CMS Expert Guide to Competition Compliance Programmes in Switzerland

Neither the Swiss Competition Commission ("Swiss NCA") nor the Swiss Federal Council has to date published any guidelines on CCPs. Swiss NCA has stated that it intends to continue assessing the adequacy of CCPs on an individual basis and therefore refrains from issuing general guidelines on CCPs that might then induce companies to simply implement guidelines that are not tailor made to the company's specific situation.

According to the Swiss Federal Supreme Court, CCPs primarily have the purpose to prevent anti-competitive practices from occurring in the first place by informing and training employees. Compliance programs are considered to be a company's management tool for implementing organizational measures to prevent unlawful conduct.

The case law of Swiss NCA and appeal courts indicates though that effective CCPs may be taken into account as a mitigating factor when calculating a fine for anti-competitive conduct if a company can demonstrate through the CCP that the violation occurred against the express will of the company and the CCP consists not only of instructions, regulations and trainings, but also includes effective monitoring, control and enforcement mechanisms (see also answer to question no. 2).

The Federal Administrative Court and the Swiss Federal Supreme Court have stated that a CCP may in principle only be considered when calculating the fine for a violation of the Swiss Cartel Act, but not on the level of culpability resulting in an exclusion of liability (see, however, answer to question no. 6).

According to the Federal Administrative Court a CCP may be considered as a mitigating factor if (i) it already existed at the time of the violation allowing the company to demonstrate through the CCP that the violation occurred against the express will of the company and (ii) the CCP consists not only of instructions, regulations and trainings, but also includes effective monitoring, control and enforcement mechanisms. However, there has not been a decision in Switzerland to date in which a CCP resulted in a reduction of the fine. 

According to Swiss case law, an effective CCP must consist not only of instructions, regulations and trainings, but also include effective monitoring, control and enforcement mechanisms (see also answers to questions no. 1 and 2 above).

For example, Swiss NCA considered in one of its decisions a compliance programme to be insufficient since it was limited to issuing an internal directive which was monitored with random sample checks and supplemented with some compliance training lessons only, while non-compliance was not sanctioned. Further, in the case of an intentional price agreement in the form of an industry-wide agreement the Swiss Federal Administrative Court held that mitigation on the basis of a CCP was excluded since the unsuitability of the CCP was obvious in such constellation.

Further, the focus clearly is on the assessment and evaluation of existing CCPs. Future efforts after a breach of the Cartel Act are not taken into account (see, however, answer to question no. 6).

The responsibility for compliance lies with the board of directors who can delegate the implementation to the management of a company. The link between the role of the company's management and employees and an effective CCP mainly is that the fact that employees do not comply with a company's CCP is considered to be an indicator that there is organizational negligence on the level of the management and the CCP not sufficiently effective.  

There is no case in Switzerland so far where the Swiss authorities did grant a reduction of the fine due to a CCP having been in place. The company always failed to demonstrate conclusively that its implemented measures (CCP) were suitable to effectively prevent any infringement of competition law and to prove that the measures taken had failed in a specific case due to special circumstances for which the company was not directly responsible.

Both Swiss NCA and the courts of appeal place high expectations on the seriousness and suitability of CCPs. Companies are required to convincingly demonstrate their efforts, explaining in detail and concretely to what extent its CCP would have been suitable to prevent the anticompetitive conduct at hand.

In Switzerland, the maximum reduction granted for mitigating reasons in practice is 20% in principle, mostly granted in connection with the conclusion of an amicable settlement. There is no case law in Switzerland on the question to what extent a pre-existing and effective CCP as such would be considered as a mitigating factor. 

In public procurement law, a distinction must be made between exclusion from ongoing public procurement procedures and exclusion from future procedures. In the case of exclusion from an ongoing procedure, neither existing nor subsequently introduced CCPs can avert exclusion from the current award procedure. The purpose of this measure is to restore legality, regardless of culpability. If bidders do not fulfil the conditions for participation, including compliance with antitrust legislation, they must in principle be excluded from the ongoing procedure.

In the case of future exclusions (so-called award bans), it should be noted that Swiss public procurement law - unlike in the EU - does not explicitly provide for the instrument of "self-cleaning" nor does it explicitly state that revised or introduced CCPs must be taken into account when deciding on sanctions. There is currently no case law (or prevailing doctrine) as to whether such measures can nevertheless avoid or mitigate sanctions.

CCPs are increasingly part of more comprehensive compliance and risk managements systems that comprise other topics such as anti-bribery, data protection, and ESG topics such as sustainable supply chains. From a competition law compliance perspective, it is important to ensure that the CCP aspect of such systems is not rendered less effective due to the (wide) scope and complexity of such systems.

Further, Swiss competition law is similar to EU competition law in many aspects but then again very different in certain areas such as, for example, vertical agreements. At the same time anti-competitive conduct often has effects both in and outside of Switzerland. Both Swiss and foreign companies are therefore well advised to consider both legal regimes when setting up and implementing their CCPs. 

As part of the partial revision of the Swiss Cartel Act in 2014, intensive discussions were held on the consideration of compliance measures when assessing sanctions under competition law. The parliamentary motion Schweiger demanded that companies with effective CCPs should either face no or only a reduced fine in the event of a competition law violation. Due to disagreements in parliament also on other aspects of the project, the entire revision of the Cartel Act was eventually rejected.

However, a revision of the Swiss Cartel Act is not required to take account of CCPs. Despite the failed revision in 2014, it is generally recognised that compliance efforts may lead to a reduction of sanction based on the current Cartel Act and the Sanction Ordinance to the Cartel Act (see answers to questions no. 1, 2 and 3). Nevertheless, Parliament is currently debating an amendment to the Cartel Act that would officially introduce a so-called "compliance defence" into the Swiss Cartel Act. The question under discussion is whether Art. 49a para. 1 Cartel Act should be amended to the effect that measures taken by undertakings to avoid competition law infringements, which are appropriate to its size, business activities and industry, may be taken into account to reduce sanctions.