On 18th August 2014, the Italian Competition Authority (ICA) gave its binding opinion on the compatibility of the by-laws of a mutual association of notaries with Article 2 of Law No. 287 of 1990 (“Italian Competition Law”), the prohibition of anti-competitive agreements.
According to Article 13 of the Italian Competition Law, undertakings can notify agreements to the ICA in order to have them assessed under Italian Competition Law.
In the present case the Italian association “Unione Mutualistica dei Notai del Veneto” (the “Association”) founded by nineteen Italian notaries in the region of Veneto sent an assessment request of its by-laws to get the green light from the ICA.
The Association was set up to give economic support to young notaries from more established notaries through a mechanism of revenue sharing by which the notaries members of the Association pay membership fees calculated on part of their annual revenue. Therefore, established notaries pay more and receive less than young notaries and vice versa.
The Association held that this mechanism gives an important support to notaries who are at the beginning of their career and therefore it would have pro-competitive effects by enabling the latter to pay initial costs and expenses required by the profession.
Further, the Association added that these kind of mutual associations were provided for by the Italian Law No. 89 of 1913, as amended by the Legislative Decree No. 1 of 2012, and therefore they cannot be considered as anti-competitive.
After carrying out an in-depth investigation, the ICA found that the Association (i.e. the by-laws) could significantly restrict competition through the money transferring between competing undertakings.
In particular, the ICA found that young notaries would not effectively compete with the established notaries in terms of lower prices, the higher quality and innovation of their professional services. The ICA pointed out that the revenue sharing, although it is not a hardcore restriction of competition per se, would particularly distort that as it would act as a disincentive to the young notaries to strive for the acquisition of bigger market shares and therefore impeding real competition.
In our view, the ICA investigation and subsequent binding opinion are welcome as they are a high profile deterrent against such anti-competitive agreements in the professional services sector which can be defined as particularly underdeveloped in Italy from a competition viewpoint.
Indeed, the ICA stated that the membership of the Association would guarantee significant income for the young notaries which they would lose in case of competition with the established notaries.
The ICA also held that the provision set out in the Law No. 89 of 1913 which allows for the establishment of such associations it is not binding on the notaries and the application of the Italian Competition Law could be only avoided if the anti-competitive conduct is strictly required by the relevant law.