The Act makes significant changes to the competition law enforcement regime in Ireland beyond the requirements of ECN+, strengthening the power of the Competition and Consumer Protection Commission (“CCPC”) and other NCAs^[1] in domestic antitrust enforcement. This briefing focuses on the additional powers that the Act grants to the CCPC and the other Irish NCAs to ensure the effective enforcement of competition law in Ireland, a separate briefing focussing on the reforms to Ireland’s merger control regime is available here.

ECN+ applies whenever NCAs are applying Article 101 TFEU (the prohibition on restrictive agreements) and Article 102 TFEU (the prohibition on abuse of a dominant position), including when equivalent national competition laws are applied in the same case.

Key Reforms in the Act

Introduction of civil administrative fines

The Act provides the CCPC^[2] with the power to impose civil fines for competition infringements of up to a maximum of €10 million or 10% of an undertaking’s worldwide turnover in the preceding financial year.  However, following concerns raised about adequate oversight and compatibility of such a regime with the Irish Constitution, any civil fines proposed by the CCPC must be confirmed by the High Court. This is a significant development as the CPPC has not to date had the power to find infringements of competition law and impose fines.

Separately, the Act also significantly increases the fines that may be imposed by the courts in criminal proceedings for infringements of competition law to €50 million or 20% of an undertaking’s turnover in the preceding financial year.

New procedures for civil enforcement

Alongside enhanced penalties for infringements of the competition rules, the Act introduces a more developed and formalised new civil enforcement process under which the CCPC can investigate breaches of competition law.  Following an investigation, and prior to a fine being issued, the CCPC can issue a Statement of Objections (“SO”), setting out the agency’s preliminary views regarding the alleged breach or non-compliance by the undertaking involved.  The undertaking then has the right to make written submissions in response to the SO.

Where an SO is issued, and following receipt of written submissions from the undertakings involved, the CCPC may decide to continue its investigation, close the investigation without further action, agree legally binding commitments with the relevant undertakings or refer the matter to an Adjudication Officer (“AO”) for determination as described below.

The role of Adjudication Officers

Under the terms of the Act, a panel of AOs will be nominated by the CCPC and appointed by the relevant Minister. AOs must be independent in the performance of their functions. Once a case is referred to an AO, they can arrange for further written submissions or oral hearings, and have the same powers, privileges and rights as a High Court judge when hearing civil proceedings.

If an AO considers that, on the balance of probabilities, there has been a breach of competition law (or other relevant matters under their adjudicative remit), the AO may decide to impose a fine or a periodic penalty payment. In recent months, the CCPC has been holding public consultations on how its new powers will operate. Following these consultations, the CCPC will publish guidelines on the operation of its powers and, where relevant, the Act obliges AOs to have regard to these guidelines in carrying out their functions. A decision of the AO can be appealed to the High Court, which has the authority to annul or vary the decision if it is satisfied that, when making the decision, the AO made a serious and significant error of law or fact.

Periodic Penalty Payments

The Act introduces a new provision allowing for the imposition of “periodic penalty payments”. An AO may impose a periodic penalty payment on an undertaking in order to compel them to: (i) comply with a search; (ii) provide complete or correct information in response to a request for information; (iii) attend at an interview, give evidence or produce information or documentation before the CCPC; (iv) comply with a prohibition notice (see below); or (v) comply with commitments. The amount of the period penalty payment may be up to 5% of the average daily total worldwide turnover of the relevant undertaking in the preceding financial year.

Prohibition Notices

The Act provides the CCPC^[3] with the power to issue prohibition notices as a forum of interim measure during an investigation if it believes that there is a risk of serious and irreparable harm to competition.

Under a  prohibition notice the CCPC may specify measures to be taken, including an order to: (i) remedy any suspected infringement of relevant competition law to which the notice relates, (ii) avoid or limit serious and irreparable harm to competition, or (iii) otherwise comply with, or address matters specified in, the notice.

Introduction of a Leniency Programme

As required by ECN+, the Act introduces a graduated leniency programme to supplement the current Cartel Immunity Programme, which is available in respect of criminal sanctions.

Under the new proposed leniency programme, the CCPC may grant immunity from an administrative financial sanction to an undertaking that is the first to come forward with evidence of an infringement, provided that certain conditions are met.  Undertakings that do not qualify for immunity may apply for leniency and receive a reduction of administrative financial sanctions. To qualify for a reduction, an undertaking must:

• Disclose its participation in a cartel;
• Provide evidence of the alleged cartel that the authority views as “significant added value” to the evidence already in its possession; and
• Satisfy the general conditions for leniency set out in the Act. The general conditions for leniency that an applicant must satisfy include ending its involvement in the cartel, cooperating with the relevant authority and ensuring that it has not destroyed, falsified or concealed evidence relevant to the application.

The CCPC may consider the timing of the submission and its overall value to the investigation when determining the level of reduction in potential fines, but the maximum level of reduction available is 50%.  This reduction reduces for each subsequent leniency applicant.

Other Reforms

The Act introduces a number of other significant reforms, including new surveillance powers for the CCPC to monitor and record those suspected of being involved in hardcore cartels, a new (and potentially wide-ranging) offence of “bid-rigging” along with substantial changes to the merger control regime (see link to separate briefing above).

The Act also introduces criminal offences for knowingly providing false or materially misleading information to an NCA where they request information relating to an investigation, or for failing to provide information in this context without reasonable cause.

In addition, the Act clarifies that NCAs can initiate legal proceedings for competition law breaches “at any time”, meaning that the previous statutory limitation period of six years for initiating legal proceedings for breaches of competition law has been dispensed with.

For further information on the Competition (Amendment) Act 2022, please contact a member of the Competition and Regulated Markets team.