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Trends and climate

Trends

Have there been any recent changes to the cartel regime? If so, have they had a significant impact on enforcement activity?

The last relevant change was the adoption of Royal Decree-Law 9/2017, which transposed EU Directive 2014/104/EU on certain rules governing actions for damages under national law for infringements of the competition law provisions of the member states and of the European Union. Upon its entry into force on 27 May 2017, the decree-law introduced a number of significant changes to the Competition Act and the Civil Procedure Act with a view to enhancing the right to claim full compensation for damages derived from infringements of competition law (eg, cartels).

The main changes to the Competition Act are:

  • the introduction of joint and several liability for all infringers for damages caused to the harmed parties. However, there are two exceptions to this rule, one relating to small and medium-sized enterprises (as defined by EU Recommendation (2003/361) of 6 May 2003) and another relating to undertakings that are exempted from fine payments due to their participation in a leniency programme;
  • the establishment of a five-year limitation period on actions for damages arising from competition law infringement;
  • the binding nature of any competition infringement declared by a final decision of a Spanish competition authority or court for the purposes of an action for damages brought before national courts;
  • the introduction of the rebuttable presumption that cartels always cause harm and the implementation of certain rules which make it easier for claimants to calculate and quantify the damages suffered;
  • the implementation of a new consensual dispute resolution regime that aims to foster consensual agreements with infringers; and
  • the introduction of the passing-on defence which establishes that the right to compensation granted to an injured party refers only to the overcharge actually suffered and which was not passed on along the supply chain. Further, the Competition Act also sets out the possibility for indirect purchasers to claim compensation for harm caused when direct purchasers have passed on the overcharge generated by competition rule violations.

The changes introduced to the Civil Procedure Act mainly refer to the disclosure of evidence. Not only can the harmed party request such disclosure from the defendant and third parties, but the defendant in an action may also request the disclosure of evidence by the claimant or third parties in order to prepare its defence, especially if it is planning to apply the passing-on defence. When requesting the disclosure of evidence, it must always be duly justified. The plaintiff must submit a well-founded justification, including reasonably available facts and enough evidence to support the credibility of the claim. The defendant must present such justification in relation to its defence.

Notably, the amendments to the Competition Act cannot be applied retroactively and the changes to the Civil Procedure Act apply only to claims initiated after 27 May 2017.

While it is too early to say with certainty, the impact of the changes on private enforcement activity is likely to be significant.

Are there any proposals to reform or amend the existing cartel regime?

There are no proposals to reform or amend the existing cartel regime. However, the National Markets and Competition Commission (NMCC) is in talks to propose some amendments that aim, among other aspects, to clarify fine calculations.

Have there been any recent key cases?

Recent cases include the following:

  • On 8 March 2018 10 courier and parcel services companies were fined €68 million for consumer allocation. The cartel members committed to not making commercial offers to any competitor’s customers. In total, the NMCC discovered nine different cartels (Exp/0578/16 Business Messaging and Parcels Services).
  • On 3 May 2018 the NMCC imposed a total fine of €7.12 million on five different media companies and €109,000 on three of their directors or legal representatives. The NMCC found that the penalised companies had exchanged sensitive commercial information for one-and-a-half years, in order to allocate public tenders concerning institutional advertising campaigns from the General State Administration (Exp/0584/16 Media Agency).
  • On 12 July 2018 the NMCC imposed a fine on two companies engaged in the purchase of used batteries for their participation in a cartel. From 2008 to 2012 the companies carried out a common strategy to fix the purchase prices of used car batteries. The companies maintained a continuous flow of contact through emails, calls and meetings to agree a common commercial strategy in order to avoid a price war. Such behaviour distorted competition, which adversely affected the suppliers in a market where purchasing firms have significant bargaining power with suppliers due to the characteristics of the relevant market. Therefore, the NMCC imposed a total fine of €5.3 million on the companies (Exp/0569/15 Automotive Batteries).
  • On 26 July 2018 11 companies were penalised for partaking in a cartel related to the supply of computer and data processing services for the Public Administration. The companies shared out customers, agreed on prices and terms of trade, and exchanged sensitive commercial information to make public tenders more expensive. The cartel lasted 15 years and the total amount of fines imposed was €29.9 million (Exp/0565/15 Tenders for Computer Applications). 

Legal framework

Legislation

Which legislation applies to cartels and what are the relevant substantive provisions?

The legislation applicable to cartels is the Competition Act (15/2007) and Royal Decree 261/2008, which implemented the Regulations on Defence of Competition.

The Civil Procedure Act (7/2001) is also relevant as it contains provisions intended to favour evidence disclosure in claims for damages derived from infringements of competition law.

The relevant substantive provision is Article 1 of the Competition Act, which prohibits agreements between undertakings, collective decisions or recommendations, or concerted or consciously parallel practices that have as their object or effect the prevention, restriction or distortion of competition in all or part of the Spanish market. Article 101 of the Treaty on the Functioning of the European Union also applies in regard to cartels affecting competition in Spain where there is also an effect on trade between EU member states.

The prohibition does not apply where the efficiencies deriving from a given agreement outweigh its anti-competitive effects. However, in practice, it is virtually impossible for cartels to benefit from an individual exemption.

The Competition Act also contains a definition of ‘cartel’. A ‘cartel’ is an agreement or concerted practice among competitors with a view to coordinating their competitive behaviour in the market or having an influence on the competition parameters by means of a number of practices.

Institutions

Which bodies are the relevant regulatory and prosecutory authorities and what are their specific roles?

The relevant bodies are the National Markets and Competition Commission (NMCC), the regional competition authorities and the commercial courts.

The Spanish body empowered to resolve cartel proceedings is the NMCC, which is a public law institution. The NMCC is composed of a council consisting of two chambers – one dedicated to competition and the other to regulatory matters – and four directorates, divided into a competition directorate and three regulatory directorates: telecoms, energy and transport.

The Competition Act gives the NMCC the power to pursue investigations, issue decisions and impose penalties in competition proceedings, specifically in cartel proceedings. The Competition Act also confers arbitration functions, consultative powers and the task of promoting competition in the markets on the NMCC.

The regional competition authorities, which are also public law institutions, are the relevant authorities to investigate, resolve and impose penalties with regard to cartels whose effects do not exceed the territory of an autonomous community.

The Spanish commercial courts are also entitled to declare the existence of a cartel as they have jurisdiction to declare the infringement of Articles 1 and 2 of the Competition Act and Articles 101 and 102 of the Treaty on the Functioning of the European Union, as well as to award damages. However, they cannot impose fines.

Are there any sectoral regulators with concurrent powers?

There are none. The NMCC took over the former competition commission and the main regulatory bodies. 

Application

Does the legislation apply to both formal agreements and informal practices?

Legislation applies to both. 

Does the legislation apply to individuals, companies or both?

Competition rules apply to undertakings (ie, any entity engaged in an economic activity). Accordingly, legislation applies to both companies and individuals as long as they are engaged in an economic activity.

Does the legislation subject companies to civil liability, criminal liability or both?

The legislation subjects companies to civil liability.

The NMCC can impose fines on the economic agents, companies or associations that intentionally or by negligence infringe competition regulation. The Competition Act classifies the infringements according to their seriousness as minor, serious or very serious. Cartels between competing undertakings are classified as very serious infringements.

Does the legislation subject individuals to civil liability, criminal liability or both?

The legislation subjects individuals to civil liability. The Competition Act foresees a personal penalty of up to €60,000 for each of the legal representatives of the company or the members of the management bodies who have participated in the anti-competitive practice. In fact, in 2016 the NMCC issued its first resolutions fining the legal representatives of the companies that were liable for the cartels.

Where cartel conduct is punishable by both civil and criminal penalties, can the enforcement authority pursue both types of penalty? How does the authority decide which penalties to seek?

Not applicable.

Are there any sector-specific offences or exemptions?

There are no sector-specific offences or exemptions.

To what extent, if any, does the legislation apply to extraterritorial conduct?

The legislation applies to cartels that have as their object or effect the prevention, restriction or distortion of competition within the territory of Spain. In cases in which the anti-competitive agreement could be considered as capable of affecting trade between EU member states, the NMCC would apply Article 101 of the Treaty on the Functioning of the European Union.

The NMCC can collaborate with other competition authorities in order to pursue infringements that may affect the effective competition that take place in other jurisdictions.

Investigations

Initiating an investigation

Who can initiate an investigation of potential cartel conduct?

Penalty proceedings are initiated by the Competition Directorate of the National Markets and Competition Commission (NMCC) (or the relevant bodies of the regional competition authorities) ex officio or by means of a complaint. Before the opening of penalty proceedings, the Competition Directorate may conduct a preliminary investigation (not subject to a given deadline) in order to determine whether the opening of formal penalty proceedings is appropriate. During this preliminary investigation, the Competition Directorate may gather information and carry out dawn raids.

If, after this preliminary investigation, the Competition Directorate considers that there are reasonable signs of anti-competitive conduct, it will formally initiate penalty proceedings. The decision to initiate penalty proceedings will be notified to the interested parties, with a copy of the complaint provided to the defendant.

If an investigation is initiated by complainants or third parties, what rights (if any) do they have?

Complainants and third parties have no rights unless they are considered interested parties. If considered interested parties, once the penalty proceedings have been initiated they can access the file and take part in the penalty proceedings (ie, they can file written submissions and offer evidence).

What obligations does a company have on learning that an investigation has commenced?

They have no specific obligation. Nonetheless, there is a duty of collaboration and information. All natural or legal persons and the bodies of any public administrations are subject to the duty of collaboration with the NMCC and are obliged to provide all kinds of data and information that they may have and may be necessary for the identification of cartels. 

What obligations does a company have if it believes that an investigation is likely?

No specific obligations.

What are the potential consequences of failing to act or delaying action?

With regard to the general duty of collaboration, if a company fails to meet the deadline to reply to a request for information submitted by the NMCC, the NMCC may impose coercive fines on the company.

Formal stages of investigation

What are the formal stages of and approximate timeframe for investigations?

The Competition Act (15/2007) foresees a two-phase procedure.

During the first phase, the Competition Directorate will handle the penalty proceedings. The main milestones are as follows:

  • The facts that may constitute an infringement must be included in a statement of objections. The statement must be notified to the interested parties so that they may reply to it and offer evidence within 15 working days.
  • By taking into consideration its findings and the parties’ arguments, as well as the evidence available, the Competition Directorate must then produce a proposal for resolution. The proposal must be notified to the interested parties so that they can make written submissions within 15 working days.
  • The Competition Directorate will then refer the case to the council of the NMCC, together with a report including a proposal for resolution and the written submissions made by the interested parties.

During the second phase, the council of the NMCC will resolve the penalty proceedings, taking into account the investigation carried out by the Competition Directorate and the arguments of the interested parties. The council of the NMCC may take into account new evidence or investigate further if it is deemed to be necessary.

The NMCC may issue:

  • an infringement decision;
  • a decision that there is no evidence of infringement;
  • a decision stating that the practices are de minimis; or
  • a decision accepting commitments from the companies under investigation as long as they fully address the competition concerns and the public interest is sufficiently protected.

However, the Guidelines on Termination by Commitments of Sanctioning Proceedings sets out that, as a general rule, a settlement will not be initiated when the alleged infringement is a cartel.

The infringement decision may:

  • order to bring the anti-competitive conduct to an end;
  • impose conditions or obligations;
  • remove the effects of the prohibited conducts;
  • impose fines; or
  • impose any other measures authorised by the Competition Act.

The maximum term to issue a decision is 18 months from the date of the decision to initiate the penalty proceedings. The investigation usually occurs during the first 12 months, leaving six months for the council to issue a final decision.

Investigative powers

What investigative powers do the authorities have?

The Competition Act provides the NMCC with several methods for detecting cartels, the most common being unannounced inspections (eg, dawn raids) and information requests.

Unannounced inspections can be conducted not only at the companies’ and associations’ premises, but also at the homes of directors, managers and other members of staff of the companies and associations concerned. The performance of such inspections requires the previous consent of the company or, otherwise, court approval.

 Officials are empowered to:

  • enter any premises, land and means of transport of the undertakings and associations of undertakings as well as the homes of entrepreneurs, managers and other staff members of the undertakings and associations of undertakings concerned;
  • examine the books and other records relating to the business, irrespective of the medium in which they are stored;
  • take or obtain (in any form) copies of or extracts from such books or records;
  • retain the aforementioned books or documents for a maximum period of 10 days;
  • seal all business premises, books or records and other business assets during this period and to the extent necessary for the inspection; and
  • ask any representative or staff member of the undertaking or association of undertakings for explanations on facts or documents relating to the subject matter and purpose of the inspection and to record the answers.

The NMCC is also empowered to require any natural or legal person as well as the bodies of any public administration to provide all of the information that may be necessary in order to detect a cartel. 

What is the geographic reach of public enforcement actions?

The territory of Spain.

When is court approval required to invoke these powers?

Court approval is required if a company does not consent to a dawn raid. 

Are searches of business and personal premises authorised? If so, which bodies carry out searches and will they wait for legal advisers to arrive?

See answer to the question “What investigative powers do the authorities have?” The NMCC is not required to wait for the arrival of legal advisers. However, in practice they do tend to wait between 30 to 60 minutes.

What level of cooperation with the authorities is required and what are the consequences for failing to cooperate?

Companies are expected to cooperate with the NMCC. Failure to cooperate is considered a minor infringement of the Competition Act if a company:

  • fails to provide the NMCC with the information requested or provide incomplete, incorrect, misleading or false information;
  • does not consent to a dawn raid; or
  • obstructs a dawn raid, for instance, by:

o failing to submit or the incorrect, misleading or incomplete submission of books or documents requested by the NMCC;

o refusing to answer questions posed by the NMCC or answering them in an incomplete, inexact or misleading manner; or

o breaking the seals affixed by the NMCC’s personnel during inspection.

These infringements may be penalised with a fine of up to 1% of the total turnover of the undertaking concerned. If it is impossible to determine the turnover of the infringing company, the fine would be between €100,000 and €500,000.

Is in-house legal advice or attorney work product protected by the law of privilege? Does this extend to the advice of in-house counsel?

According to judiciary law, attorneys (external and in-house lawyers) are subject to the same duties of confidentiality and secrecy regarding communications exchanged with clients as the regulation of the legal profession. Therefore, attorney work product is protected by the law of privilege in the sense that communication with clients must remain confidential.

However, in the context of competition law and particularly dawn raids, the European Court of Justice has stated that internal company communications with in-house lawyers in European Commission investigations are not covered by legal professional privilege.

While this judgment does not apply to investigations subject to Spanish law, and despite the fact that both external and internal lawyers are subject to the same duties, the NMCC tends to apply European case law during inspections and considers that internal counsel communications are not covered by legal professional privilege unless it is proved that they reproduce legal advice provided by external lawyers.

Are any other limitations imposed on investigatory powers in order to safeguard the rights of those under investigation?

The NMCC cannot access personal information or information not related or going beyond the purpose of the dawn raid.

What is the process for objecting to an authority’s exercise of its claimed powers?

Decisions by the competition directorate may be challenged before the council of the NMCC within 10 days. Decisions of the chair and the council of the NMCC may be appealed, in the terms foreseen in the Administrative Jurisdiction Act (29/1998), before the National High Court within a period of two months starting from the day after the notification of the decision. Appeals against the decision of the National High Court may be lodged only with the Supreme Court. 

Publicity and confidentiality

What information about investigations will be made publicly available and at which stage(s) of the process?

Dawn raids carried out by the NMCC are published on its website. However, the identities of raided companies are kept confidential.

The opening of the penalty proceedings as well as the identities of affected companies are published on the NMCC website.

Decisions by the council of the NMCC regarding alleged infringements of competition law are published on the NMCC website once they have been notified to the interested parties and the confidentiality issues have been sorted out.

Is any information automatically confidential and is confidentiality available on request?

The NMCC may order to keep information confidential, either on its own initiative or at the request of any interested party. If the NMCC does not accept the confidentiality request, the interested party is entitled to appeal the decision before the National High Court.

All leniency applications and their contents must be treated as confidential information by the NMCC, and it will file this documentation in a separate folder when classifying such information. However, interested parties will have access to the information deemed essential in order to reply to the statement of objections. 

International cooperation

Do the authorities in your jurisdiction cooperate with authorities in other jurisdictions?

The NMCC cooperates with the European Commission and the national competition authorities in other EU member states through the European Competition Network.

The NMCC is also entitled to exchange information (including confidential information) with any other national competition authorities within the European Union, as well as the European Commission. 

Do the relevant enforcement authorities request waivers so as to allow for increased cooperation with authorities in other jurisdictions? What are the consequences of declining to grant a waiver?

See answer to the question “Do the authorities in your jurisdiction cooperate with authorities in other jurisdictions?”

Decisions

How is a cartel investigation resolved? Are settlements, plea bargains or other negotiated resolutions available?

See answer to the question “What are the formal stages of and approximate timeframe for investigations?

What is the process for negotiating a settlement, plea bargain or other negotiated resolution? Do such resolutions require court or other approval?

See answer to the question “What are the formal stages of and approximate timeframe for investigations?

If a settlement is not reached, what is the procedure for adjudicating a charge of cartel conduct?

See answer to the question “What are the formal stages of and approximate timeframe for investigations?

Which party must prove its case? What is the relevant standard of proof?

The burden of proof of the existence of a cartel rests with the party that alleges an infringement, so it falls upon the NMCC. There is no specific level of proof required by Spanish legislation in order to determine the existence of cartel infringements. Both direct and circumstantial evidence are admissible.

Members of an alleged cartel that claim the benefit of an individual exemption must bear the burden of proving that the conditions for an individual exemption are met. It is practically impossible for cartel members to benefit from an individual exemption.

Is there a hearing? If so, what is the process for submitting evidence and testimony?

Although uncommon, hearings can be agreed. Oral hearings have not been held since 2010, but the NMCC recently stated that it will agree to hold oral hearings in penalty proceedings that, due to their complexity, require it.

The interested parties, their representatives, the officials of the Competition Directorate and the persons authorised by the council of the NMCC will take part in the oral hearing. It begins with a presentation by an official of the Competition Directorate of a proposal for resolution and continues with the arguments of the interested parties. Replies by both the Competition Directorate and the interested parties will then follow. The chair of the NMCC and any other member of the council authorised by the chair may address any party to seek clarification.

What are the accused’s procedural rights?

The alleged infringers are entitled to access the file, make written submissions, offer evidence and request an oral hearing. 

Appeal process

What is the appeal process?

Decisions by the council of the NMCC may be appealed to the National High Court within two months of the appellant being notified of the decision.

Appeals against National High Court judgments may be lodged with the Supreme Court where there is a matter of significant legal interest. A significant legal interest is presumed with regard to first-instance judgments issued by the National High Court concerning decisions by regulatory bodies. The Supreme Court focuses on points of law, unless factual findings are found to be clearly erroneous.

The appeal does not lead to a suspension of penalties imposed by the NMCC, unless the companies involved justify serious damage stemming from the imminent execution of the penalty and this is accepted by the National High Court.  

To what extent can the appeal body review the agency’s findings of fact, legal assessment and penalties?

The National High Court is entitled to review the agency’s findings of fact, the legal assessment and penalties.

By contrast, the Supreme Court is focused only on points of law unless factual findings are found to be clearly erroneous.

Penalties

Penalties for companies

What are the potential penalties for companies involved in a cartel?

As cartel activity is considered to be a very serious infringement, the NMCC may impose fines of up to 10% of the total turnover of the infringing company in the preceding business year. When the turnover of the infringing company cannot be calculated, the NMCC can impose a fine of up to €10 million.

In addition, companies that have been penalised for a serious infringement relating to the distortion of competition will be unable to enter into any kind of public sector agreement once the decision is final. The scope and duration of the debarment will be determined by the judgment or the administrative decision declaring the infringement or otherwise by means of ad hoc proceedings. In general, debarment from government procurement cannot exceed three years.

Are there guidelines in place for penalties? If not, how are penalties normally calculated?

Guidelines published by the NMCC in 2009 were found inapplicable by the Supreme Court in January 2015. The Supreme Court ruled that:

  • the 10% limit on the annual turnover of the company (or 5% or 1% depending on the seriousness of the infringement) is the maximum penalty; and
  • the percentage must be calculated over a company’s total annual turnover and according to the following criteria set out in the Competition Act:

o dimension and characteristics of the markets affected by the infringement;

o market share of the undertakings responsible;

o scope and duration of the infringement;

o effect on consumers, users and other economic operators;

o illicit profits obtained due to the infringement; and

o existence of any aggravating or mitigating circumstances.

The main aggravating factors are:

  • repeated commission of infringements established in the Competition Act;
  • role of a leader in or instigator of the infringement;
  • adoption of measures for enforcing or safeguarding the achievement of the unlawful conduct; and
  • failure to collaborate with or obstruction of inspections.

The main mitigating circumstances are:

  • undertaking of actions that bring about an end to the infringement;
  • effective non-implementation of the prohibited conducts;
  • undertaking of actions intending to remedy the harm caused; and
  • active and effective collaboration with the NMCC outside the scope of the leniency programme.

The National High Court has already issued several judgments ordering the NMCC to recalculate such fines according to the criteria set by the Supreme Court.

Do the authorities take into account any penalties imposed in other jurisdictions?

No penalties imposed in other jurisdictions are taken into account.

How can a company mitigate its exposure to fines?

A company can mitigate its exposure to fines by asking for immunity or fine reduction. A company can also mitigate its exposure to fines if any of the abovementioned mitigating circumstances are applicable.

Penalties for individuals

What are the potential penalties for individuals involved in a cartel?

The legislation subjects individuals to civil liability. The Competition Act foresees a personal penalty of up to €60,000 for each of the legal representatives of the company or the members of the management bodies who have participated in the anti-competitive practice. In fact, in 2016 the NMCC issued its first resolutions fining the legal representatives of the companies that were liable for the cartels.

Do the authorities take into account any penalties imposed in other jurisdictions?

No penalties imposed in other jurisdictions are taken into account.

Is a company permitted to pay a penalty imposed on its employee?

There are no specific regulations forbidding a company from paying a penalty imposed on its employees. 

Is a company permitted to continue to employ an employee involved in cartel conduct?

There are no specific regulations forbidding a company to continue employing an employee involved in cartel conduct.

Private actions

Private damages actions

Can private actions for damages be brought in your jurisdiction? If so, who may assert such actions?

Any natural or legal person who has suffered harm as a result of an infringement of competition law is entitled to claim full compensation before the commercial courts.

What relief may be awarded to successful claimants (eg, damages, costs, injunctive relief or attorneys’ fees)?

Private damage claims are available for both direct and indirect purchasers.

Claimants are entitled to claim full compensation. Full compensation is calculated by reference to what is necessary to restore the claimant to the position in which it would have been had the infringement not existed. Therefore, the damages that can be claimed are:

  • actual loss;
  • loss of profits; and
  • the legal interests since the claim was submitted.

As regards costs, the Civil Procedure Act states that, in general, they must be imposed on the party who has had all of their pleas rejected, unless the court considers that the case posed serious doubts due to its complexity. If the claim is partially estimated, the parties must bear their own costs and the common costs must be shared equally.

The costs of the procedure are composed of:

  • attorneys’ fees;
  • attorney’s fees (comprising a fixed amount depending on the quantum of the procedure);
  • taxes and other duties for exercising jurisdictional right; and
  • experts’ fees (where applicable) (comprising a bill invoiced to the party).

This total amount must not exceed one-third of the quantum of the proceedings.

How are the amounts of any damages, costs or attorneys’ fees calculated?

The burden of proof of the damages lies with the claimants. In this regard, claimants normally submit expert’s reports to prove the damages suffered. If claimants prove the existence of damages but find it practically impossible or extremely difficult to calculate them, commercial courts are entitled to estimate the damages.

The burden of the proof of the passing-on defence rests with the defendants. Expert reports are normally used to support such a defence.

The costs are calculated as follows:

  • Attorney’s fees: calculated according to the Bar Association’s guide, which establishes rates applicable to the amount of the procedure.
  • Solicitor’s fees: calculated according to solicitor’s scales, depending on the kind of procedure and its amount.
  • Other professionals involved: the invoice submitted by the experts must be included in the costs of the procedure.

Have there been any notable recent cases in which a private action was the subject of adjudication?

There are no notable recent cases. However, changes recently introduced in both the Competition Act and the Civil Procedure Act are expected to enhance private damages actions.

Class actions

Can class actions be brought in your jurisdiction? If so, what is the procedure for such cases?

Class actions are available in Spain in some limited cases. The Civil Procedure Act clearly establishes the possibility of collective legal standing in cases involving only the defence of consumers’ and users’ interests. Consumer associations can protect the interests of their associates and even the general interests of consumers and users. Therefore, the Consumer Protection Act allows consumers and final users to file collective proceedings through consumer associations. This could be applicable to antitrust cases, particularly those involving the declaration of an antitrust infringement or injunctions.

This possibility was partially recognised in Spain by means of the Civil Procedure Act, which recognises the rights of consumers to claim against a cartel. A collective action may be more efficient for consumers, companies and plaintiffs as they can distribute costs, efforts and risks.

Immunity and leniency

Immunity and leniency programmes

Is an immunity and leniency programme available for companies? If so, how does it operate?

The Competition Act and the Regulations on Defence of Competition set out provisions governing the immunity and leniency programmes. In addition, the National Markets and Competition (NMCC) issued its Communication on the Leniency Programme on 19 June 2013, in order to improve the method of filing and reviewing a leniency application under cartel proceedings.

Accordingly, the NMCC must exempt a company or an individual that is allegedly involved in a cartel from the payment of the fine if:

  • the company is the first to provide evidence which allows the NMCC to order an inspection, provided that at the time of the submission of evidence the NMCC does not already have sufficient evidence to order an inspection; or
  • the company is the first to provide evidence which may enable the NMCC to find an infringement of Article 1 of the Competition Act in relation to a cartel, provided that at the time of the submission the NMCC does not have sufficient evidence to find an infringement and an exemption to a company or individual has not been granted in accordance with the first point.

The process for initiating/completing an application for immunity or partial leniency is as follows:

  • Any applicant for leniency (exemption or reduction of a fine) must submit its exemption or reduction application before the Cartels and Leniency Unit of the Competition Directorate of the NMCC.
  • Formal leniency applications may be filed directly by the company or natural person or through their representatives.
  • The applications will be registered only after they are received at the registry of the NMCC. The order of registration will be set up according to the exact date and hour of submission of any application with the registry.
  • Applications will be assessed on a chronological basis, according to their exact time of registration. 

Can the enforcement authority decline or withdraw leniency? If so, on what basis?

The NMCC can decline or withdraw leniency in the following cases:

  • if the NMCC is not the authority particularly well placed to deal with the exemption application submitted and that competence rests with the European Commission or with the competition authority of another EU member state;
  • if the NMCC is not the competent authority to deal with the exemption application and that competence rests with a regional competition authority;
  • if the presumed infringement becomes time barred under Article 68.1 of the Consumer Protection Act;
  • if the fine exemption application is presented after the statement of objections has been notified;
  • If the exemption application has been submitted jointly by several applicants or if the applicant indicates it has not participated in the cartel;
  • if the applicant is disqualified from obtaining exemption from payment of the fine because it took steps to compel other undertakings or individuals to join or remain in the cartel;
  • if the content of the exemption application is insufficient because it does not contain information and evidence on a cartel or if such evidence is not presented after the applicant has been granted a specific timeframe for doing so;
  • if the content of the exemption application is incomplete because the information and evidence submitted prevent the investigation division from ordering an inspection or establishing a cartel infringement; and
  • if the conditional exemption is unavailable because the requirements of Article 65 of the Consumer Protection Act are not met, either because the NMCC already has sufficient evidence to order an inspection or to establish the existence of the infringement or because a conditional exemption has already been granted to another exemption applicant.

Are there benefits for cooperators that do not qualify for immunity? If so, how are these benefits determined?

There are benefits for cooperators that do not qualify for immunity. A company or an individual may ask for a fine reduction if it:

  • provides evidence of the suspected infringement that represents significant added value with respect to the evidence that the NMCC already has;
  • cooperates fully, continuously and expeditiously with the NMCC throughout the administrative investigation procedure;
  • ceases its participation in the alleged infringement at the time that it submits the evidence of the existence of the cartel, except in those cases where the NMCC deems necessary that its participation continues in order to preserve the efficacy of an inspection; and
  • has neither destroyed evidence relating to the application for exemption nor disclosed, directly or indirectly, to third parties other than the European Commission or other competent authorities, the existence of its application or part of its contents.

In these cases:

  • The first company or individual that fulfils the conditions is granted a reduction of 30% to 50%.
  • The second company or individual that fulfils the conditions is granted a reduction of 20% to 30%.
  • Any subsequent company or individual that fulfils the conditions is granted a reduction of up to 20%.

What benefits (if any) are available for employees and former employees of a company that seeks leniency?

The immunity or the fine reductions granted to companies will also benefit its legal representatives or the members of the management bodies that have participated in the agreement or decision provided that they have cooperated with the NMCC.

Is an immunity or leniency programme specifically available for individuals? If so, how does it operate?

The leniency programme is the same for both companies and individuals.

Have there been any notable recent cases in which a leniency application was the subject of adjudication?

Yes, there have been. For instance, in Case/0562/15 Cables BT/MT (21 November 2017) 11 companies and the FACEL association were fined up to €43,921,345 for the creation of a cartel. The cartel consisted in the fixation of prices and other selling conditions concerning low and medium tension cables. One of the companies (GC) applied for the leniency programme and received a fine exemption of over €12 million.

Criminal liability

Is immunity from criminal prosecution available? If so, how and under what conditions is immunity granted?

Not applicable.

Application procedure

What is the procedure for a leniency application?

The NMCC recommends that applicants should submit their applications in a sealed envelope, which, after registration at the NMCC registry, must be opened only by Cartels and Leniency Unit (CLU) officials. Applications must consist of a template (the NMCC has included this template in Annex I of its Communication on Leniency Programme, available on the NMCC website), which should be signed by the applicant and contain the relevant information and documentation regarding the existence of the cartel and its main characteristics.

Two versions of each leniency application must be submitted: the original (to be kept by the NMCC) and a copy (to be kept by the applicant). Both versions should be marked with an adhesive receipt seal by the NMCC registry indicating the exact date and hour that the documents were received. If requested by the applicant, the NMCC may also provide a document confirming the receipt of the leniency application.

If previously agreed with the CLU, applicants may also submit oral leniency applications, which must be recorded on NMCC premises. The transcription of the application must be immediately registered at the NMCC registry, indicating the exact date and hour of registration.

Once the CLU receives an exemption application, it will review its contents and confirm with the applicant whether the exemption can be granted. This must be confirmed only by the council of the NMCC at the end of the penalty proceedings and provided that the applicant has fulfilled all of the legal requirements.

If the exemption of the fine is not possible (ie, in cases where a previous exemption has been submitted regarding the same cartel or where the NMCC was already aware of the existence of that cartel), the CLU must allow any applicant to withdraw its leniency application or to submit an application for a fine reduction.

What is the typical timeframe for consideration of a leniency application?

The Competition Directorate will grant a provisional immunity before any dawn raid following the application or before the submission of the statement of objections, as the case may be. The council of the NMCC will confirm the immunity in the decision declaring the existence of the cartel as long as the applicant has fulfilled all of the following requirements set out in the Competition Act:

  • The applicant must maintain full, continuous and efficient cooperation with the NMCC throughout the sanctioning proceedings. This cooperation implies:

o providing the NMCC immediately with all the relevant information and evidence;

o immediately answering any request for information;

o facilitating oral interviews between the NMCC and present (or former if relevant) executives and employees of the company;

o not destroying, hiding or falsifying any documents or relevant evidence regarding the cartel; and

o not disclosing to any third parties the existence or the contents of the leniency application before the statement of objections is sent by the NMCC to the affected companies, unless otherwise agreed with the NMCC.

  • The applicant must refrain from further participation in the alleged infringement as soon as the evidence has been provided, unless the NMCC deems it necessary to safeguard the efficacy of a dawn raid.
  • The applicant must have neither destroyed evidence relating to the application nor revealed its intention to apply for leniency to third parties.
  • The applicant must not have taken steps to coerce other companies to take part in the infringement.

What information and evidence is required?

According to the Communication on Leniency Programmes, leniency applications must be accompanied by (at least) the following information:

  • the identification of the leniency applicant, including name and contact data, a brief description of the applicant and (if necessary) the identification of the representative and a copy of the power of attorney;
  • the participants in the cartel, including names and contact data, a brief description of the companies and the form and extent of their participation in the agreement;
  • a detailed description of the cartel, including its objectives, activities and functioning, products, services and territories affected, the duration and nature of the cartel, specific dates, locations, content and participants in meetings;
  • evidence relating to the cartel in the possession of the applicant or available to it within a reasonable period; and
  • actions adopted (ie, a declaration that the applicant has not disclosed to third parties its intention to submit a leniency application and a declaration that the applicant has not destroyed evidence relating to the leniency application).

What information and evidence is disclosed to subjects of the investigation other than the leniency applicant?

See answer to the question “What confidentiality protection is offered to applicants?” below.

What level of cooperation is required from applicants?

Full and continuous cooperation is required.

What confidentiality protection is offered to applicants?

All leniency applications and their contents (including the identity of the applicant) are treated as confidential information by the NMCC, which must file these documents in a separate folder when classifying the information corresponding to the relevant case file. However, the affected companies will have access to the information deemed essential in order to reply to the statement of objections formulated by the NMCC.

According to the communication on leniency programmes:

  • In the event of judicial review, when the leniency application submitted in the penalty proceedings is sent to the National High Court, the NMCC will expressly identify the statements made by the leniency applicant and no copies of it will be permitted.
  • If the documents submitted by the leniency applicant are requested by a court that is competent to examine the NMCC’s actions before the issuance of the resolution that puts an end to the penalty proceedings, those documents will be remitted on a confidential basis and expressly indicate that they cannot be communicated to possible interested parties or third parties.
  • When dealing with civil actions for damages arising from cartels declared through penalty proceedings where a leniency application was submitted, the NMCC will not provide copies of the statements of the leniency applicants, since such disclosure would impair the effectiveness of the leniency programme and weaken the fight against cartels. Further, by virtue of the Civil Procedure Act, courts cannot request any party or third party to disclose statements made in the leniency application.

Can the company apply for a marker? If so, under which conditions?

The company can apply for a marker. On a prior reasoned request from the applicant, the Competition Directorate may grant a timeframe for submitting the evidence that the applicant was unable to submit at the time that the leniency application was presented. Further, in the summary application an extended time limit for submitting the cartel evidence may be requested. 

Once the application has been completed and the evidence has been submitted within the timeframe, the date and time of receipt of the leniency application will be understood to be the initial entry date and time at which the summary application was filed.