The Netherlands Authority for Consumers and Markets (ACM) was established on 1 April 2013, when the Netherlands Competition Authority (NMa), the Netherlands Independent Post and Telecommunications Authority (OPTA) and the Netherlands Consumer Authority joined forces. Until 1 August 2014 ACM operated on the basis of the original powers available to the three different supervisory authorities at the time. This meant that ACM had other (in practice: broader) powers in e.g. competition cases than in consumer cases, for instance. When the Streamlining Act entered into force on 1 August 2014, most of those powers were harmonised. A number of changes were furthermore made that are unrelated to the establishment of ACM. This blog principally addresses those changes.
Raise of worldwide turnover threshold for applicability of duty to report concentrations
One of the main changes in day-to-day practice is the raised turnover threshold for establishing the duty to report concentrations (e.g. mergers, acquisitions and the establishment of certain joint ventures). That worldwide turnover threshold was €113.45 million in the past, but has now been raised to €150 million. The second threshold, which relates to the national turnover, remains unchanged at €30 million. Nothing will change for healthcare institutions, to which the reduced turnover thresholds (consisting of e.g. a joint turnover threshold of €55 million) will continue to apply.
Limitation of former employees’ (derivative) right to remain silent
A change that is relevant to cartel investigations is the limitation of the right of former employees to remain silent. In its decision of 21 December 2012 the Trade and Industry Appeals Tribunal (CBb) found that former employees had a derivative right to remain silent. They could therefore invoke that right if they were examined about their former employer and its activities at the time. The legislature put an end to this with the Streamlining Act. Former employees can no longer invoke the right to remain silent for the benefit of their former employer. That right can therefore be invoked only by the natural persons in the company’s employment. However, the right to remain silent continues to apply in full if the former employee himself or herself is suspected of a violation.
Abolition of the dual system of consumer protection
The Streamlining Act also puts an end to an anomaly in the supervision exercised by ACM, i.e. that ACM must enforce certain aspects of consumer protection law under civil law rather than public law. Since 1 August 2014 the Consumer Protection Enforcement Act has been enforced only via the administrative approach. This is expected to make the supervision of consumer law more efficient – and more easily accessible for ACM. Moreover, administrative enforcement offers the possibility of imposing fines. In the future ACM is therefore more likely to impose fines on violations of consumer protection rules.
Fine decisions: suspending effect of objection and publication duty
Until 1 August 2014 parties on which ACM had imposed a fine could postpone their payment obligation by filing an objection and appeal. In practice this meant that the fine usually did not have to be paid until many years later (albeit with interest). The legislature considered that situation undesirable. The Streamlining Act therefore provides that filing an objection to a fine decision of ACM suspends the payment obligation for only 24 weeks. Practice has shown, however, that fines are very often reduced or sometimes even withdrawn entirely on completion of the objection and appeal procedure. ACM therefore should not (and will not) be overly optimistic about the collection of fines; it is likely that it will regularly have to repay the fined company or person at least part of the fine.
Changes in the publication regime
The Streamlining Act is based on the assumption that ACM announces all fine decisions within ten working days, unless one of the exceptions under the Public Administration Act applies. When fines of the highest category are imposed (usually on cartels), the entire decision must be published, the only possible exception being sections that contain confidential business and manufacturing data. In principle, the names of the natural persons and legal entities involved must also be published. However, a specific exception then applies (i.e. if the interest of publication does not outweigh the interest of privacy).
ACM has a large degree of discretion with regard to decisions in which no fine is imposed (such as decisions on disputes or designation decisions). The Streamlining Act gives ACM the right to publish those decisions, but it is not obligated to do so. The same applies to other documents produced by it or at its instruction.
To prevent competition authorities from using possibly sensitive correspondence between companies and their lawyers in their investigations, for instance in the case of dawn raids, legal privilege has applied in competition cases for some time already. ACM may not use any documents covered by legal privilege. Until 1 August 2014 it was unclear whether legal privilege also applied to advice in the field of e.g. the Electricity Act or the Telecommunications Act. The Streamlining Act has put an end to this uncertainty by expressly providing that legal privilege also applies to all documents exchanged between a company and its lawyer.
As the name implies, the Streamlining Act is principally aimed at streamlining the various powers available to ACM under the various acts. The changes with regard to competition law are relatively minor in that respect, since the Competition Act already gave ACM extensive powers. ACM’s powers will increase with regard to the supervision of other Acts (such as the rules in the field of consumer protection), which may give rise to somewhat more repressive supervision.