On 11 July 2016, the Italian Administrative Supreme Court (“IASC”) issued an important judgment regarding the criteria that the Court of First Instance (“CFI”) and the Italian Competition Authority (“ICA”) should follow when determining the gravity of an infringement of competition rules and the subsequent sanctions.

The IASC overturned the decision of the CFI, which stated that in assessing the gravity of a breach of competition law, it is necessary to bear in mind the real adverse effects on the relevant market and the negative economic impact stemming from the anti-competitive conduct, even when the lat-ter may be considered an infringement of competition by object.

The IASC held that when considering the gravity of the infringement, in this instance the infringe-ment had to be downgraded from “serious infringement” to “normal infringement”, although alloca-tion of customers was a violation of competition by object. The IASC opined that the ICA and the CFI disregarded the fact that the price of the services provided to consumers during the cartel were lower in comparison to the precedent period.

In our opinion, this decision provides a less formal approach towards competition rule violations to be followed by the ICA and the CFI, aimed at taking into account the real effects on the relevant market of the competition infringements, regardless of their type.