Antitrust Law Daily Wrap Up, ANTITRUST NEWS: EC Competition Policy Chief Almunia Speaks on Remedies, (Mar 11, 2013)

By E. Darius Sturmer, J.D.

At an antitrust conference in Brussels on March 8, Joaquin Almunia, Vice President of the European Commission (EC) responsible for Competition Policy, offered his views on the range of instruments such as fines, remedies, and commitments that the EC can use to combat business practices that go against articles 101 and 102 of the EU Treaty. Almunia also discussed settlement procedures available to companies in the context of cartel enforcement.

Almunia began his address by describing the two principal paths of enforcement the EC can take in its pursuit of an antitrust case—prohibition or commitment—and trumpeted the cooperative nature and embrace of the commitment option by companies since its inception in 2003. He pointed to instances of commitment decisions in numerous sectors that have had a positive and rapid impact on the structure of the respective markets.

Almunia explained that the EC chooses to accept commitment offers without any admission of wrongdoing for several reasons, chief among them being to conclude cases swiftly when doing so brings the most benefits to the markets. “In certain industries—such as high-tech and fast-moving markets—it is important that competition is restored quickly and effectively,” he said. He cited commitments accepted from IBM in 2011 and in an e-books case last year, and touted the competition authority’s active enforcement of such commitments with the recent decision against Microsoft, fining them €561 million for non-compliance with pledges made in 2009.

Regarding the use of settlements in cartel proceedings, Almunia noted that companies seem to have warmed to the option since 2010, when the procedure was first implemented, even though settlement involves admitting liability and receiving fines. “[M]any companies,” he said, “are keen to settle not only because they can obtain a 10% discount on their fines, but above all because they want to put unacceptable business practices behind their backs as fast as possible.” Almunia predicted that “around half of [the EC’s] cartel cases may be concluded with settlements in the coming years,” a result that seemed to him “a good balance between the different procedural tools.”

The conclusion of cases in each of these various fashions over the past two years have enabled the EC to streamline its processes and set procedural standards for the future, Almunia said, as well as teaching the authority to better screen cases at an early stage to determine which avenue of resolution to pursue. He encouraged companies that are genuinely interested to settle “to adopt a proactive and cooperative attitude,” calling the settlement attitude “essential” to pushing cases forward.

Companies: IBM Corp.; Microsoft Corp.

News: Antitrust