As of 1 April 2010 the most recent amendment to the Act LVII of 1996 on the prohibition of unfair market practices and unfair competition (“Competition Act“) will enter into force. The amendment concerns the possibility of rewarding private individuals who provide essential written evidence to the Hungarian Competition Office (“HCO”) for the establishment of infringements under Article 11 of the Competition Act or Article 101 of the TFEU of the following types:
- price-fixing;
- market-sharing (also in tender procedures); and
- determining production/sale quotas.
The evidence must be in written form and must be essential for the establishment of the infringement. The information provided is also considered essential evidence if, based on such information, the court issues a writ allowing the HCO to carry out a dawn raid (an unexpected visit of the HCO at the undertaking’s premises to collect evidence), and the HCO produces essential evidence during the dawn raid.
The evidence must be provided by a private individual; legal representatives of undertakings which have already applied for leniency may not be rewarded. An individual may be rewarded only once. No reward is granted if evidence is obtained by committing a crime and where the judgement relating to the crime/offence is made after the payment of the reward, the reward will be returned to the HCO.
The HCO will ensure that individuals who wish to submit essential evidence may contact the HCO on an anonymous basis in order to see whether the evidence would qualify as essential, and that they can request the confidential treatment of their personal data. However, this preliminary assessment of the evidence is not binding on the HCO. Furthermore, the HCO may invite the individuals to testify in the respective competition control procedure, if initiated.
The amount of the reward is fixed at 1% of the fine imposed by the HCO on the undertaking, but cannot exceed 50 million forints (approx. EUR 190.000). When the individual provides essential evidence he/she must notify the HCO within five (5) days from the preliminary assessment that he/she claims the payment of the reward. The reward is paid after the decision is reached by the HCO in relation to the infringement. The HCO shall not be entitled to claim a refund of the reward even if the court – when reviewing the HCO’s decision - reduces the amount of the fine, annuls the decision or modifies it so that the evidence provided is no longer considered to be essential, unless the court has established the illegality of the evidence provided.
“Awarding the informers may lead to an increased efficiency in the exploration of cartels, promoting prevention.” – said Mr. Lajos Wallacher, the vice-president of the HCO to the press.
Law: Act LVII of 1996 on the prohibition of unfair market practices and unfair competition
