Presently, lay judges with experience in competition matters dominate the panels of Austrian courts that decide cartel cases. The only exception is the plenum of the Supreme Court, which handles exceptional cases of great importance. The Federal Chamber of Labour, the Chamber of Commerce and the Presidential Conference of Austrian Chambers of Agriculture nominate the lay judges.
The Format/Profil Case concerned the acquisition of a controlling interest in a competitor (with an 11% market share) by the publisher already dominating the weekly news magazine readers market (with a 48% market share). Although the acquisition would result in a strengthening of a dominant position, the cartel court of first instance approved it with only minor misgivings. The professional judge was thought to have been overruled by the two lay judges nominated by the Federal Chamber of Labour and the Chamber of Commerce. The decision caused a media outcry. Either the minister of commerce or the minister of justice was expected to file an appeal with the Supreme Court, but neither did.
The outcome of the case and subsequent adverse publicity concerning the influence of certain organizations and the aforementioned ministers accelerated the process of reform. Within weeks the two ministers presented the draft of a revised Cartel Law Act.
According to the draft:
- professional judges will have the majority of votes in the panels of cartel courts of all instances;
- the advisory board composed of members of the Federal Chamber of Labour, the Chamber of Commerce and the Presidential Conference of Austrian Chambers of Agriculture will be abandoned as a procedural institution. Instead these organzations will still be able to offer their opinions;
- an independent Federal Competition Authority at the Ministry of Commerce and a special Federal Cartel Prosecutor at the Ministry of Justice will be established to replace the roles currently filled in cartel cases by the Federal Chamber of Labour, the Chamber of Commerce and the Presidential Conference of Austrian Chambers of Agriculture; and
- a Competition Commission will be established within this independent Federal Competition Authority. Upon request the commission will have to render economic opinions similar to those of the present advisory board.
In addition to this comprehensive reform, the draft (i) broadens the power to demerge companies where a merger was wrongly approved on the basis of incorrect information (provided by the parties) or infringement of the undertakings of the approval of the merger and (ii) abandons criminal sanctions against individuals throughout the entire cartel law and increases fines for enterprises.
For further information on this topic please contact Dieter Hauck, Bernhard Köck or Martin Nepraunik at Preslmayr & Partners by telephone (+431 533 16 95) or by fax (+431 535 56 86) or by email ([email protected], kö[email protected] or [email protected]).