Cartel Regulation In Italy: Recent Cases And Developments

"An extract from The European Antitrust Review 2008, a Global Competition Review special report - www.GlobalCompetitionReview.com"

Except for differences in procedural law, Italian competition rules mirror those of the European Union. This article provides a brief overview of the applicable cartel law in Italy. The Italian Competition Authority (ICA) has also recently been granted new powers, such as the power to adopt interim measures and to accept commitments and make them binding and finally the possibility to accept leniency applications. Some of the cases mentioned below give an example of how the ICA enforces these new rules.

Cartel law enforcement in Italy

The ICA is responsible for controlling (i) agreements that impede competition, (ii) abuses of dominant position and abuses of economic dependence, (iii) mergers and acquisitions that create or strengthen a dominant position with the effect of eliminating or restricting competition, (iv) misleading and comparative advertising and (v) conflicts of interest.

Pursuant to article 2 of Law 287 of 10 October 1990 (Law 287), which reproduces almost entirely article 81 of the EC Treaty, agreements are prohibited between undertakings that have as their object or effect appreciable prevention, restriction or distortion of competition within the national market or within a substantial part of it.

The ICA enforces article 81 of the EC Treaty, instead of article 2 of Law 287, in all those cases in which an anti-competitive agreement could affect, with a certain degree of probability, trade between member states, notwithstanding that the relevant geographic market extends only throughout the Italian territory or a part thereof.

The ICA may grant temporary exemption for those agreements that, although formally against competition rules, have the effect of improving the conditions of supply in the market, leading to substantial benefits for consumers. Such improvements are identified taking also into account the need to guarantee to the undertakings the necessary level of international competitiveness and are related, in particular, with increases in production, improvements in the quality of production or distribution, or with technical and technological progress.

The ICA has the power to start an investigation following a complaint filed by competitors or consumers, or at its own initiative.

With regard to dawn raids and the way the ICA actually gets incriminating information, the powers of the ICA are similar to those of the EU Commission, with the only difference that in Italy it is not possible to access private homes of the investigated company's management or staff.

In case of infringement, the ICA can impose remedies as well as impose a fine up to 10 per cent of the Italian turnover of each undertaking or entity during the prior financial year.

In the first months of 2007 the ICA introduced a leniency programme, similar to that of the European Commission. The programme foresees a sliding scale of reductions according to the usefulness of the collaboration offered by 'penitent' companies. These go as far as total immunity for a company that is first to provide the ICA spontaneously with decisive proof of a secret cartel where such information is not available to the ICA.

It is in any case possible for a company whose cooperation contributes significantly to the evidence available to the Authority to benefit from a reduction in its fine, usually of not more than 50 per cent. Obviously account will be taken of the timeliness of the company's collaboration and the value of the evidence produced.1

It is possible that the company may not be in a position to supply the elements of proof necessary to obtain immunity immediately, but may be able to procure them within a short time. In...