Economic Undertakings

Belgium updates economic law and penal code

Introduction of filing fees in merger notifications and transposition of the ECN+ directive into Belgian law

On March 7, 2022, amendments to both the Belgian Code of Economic Law (CEL) and the Belgian Criminal Code (CPG) were published in the Belgian Official Gazette (Belgisch Staatsblad, Belgian Monitor).

The main changes include:

  • Introduce a filing fee in merger notifications

  • Compile the rules and formalities relating to leniency programs in the CEL and refine them

  • Refine the provisions relating to cooperation with other NCAs and the European Commission

  • Broaden the circumstances in which periodic penalty payments and/or fines may be imposed

  • Specify what turnover should be taken into account for the purpose of calculating fines imposed on associations of undertakings and how these fines should be levied

  • Amend the provision on bid-rigging in the BCC to clarify that (criminal) immunity is available for bid-rigging offences.

With the exception of the introduction of filing fees in merger notifications, these amendments have been introduced to align the Belgian competition law rules with the “EU Directive 2019/1 on empowering the competition authorities of the Member States members to be more effective implementers and to ensure the proper functioning of the internal market” or “ECN+ Directive” for short.

IN DEPTH

The ECN+ Directive aims to ensure that CRAs “have the guarantees of independence, means and powers of enforcement and sanction necessary to be able to [and consistently] apply Articles 101 and 102 TFEU”. To this end, the ECN+ Directive introduces minimum standards regarding the powers of an NCA to:

  • Carry out dawn searches, which may, in certain circumstances, also extend beyond the premises of the company under investigation

  • Send requests for information both to the surveyed company as well as to its employees

  • Interviewing employees as part of a competition law investigation

  • Imposing behavioral or structural remedies to end a competition law violation

  • Imposing provisional measures during an ongoing investigation

  • Use “commitments”

  • Imposing fines or requesting in non-criminal legal proceedings that fines be imposed (note that the ECN+ Directive also provides minimum standards for the calculation of fines)

  • Imposing periodic penalties.

The ECN+ Directive also provides minimum standards for leniency and immunity programs, including the ability to submit markers and summary applications, and the ability for individuals to receive immunity from fines and sanctions. . Finally, the ECN+ directive also defines the rules of cooperation between NCAs for investigations in the field of competition law.

Main changes in Belgian legislation

Key changes to the CEL by the March 7, 2022 release include:

  • Introduce a filing fee in merger notifications. From now on, notifications of concentrations before the BCA oblige the notifying party or parties to pay a fee of 52,350 euros or 17,450 euros for full notifications or simplified notifications, respectively.

  • Compile the rules and formalities relating to leniency programs in the CEL and refine them. Previously, the formalities surrounding leniency applications were outlined in the BCA Leniency Guidelines 2020 (Leniency Guidelines). These served as a complement to art. IV.54 of the CEL which merely outlined the basic conditions and formalities of the Belgian leniency programme. Now, the CEL outlines all the terms and formalities of the leniency program, such as the rules for immunity and leniency applications submitted by companies or associations of companies, marker applications, summary applications and applications of immunity submitted by natural persons.

    While most of these provisions now covered by the CEL are taken from existing leniency guidelines, it should be noted that the rules for summary leniency applications differ somewhat from those that applied previously. Previously, a summary leniency application could be submitted to the ABC if the applicant “has submitted or intends to submit an application to the European Commission”. Although this has been extended to cover not only leniency applications to the European Commission, but also markers, an applicant can now only submit a summary leniency application to the ABC if they have already submitted an application for clemency or a scorer in the European Commission – not longer if he simply intends to do so. In addition, the new rules now also specify that the application must relate to a “territory of more than three Member States”.

    A welcome change brought about by the March 7, 2022 publication is that an applicant for a Summary Leniency Application, Immunity Application, Leniency Application or Marker does not have to submit these documents in Dutch or French – as was the case before – but can choose to submit them in German or “any other EU language agreed between the applicant and the auditor”. Evidence must be submitted in the original language. As it is not French, Dutch or German, the applicant may be asked to provide a translation into one of these languages.

  • Refine the provisions relating to cooperation with other NCAs and the European Commissionmore specifically with regard to the assistance of the ABC during dawn raids requested by the European Commission or another NCA (or vice versa), the exchange between the ABC and other NCAs and/or the European Commission of leniency applications or other information, the use of such information received by the NCAs and/or the European Commission in the ABC’s own investigation, etc.

  • Broaden the circumstances in which periodic penalty payments and/or fines may be imposed. In addition to the existing powers of the ABC to impose a fine of up to 1% of the turnover of the undertaking (or association of undertakings) for having provided incorrect, misleading or incomplete information, for not for providing information within a set time limit and/or for obstructing an investigation, such a fine can now also be imposed in cases of misuse of arms (i.e. the implementation of a notifiable transaction without submitting a notification to the CBA). This last possibility was removed following the new amendments made by the law of May 2, 2019 but is now reintroduced following the case law of the Court of Justice of the European Communities. In addition, a fine of up to 1% of the average daily turnover achieved during the previous financial year can now be imposed, per day of delay, on:

    • Provide complete and correct information in connection with a request for information or notification of a concentration

    • Provide an explanation if the deadline for an information request has not been met

    • Consent to investigative measures

    • Appear before the BCA for a hearing

  • Specify what turnover should be taken into account for the purpose of calculating fines imposed on associations of undertakings and how these fines should be levied.

Finally, the publication of March 7, 2022 modifies the rules of the BCC which specify the criminal sanctions in the event of bid-rigging. Previously, art. 314 of the BCC stipulated that bid-rigging was punishable by imprisonment from 15 days to 6 months and a fine of 100 to 3,000 euros. This provision is now extended to clarify that immunity is available – and therefore these penalties should not be imposed – where the infringer has filed an immunity application with the ABC regarding the same facts and has provided any relevant information relating to the circumstances of the bid-rigging offense and the parties involved to the Crown.

The changes will come into effect on March 17, 2022.

© 2022 McDermott Will & EmeryNational Law Review, Volume XII, Number 73