LEGISLATION ON MANUFACTURING SUBSUPPLY (Advisory opinion)
PRESS RELEASE
The Italian Competition Authority submitted an opinion to the Speakers of the Senate and the Chamber of Deputies dealing with Section 9 of draft law no. 3509 on manufacturing subsupply. Such a law introduces the concept of abuse of economic dependence, defining the anticompetitive business practice in which one or more firms may engage in order to create or maintain a condition of economic dependence of a supplier. This economic dependence is considered as abusive situation in which a firm can unilaterally impose rights and obligations in the contractual relationships between the parties.
Refusal to deal, imposition of unjustifiably discriminatory contractual conditions, arbitrary cessation of commercial relationships are viewed in the draft law as being abuses of economic dependence. Consequently, agreements which give rise to such abuses are to be considered null.
Section 9 above provides that the law in question be incorporated in the Competition Act. The Authority deemed it improper, holding that the objective of antitrust legislation is to protect competition with regard to market conditions. In addition, national antitrust legislation is in line with European Community law and Section 1, subsection 4, of Law no. 287/90 binds the interpretation of the substantial provisions of the Act to the Community principles.
Viceversa, Section 9 of the draft law in question is a specific rule concerning the regulation of contracts between the parties and not necessarily having impact of such relationships on competition. Further, this rule cannot be found in Community law, as it originates from the need to balance the contractual relationship between the parties. The rule in fact addresses the problem of safeguarding the weaker party, by prohibiting that the economically stronger party draws up the contract in his own interests and imposes his conditions on the other party without any chance for negotiations. Therefore such a rule is to be considered within the Civil Code concerning contracts and obligations.
To this end, the Authority said that the arbitration commissions of the Chambers of Commerce provided for by Section 10 of the draft law in question (to the extent in which they do not constitute an obligatory arbitration as prohibited by the Constitutional Court's ruling) and the ordinary judge are adequate to avoid, given also their diffused presence over the territory, contractual disparity between the parties with regard to disputes and conflicts falling within the exclusive scope of the Civil Code.
As such, if and when dominant firms would engage in conduct that constituted an abuse of economic dependence, Section 3 of Law no. 287/90, jointly with Section 86 of the Treaty establishing the European Economic Community, sets out that the Authority can take effective action to safeguard weaker firms and the entire competitive arena. In this connection, it is to be noted that, in implementing the Competition Act, the Authority has already pronounced on many cases of refusal to deal and imposition of unjustifiably discriminatory contractual conditions.
In compliance with Section 22 of the Act, the Authority expressed the hope that the abuse of economic dependence, as provided for by Section 9 of draft law no. 3509, would not be incorporated in Law no. 287/90.