Enhanced competition enforcement: recent European Commission initiatives

The European Commission is determined to enhance competition law enforcement within the EU. In March 2017, the competition watchdog issued a proposal for a Directive to empower the competition authorities of the Member States to be more effective enforcers and to ensure the proper functioning of the internal market. The Commission also put in place an anonymous whistleblower tool.

Individuals can now anonymously report conduct that is contrary to European competition law. Individuals could already alert the European Commission of potential antitrust breaches, but now the whistleblower can choose whether or not to reveal his identity.

The desirability of encouraging whistleblowers to come forward with inside information by ensuring their anonymity has been debated. Individuals could have incentives to submit partial or even false information to the Competition Authority, for instance for retaliatory motives towards the company complained about. The Competition Authority will want to investigate all tip-offs, but it risks investing too many of its already scarce resources in potentially fruitless submissions by individuals.

In the end, similar to the German Bundeskartellamt, which had already received anonymous tip-offs, the Commission decided to put in place an anonymous whistleblower tool in March 2017. In essence, the tool ensures anonymity through an encrypted messaging system run by an external service provider.

Clearly, the European Commission seeks to complement its leniency tool, allowing companies and their representatives to report anti-competitive conduct, with the companies in turn possibly benefiting from immunity or a reduction in the fine. The Commission hopes that more employees come forward with insider information about cartels.

The new internet page for whistleblowers, whether or not anonymous, can be viewed here.

The Commission also took another angle, with a proposal for a Directive enabling the National Competition Authorities (“NCAs”) to enforce EU competition rules and ensuring that they dispose of the required tools.

Despite the European Competition Network (“ECN”) allowing for coherent application of EU antitrust rules throughout the EU through better communication, disparities of enforcement remain among NCAs.

Following a public consultation launched in November 2015, the Commission proposed new rules to equip NCAs with a minimum common toolkit and effective enforcement powers, making sure that they will:

• “Act independently when enforcing EU antitrust rules and work in a fully impartial manner, without taking instructions from public or private entities.
• Have the necessary financial and human resources to do their work.
• Have all the powers needed to gather all relevant evidence, such as the right to search mobile phones, laptops and tablets.
• Have adequate tools to impose proportionate and deterrent sanctions for breaches of EU antitrust rules. The proposal includes rules on parental liability and succession so that companies cannot escape fines through corporate re-structuring. National competition authorities will also be able to enforce the payment of fines against infringing companies that do not have a legal presence on their territory, an important feature since an increasing number of companies operate internationally.
• Have coordinated leniency programmes […]” (press release IP/17/685 “Antitrust: Commission proposal to make national competition authorities even more effective enforcers for the benefit of jobs and growth”, 22 March 2017).

The proposal for a Directive has been submitted to the European Parliament and the Council in accordance with the normal legislative procedure. After adoption, the Directive must subsequently be implemented by the Member States.