Competition renewed

On 28 May 2013, the new legislation on competition came partly into force. The Code on economic law, which is
a long-term project, contains book IV on the protection of competition and book V on competition and price evolution.

As from now, the government can appoint the new members of the Competition Authority, which is necessary in order to accomplish the necessary changes.

Book IV and V, of which you will find below a brief explanation, will most probably enter into force soon.

Next to a complete reform of the Belgian Competition Authority, the new legislation will provide new procedures and contains new provisions on the pricing of goods.

1. Reform of the Belgian competition authority.

According to the new law, an independent body is brought to life, which will preserve fair and free competition. The Belgian Competition Authority is composed out of the President and its office, the Competition College, the Execution Committee and the College of Competition Prosecutors managed by the Prosecutor-general.

As a result, the Competition Authority should be a streamlined structure and should be able to perform its duties more adequately. Hence, this body should now be able to apply articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU) in an efficient and transparent manner.

The law assigns a representation function to the President and its office, such as the representation of Belgium in European or International competition bodies and he has to partake in European or International discussions and negotiations concerning competition legislation and policy.

The Competition College on the other hand has the power to take the decisions on competition issues, while the Execution Committee is competent to organize and compose the office of the President and the College of Competition Prosecutors, and to determine guidelines on the implementation and the application of competition rules.

Finally, the College of Competition Prosecutors is charged with the investigations concerning concentrations. Under the new legislation, the investigation power of the College of Competition Prosecutors is more extensive than before and the independence of the investigation should be guaranteed.

2. Reform of certain procedures

A new element is the injunction right of the Minister of Economic Affairs, which gives the Minister the power to order an investigation.

Another important innovation is the implementation of provisional measures. The College of Competition Prosecutors, the plaintiff or the Minister will be able to request for provisional measures during the investigation of a case. Subsequently, the Competition College will be able to order said provisional measures in order to suspend the unfair competition practices, which are subject of the investigation. It must be noted that the procedural deadlines in this respect are quite short.

Nonetheless, it will be possible to lodge appeal against the decisions of the Competition Competition College before the Court of Appeal of Brussels. Although the appeal as such will not suspend the immediate execution of the decision of the College, it is possible to request suspension of the decision in question.

In addition, the College of Competition Prosecutors is competent to engage in settlement discussions with the undertaking, which is subject of the investigation. The law provides for a specific procedure, based on which these settlement discussions can take place. In order to be eligible to agree to a settlement proposition, the law requires that the undertaking in question acknowledges its involvement and responsibility of the violations.

Furthermore, it is important to mention that individuals may be subjected to the sanctions provided by the law. This should refrain any individual, whether or not he or she is part of the management, to cooperate or participate to unfair competition.

3. Competition and price evolutions

The Code on economic law also implemented Book V on competition and price evolutions. The basic principle by which the prices of goods are determined by the free market is still fundamental. However, the price observatory will be able to consult professional and consumer organizations or the interested parties, if it would determine a problem concerning prices or margins, abnormal price evolutions, or a structural market problem.

Additionally, the price observatory will notify the Minister of its report and will transfer said report to the Competition College. Based on this report, the Competition College will be competent to take provisional measures in order to end these wrongful practices and which cannot last longer than 6 months.

4. Conclusion

It is fair to say that implementation of a new Competition Authority is a positive evolution and will support the enforcement of competition. However, question can be raised concerning some of the procedural matters, given that the powers of the Competition Authority have been substantially broadened. Time will tell whether the Competition Authority will function as an independent and balanced body and if the new legislation will safeguard competition rather than burden the free market.