The Spanish competition authority ("CNMC") has published a "Guide on Regulatory Compliance Programmes in Relation to Competition Law" (the "Compliance Guide") which provides guidance on the circumstances in which internal compliance programmes can lead to more lenient sanctions imposed as a result of a breach of competition law.
| what you need to know - key takeaways |
- With this publication, the CNMC aims to incorporate compliance considerations into companies' day-to-day decision-making processes.
- A positive evaluation of a compliance programme by the CNMC could entail a reduction of the fines that the company might face in an antitrust investigation, and (in the case of a bid-rigging infringement) potential avoid a ban from participating in future public tenders.
- However, the mere implementation of a compliance programme cannot in itself benefit from the above. It must meet a number of criteria that will be assessed on a case-by-case basis by the CNMC.
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The Compliance Guide offers two key messages:
- the mere implementation of a compliance programme (either before or after an investigation is launched) does not constitute in itself a mitigating circumstance. It needs to meet a number of criteria that will be assessed on a case by case basis by the CNMC; and
- a positive evaluation of the compliance programme can result in: (a) a reduction in the level of fine that the company might face, and possibly immunity (in certain circumstances where the infringing conduct is reported to the CNMC but immunity applications are not usually applicable); and (b) avoiding a ban from participating in future public tenders in the case of a bid-rigging infringement.
According to the Compliance Guide, in order to obtain a positive evaluation, a compliance programme must meet the following criteria:
- Involvement of the company's governing bodies and/or senior management: This will be the case when, among others, there is an incentive policy in place that rewards compliance (for example, applying bonusses) and punishes non-compliance (for example with salary cuts, limitation of promotion, or even dismissals) and top managers clearly and firmly state that compliance with Competition law is not only a legal obligation, but a core element of the company's culture (for example, in the intranet, compliance emails, etc.).
- Effective training: The company must have a training programme to ensure that employees receive training regarding Competition law (the training must be adapted to each different activities and functions).
- Independence and autonomy of the Compliance Officer: The company must demonstrate the independence and autonomy of the Compliance Officer responsible for the design and execution of its compliance programmes. This includes granting the Compliance Officer the power to report conduct directly to the governing body.
- Risk identification and design of control mechanisms: The company should have: (a) a risk map identifying the business areas and employees that are at the highest risk of infringing competition law, as well as the likelihood and impact of such infringement; and (b) a control matrix stating the procedures the company will follow in case an infringement materialised.
- Design of the internal procedures for lodging complaints and/or doubts: There must be an internal reporting channel to report potential infringements of competition law or doubts regarding the lawfulness of certain conduct. The channel must allow the adequate and prompt analysis of the risks and the protection of complainants (for example, ensuring the anonymity of the complainant).
- Design of a clear and effective disciplinary system: The compliance programme should include both disciplinary action (e.g. salary cuts or dismissals) and possible incentives for employee compliance (for example, including termination clauses in case of competition law infringements in the contracts with senior managers).
The Compliance Guide contains an annex that offers several indicators that could be used by companies to determine whether their compliance programmes comply this criteria. In addition, the CNMC also offers an online tool with a series of questions that the companies can use to self-assess their programmes.
With thanks to Teresa Prado of Ashurst for her contribution.
