New amendments to the Finnish Competition Act are finally set to take effect on 24 June 2021 after the implementation process was delayed due to critical views disclosed by the Finnish Parliament’s Constitutional Law and Commerce Committees. The amendments will increase the Finnish Competition and Consumer Authority’s (the FCCA) enforcement powers and finalise the implementation process of the ECN+ Directive. Finland will be following France, Germany and Spain in being among the first EU Member States to implement the Directive, although the Directive was supposed to be implemented by 4 February 2021.
The principal amendments have remained almost the same as described in our previous Legal Alert on the matter. The improvements primarily address the constitutional issues raised by the Committees and clarify the amendments by taking fundamental principles such as proportionality into account. One of the main issues was also deciding which institution should have the right to allocate the imposed fines.
We describe the main changes made to the original Government proposal in this Legal Alert. For more information on the amendments themselves, please read our previous Legal Alert, which is linked above.
Powers to impose structural remedies
As we described in our previous Legal Alert, the amendment provides the FCCA with the right to impose structural remedies in the context of cartels and market dominance abuse cases. This is potentially the most far-reaching new power provided to the FCCA, which was also noted by the Commerce Committee.
Even though the wording of the new Section of the Competition Act has remained the same, the Commerce Committee emphasised that the structural remedies should only be used as a final resort, and the content of the remedy would ultimately remain at the discretion of the Market Court and the Supreme Administrative Court.
As such, the FCCA will only have the right to propose structural remedies, while the competent court will render the final decision. It should also be noted that while imposing structural remedies has been possible under the European Commission’s regime since 2004, these remedies have never been used.
Expanded powers for interim measures
In deviation from the original Government proposal, interim orders can only remain in force for one year. However, the FCCA is allowed to extend the duration thereof by one year at a time if the measure is still considered necessary.
Expanded powers to impose fines on associations of undertakings
The amendments still provide the FCCA with the right to assign the obligation to pay the relevant fine to any of the member undertakings whose representatives were part of the decision-making bodies of an association involved in competition infringement.
However, as with the other competition infringement related sanctions, the FCCA will only have the right to propose that a penalty payment be imposed on such undertakings. The Market Court will render the actual decision.
The definition of decision-making bodies, the principle of proportionality that applies to remaining minor penalty payments and other relevant legal principles are also included in the new Section introduced to the Finnish Competition Act.
The amendment of the Competition Act will enhance the FCCA’s investigative and enforcement powers and serve to further expand the scope of potential liability for anticompetitive practices. In light of these, compliance with competition rules and upholding the right to a defence will become increasingly important. Therefore, it is crucial that enforcement powers remain sufficiently counterbalanced by appropriate judicial safeguards.
While the credible and efficient enforcement of competition law is of primary importance for the proper functioning of a market economy, it is a relief to note that the approved amendments eliminate most of the issues caused by the original Government proposal by reserving the authority to impose sanctions for the competent court and acknowledging the fundamental principles of law.
Borenius’ lawyers are available to assist in addressing any questions you may have regarding the new amendments.