Administrative fines and leniency
Adopted by the Ministry of Modernisation 22 August 2005, pursuant to Act of 5 March 2004 No. 12 on Competition between undertakings and control of concentrations (Competition Act), Section 29, sixth paragraph; see Royal resolution of 16 April 2004 No. 631.
Chapter 1. Scope
Section 1 Scope
This regulation establishes detailed rules on the calculation of administrative fines pursuant to Section 29 of the Competition Act and leniency pursuant to Section 31 of the Competition Act. The term leniency means in this regulation full or partial reduction in the administrative fines related to an infringement of Section 10 of the Competition Act.
The provisions for calculating administrative fines for undertakings are applied correspondingly to associations of undertakings.
Chapter 2. Calculation of administrative fines
Section 2 Maximum administrative fine
The Competition Authority may impose administrative fines up to 1 percent of the undertaking’s turnover if the undertaking or someone acting on its behalf, intentionally or negligently:
a) infringes Section 18, first paragraph,
b) infringes a decision or regulation pursuant to Section 23,
c) fails to comply with orders pursuant to Section 24 or 25,
d) gives incorrect or incomplete information to the competition authorities,
e) breaks a seal made pursuant to Section 25, or
f) contributes to an infringement listed in letters a through e.
The Competition Authority may impose administrative fines up to 10 percent of the undertaking’s turnover if the undertaking or someone acting on its behalf infringes, intentionally or negligently:
a) Section 10 or 11,
b) decision pursuant to Section 12,
c) regulation pursuant to Section 14,
d) decision pursuant to Section 16,
e) Section 19, first paragraph,
f) decision pursuant to third paragraph, Section 19, or
g) contributes to an infringement listed in letters a through f.
The term turnover is the undertaking’s total sales revenue for the latest accounting year. If an association of undertakings infringes the Act and the infringement concerns activities of undertakings that are members of an association, turnover means the total sales revenues of the members that are active on the market affected by the infringement.
Section 3 Details of the calculation of fines
It follows from Section 29, third paragraph of the Competition Act that calculation of the administrative fine shall principally take into account the undertaking’s turnover and the gravity and duration of the infringement. If the infringement concerns Section 10 of the Competition Act, the regulations on leniency in Chapter 3 also apply.
In assessing the gravity of an infringement, particular consideration will be given to:
a) the nature of the infringement,
b) the actual effect of the infringement on the market,
c) the size of the affected market,
d) the undertaking’s profits,
e) degree of guilt,
f) whether the person infringing the Act had played a leading or a passive role in the infringement.
Other elements that can influence the calculation of the fine are inter alia:
a) whether the arrangement or action was carried out,
b) whether the undertaking through guidelines, instruction, training, supervision or other actions could have prevented the infringement,
c) whether the undertaking has assisted the Competition Authority in its investigation of the infringement,
d) the financial position of the corporate group of which the undertaking is a part.
For an infringement that has lasted between one and five years, the amount based on the elements in the second and third paragraph, can be increased up to 50 percent. When the duration of the infringement exceeds five years, the amount can be increased up to 10 percent for each year the infringement has lasted.
Chapter 3. Leniency in the case of infringement of Section 10 of the Competition Act
Section 4 Full leniency
Full leniency will be granted if the undertaking, on its own initiative, is the first to submit evidence, as provided in Section 5, that is sufficient to:
a) acquire a court order to secure evidence pursuant to Section 25 of the Competition Act in connection with a possible infringement of Section 10 of the Competition Act, and the Competition Authority, at the time the information is submitted, is not in possession of sufficient evidence to be able to acquire such an order, or
b) prove an infringement of Section 10 of the Competition Act, and the Competition Authority, at the time the information is provided, is not in possession of sufficient evidence to prove such infringement.
Full leniency will not be given if the undertaking:
a) does not fully cooperate with the Competition Authority’s investigation, including to provide all evidence that is known to the undertaking and to answer any question or inquiry the Competition Authority has in connection with the infringement,
b) does not end its participation in the infringement at the latest when the evidence is submitted pursuant to first paragraph, letter a or b, unless the Competition Authority has requested a different course of action, and
c) has sought to coerce other undertakings to participate in the infringement.
Only one undertaking may be granted full leniency for the same infringement.
Section 5 Submission of evidence
When an undertaking submits evidence pursuant to Section 4 it shall either:
a) immediately submit all evidence that it has in its possession, or
b) give a clear description of the nature and content of the evidence.
If the submission is made under the first paragraph, letter b the undertaking must, at a date set by the Competition Authority, provide all evidence regarding the infringement that it has in its possession.
The undertaking may request the return of submitted evidence that does not fulfil the conditions in Section 4, first paragraph. Nevertheless, this does not prevent the Competition Authority from acquiring additional information pursuant to Sections 24 and 25 of the Competition Act.
Section 6 Partial leniency
Partial leniency will be granted if the undertaking:
a) submits evidence that significantly strengthens the Competition Authority’s ability to establish an infringement of Section 10 of the Competition Act, and
b) ends its participation in the infringement no later than when the evidence is submitted pursuant to letter a.
Section 7 Reduction in the administrative fine in the case of partial leniency
If the undertaking is granted partial leniency, the administrative fine will be reduced as follows:
a) The first undertaking that fulfils the conditions in Section 6 is granted a reduction of 30 to 50 percent.
b) The second undertaking that fulfils the conditions in Section 6 is granted a reduction of 20 to 30 percent.
c) Any other undertaking that fulfils the conditions in Section 6 is granted a reduction up to 20 percent.
The precise calculation of the leniency in accordance with the first paragraph shall take into account how timely the evidence was submitted, the extent to which the evidence strengthened the case and the extent to which the undertaking has cooperated with the Competition Authority.
Section 8 Request for leniency
A request for leniency pursuant to Sections 4 and 6 should be addressed to the Competition Authority.
The Competition Authority will issue a written confirmation stating the date and time the request, with corresponding evidence, is received. The confirmation shall include identification of the evidence submitted.
Section 9 Response to a request for leniency
If the Competition Authority, on the basis of the submitted evidence, finds that the conditions for full leniency under the first paragraph of Section 4 are fulfilled, it will inform the undertaking as soon as possible that full leniency will be granted, as long as the conditions in the second paragraph of Section 4 are complied with.
In the case of a submission of evidence pursuant to the first paragraph, letter b of Section 5, the Competition Authority will assess whether the description of evidence fulfils the conditions in the first paragraph of Section 4, and then inform the undertaking of the result as soon as possible. If the Competition Authority finds that the later submitted evidence corresponds to the description, it shall, as soon as possible, grant the undertaking full leniency as long as the conditions in the second paragraph of Section 4 are complied with.
If the Competition Authority, on the basis of the submitted evidence, finds that the conditions pursuant to the first paragraph, letter a of Section 6 are fulfilled, it shall inform the undertaking in writing as soon as possible that partial leniency will be granted pursuant to the first paragraph, letter a, b or c of Section 7, as long as the condition in the first paragraph, letter b of Section 6 is complied with.
Chapter 4. Entry into force
Section 10 Entry into force
This regulation enters into force immediately.
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