Competition [Amendment] Act 2012 commenced
The Minister for Jobs, Enterprise and Innovation Mr Richard Bruton TD today [Tuesday] announced that he has signed a Commencement Order which brings into force the provisions of the Competition [Amendment] Act 2012 with effect today [Tuesday 3rd July 2012], following its recent passage through the Oireachtas.
The enactment of the legislation is part of a suite of measures being introduced by the Minister in a bid to battle white-collar crime, bring down costs across the economy and ensure that consumers aren’t ripped off by anti-competitive practices by business. These measures are aimed at helping the Competition Authority to investigate and prosecute organisations that engage in cartels, price-fixing, abusing dominant positions and other practices which damage the interests of the consumer and the economy.
The Act’s provisions include:
· the maximum imprisonment sentence on conviction on indictment of an offence relating to anti-competitive agreements, decisions and concerted practices is to be raised from 5 to 10 years;
· increases in fines that can be imposed for various breaches of Competition law, including an increase in the level of fine for criminal conviction of hard-core offences from €4 million to €5 million;
· an amendment to the Companies Act 1990 to add non-indictable contraventions of section 4 or 5 of the 2002 Competition Act to the list of circumstances under which the court may order that a person shall not be appointed as a company director;
· enabling commitments given to the Competition Authority to be made rules of court;
· Section (1) of the Probation of Offenders Act 1907 will not apply to certain offences in respect of anti-competitive practices or abuse of dominant position;
· the specific inclusion of interim, interlocutory and permanent injunctions as reliefs, and
· an easing of the burden of proof for private plaintiffs taking a follow-on case for damages following public enforcement proceedings where a Court determines that an undertaking has engaged in prohibited conduct or practices.
Minister Bruton said
“As I have said repeatedly, we must work hard to reduce costs across the economy if we are to create an environment in Ireland in which job-creating businesses can start-up, grow and succeed. One key aspect of this is ensuring that there are effective measures in place to combat anti-competitive practices which hurt the ordinary consumer, small business, and ultimately the economy.
“This Act is aimed at strengthening the enforcement of competition law in Ireland and at tackling white collar crime. Powerful people and organisations who abuse their position to the detriment of the ordinary consumer and small business will now face a greater chance of prosecution, and tougher penalties if convicted. It will make a real difference in the fight to tackle white-collar crime and ultimately help our economy on the road to recovery.”
The Minister also stated that “Through this measure, the Government is sending out a very strong signal to cartelists that competition offences are regarded as serious offences by the legislature and I am sure they will be treated as such by the court.”
In addition to strengthening the public enforcement regime of competition law, the Minister acknowledged the strong deterrent value of public enforcement as a facilitator of subsequent follow-on actions by private plaintiffs. He said “the measures in the Bill are also aimed at encouraging and facilitating private enforcement actions which I regard as a potent and important tool for the enforcement of competition law.”
Since taking office, Minister Bruton has also:
· obtained Government approval to draft legislation to merge the Competition Authority and the National Consumer Agency in order to create a powerful competition and consumer enforcement body with real teeth. This drafting is now ongoing, and the legislation is expected to be published later this year;
· committed to a 25% increase in the staff numbers of the Competition Authority in order to strengthen its enforcement activities. The additional staff will be specialist professional staff – investigators, economists, criminal lawyers, and IT staff – required in order to successfully investigate and enforce anti-competitive practices. In keeping with a drive for reform across his Department, the Minister will be putting in place mechanisms to ensure that improved outcomes are delivered in return for the increased resources;
· has requested the Competition Authority, under the Action Plan for Jobs, to commence a market study on an area of the economy where competition is restricted – the Competition Authority has commenced a market study on ports;
· engaged with Ministerial colleagues to address outstanding recommendations from previous Competition Authority studies, which were neglected by previous Governments.
ENDS
Notes
Existing Irish legislation (the Competition Act 2002) already provides for sanctions by setting out a range of penalties, including fines and custodial sentences, for breaches of the Act.
Competition offences can be divided between hard core offences (cartels, concerted practices, price-fixing, etc as set out in section 4 (1) (a) to (c) of the Competition Act, 2002) and non-hard core offences (abuse of dominant position, applying dissimilar conditions to equivalent transactions, etc as set out in sections 4 (1) (d) and (e) and 5 of the Competition Act 2002).
The Act’s provisions include:
· the maximum imprisonment sentence on conviction on indictment of an offence relating to anti-competitive agreements, decisions and concerted practices is to be raised from 5 to 10 years;
· an increase in the level of fine for criminal conviction of hard-core offences from €4 million to €5 million;
· an increase in the level of fine for summary conviction of certain competition offences from €3,000 to €5,000;
· an increase in the maximum daily fine applicable to a continuing contravention from €300 to €500 in respect of a summary conviction and in the case of a conviction on indictment from €40,000 to €50,000;
· an amendment to the Companies Act 1990 to add non-indictable contraventions of section 4 or 5 of the 2002 Competition Act to the list of circumstances under which the court may order that a person shall not be appointed as a company director;
· enabling commitments given to the Competition Authority to be made rules of court;
· Section (1) of the Probation of Offenders Act 1907 will not apply to certain offences in respect of anti-competitive practices or abuse of dominant position;
· the specific inclusion of interim, interlocutory and permanent injunctions as reliefs, and
· an easing of the burden of proof for private plaintiffs taking a follow-on case for damages following public enforcement proceedings where a Court determines that an undertaking has engaged in prohibited conduct or practices.
Introduction of legislation, strengthening competition law, is a condition of the EU/IMF Programme of Financial Support for Ireland.