Compliance, and in particular competition compliance, remains at the top of in-house counsel’s agenda. In particular, compliance is fundamental to reducing competition law infringements – “prevention is better than cure” – but in-house counsel often face difficulties in getting the appropriate level of support and budget for effective competition law compliance.

We have recently published an article which puts forward a policy proposal to the European Commission (“Commission”) that would not only support companies in their competition compliance efforts, but also the Commission in its enforcement of EU cartel rules.

We propose that within the context of cartel settlements the Commission offer limited reductions in fines for competition law infringements (up to 5% of the fine), against auditable and enforceable binding commitments by the affected companies to spend that fine reduction on increased future compliance efforts.

This proposal – building on, but differing from, earlier suggestions – is straightforward, realistic, and easily and quickly implementable in the context of the existing legal framework and the Commission’s fining guidelines.

Companies benefit from financial support committed to compliance over several years to increase their compliance efforts, and decreasing the likelihood that they will be involved in future cartels.

The Commission benefits by reducing the likelihood of future antitrust infringements, increasing incentives for companies to enter into settlements – and decreasing the likelihood of hybrid settlements and reducing yet further the number of appeals – all without needing to deploy further resources of its own.

While we believe that this present proposal – if implemented – will enhance the effectiveness of antitrust compliance programmes, we also acknowledge that it is only one “tool” to achieve this aim, and not a panacea.

But given that anticompetitive activity, including the most egregious forms such as cartels, continues, the question for the Commission is perhaps not whether or not this proposal should be implemented, but, if not this, then what?

A pdf of the article can be accessed by our Covington Competition Blog subscribers here.

Tags: Competition, European Commission, European Union
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Photo of Kevin Coates Kevin Coates

Kevin Coates advises clients on strategic antitrust and other government investigation issues drawing on twenty years of public sector experience in the Directorate-General for Competition of the European Commission (“DG COMP”) and ten years of private sector experience as in-house counsel and in…

Kevin Coates advises clients on strategic antitrust and other government investigation issues drawing on twenty years of public sector experience in the Directorate-General for Competition of the European Commission (“DG COMP”) and ten years of private sector experience as in-house counsel and in private practice.

Kevin advises on all aspects of EU, UK and international competition law, including abuse of dominance, cartels and leniency, mergers and compliance, as well as related EU regulations such as the Digital Markets Act (DMA) and Digital Services Act (DSA). He has extensive experience in technology, software and e-commerce sectors.

Kevin worked in the Directorate General for Competition (DG COMP) of the European Commission for twenty years, including seven years reporting directly to the Director General, and nearly ten years as a head of unit, latterly as Head of a Cartel Unit. While working for the Director General he advised on case, policy and communications issues, worked closely with the Competition Commissioner and their Cabinet, and was one of the team that produced the Guidance on Enforcement Priorities under Article 102.

Kevin also served as in-house Counsel at AOL Europe where he was responsible for antitrust and regulatory issues for AOL subsidiary companies in the UK, Germany, France and the Netherlands.

He co-wrote the IP and the telecoms and media chapters in Faull & Nikpay’s “EC Law of Competition,” and is the author of “Competition Law and Regulation of Technology Markets” published by Oxford University Press in 2011. He was a Hauser Global Fellow at NYU School of Law in 2009/2010.

Drawing on his substantive antitrust experience in government and private practice, Kevin counsels clients on business-critical issues. He is known for combining a deep knowledge of the law with an ability to communicate clearly and convincingly.

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