What are the key steps in a cartel investigation?
The Board may ex officio, or as a result of a notice or complaint, launch a preliminary investigation prior to initiating a full-fledged investigation. At the preliminary investigation stage, unless the Authority decides to conduct a dawn raid or apply other investigatory tools (i.e. formal information request letters), the undertakings concerned are not notified about the preliminary investigation. The preliminary report of the Authority’s experts will be submitted to the Board within 30 days after the Board’s preliminary investigation decision. The Board will then decide within 10 days whether to launch a formal investigation. If the Board decides to initiate a full-fledged investigation, it will send a notice to the undertakings concerned within 15 days. The investigation will be completed within six months. If deemed necessary, this period may be extended by the Board only once, for an additional period of up to six months.
The investigated undertakings have 30 calendar days as of the formal service of the investigation notice to prepare and submit their first written defences. Subsequently, the investigation report is issued by the Authority. Once the investigation report is served on the defendants, they have 30 calendar days to submit their second written defence, extendable for a further 30 days. The investigation committee will then have 15 days to prepare an additional opinion concerning the second written defence. The defending parties will have another 30-day period to submit their third written defence to the additional opinion. Once the defendant’s written defences are submitted to the Authority, the investigation process will be completed (i.e. the written phase of investigation involving the claim/defence exchange will close with the submission of the third written defence). An oral hearing may be held upon request by the parties. The Board may also ex officio decide to hold an oral hearing. Oral hearings are held within at least 30, and at the most, 60 days following the completion of the investigation process under the provisions of Communiqué on Oral Hearings before the Board No. 2010/2. The Board will render its final decision within: (i) 15 calendar days from the hearing, if an oral hearing is held; or (ii) 30 calendar days from the completion of the investigation process, if no oral hearing is held. It usually takes around three to five months (from the announcement of the final decision) for the Board to serve a reasoned decision on the counterpart.
The conduct of a cartel investigation is a matter for the ACCC as the responsible investigating authority. There are no legislative or other prescribed timeframes for an investigation (other than the 6 year time limit for the ACCC to commence proceedings to recover a civil penalty). Cartel investigations are typically protracted and often last years.
The ACCC gathers evidence voluntarily or through its compulsory information gathering and search and seizure powers (see 2.3 below).
Following an investigation, the ACCC may:
- refer serious cartel conduct to the CDPP. It is a matter for the CDPP to determine whether to commence a criminal prosecution;
- initiate civil proceedings in the Federal Court seeking penalties and other orders;
- resolve less serious conduct by accepting court enforceable undertakings or through engagement and negotiation where the party may commit to do various things to address the conduct and ensure it does not recur; or
- take no further action (such as for technical contraventions).
Internal steps. Launching a probe
An investigation formally starts with the issuance of an order by the competent IA, mandating a probe for a term of no less than 30 business days and no more than 120 business days (which term may be extended up to 4 times for additional periods of 120 business days each), into a specifically identified market. The IA must establish an objective cause to launch the probe, identify an affected market or markets, and the presumptive anticompetitive behaviour that it suspects has occurred. This order is usually not made public until after initial requests for information (“RFIs”) and/or dawn raids have been conducted.
Investigations may be the result of a complaint (from an agency or a private party) or a leniency application, but may also be launched ex officio by the IAs. Prior to launching an investigation, the agencies usually conduct internal research and may request information from other agencies, such as the Banking Commission or the Tax Administration Service. They may also get information from affected government bodies, which may be critical in cases involving bid-rigging, for instance. To the extent the investigation is the result of a leniency application, a substantive information gathering (generally from the applicant) process is usually conducted by the IA prior to launching the investigation.
Statements of objections
Within 60 business days after the investigation period concludes, the competent IA must submit a report to the Plenum the relevant agency (COFECE or IFT) proposing to either (i) close the matter on the grounds that it lacks elements to pursue a cartel or (ii) summon presumptively responsible parties by issuing statements of objections (dictamen de probable responsabilidad or “SO”) with cartel charges. If the IA proposes to issue SOs, the competent agency must summon the charged agents to a trial-type proceeding. If the IA proposes to close the matter, the Plenum may accept such recommendation or, if it deems that there are sufficient elements to establish the existence of anticompetitive behaviour, agree to the issuance of SOs (which powers certainly call into question the independence of the IAs).
The agents served with SOs are summoned to a trial-type proceeding where the IA is the prosecutor and said agents the defendants. During this proceeding, the charged agents will have the opportunity to challenge the findings of the IA or the evidence in which it grounded the SO, offer and produce evidence and argue in favour of their case. Charged agents have a 45 business day window to produce their response to the SO and offer evidence. Substantially all evidence admissible under the rules of the civil procedure may be offered, including witnesses, experts, documents and recordings, among others.
Once all admitted evidence has been heard, the competent agency will grant the IA and the charged agents a 10 business day window to file closing arguments. After such term expires, the file is deemed substantiated and the parties have a 10 business day window to request an oral hearing before the Commissioners of COFECE or IFT, as applicable, to present oral argument directly to them.
Within 40 business days following the last oral hearing or after the expiration of the term to request it (if no agent so requests), the Plenum of the competent agency must issue a final decision either confirming the findings of the IA and imposing fines and other remedies (disqualification, order to refrain from certain conduct, etc.) or rejecting the charges in the SO. Those agents affected by such decision may petition for judicial review within 15 business days following notice thereof, before the Federal Courts Specialized on Telecommunications, Broadcasting and Competition, through an amparo claim.
At the administrative sphere, the General Superintendence is the body responsible to initiate an administrative inquiry, which is a formal investigation procedure. The administrative inquiry may be initiated ex officio or through a grounded representation of any interested party, such as the Public Prosecution Office or any affected governmental body, entity, company or individual.
The purpose of the administrative inquiry is to collect evidence of the materiality and authorship of the conduct in order to support the initiation of administrative proceedings and, as a rule, it must be closed within 180 days, which can be subject to indefinite extension according to CADE’s current interpretation of the Antitrust Law.
The General Superintendence may simply dismiss the administrative inquiry or initiate the respective administrative proceeding if it considers that there are sufficient elements to prove the materiality and authorship of the conduct. Once the administrative proceeding is initiated, the defendants are served and shall present defense within 30 days as a general rule.
The administrative proceedings to impose administrative sanctions for violations against the economic order follow the following main steps: (i) defense presentation; (ii) fact-finding and technical note ending the fact-finding phase; (iii) final arguments of the defendants; (iv) General Superintendence’s opinion dismissing the case or recommending the defendants’ condemnation; (v) at the Tribunal, a Reviewer is chosen; (vi) the Reviewer can complement the fact finding; (vii) defendants shall present another petition and CADE’s Attorney General’s Office and the Federal Prosecution Office also present their opinion; and, finally, (viii) the Tribunal issues the final decision at the administrative level either condemning the defendants or dismissing the case for any or all of them.
The chart below summarizes the main steps of an administrative proceeding to investigate anticompetitive conducts:
The FCCA can initiate investigations into suspected competition restrictions ex officio or as a result of complaints or applications for immunity. The FCCA typically initiates investigations by conduct¬ing dawn raids (i.e. surprise inspections) at undertakings’ business premises. This the FCCA has independent jurisdiction to do. In addition, the FCCA must assist, upon request, in investigations conducted by the Commission pursuant to Council Regulation (EC) No. 1/2003.
Additionally, the FCCA can also carry out inspections outside business prem¬ises (e.g., in private residences) either independently or in assistance to the Commission. In all situation where private premises are investigated a search warrant is required from the Market Court.
Article 38 of the Competition Act, concerns an undertaking's rights of defence in connection with investigations carried out by the FCCA. Firstly, the undertaking has the right to be informed of its position in an investigation by the FCCA and the suspicions directed towards it. Further, the undertaking is entitled to information regarding documents related to the investigation and the state of the matter, unless precluded by the Act on the Openness of Government Activities or EU law. Finally, an undertaking has the right to be heard before the FCCA makes a proposal to the Market Court for the imposition of fines and the decision on the existence of a cartel under the Competition Act or the TFEU. The FCCA's allegations will be laid out in a written declaration containing all the facts that have come to its attention, as well as the resulting allegations and their ground. A time limit is then set for the undertaking to give its reply, either in writing or orally. The FCCA may also, subject to its discretion, arrange state of play meetings either by ex officio or by the parties' request at any point during the proceedings.
An investigation may be initiated by the Bureau based on information obtained from an immunity applicant or through other means like information from Canadian or foreign enforcement agencies, whistleblowers and anonymous tips. It also may begin an investigation based on information obtained from public sources such as the media. In addition, the Bureau is collaborating with enforcement and procurement partners to develop bid-screening algorithms that analyze bidding data for signs of collusion.
Other than in the context of the immunity and leniency programs, which are discussed below, there are no key deadlines, nor any specific limitations on the timeframe of a Bureau investigation.
Typically, once the Bureau initiates an investigation, it will seek to obtain information from the targeted entity, as well as the targeted entity’s competitors and clients. In order to collect information, the Bureau has extensive investigative powers, as described below in section 6.
Once the Bureau concludes its investigation, if it deems its information sufficient for prosecution, it refers the file to the PPSC. The PPSC reviews the file to determine whether to prosecute the targeted entity. This decision turns on whether there is a reasonable prospect of a conviction. If it chooses to prosecute, the PPSC will file criminal charges against the accused. The matter will then proceed in front of the courts as would any other criminal matter.
There is no limitation period for the investigation of a criminal offence or laying of criminal charges under the Act. The Bureau’s investigation and subsequent prosecution by the PPSC often take years. However, once criminal charges are filed, the PPSC has 30 months from the date the charges are filed to get to the end of trial (see R v Jordan, 2016 SCC 27). Failure to do so triggers a presumption that the delay was unreasonable, which will lead to a stay of proceedings, unless exceptional circumstances justify it. To date, bid-rigging charges in one domestic case have reportedly been abandoned because the presumptive ceiling was exceeded.
The investigation of a cartel case mainly includes steps as finding clues, filing a case, investigating, making preliminary conclusions, and making final conclusions.
Firstly, an AMEA searches for clues of the monopolistic conduct ex officio, through people’s reports, assignment by higher authorities or case transferring from other agencies. After necessary investigation, it will decide whether to file the case.
Secondly, the AMEA conducts investigations according to law, and the investigated parties have the obligation to cooperate with the investigation.
Thirdly, the AMEA makes a preliminary conclusion based on the evidence obtained from the investigation, and issues an Administrative Penalty Prior Notice (Statement of Objection) to the investigated party. The investigated party has the right to state opinions, make defenses, and apply for a public hearing if necessary.
Lastly, after considering the facts of the case and the opinions of the investigated party, the AMEA makes a final punishment decision and issues an Administrative Punishment Decision (Final Decision) to the investigated party.
The DOJ usually initiates investigations of cartel conduct when either (a) a leniency application is made or (b) the DOJ learns of a potential cartel from public sources, such as news, complaints by victims, or other government sources. The DOJ will then turn to overt investigative steps (as discussed in 6).
There are no specific deadlines in a DOJ investigation, except for the applicable statute of limitations. The DOJ must bring charges within five years of the date of an offence. Sherman Act conspiracies are a ‘continuing violation,’ which means they are deemed to continue, and the limitation period does not begin to run, until they are abandoned or their objects are attained. If a defendant can establish that he or she affirmatively withdrew from the conspiracy, the statute of limitations begins to run on the date of withdrawal as to that defendant.
Cartel investigations are typically opened with a dawn raid by the JFTC. In addition to and following the dawn raid, the JFTC normally requests the submission of relevant materials from the target entity and/or relevant individuals and also conducts interviews with relevant individuals. If the JFTC believes that there was a cartel infringement, the JFTC will send drafts of cease and desist orders and surcharge payment orders to the infringing undertaking. In practice, it often takes more than 12 months from the JFTC’s initial dawn raid until the JFTC’s issuing of the draft orders.
Simultaneously to the issuing of the draft orders by the JFTC, a hearing date (normally within 2-4 weeks from the issuing of the draft orders) will be set for the infringing undertaking to submit oral and/or written opinions and evidence concerning the draft orders. The allegedly infringing undertakings are also allowed to review and copy the relevant evidence used by the JFTC. Details of the administrative procedures are available under the JFTC’s “Guidelines on Administrative Investigation Procedures under the Antimonopoly Act”.
In the case of criminal procedures, the JFTC will typically file a criminal accusation against the infringing undertaking to the Public Prosecutors Office following the above administrative procedures, and the Public Prosecutors Office will bring an indictment against the allegedly infringing undertaking in the competent court.
Under the CA, the MyCC may on its own initiative, conduct any investigation which the MyCC thinks expedient where the MyCC has reason to suspect that any enterprise has infringed or is infringing any prohibition under the CA or any person has committed or is committing any offence under the CA. Further, the MyCC may also conduct an investigation on any enterprise, agreement or conduct that has infringed or is infringing any prohibition under the CA or any person who has committed or is committing any offence under the CA upon receipt of a complaint by a person.
Following from a complaint being made to the MyCC, the MyCC may make inquiries on the complainant for the purpose of deciding whether the MyCC should, in its discretion, investigate the matter. In the event the MyCC decides not to investigate such complaint, it will inform the complainant of such decision and the reasons for the decision.
In the event that the MyCC decides to pursue with the investigation, the MyCC has all the investigative powers as further explained below. After the completion of the investigation, the MyCC may propose to make a decision to the effect that a Chapter 1 Prohibition has been or is being infringed (provided that the MyCC is satisfied that such an infringement has arisen). Thereafter, an enterprise alleged to be infringing the Chapter 1 Prohibition may inform the MyCC that it wishes to make an oral representation and the MyCC shall, before taking any relevant decision, convene a session for the oral representation to be held. Notwithstanding the request for oral representations to be made, the MyCC may at any time conduct hearing for the purpose of determining whether an enterprise has infringed or is infringing Chapter 1 Prohibition.
Following from the abovementioned procedures, the MyCC will either issue a finding of non-infringement or finding of an infringement.
In some cases the Secretariat may conduct a market observation. This is an informal proceeding. In this phase, the Secretariat has no investigative powers and the undertakings usually have no duty to cooperate.
A formal cartel investigation starts with a preliminary investigation. In the preliminary investigation, the Secretariat may allow the undertakings concerned to comment on a complaint, send questionnaires to the undertakings or propose measures to eliminate or prevent restraints of competition. There are no deadlines and the specific steps depend largely on the case and are at the discretion of the Secretariat.
An in-depth investigation will be opened directly (e.g. in case of dawn raids) or following the preliminary investigation if there are indications of an unlawful restraint of competition. The Secretariat publishes the opening of an investigation. The investigation by the Secretariat is concluded with a proposed draft decision by the Secretariat (equals procedurally the Statement of Objections in the EU). The parties involved in the investigation may comment on the Secretariat's proposed draft decision in writing. The duration of the investigation depends largely on the case and can take years.
The Competition Authority has extensive powers with respect to the conduct of an investigation on suspicion of a binding arrangement. The Competition Authority initiates an investigation in accordance with the decision of the Competition Commissioner, and it is not limited to timetables (expect with respect to the limitation of offenses). In recent years, the Competition Authority has been conducting undercover investigations, in which the Competition Authority conducts covert investigative activities, including telephones monitoring, surveillance, etc. After the Competition Authority has collected sufficient evidence, the investigation becomes apparent, and then arrests are carried out, the Competition Authority raid the company's offices, seize computers and documents and investigate suspects and witnesses.
Competition investigations may be opened by the Directorate for Competition (the investigative body of the CNMC), either as a result of information provided by any person, or ex officio of its own motion, or on the motion of the Board. Recently, a whistle-blower letterbox has been added to the CNMC’s webpage for the public to report competition infringements. In cartel cases, the enquiry may be initiated by the Directorate for Competition further to a leniency application.
Before the formal procedure commences, preliminary proceedings are conducted in order to confirm that there are sufficient indicia pointing to an infringement. Such preliminary proceedings are not subject to any deadline and may consist in sending requests for information or conducting unannounced inspections at the premises of the investigated undertakings or the domiciles of their employees (see below). Given that the formal procedure has not been initiated yet at this stage, procedural guarantees in preliminary proceedings have not yet been fully recognised for the parties, although the information gathered by such means would be included in the file once it is open and a decision on confidentiality is adopted.
Should preliminary proceedings not result in the closing of the investigation by the Board, the formal procedure would be opened. From that moment, the parties enjoy full procedural rights, which include, inter alia, temporally unlimited access to the file and the possibility to request the confidential treatment of certain information provided by, or seized from, them in the course of proceedings. The deadline for the Board to adopt and notify a decision is 18 months under pain of expiry of the procedure. Within that timeframe, the Directorate for Competition is supposed to complete the investigation within 12 months, although non-compliance with this deadline does not entail the expiry of the procedure.
Regarding procedural milestones, the Directorate for Competition usually issues the statement of facts between the eighth and tenth month, for the parties to react within 15 working days, which may be extended for an additional seven working days, although observations may be made at any previous moment. Then, between one or two months later, a proposal for the decision is sent to the parties for comments within 15 working days, which may be extended for an additional seven working days. Subsequently, the decision proposal, together with the observations of the parties, is referred to the Board, which may ex officio or at the parties’ request order additional investigation proceedings, to which the parties may submit additional observations within seven working days; convene a hearing, which has been extremely unusual in practice until very recently (see below); or even undertake the legal requalification of facts, in which case the parties may submit observations within 15 working days. An early termination procedure is not available for cartel infringements.
The CC has discretion in opening investigations. It may do so either following a formal complaint being submitted thereto, or ex offcio (based on information received through the online whistleblowing platform recently implemented, or on information received by the members of the Plenum of the CC or the CC as an institution, from different sources). It may also open investigations based on formal notices from other state bodies (including criminal investigation authorities), as it has done is several bid-rigging cartels involving state-run public procurement procedures.
The rule is that an investigation is launched only when the CC holds sufficient elements that allow it to reasonably suspect that an infringement of competition has taken place. It must have elements which, corroborated with other means of proof which it may collect via dawn raids or requests for information, will allow it to bring charges of infringement of competition rules.
The official deed launching the investigation is an order issued by the Chairman of the CC (of a deputy-chairman, as the case may be) stating the grounds for investigation, the scope of the procedure and appointing the rapporteur, i.e. the public servant leading the overall investigative effort. The order launching the investigation is subject to court review at the end of the procedure, alongside the decision that ends the procedure and imposes fines (if the case).
Under current enactments, there are no specific deadlines to be observed when launching an investigation other than the statutes of limitation, which is of 5 years in the case of infringements of competition rules. This duration is calculated as of the perpetration (for uno ictu deeds) or since the last act of infringement (for continuous deeds).
Apart from on-site inspections (commonly referred to as 'dawn-raids'), the CC gathers information via requests made in the form of questionnaires issued during the investigation and concerning matters specific to the object of the procedure. It is common practice for the CC to grant answering deadlines of two weeks, which may be extended (usually out of courtesy) by another week and seldom by two additional weeks. There are cases, for instance in procedures that are of high priority to the CC, that such deadline extensions will not be granted. During an investigation procedure, it is common practice for there to be two or three such requests for information.
In terms of duration of the procedure, at present, the CC strives to keep them at 2 or maximum 3 years. Shortening the duration of the investigations was taken on board as a policy matter by the management of the Council and, in past years, it has been duly observed.
During the investigation, the case team holds meetings with the persons involved, in order to discuss cooperation matters or for obtaining or receiving eventual clarifications for different matters. Such state-of-play meetings are not compulsory under the law and are held exclusively out of courtesy of the CC (nonetheless they may also serve as proof of the parties' cooperation with the competition authority).
The CMA will open an investigation if it has reasonable grounds for suspecting a breach of competition, e.g. following a complaint by a third party or an application for leniency.
The first formal milestone in an investigation is generally for a case initiation letter to be sent to the parties. This outlines the conduct being investigated, the relevant legislation, the expected timetable and key contacts. The CMA also typically publishes a notice of investigation on its website, briefly summarising the suspected infringement.
Parties under investigation are kept updated either by telephone or in writing, and able to meet members of the case team at periodic ‘state of play’ meetings.
At the conclusion of the investigation, the CMA may:
(i) close the investigation due to administrative priorities;
(ii) decide that there are no grounds for action;
(iii) accept commitments relating to future conduct; or
(iv) issue a statement of objections that the parties’ conduct infringes competition law. The parties will be entitled to make representations, following which the CMA may issue an infringement decision, impose fines and direct the anticompetitive conduct to end.
a) Initiating an investigation
The Commission may start an investigation on the basis of: (i) an approach by one of the cartel members (i.e. acting as a whistle-blower); (ii) a third-party complaint (using Form C); (iii) an NCA’s raising the matter with the Commission; or (iv) its own initiative.
b) Key procedural steps
Once alleged cartel conduct comes to its attention, the Commission will embark on a fact-finding exercise, either informally or using its formal powers of investigation (including through requests for information and ‘dawn raids’ – see further below). Depending on the outcome of this fact-finding exercise, the Commission will decide whether there is sufficient evidence of an infringement that warrants further investigation.
If the case is pursued, the Commission will in due course formally initiate proceedings (although this may not be until after a long period of intensive investigation). At this point NCAs lose their competence to apply Article 101. The Commission may ultimately adopt its settlement procedure (see further below) or serve a statement of objections on the parties in which sets out its case. If the Commission issues a statement of objections, the parties are granted access to the information on the Commission’s file and have the opportunity to respond in writing and, if they so choose, at an oral hearing.
After considering the parties' submissions, and assuming its concerns remain, the Commission drafts an infringement decision, which will be reviewed by the Advisory Committee, comprising representatives of the NCAs, before being submitted to the College of Commissioners for formal adoption.
c) Investigations timeline
It is difficult to generalise, as the timeline can vary significantly on a case-by-case basis depending, among other things, on factors such as the existence of a leniency applicant supporting the Commission’s case. However, from initial investigation to final disposition investigations usually take several years and the Commission does not work to any target timeframes. Over the 2000-2014 period the average cartel investigation lasted over four years (from initial information-gathering stage to the decision) and there are several cases where proceedings exceeded the five-year mark.
The procedure may be initiated either ex officio or by a claim filed by any physical or legal, private or public, person. Once the claim has been filed before the Antitrust Commission, the claimant will be summoned in order to ratify or rectify it. The claim shall include: (a) name and domicile of the claimant; (b) specific description of the claim’s purpose; (c) the facts that support the claim; (d) a summary of the applicable law; and (e) evidence for the analysis of the claim. Claims may be dismissed in limine if the Antitrust Commission concludes that the alleged infringement does not fall within the legal description of restrictive practices. Otherwise, the accusation must be notified to the alleged infringer, who must submit explanations and comments within 15 business days.
If the explanations are regarded as conclusive or if there is no sufficient evidence for the claim, the docket may be archived. Otherwise, the Antitrust Commission must continue the investigation, decide about the notification to the alleged infringers, who must form a defense and offer the evidence to be produced within 20 business days.
The Antitrust Commission will fix a term to produce evidence and, afterwards, appraise the evidence. Decisions about the evidence produced are final and may not be appealed. The evidence period is of 90 business days and may be extended for the same period. The Antitrust Commission has to issue its final decision in within 60 business days.
Up to the issuance of the decision, the alleged infringer may propose an “agreement” entailing the immediate or gradual cessation of the actions which originated the accusation. If the proposal is accepted by the Antitrust Commission, the investigation is archived.
The Antitrust Commission may give intervention to third parties, such as the affected parties, consumer associations and commercial chambers, public authorities and any other person that may hold a legitimate interest in the investigated facts.
Furthermore, the Antitrust Commission may request for non-binding resolutions on the investigated facts to physical or legal persons, either public or private.
Finally, whoever files a false / scam claim may be subject to the sanctions provided under the Antitrust Law.
The first step in the investigation is normally either an information request or an unannounced inspection. Everyone is obliged to provide any information requested by the NCA and the NCA is empowered to examine all forms of documentary evidence and business records in order to secure evidence. Comparable powers are granted ESA through Protocol 4.
After initiating the case, the authorities will examine the collected evidence. They may issue additional information requests and request oral testimonies from employees or officers. The authorities may also collect evidence from third parties, e.g. customers. There are examples of the NCA conducting a second unannounced inspection. During this investigating phase, it is not uncommon for the company under investigation to request meetings with the authorities or send written submissions to present relevant facts and provide their view on the matter.
After the examination of relevant facts and evidence, the authorities will decide upon whether to proceed with the case. If the Authority proceeds towards decision, the undertaking will be provided a statement of objections and given the opportunity to provide their comments, before a final decision is issued.
A cartel investigation can be launched following a complaint by a competitor, supplier or customer of one of the cartel participants, at the BCA’s proper initiative, on injunction from the minister, or – more commonly – following an immunity or leniency application filed by one of the companies part of the cartel or by an individual that participated in the cartel.
In case of a complaint that is filed with the Competition Prosecutor General, such a complaint can be dropped by the College of Competition Prosecutors if they consider that the complaint is inadmissible, not well-founded, or in view of the limited resources and the priorities of the BCA that are set. Such a reasoned decision is open to appeal by the complainant, within 30 days of receipt of the decision. Such an appeal must be filed with the president of the BCA who will then compose the Competition College that will review the appeal. When it comes to complaints relating to cartels, which is rare in any event, it is to be expected that the BCA will take up the case.
Investigations are carried out by the Investigation Service, under the direction of the Competition Prosecutor General. Upon receipt of information, a distinct team will be appointed that will handle the investigation. This team is then led by a Competition Prosecutor.
After internal review of the information at their disposal, which may – among others – be the information contained in an immunity or leniency application, the BCA may organize surprise inspections at the company premises or at the private homes of individuals. This would be the typical first relatively public step in a cartel investigation. The BCA has published guidelines on surprise inspections. They were adopted by BCA decision of 17 December 2013. Any decision to carry out such a surprise inspection is subject to a prior authorisation of the examining magistrate (onderzoeksrechter/juge d’instruction). The guidelines describe in relative detail the investigative powers of the ABC including rules on how to conduct searches of digital information.
Next to surprise inspections, the ABC can also send requests for information to the undertakings concerned. Refusals to respond to such requests for information, late responses or incomplete or wrong responses can result in fines and/or penalty payments.
If the College of Competition Prosecutors considers that the investigation is justified, the Competition Prosecutor General communicates a statement of objections to the undertakings and natural persons involved, and gives access to the evidence that was used to reach their provisional conclusion, and also to all non-confidential versions of documents and information collected during the investigation. The parties will get at least one month to respond to the statement of objections.
At the latest one month upon receipt of the undertakings’ and natural persons’ responses, the Competition Prosecutor, on behalf of the College of Competition Prosecutors, will file a reasoned draft decision with the president of the BCA. Upon receipt of the draft decision, the president without delay will compose the Competition College that will hear the case and he will submit the draft decision as well as the procedural file to the Competition College.
Simultaneous with the filing of the draft decision with the president of the BCA, the parties whose behaviour is investigated also will be informed of this event and will be given access to the investigation file and to the file of procedure. In case of a complaint, the complainant will also be informed of this event and will be given access to a non-confidential version of the draft decision.
As soon as the parties under investigation have been given access to the file, they have two months to submit their written observations and the documents of the investigation file they wish to add to the file of procedure. Upon reasoned request, this period can be extended.
Upon receipt of the written observations of all parties who are qualified to file observations, or after expiry of the deadline for filing such written observations, the written part of the proceedings is closed. The president will then organize a hearing of the Competition College. Such a hearing must take place at least one month and at most two months after closing of the written procedure.
The Competition College takes a decision within a term of one month after hearing the case. This term can be suspended if consultation with the European Commission is required.
At any stage of the investigation, but before filing a draft decision with the Competition College, the Investigation and Prosecution Service can invite the parties under investigation to enter into a settlement with the BCA. If such settlement discussions are initiated, this will suspend all other periods described above until the settlement talks are terminated or lead to a settlement decision. The settlement procedure is described in detail in Articles IV.51 to IV.57 CEL and will be explained under question 4 Settlement below.
The limitation period for finding an infringement is five years, with a maximum of 10 years, after termination of the infringement. An appeal before the Brussels Market Court will suspend this limitation period and will therefore allow a total duration that may exceed 10 years in total.
Investigations in cartel cases may be launched:
- after the HCC’s ex officio initiation of proceedings;
- following a complaint filed with the HCC; or
- upon a leniency application.
There are no particular legal requirements for lodging a complaint against a cartel. Unlike the proceedings before the European Commission, complainants are not required to demonstrate a legitimate interest for lodging the complaint.
When the investigation is deemed mature and pursuant to the prioritisation system of the HCC, the President of the HCC – following a proposal by the Directorate-General – brings before the Commission the relevant cases.
The cases are, then, assigned to a Commissioner-Rapporteur who shall submit a proposal to the Plenary of the HCC within one hundred and twenty days from its assignment (this time limit can be extended at most by sixty days).
Each decision of the HCC is reached within twelve months from the assignment of the relevant case to the Commissioner-Rapporteur (this time limit can be extended at most by two months).
Note that there is no time limit regarding the period between the initiation of proceedings and the assignment of the case to a rapporteur. However, when examining a case, the HCC should bear in mind that the infringements of the provisions of the Competition Act, which provide the HCC with the competency to impose penalties, are subject to a five-year limitation period. The limitation period commences on the day on which the infringement is committed or on the day on which the infringement ceases, in case of continuing or repeated infringements. Any action taken by the HCC or any other competent competition authority, for the purpose of the investigation or the proceedings in respect of the infringement in question, shall interrupt the limitation period for the imposition of fines.
The CCI can initiate an investigation into a cartel either: (i) on its own motion (suo moto); (ii) on the basis of a complaint (known as an “information”) filed by any person, consumer or their association or trade association; (iii) following a reference from the central or state government, or a statutory authority. An investigation may also be started on the basis of a leniency application, which the CCI treats as a suo moto investigation.
On the basis of the evidence available before it, if the CCI is of the prima facie view that a contravention of the Competition Act has taken place, it will direct the DG to investigate the matter. If the CCI is of the prima facie view that there is no contravention of the Competition Act, the CCI will close the investigation.
When the DG is directed to investigate the matter, it must conduct the investigation in a time bound manner and submit a report to the CCI containing its findings on the allegations before it (DG Report). The DG is required to submit the DG Report within 60 days from the receipt of the directions of the CCI. However, the DG is allowed to request extensions of time, and the submission of the DG Report generally takes around one to two years.
After consideration of the DG Report, the CCI usually forwards it to the parties concerned, giving them an opportunity to respond. If the CCI is not satisfied with the DG Report, it may conduct its own inquiry or may require the DG to conduct further investigation before forwarding the final DG Report to the parties.
After receiving a response from the parties, the CCI may provide them with an opportunity to be heard. Once any oral hearings in the matter are concluded, the CCI must, as far as practicable, pass its final order in the matter within 21 days of the date of final arguments. In practice, the CCI often takes much longer in issuing its final orders.
The SCA can obtain information on suspected violations of Swedish competition law upon leniency applications by one of the cartel members (acting as a whistle-blower), a third-party complaint or through investigations launched by the SCA at its own initiative. When a suspected cartel conduct comes to the SCA’s attention, the SCA will first proceed with taking a decision on whether to prioritise and proceed with an investigation or formally dismiss the matter (thereby triggering a subsidiary right for concerned companies to directly bring actions before the Patent and Market Court). The SCA’s decision-making process in relation to the prioritisation of matters for further investigation is conducted on basis of its prioritisation policy and by weighing all relevant circumstances.
Following its decision to initiate a formal investigation, the SCA can conduct on-site inspections (i.e. dawn raids) upon authorisation from the Patent and Market Court. The SCA may also question the representatives of the suspected companies and request information from the suspected companies, consumers and other relevant market actors.
Should the SCA find that it has sufficient evidence to prove the existence of a cartel, it will issue a statement of objections to the suspected companies, setting out the evidence available to it and its preliminary conclusions as to the infringement. The suspected companies will then be given an opportunity to respond to these allegations, after which the SCA may:
- order the company(ies) to cease the infringement under penalty of a fine;
- bring an action against the company(ies) before the Patent and Market Court with a request for an administrative fine; or
- issue a fine order if the company(ies) concerned does not contest the SCA’s statement of objections (see section 4.1 below).
The approximate timeframe for the SCA’s investigation depends on the complexity and scope of the matter and can range between one to several years.
The CPC commences an investigation acting either on its own initiative or as a result of a complaint submitted to it or following an application for leniency. Ex officio investigations are typically initiated by conducting dawn raids at undertakings’ business premises. The Commission’s Service carries out a preliminary investigation of the case on the basis of which the Commission decides whether the case merits further investigation. If this is indeed the case, the CPC will inform the relevant parties that they are officially under investigation and will request their cooperation and the submission of relevant information.
After the conclusion of the investigation, the CPC will forward a statement of objections to the undertakings concerned which sets out the facts upon which it relies, its reasoned provisional conclusions and the action likely to be taken. The undertakings concerned are allowed to have access to the CPC’s file in order to prepare their written submissions to the CPC. In addition to submitting their written submissions they can also request an oral hearing before the CPC in order to orally support their case. If the CPC concludes that it has sufficient evidence to support a finding of prohibited cartel behaviour, it will issue a fully reasoned infringement decision. The CPC may also, subject to its discretion, arrange state of play meetings either by ex officio or by the parties’ request at any point during the proceedings.
Any concerned person may file a complaint with the Competent Authority regarding any violation of the UAE Competition Law. The complaint shall include the following information: 1). The name of the Complainants; 2). The parties against whom the complaint is filed; 3). The provisions of the Competition Law claimed to have been violated; 4). the facts related to the violation of the provisions of the Competition Law; 5). The practices claimed to have been violated and 6). The documentary evidences that support the complaint.
Once the complaint is filed, the Competent Authority shall follow certain statutory procedures and strict formalities. It starts by examining the complaint, along with the supporting evidences and may request the complainant to provide the Authority with any information or documents as it deems necessary for the examination of the complaint. The complainant shall provide the Competent Authority with the requested information or documents within (15) fifteen days from the date of sending the request for information by the Authority.
Upon the completion of the examination of the compliant, the Competent Authority shall issue a notification to the complainant either 1). Accepting the complaint due to adequate information that permits commencing an investigation into the complaint or 2). Rejecting the complaint due to insufficient information that permits commencing an investigation into the complaint.
Upon the acceptance of the complaint, the Competent Authority shall notify the parties against whom the complaint is filed (“The Defendants”) regarding the subject of the complaint within (10) ten days in order to give the Defendants the opportunity to defend themselves. The notification of complaint shall include sufficient information about the allegations; the practices which are claimed to violate the UAE Competition Law, the provisions of the UAE Competent Law which are violated by the Defendants and a deadline for the Defendants to submit their response to the complaint.
The Competent Authority shall investigate the complaint, along with the supporting evidences and may request the parties to provide the Authority with any information or documents it deems necessary for the consideration of the complaint. The parties shall provide the Competent Authority with the requested information or documents within (30) thirty days from the date of sending the request for information by the Authority. The said mentioned period could be extended for another (30) thirty days provided that such extension does not affect the investigation procedures of the complaint.
The Competent Authority may take any action it deems necessary to investigate and consider the complaint, including holding meetings with the parties of the complaint and any parties related thereto. Thereafter, the Competent Authority shall prepare a detailed report to the Minister of Economy which shall include information about the facts and procedures taken by the Competent Authority in relation to the compliant, evaluation of the information, evidences and pleas submitted by the parties as well as proposed decision in relation to the complaint. The Competent Authority shall submit the detailed report to the Minister of Economy within (10) ten days as of the date of completion the preparation of the report.
The Minister of Economy shall issue a reasoned decision in respect of the complaint within (30) thirty days from the date of submitting the report by the Competent Authority. Thereafter, the Minister of Economy shall inform the parties of the complaint about the decision no later than (10) ten days from the date the decision is made.