• Belgium Enacts New Competition Law
  • May 3, 2013 | Authors: Bernard E. Amory; Serge Clerckx; Laurent De Muyter; Alexandre G. Verheyden
  • Law Firm: Jones Day - Brussels Office
  • A profound change to the institutional and procedural landscape for competition law in Belgium has taken place with the enactment of new competition law provisions in the Belgian Code of Economic Law (Chapter IV, Protection of Competition and Chapter V, Competition and Price Evolution). These new provisions are designed to provide for more effective enforcement, which at the same time creates new risks for potential defendants.

    Creation of revamped competition authority

    More efficient structural basis. To increase the efficiency of the Belgian Competition Authority (Belgische Mededingingsautoriteit / Autorité belge de la concurrence) (the "Authority"), it will now operate as an administrative authority.  Its previous stature as an administrative court resulted in significant delays.

    New functions of President and General Auditor. The new President and General Auditor hold the key roles in the oversight and initiatives of the Authority.  The President will be responsible for representing the Authority and for its effective functioning and will be directly or indirectly implicated in all decisions adopted by the Authority. The Auditor General will have overall responsibility for investigating and prioritizing cases.

    Creation of a price "observatory" and new powers of intervention in pricing/margins. A new price "observatory" (prijzenobservatorium / observatoire des prix) will be responsible for monitoring price evolutions in the event of perceived competitive problems in relation to prices or margins. The Authority has the power to adopt provisional means in view of remedying such perceived pricing or margin problems in the event of urgent need for businesses or consumers. These provisional measures by the Authority are to be followed by structural measures proposed by the Minister of Economic Affairs.

    Major procedural modifications

    Complete overhaul of procedures for summary proceedings. While the conditions for summary proceedings before the Authority remain unchanged, the procedure has been completely altered.  Following an applicant’s initiation of proceedings, the case may now be heard within very short timeframes and without the involvement of the Authority’s auditors (the office for investigating cases). This procedure may become a substitute for summary proceedings (kortgeding/référé) before the Belgian Commercial Court since in practice the new procedure means that in order to maximize chances of success, an application must already provide the necessary evidence in support of a claim.

    Introduction of settlement procedure for all restrictive practices. The new possibility for settlements is available for all cases of restrictive practices and is not limited to cartels. Companies will be eligible for a reduction of 10% of their fine if they accept a settlement, but in return, they must recognize their liability.  Settlement decisions are final and not subject to appeal.

    Introduction of individual liability

    Possible administrative sanctions on individuals. The new Competition law also introduces the possibility of imposing administrative fines on individuals who have directly participated in serious violations of competition law consisting of agreements on prices, limitation of output, and bid rigging.

    Capped sanctions. Individual fines may not exceed €10.000.

    Uncertainty of impact of new Competition law provisions

    The new Competition law provisions contain worrisome loopholes and inconsistencies, notably in relation to issues of confidentiality, access to the file, and the appeal of the Authority’s decisions before the Brussels Court of Appeal. These deficiencies are likely to result in material inefficiencies in applying these new provisions.