The Czech Office for Competition Protection (ÚOHS) has issued a new notice on competition compliance programmes effective from 1 January 2024. The notice sets out the conditions under which a compliance programme can be considered a mitigating factor, resulting in a potential fine reduction of up to 10%.
With an eye on enhancing transparency and predictability in competition law enforcement, this notice promises to redefine how businesses handle compliance needs. But what does it mean for your business?
Mitigating Fines: The Compliance Edge
The conditions outlined in the notice transform a compliance programme from a set of rules to a system that can reduce fines by up to 10%. But how?
Active Prevention Takes Centre Stage
The Competition Authority doesn’t only focus on punitive measures; it aims to promote a culture of active prevention. The notice calls for competitors to be frontline defenders against competition law infringements, spreading awareness and curbing potentially problematic conduct across all industries.
The Compliance Programme’s key issue
Importantly, the Competition Authority will only approve compliance programmes that meet or exceed the programme requirements. Effectiveness is the keyword. To get the green light, competitors need more than a checklist; they also need sophistication, quality, and commitment.
Effective Measures under the Notice
The notice details the elements that make a compliance programme effective. These elements include the following.
1. Risk Assessment Mastery: Identifying, Analysing, and Mitigating
At the core of an effective compliance programme lies the ability to assess risks precisely. The Competition Authority encourages competitors to identify, analyse, and evaluate the risks accurately. In addition, measures should be implemented not just to lower or eliminate these risks, but to prevent them in the first place. It's risk management with a proactive slant.
2. Regular and Impactful Training: Empowering Your Team
The Competition Authority notice emphasises the importance of not just having a rulebook but ensuring that everyone in your team understands it. Regular and effective training seminars are a key element of this, with annual sessions that go into depth. For example, if your business often interacts with competitors at managerial levels, the training can highlight the strict prohibition on cartel formation. To increase engagement, topics can focus on what's off-limits and what’s obviously illegal.
3. Compliance Oversight and Disciplinary Systems
A compliance programme is only as good as who oversees it. Oversight will be guaranteed by a compliance officer, who ensures that the programme is fully implemented. The Competition Authority's notice recommends setting up internal reporting mechanisms and clearly defining a contact point where employees can seek guidance. This should help to create a culture where employees feel comfortable reporting concerns and seeking advice, thus catching potential issues before they escalate.
Fine Reductions Unveiled
The Competition Authority's notice sets out a clear path to fine reductions, provided competitors adhere to the rules. If a competitor enters into a leniency or settlement arrangement, and if senior management avoids the accusation of anticompetitive behaviour, there is the potential for a reduction in the fine of up to 5% for those rolling out a new compliance programme, and 10% for those enhancing an existing one – all during the proceedings. This incentive has the potential to turn good intentions into measurable outcomes.
CMS: Helping you Navigate the Compliance Landscape
CMS is your partner in transforming your compliance programme into a strategic advantage. Our team is adept at not only meeting but surpassing the Competition Authority's standards. From crafting comprehensive programmes to implementing legal strategies, we're here to make your compliance journey smoother and more effective.
Don't let compliance be a challenge. If you're intrigued by the idea of a reduced fine and ethically sound business environment, CMS is ready to assist you. Contact our experts Tomáš Matějovský and Lenka Krutáková today, and we’ll guide through all of the compliance requirements with confidence. CMS is here to ensure your business stays ahead of the curve.
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