As of 1 July 2016 the maximum fines handed down by the Netherlands Authority for Consumers and Markets (“ACM”) have risen considerably. This applies to infringements of all laws supervised by ACM. Notably, the maximum fine for infringement of the prohibition of cartels has risen, for both the firms and the individuals involved. In this blog we will cover the most important changes and explain how businesses can prepare themselves. We will also talk briefly about the new law that obliges businesses to have an internal whistleblowing scheme.

Cartel fines

For a cartel started after 1 July 2016 ACM can impose a maximum fine of €900,000 (instead of €450,000) or – if this is greater – a maximum of 40 percent of the annual group turnover (instead of a maximum of 10 percent). The fine will be doubled if it transpires that, during the preceding five-year period, a company was guilty of the same offence (recidivism).

The fine for executives has also increased, to a maximum of €900,000 (previously €450,000). The same is true of the fine for non-cooperation in an ACM investigation. From now on this will be a maximum of €900,000 (previously €450,000) or – if this is greater – no more than 1 percent of annual turnover. These fines will also be doubled in the event of recidivism.

Cartel infringements that started prior to 1 July 2016 fall under the “old” penalty regime, even if the offence has continued beyond 1 July 2016.

Other fines

All other maximum fines that the ACM can impose have also doubled. These include fines for infringements of the ban on abuse of a dominant position, merger control, consumer law, the Dutch Heating Supply Act or the rules regarding post, transport, energy and telecoms.

In summary, the ACM penalty system for offences committed after 1 July 2016 looks like this:

  • for all minor offences: maximum €900,000 or – if this is greater – 1 percent of the turnover of the market organisation;
  • for all serious offences, other than cartel infringements: maximum €900,000 or – if this is greater – 10 percent of the turnover of the market organisation;
  • in all instances (minor and serious offences) recidivism will lead to a doubling of the applicable absolute and relative maximum fines set out under the points above.

The minister has now amended the Fining Policy Rules (Boetebeleidsregels) for ACM in line with this change in law.

Be prepared

ACM recently launched an offensive to track down more cartels. We responded to this in an appropriate manner. In view of the punitive fines for infringement of the cartel ban and for non-cooperation in an investigation, it is important to be well-prepared for any dawn raids by the ACM. The website provides practical information about companies’ most important rights and obligations. It gives tips & tricks on the best way for businesses to conduct themselves in the event of a company visit.

It’s important to add that from 1 July 2016 companies with more than fifty employees must have an internal reporting scheme for breaches of law and regulations under the Dutch Whistleblowers (Safe Haven) Act. Within that context, updating your internal compliance programme is a good idea. A lawyer specialising in that field can assist you with this.