On 7th May 2014, the Italian Competition Authority (“ICA”) opened an in-depth investigation into six banks operating in the Province of Trento and Bolzano (the “Banks”) in order to assess whether they infringe Article 2 of the Italian Law No. 287 of 1990 and/or Article 101 TFEU, the provisions against anti-competitive agreements.

The ICA investigation started after a complaint filed by the consumer association “Centro Consumatori Utenti Alto Adige” which alleged the existence of an anti-competitive agreement aimed at setting a minimum mortgage interest rate among the Banks. This allegation was based on the outcome of a comparative survey carried out by the consumer association in November 2013.

The ICA pointed out that according to the evidence gained so far, the Banks all provided for a minimum mortgage interest rate set at 3% called “rate floor”. In essence, the interest rate could never be below the said threshold.

Therefore, the ICA held that the homogeneous application of such an interest rate threshold among the Banks would amount to the setting of a minimum price for mortgage. This behaviour would constitute a hardcore restriction of competition and would aim to avoid price competition to the detriment of mortgage subscribers.

In addition, the ICA found that the alleged anticompetitive agreement among the Banks would infringe also Article 101 TFEU as the territory of Trento and Bolzano borders another European Union Member State (Austria). The alleged collusion therefore may foreclose commercial trade between two Member States at least.