At the beginning of April 2024, the President of the Office of Competition and Consumer Protection (UOKiK) published new clarifications on the determination of the amount of fines in cases related to the conclusion of agreements restrictive of competition and the abuse of dominant position. This is the result of legislative changes made in connection with the implementation of the ECN+ Directive on increasing the effectiveness of competition law enforcement. The Clarifications are not legally binding, but the President of UOKiK has stated that he will determine the amount of fines in accordance with the Clarifications and that any deviation will be justified. Thus, in practice, the Clarifications will be an important point of reference when setting fines.
The Clarifications apply to cases in which antitrust proceedings were initiated after 1 January 2024.
Total fine for companies
In accordance with the regulations, the President of UOKiK may impose a fine of up to 10 % of a company’s turnover in the financial year preceding the year in which the fine is imposed if the company has, inter alia, engaged in practices that restrict competition, even if these are unintentional.
However, if it is established that an undertaking which has engaged in a practice restricting competition was subject to the determining influence of another undertaking or undertakings, the President of UOKiK may impose a joint fine on that undertaking and the undertaking(s) which exercised such influence over it. If proceedings are conducted against the undertaking which exercised determining influence and the undertaking over which that influence was exercised, a joint fine will be imposed on them, unless the circumstances of the case justify the imposition of two or more fines instead of a joint fine.
When calculating the above-mentioned 10% of the turnover, if the infringing undertaking was under the decisive influence of one or more other undertakings, the President of UOKiK will also take into account the turnover of the undertaking(s) exercising such influence and of those over whom the influence is exercised. This means that the maximum amount of the fine can be up to 10% of the turnover not only of a single company, but also, for example, of another company in its group which exercised a decisive influence on the former.
Method of calculating fines
In determining the amount of the fine, the President of UOKiK will take into account factors such as the circumstances of the violation of the Competition and Consumer Protection Act of 16 February 2007, previous violations of the Act, the duration, gravity and market consequences of the violation, as well as mitigating and aggravating circumstances.
In accordance with the Clarifications, in determining the amount of the fine, the President of UOKiK will set a starting amount and then a base amount. These amounts relate to one year of the infringement.
The starting amount will be a percentage of the ‘relevant turnover’ of the undertaking(s) to be fined. This amount will be determined by indicating a percentage between 0.01 % and 3 % of the relevant turnover. When determining the starting amount from this percentage range, the President of UOKiK will set its value closer to the upper limit for the most serious infringements (in particular, agreements between competitors and abuses of a dominant position aimed at excluding competitors from the market). This amount will be a kind of a ‘starting point’ for the calculation of the final fine, after mitigating and aggravating circumstances have been taken into account.
The starting amount may be further increased or decreased by up to 75 % (the previous 2021 clarifications provided for an increase of 50 % or a decrease of 90 %), taking into account, inter alia, the low revenue earned from the affected products by the undertaking directly involved in the infringement in relation to its total turnover. The amount thus determined becomes the base amount.
For infringements lasting longer than one year, the base amount will be increased accordingly. The President of UOKiK will multiply the base amount by the number of full years of involvement in the infringement for which the fine is imposed. If, in the last commenced year of the infringement, the duration of the infringement exceeds six months, the multiplier will be increased by 0.5.
Mitigating and aggravating circumstances
In determining the amount of the fine, the President of UOKiK will also take into account the mitigating circumstances specified in the Clarifications and in the Act. Consideration of these may result in an increase or decrease of the base amount determined at an earlier stage of the analysis (taking into account the duration of the infringement) by a maximum of 25% (which was 50% in the previous 2021 clarifications).
Discretion
If the President of UOKiK is of the opinion that the amount determined according to the guidelines of the Clarifications is inadequate and would not serve its purpose, a higher or lower fine may be imposed (this will be further justified). However, this amount may not exceed the maximum fine specified in the Act.
The full text of the Clarifications is available here.
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