the largest law firm in the czech republic ranked by clients as the best law firm in the czech...
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![Page 1: The largest law firm in the Czech Republic Ranked by clients as the best law firm in the Czech Republic Czech law firm of the year (2012) No. 1 legal advisor](https://reader035.vdocuments.site/reader035/viewer/2022062404/551b9503550346167e8b544e/html5/thumbnails/1.jpg)
The largest law firmin the Czech Republic
Ranked by clientsas the best law firm
in the Czech Republic
Czech law firm of the year
(2012)
No. 1 legal advisor according to the number of M&A
deals in the Czech Republicand Eastern Europe
(2012)
No. 1 among Czech law firms
(2012)
Fifth Annual Conference on Competition Enforcement in the CEE Member States, Bratislava, 21 February 2014
Recent developments in CEE Member StatesThe Czech Republic
Robert Neruda
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1. Private enforcement
2. Criminal enforcement
3. Administrative enforcement
1. Activities of NCA
1. Cartels
2. Other agreements
3. Dominance
4. Mergers
2. Legislation
3. Courts (Due Process)
4. General / policy observations
AGENDA
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• No specific provisions in the Czech law … but
• The possibility to seek damages has always been recognized
• No/scarce case law
• Reasons (similar to other jurisdictions):
• Uncertainty
• Lack of incentives
• Access to evidence
• The role of public enforcement (protection of leniency, settlements, access to file)
PRIVATE ENFORCEMENT
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• Individual criminal liability
• 2010 – new Criminal Code
• Criminal liability for cartel behavior (no other anticompetitive practices)
• Very strict – up to 8 years of imprisonment
• No decisions, but seemingly some investigations pending, incl. stand alone
• Criminal liability of companies
• 2012 – new Act on Criminal Liability of Companies
• Not applicable to cartels, except for bid rigging
• despite the wide reach of the new legislation
• Parallel investigations by the Czech NCA and the police avoided
CRIMINAL ENFORCEMENT
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• No changes in powers/competences of the Czech NCA in the field of antitrust
• Anticompetitive behavior of public authorities (not desired by the Czech NCA)
• But other areas
• Significant Market Power Act (supermarkets)
• Public procurement
• Relative decrease of importance?
• Significant divergence in the level of activity among sections (cartels v. dominance and verticals)
• Cartels – lot in pipeline, but lack of decisions
• Stable merger control
ADMINISTRATIVE ENFORCEMENTIN GENERAL
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1. Cartel Department of the Czech NCA
i. Well resourced and stable, most active
ii. Disproportion between the number of opened cases and decision – ever increasing workload?
iii. Difficult procedural aspects – rules of third parties, access to file
6
Decisions Cases opened Dawn Raids
41 34 3 31
5
20
14
14Cases – Decisions – Dawn Raids
2010 2011 2012 2013
ADMINISTRATIVE ENFORCEMENTCARTELS
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• Series of fining decisions in 2007- 2010, then silence
• The declarations of economists („no hard core restrictions“) vs
• Recent decisions of the Office („RPM hard core infringement and not likely to be exempt“ – Candy) vs
• Case law (strict approach, RPM almost per se prohibited)
= uncertainty
• No decisions (guidance) as to non pricing vertical agreements
= uncertainty
• Despite distribution is of a key importance for majority of businesses
ADMINISTRATIVE ENFORCEMENTVERTICALS
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• The least activity
• Last (real, new) decision in 2010
• predatory pricing, bus transport, 5 mio CZK (EUR 185.000)
• Investigation of margin squeeze in telco lasts almost five years
• Pending investigations of (alleged) non pricing abuses (probably less demanding) without decisions
• Tricky signal for the business
ADMINISTRATIVE ENFORCEMENTABUSE OF DOMINANCE
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• Flexible, predictable, well functioning system
• No intervention (prohibition, commitments) in 2013
• Last prohibition in 2004
• NEW: third parties' right to appeal may delay the closing
ADMINISTRATIVE ENFORCEMENTMERGERS
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57
140
204
239
134
5661 61 57 40 45 50 53
33
0
50
100
150
200
250
300
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
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• Substantive changes
• Full leniency available for initiator and leader of the cartel
• Immunity from criminal prosecution and from ban on public contracts and concession agreements
• Procedural changes
• Leniency application outside the administrative file
• Duty to continue in cartel activity (to avoid jeopardizing a dawn raid)
ADMINISTRATIVE ENFORCEMENTSOFT LAW – 2013 LENIENCY PROGRAMME
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• Confirmation of the practice so far
• Available also outside cartel area
• Fixed discount 20 %
• Short decisions, no details (affected customers)
• Immunity from ban on public contracts and concession agreements (but not from criminal prosecution)
• No hybrid settlements
• Practical observations
• Is 20 % enough? Is it really only 20 %?
• A deathblow for private enforcement?
• Effects on the competition doctrine?
ADMINISTRATIVE ENFORCEMENTSOFT LAW – 2013 SETTLEMENT NOTICE
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• Prioritisation, commitments outside and within the administrative proceedings
• No declaration of illegality
• Prioritisation
• If no public interest in conducting the proceedings due to the low harmful effect
• No review available for complainants
• Commitments (both types)
• Relaxation of former strict (prohibitive) rules
ADMINISTRATIVE ENFORCEMENTSOFT LAW – 2013 NOTICE ON ALTERNATIVE SOLUTIONS
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• The complainant has no standing to appeal/challenge the fact the Czech NCA does not open the investigation (SAC Mediaservis, Regio Jet)
• The Czech NCA may use the evidence collected and provided by the Police (Regional Court in Brno in Litoměřice)
• Bid rigging per se prohibited, even in case the agreed price is the same/lower than the competitive price (Regional Court in Brno in Litoměřice)
• The Czech NCA is not obliged to define the relevant market with the use of economic and empiric analyses (Regional Court in Brno in Litoměřice)
COURTS
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• The Czech NCA
• Lack of decisions in cartels, dominance, verticals
• The Czech NCA probably needs more resources (financial, human)
• The relative importance of the antitrust agenda within the Czech NCA
• Judicial review
• Is the recent decentralization and de-specialization the right step for competition cases?
POLICY ISSUES
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• The judicial review probably Art. 6/1 ECHR compliant
• The courts de facto review the assessment of the complex economic evidence made by the Office (See Student Agency case but Litoměřice)
• But there is still a need to:
• Balance the protection of leniency applicant and
• other parties to the proceedings
• injured parties
• Find the right balance with the rights of third parties
• prioritisation, mergers, possibility to appeal
• Find the room and incentives for private enforcement
• settlements (and other alternative solutions) problematic in this regard
DUE PROCESSSTATUS AND ISSUES TO SOLVE
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• The Czech administrative system based on the on the permanent access to file
• Not suitable for leniency
• Review court surprisingly approved the Office's approach of denying access of other parties to the application
• the Supreme Administrative Court?
• 2012 Amendment
• The limited access part of the hard law
• Practical observations
• LA accessible (for reading only) for 1/10 of the investigation.
• Is it Art. 6/1 ECHR compliant?
• Third parties‘ access to the file granted by the courts
DUE PROCESSACCESS TO FILE
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• The hard law - right to be heard only
• 7/2012 Regional Court in Brno Litvínovská uhelná
• Any third party that duly exercised its rights (complained) during the proceedings has a right to appeal the clearance decision
• But no procedural details (eg. only participant receives the decision)
• The right to appeal within 1 month/1 year – the decision does not become final
• Risk of abuse - risk for closing
• Possible solution
• Short term – Supreme Administrative Court
• Long Term – an amendment tothe Competition Act enabling to challenge the final decision
DUE PROCESSCASE STUDY – RIGHTS OF THIRD PARTIES IN MERGERS
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