AGCM Resolution no. 25152 of October 22th, 2014 - Guidelines on the method of setting pecuniary administrative fines pursuant to Article 15, paragraph 1, of Law no. 287/90
Guidelines on the method of setting pecuniary administrative fines pursuant to Article 15, paragraph 1, of Law no. 287/90*
(Only the Italian text is authentic)
- Pursuant to Article 15, paragraph 1, of Law no. 287/90, by issuing a decision that establishes a serious infringement of Articles 2 and 3 of Law no. 287/90 or Articles 101 and 102 TFEU, the Authority “may decide, depending on the gravity and the duration of the infringement, to impose a fine up to ten per cent of the turnover of each undertaking or entity during the prior financial year”. Furthermore, Article 31 of the same law provides that for pecuniary administrative fines imposed for infringements of competition rules, “the provisions contained in Chapter I, Sections I and II of the law of 24 November 1981, no. 689, where applicable, will be observed”. Article 11 of Law no. 689/81 especially provides that in setting the amount of the fine, the following elements shall be taken into account: “the gravity of the infringement, the actions undertaken by the infringer for eliminating or mitigating the consequences of the infringement, as well as the infringer’s personality and economic conditions”.
- In exercising its power to impose such fines, the Authority enjoys a wide margin of discretion, within the limits of the aforementioned rules. In particular, the fine shall not, in any event, exceed ten per cent of the total worldwide turnover achieved by the undertaking or entity in the last financial year closed before the date of the infringement decision. Within the above-mentioned limits, for an effective deterrence, the level of the fine imposed must not exceed the amount necessary to induce undertakings to comply with antitrust rules.
- The Authority’s fining policy is intended both to punish those who are guilty of unlawful conducts and to prevent recurrence of unlawful conducts, as well as to dissuade other undertakings from engaging in any forbidden behaviour. In particular, in exercising its power to impose fines, the Authority pursues the following twofold objective:
a) specific deterrence in respect of undertakings or associations of undertakings which are responsible for an infringement of the rules on anticompetitive agreements and abuse of dominant position (so-called specific dissuasive effect );
b) general deterrence in respect of all economic operators in order to dissuade them from engaging in or continuing conducts contrary to competition rules (so-called general dissuasive effect).
- The objective of these Guidelines is to illustrate the principles that the Authority shall apply when setting fines for serious infringements of the national or EU rules concerning anticompetitive agreements and abuse of dominant position, with the aim of ensuring the transparency and predictability of the Authority’s decision-making process. Explain the methodology followed for setting fines, although this methodology is not an exact calculation, it is functional in enabling the parties to be aware of the reasons and the reasoning which led the Authority to impose a specific fine, at the same time facilitating a full judicial review of the Authority’s decisions. In addition, a higher degree of transparency and predictability of the fines can effectively contribute in discouraging infringements of the antitrust law.
- The Authority intends to exercise its sanctioning power with particular rigour where deemed appropriate and, in particular, in cases of secret agreements aimed at price-fixing and/or market-sharing and/or output-limitation or anyway in cases that seriously undermine the competitive functioning of the market to the detriment of consumers.
- The calculation method illustrated below provides a general indication and should not be regarded as the basis for an automatic and arithmetical calculation.
II. Setting the fine: basic amount
- The basic amount of the fine for each undertaking shall be obtained by multiplying a proportion of the value of sales, depending on the degree of gravity of the infringement, with the duration of the participation in the infringement. In the circumstances specified below, the Authority may decide to add an additional entry fee to the basic amount. In setting the basic amount of the fine, the Authority shall use rounded figures.
II.1 Value of the sales of goods or services relating to the infringement
- For an effective deterrence, the final amount of the fine must not be less than the advantages that the undertaking expects to derive from the infringement. Depending on the type of infringement, these advantages are a function of the total value of the sales affected by the unlawful conduct. For this reason, the Authority considers that the fines applicable to antitrust offences should be calculated from the value of the sales of goods or services which are - directly or indirectly - related to the infringement committed by the undertaking on the relevant market(s) in the last full financial year of its participation in the infringement (hereinafter, value of sales).
- The value of sales must be set net of VAT and any other taxes directly related to the sales. If the undertaking does not make available the data on the turnover of the last full financial year of its participation in the infringement, or this data is not reliable or sufficiently representative or cannot be determined in any other way, the Authority shall take into account any other information it considers relevant or appropriate, such as e.g., the average sales value over the entire duration of the infringement or another year of this reference period, or a percentage of the total turnover in Italy.
- In the case of an association of undertakings, the “value of sales” of the goods or services related to the infringement corresponds to the total value of the associative contributions paid by members of the association.
II.2 Percentage of the value of sales as a function of the gravity of the infringement
- The percentage to be applied to the value of sales shall be determined according to the degree of gravity of the infringement. This percentage shall not be greater than 30% of the value of sales.
- In assessing the gravity of the infringement, the Authority shall take into account the nature of the infringement in first place. The Authority considers that secret horizontal agreements aimed at price-fixing, market-sharing and output-limitation constitute the most serious restrictions of competition. In this respect, the possible secrecy of an anticompetitive practice is directly related to the likeliness of it to be discovered and, therefore, to the expected penalty. For this type of infringement, as a general rule, the percentage of value of sales considered shall not be lower than 15%.
- In the case of infringements involving several undertakings, in assessing the degree of gravity, the Authority may consider the aggregate market share held by all the undertakings that participated in the infringement.
- Additional criteria to assess the gravity of the infringement, which the Authority shall take into account for determining the percentage to be applied to the value of sales, are the following: (i) the conditions of competition on the market concerned (e.g., the concentration level, the existence of entry barriers); (ii) the nature of products or services concerned, with particular reference to the possible detriment to innovation; (iii) whether the unlawful practice was actually implemented or not; (iv) the relevance of the actual economic impact or, more in general, of any injurious effects of the infringement on the market and/or consumers, provided that the Authority possesses elements that allow a reliable estimate of them.
II.3 Duration of the infringement
- The duration of the infringement, expressly considered by Article 15, paragraph 1, of Law no. 287/90, has an impact on the injurious consequences of the infringement and, therefore, must be also appraised for setting the amount of the fine: the amount obtained by applying a given percentage to the value of sales shall therefore be multiplied by the number of years for which the undertaking participated in the infringement.
- For fractions of a year, the duration shall be calculated as a function of the actual number of months and days of participation in the infringement.
II.4 Additional amount (entry fee)
- In order to achieve an effective and deterrent fining policy, especially against the most serious restrictions of competition, regardless of their duration and actual implementation, the Authority may increase the basic amount of the fine by adding an entry fee of between 15% and 25% of the value of sales of the goods or services related to the infringement.
II.5 Collusion in the context of public procurement tenders
- In general, also in cases of collusion in the context of public procurement tenders, the Authority shall take into account the value of the sales directly or indirectly related to the infringement. In principle, for each undertaking participating in the collusive practice, the said value is equal to the amount(s) awarded following the adjudication of the bid (or the private negotiation) or to the basic contract price in the case of non-awarding in the tender(s) affected by the infringement, with no need to apply the aforementioned adjustments based on the duration of the infringement. Where the relevant market is wider than the tender(s) considered, the Authority may take into account the overall value of sales in the entire market of the product/service affected by the infringement (including therefore all sales made by the undertaking in the relevant market and not only of the sales related to the tender) during the last full financial year in which the undertaking participated in the infringement; where appropriate, the Authority may also decide to adjust this value on the basis of the duration of the infringement, pursuant to the preceding paragraphs.
III. Adjustments to the basic amount: aggravating and mitigating circumstances
- The basic amount of the fine, set as described in the preceding paragraphs, may be increased to take into account specific circumstances which aggravate (aggravating circumstances) or attenuate (mitigating circumstances) the liability of the infringer, with particular reference to the role played by the undertaking in the infringement, its conduct during the Authority’s investigation, as well as the actions undertaken by the infringer for eliminating or mitigating the consequences of the infringement and the infringer’s personality, also in the light of the provisions of Article 11 of Law no. 689/81.
- Where there are several circumstances, the Authority shall carry out an overall assessment and quantification. As a general rule, the incidence of each circumstance taken into account by the Authority pursuant to the following paragraphs shall not be more/less than 15% of the basic amount, up to an overall percentage more/less equal to 50% of the basic amount.
- The aggravating circumstances include, by way of example:
- to have played a decisive role in the promotion, organisation or monitoring of an infringement involving several parties; to have induced or coerced, even with retaliatory measures, other undertakings to participate and/or to continue in the infringement;
- to behave in such a way to prevent, hinder or delay the Authority’s investigations.
- Notwithstanding paragraph 20, the basic amount may be further increased up to 100% in the case where the Authority or the European Commission have established that in the five years preceding the beginning of the currently investigated infringement, the same undertaking committed one or more infringements similar or of the same type - in terms of objects or effects - to the infringement currently under investigation. To determine the appropriate increase to be applied to the basic amount in the case of recidivism, the Authority shall take account of the nature and the substantial affinity between the ascertained infringements.
- The mitigating circumstances include, by way of example:
- to have promptly adopted suitable initiatives to mitigate the effects of the infringement, in particular by restoring the conditions of competition as they were prior to the infringement and/or by providing and implementing - spontaneously or in the context of a settlement concluded prior to the infringement decision - compensation measures in favour of the injured parties. The mere interruption of the unlawful conduct following the opening of the investigation does not constitute an attenuating circumstance;
- to effectively cooperate with the Authority during the investigations, beyond legal obligations. For cases which fall within the scope of the Authority’s leniency programme, the cooperation of an undertaking shall only be assessed as provided for by the leniency programme;
- to prove to have played a marginal role in the infringement, including proof of not having actually implemented the unlawful practice;
- the existence of rules and regulations and/or measures by public authorities that encourage, facilitate or authorise the infringement;
- the adoption and observance of a specific compliance programme that is appropriate and in line with both European and national best practices. The mere adoption or existence of a compliance programme shall not be regarded as an attenuating circumstance if there is no proof of an effective and concrete commitment to observe the compliance programme (e.g., through full involvement of corporate management, the identification of personnel responsible for the programme, risk identification and assessment based on the business sector and operating context, the organisation of training activities appropriate to the economic size of the undertaking, the provision of incentives for rewarding compliance to the programme and disincentives for failure to comply with it, the implementation of monitoring and auditing systems).
- Furthermore, by way of derogation from paragraph 20, the amount of the fine can be further reduced by up to 50% of the basic amount in the event that during the investigation the undertaking provides information and documentation which, even through a targeted inspection, are deemed to be decisive for the establishment of a different infringement other than that which is the subject of the investigation and falling within the scope of the leniency programme, where the undertaking benefits from conditional immunity from penalties for this different infringement pursuant to paragraphs 2 and 12 of the leniency programme.
IV. Other adjustments to guarantee proportionality and effective deterrence
- The Authority may increase the fine up to 50% if in the last financial year closed before the date of the infringement decision the total worldwide turnover of the undertaking responsible for the infringement was particularly high compared to the value of the sales of goods or services related to the infringement or if the undertaking belongs to a group of significant economic dimensions.
- The Authority will also take into account the need to increase the fine in view of the amount of illicit profits made by the undertaking responsible for the infringement, if the Authority possesses elements that allow a reliable estimate of the said illicit profits.
V. Involvement in several offences
- In cases where a same conduct constitutes infringement of Articles 2 and 3 of Law no. 287/90 or Articles 101 and 102 of the TFEU, or when the same conduct involves different infringements of the same provisions, the Authority shall fine the undertaking for the most serious infringement established with the same decision, with a fine that can be increased up to three times, based on the provisions of Article 8, paragraph 1 of Law no. 689/81 (formal concurrence of offences).
- In cases where more than one conduct violates several times one or more of the aforesaid provisions, the undertaking responsible will be fined as many times as the ascertained infringements (substantial concurrence of offences).
VI. Legal maximum
- When the final amount of the fine, set as described in the preceding paragraphs, exceeds the legal maximum referred to in Article 15, paragraph 1, of Law no. 287/90, it shall be reduced to the said maximum amount. The basis for calculating the legal maximum amount, in conformity with national law, is the aggregate worldwide turnover of the last financial year closed before the date of the infringement decision by each undertaking that participated in the infringement.
- When applying the leniency programme, pursuant to Article 15, paragraph 2- bis, the fine may not be imposed or may be reduced in accordance with the conditions laid down in the "Communication on the non-imposition or reduction of fines".
VIII. Ability to pay
- The Authority shall take into account the economic conditions of the undertaking responsible for the infringement as provided for by Article 11 of Law no. 689/81. In this regard, upon reasoned and detailed application submitted by the party concerned within the deadline of evidence acquisition phase referred to in Article 14, paragraph 2, of Presidential Decree no. 217/98, the Authority may reduce the fine in consideration of the effective limited ability to pay of the party concerned. The undertaking that intends to submit such an application must produce complete, reliable and objective evidence proving that the imposition of a fine set according to these Guidelines, would irretrievably jeopardize its economic viability and would therefore cause it to exit the market. The Authority shall not take into consideration applications based solely on balance sheet loss in recent years or on generalised crisis in the sector concerned.
IX. Joint and several imposition of fines
- In the case in which several companies belonging to the same group are involved in the infringement, the Authority may impose the fine jointly and severally upon them.
X. Symbolic fine
- In certain specific circumstances, which are expressly mentioned and justified in the infringement decision, the Authority may impose a fine of a symbolic amount.
XI. Final and transitional provisions
- The specific circumstances of a given case or the need to achieve deterrence in a particular case may justify derogations from these Guidelines; any derogation shall be expressly mentioned and justified in the infringement decision.
- These Guidelines apply to on-going proceedings, where a statement of objections has not been notified to the parties, pursuant to Article 14, paragraph 1, of Presidential Decree no. 217/98.
 Council of State, Sec. VI, judgment no. 9565 of 29 December 2010, Ras-Generali/IAMA Consulting.
 The case-law has confirmed the Authority’s practice to consider the total worldwide turnover, inclusive of VAT and other taxes as basis for the calculation of the maximum legal threshold (Council of State, Sec. VI, judgments nos. 695 and 697 of 27 February 2008, Associazione Nazionale Esercenti Cinematografi Lombarda).
 As recognised by the case-law, the parties must be put “in conditions to check that the calculation method used and the steps followed [by the Authority] are free of errors and compatible with the provisions and principles applicable to fines, in particular with the prohibition of discrimination” (Council of State, Sec. VI, judgments nos. 695 and 697 of 27 February 27, 2008, Associazione Nazionale Esercenti Cinematografi Lombarda; see as well Council of State, Sec. VI, judgment no. 6469 of 17 December 2007, Lottomatica-Sisal and Council of State, Sec. VI, judgment no. 3013 of 20 May 2011, Recycling of exhausted batteries).
 Council of State, Sec. VI, judgements nos. 695 and 697 of 27 February 2008, Associazione Nazionale Esercenti Cinematografi Lombarda; Lazio Regional Administrative Court, Sec. I, judgement no. 125 of 9 January 2013, Hybrid E-Mail.
 For example, the amounts adjudicated following a private negotiation where the practice was implemented by boycotting the tender(s).
 For example, when the agreement affects participation in a number of tenders that may impact the price of the goods concerned on the entire market or when the aim is non-participating in tenders so as to influence the market price.
 Council of State, Sec. VI, judgement no. 2438 of 20 April 2011, Tele2/Tim-Vodafone-Wind; Council of State, Sec. V, judgment no. 6525 of 13 December 2011, La Nuova Meccanica Navale/Cantieri del Mediterraneo.
 Council of State, Sec. VI, judgment no. 9306 of 20 December 2010, ENI-Trans Tunisian Pipeline. This provision does not refer to the case of continued and complex agreement and/or abuse of dominant position achieved by means of a complex and unified strategy.