantages.
Large-sized mergers, takeovers, and certain joint ventures must often be approved in advance by the competition authorities, such as Nza, ACM and/or European Commission (merger control). These proceedings might be completed quickly in a few weeks or they may involve months of negotiations with the regulators to find conditional clearance (remedies).
Infringements of competition law involve major risks, such as fines, claims for damages and tarnished reputations. Compliance with competition law is therefore high on the agenda of many companies. Training courses can help to raise awareness among members of staff. Sometimes a risk analysis is useful. Audits or forensic investigations have proven a valuable tool in such situations.
Competition law constitutes the core business of Maverick. We have extensive experience of all facets of European and Dutch competition law and are ready to support and assist you in these matters.