Prohibited Agreements

Article 1 of the Competition Act prohibits all agreements, collective decisions or recommendations, or concerted or intentional parallel practices that produce or could produce the effect of impeding, restricting or distorting competition in the markets.

Conducts of this kind materialise, amongst others, in agreements or arrangements to fix prices or other trading conditions, limit output or share markets. One example is a situation in which several companies in the same sector agree to jointly raise the retail price of their products to a similar extent. Investigating such cartels is, in fact, one of the CNC's priority actions.

Agreements of this kind are prosecuted because they have a harmful impact on consumers by eliminating the incentives for the cartel participants to improve the quality of their products or services and reduce their cost, while at the same time hindering the business of other companies.

There are some agreements, however, which, though they fall within the scope of article 1 of the Act, are not punishable because they are deemed to generate favourable effects for consumers, improvements in production, distribution or sale and foster technical progress to an extent that more than offsets their harmful effects on competition. An example of arrangements of this kind are certain delinquent-debtor registers that allow company-customer relations to function more effectively in a given sector.

Although the former Competition Court previously gave explicit authorisation for this type of arrangement for a given time period if a series of requirements were met (article 1.3 of the Competition Act), the new Competition Act has implemented the corporate self-assessment system, in line with the European Commission.