Navigating the Globe: Cartel Enforcement Around the World

Transcription

1 Navigating the Globe: Cartel Enforcement Around the World Chapter 13: Germany Presented by the Cartel and Criminal Practice Committee and the International Committee July 18, 2013

2 Presenters Moderator: Mark R. Rosman, Partner, Wilson Sonsini Goodrich & Rosati, Washington, D.C. Panel: Christian Horstkotte, Partner, Baker & McKenzie, Dusseldorf, Germany Katharina Krauss, Head of Unit, German Federal Cartel Office, Bonn, Germany Jens-Olrik Murach, Partner, Gibson, Dunn & Crutcher, Brussels/Munich, Belgium/Germany 2

3 Discussion Outline German Cartel Laws Leniency/Immunity Process Negotiation Process Recent Developments Questions & Answers 3

4 Overview Sec 1 Act Against Restraints of Competition Harmonized with EU law (Art 101 TFEU) Covers horizontal and vertical restraints EU Block exemptions applicable De minimis notice except for hardcore restrictions Monetary fines on companies (up to 10% of worldwide turnover) and individuals (up to 1 million) Sec 298 Criminal Code (bid rigging in public procurement) Criminal liability for individuals, monetary fine or imprisonment up to 5 years 4

5 Investigative Process Two types of proceedings: (i) administrative and (ii) fines In fines proceedings FCO can search premises and private houses (dawn raids), confiscate evidence and interview suspects and witnesses In administrative proceedings FCO usually investigates by sending questionnaires Decision by FCO with reasons Review by Court of Appeals Düsseldorf (first instance, full fact finding and own decision on fines) and Federal Supreme Court (second instance, only legal assessment) 5

6 Investigative Process In principle EU NCAs remain competent for investigations in violation of Art 101 (possibility of parallel investigations and fines) FCO informs other NCAs and EU Commission of initiated proceedings through the intranet of the European Competition Network EU Commission may initiate own proceedings before NCA decide and block the NCAs competence EU Commission also refers cases to NCAs 6

7 Leniency/Immunity Program Leniency Notice of 2006 Horizontal cartels Immunity for first to report and to fully cooperate Possibility of reduction of fines up to 50% for runnerups FCO accepts markers (written or oral, in German or English) FCO operates online communication platform for anonymous tip-offs (not only for delinquents but also for witnesses) 7

8 Statistics: Leniency Applications

9 Negotiation Process Many of the recent cases have been settled (cumulated with leniency application) Settlement practice is not codified, FCO issued no notice, rather informal process: Acknowledgment of the facts and acceptance of fine Waiver of full access to file and of receipt of statement of objections possible, only short form decision Common sense not to appeal (not enforceable) Reduction of fine approx. 10%, possibility to discuss dimension of violation (duration, turnover calculation) 9

10 Recent Developments Sanctions new guidelines Focus of the FCO in recent cases Resale price maintenance Information sharing between competitors Access to file / Pfleiderer judgment 10

11 Sanctions Limit: 10 % of the worldwide turnover of the corporate group High level of fines In 2012: 316 million In addition: fines (up to 1 million) can be imposed on the acting individuals Sec 298 Criminal Code (bid rigging) Criminal liability for individuals, monetary fine or imprisonment up to 5 years Increasing number of damage claims in addition to fines 11

12 Statistics: Fines imposed by the FCO

13 Examples of Fines Year Case Sum Single 2007 Advertising time m m 2008 Roof tiles m 66.3 m 2009 Coffee m 83.0 m 2010 Glasses m 23.7 m 2011 Fire engines 50.0 m 30.0 m 2012/13 Railway tracks m m 2013 Flour 65.0 m 24.0 m 13

14 New Fining Guidelines Federal Court of Justice in Grauzement case: 10% threshold is the upper fine limit, no cap Different from EU Commission (Art. 23 Reg. 1/2003) In June 2013, the FCO released new guidelines on the setting of fines 10% threshold is the upper limit of the range of fine Individual range for each undertaking based on total turnover (10% of affected turnover multiplied by 1 6) Within range various factors to be taken into account 14

15 Focus in Recent Cases Resale price maintenance Imposing pressure on retailers to sell at recommended resale prices In particular re online sales Information exchange between competitors Various cases in 2012 and 2013 Consumer goods, drugstore products, confectionary In many cases: exchange of status and process of negotiations with retailers seen as in infringement Often triggered by leniency applications 15

16 Damage Claims Hot topic in Germany: Access to file European Court of Justice: Pfleiderer jugdment Followed by Bonn Local Court No access to leniency documents Importance of leniency applications (39 bonus applications in 2011/2001 in 37 cases in 2012 and 29 cases in 2011) Balancing of interests by Bonn Local Court: effective application of leniency programs should prevail over the interests of damage claimants 16

17 Questions & Answers 17

18 Biographies

19 Dr. Katharina Krauss Katharina Krauss is Head of Unit at the German Federal Cartel Office (FCO) in Bonn, Germany. She advices the Decision Divisions of the FCO in fines proceedings and notably in the preparation, conduct and result analysis of search operations and in the application of the German leniency notice. She has more than 10 years of practical experience as a case handler and case manager in cartel and merger cases of the FCO. She has written and lectured on criminal procedural law, cartel enforcement and antitrust law. 19

20 Christian Horstkotte Christian Horstkotte is a Partner in the Dusseldorf office of Baker & McKenzie. He heads the firm's German/Austrian antitrust and competition practice. Christian advises clients on all aspects of German and European antitrust law, focusing on complex merger control proceedings as well as cartel cases before German and European competition authorities and courts. He gives compliance trainings on a regular basis and also has a broad experience in dominance cases. His practice in particular focuses on clients in the energy, financial services, FMCG, IT and logistics industries. Christian is publishing and lecturing on a regular basis. He is co-author of Frankfurter Kommentar zum Kartellrecht where he comments on various articles of the EU cartel regulation no. 1/2003. He is member of the German Association of Antitrust Lawyers (Studienvereinigung Kartellrecht) where he co-chairs the Düsseldorf/Cologne regional group. Prior to joining Baker & McKenzie 2011 as a partner, he practiced nine years in Freshfields Bruckhaus Deringer's Brussels and Dusseldorf offices. 20

21 Dr. Jens-Olrik Murach Jens-Olrik Murach is a partner in the Brussels and Munich offices of Gibson, Dunn & Crutcher LLP. For more than ten years, Jens has been practicing antitrust law in Germany and Brussels. His practice comprises counseling on all aspects of EU and German antitrust law, including merger control and joint ventures, restrictive practices, market dominance, cartel investigations, market and sector investigations, as well as private antitrust litigation. Jens-Olrik regularly represents clients in cartel investigations before the German Federal Cartel Office (Bundeskartellamt) and the European Commission as well as before courts. Jens-Olrik is author of a book on German Merger Control (Deutsche Fusionskontrolle, Erich Schmidt, 2011) and co-author in the Frankfurt Commentary on Antitrust Law (Frankfurter Kommentar zum Kartellrecht, Otto Schmidt). He teaches German and EU antitrust law in the Master Program on White Collar Crime of the University Osnabrück. 21

22 Mark R. Rosman Mark Rosman is a Partner in the Washington, D.C., office of Wilson Sonsini Goodrich & Rosati and a member of the firm s antitrust practice. Prior to joining WSGR, Mark served as Assistant Chief of the National Criminal Enforcement Section in the U.S. Department of Justice's Antitrust Division. In this role, he oversaw teams of trial attorneys and law enforcement agents who prosecuted numerous cartel cases and related violations, including Foreign Corrupt Practices Act (FCPA) violations, bribery, wire fraud, obstruction of justice, and kickbacks. Mark was lead attorney on many of the Section s most prominent enforcement actions, including the Antitrust Division s investigation into air transportation price-fixing its largest ever which resulted in a record $1.8 billion in fines. Previously, Mark was Special Assistant to the Directors of Enforcement in the Antitrust Division s Office of Operations, where he assisted Directors and Deputy Assistant Attorneys General in criminal matters and merger and civil non-merger cases. He worked on many cases involving amnesty, recommended indictments, plea agreements, immunity, investigations, and case development. Mark began his legal career as a trial attorney in the Dallas field office of the Antitrust Division. 22