The Polish Office of Competition and Consumer Protection – antitrust proceedings in Poland

The Polish Office of Competition and Consumer Protection is an institution next to which one cannot pass by indifferently. Its functioning in the Polish market is motivated by many reasons, limitation of the monopoly on the Polish market being one of them. Antitrust proceedings are discussed by Paweł Dyrduł, associate lawyer from KG Legal Kiełtyka Gładkowski Professional Partnership based in Cracow.

The Office of Competition and Consumer Protection

The Office of Competition and Consumer Protection was established in Poland in 1990. Initially, it was functioning in the Polish market as the Antimonopoly Office. The purpose of the Office was to undertake actions aimed at counteracting anticompetitive agreements and abuse of dominant position on the market, as well as controlling the concentration of entrepreneurs. The current name – Office of Competition and Consumer Protection – was granted in 1996. The competence of the Polish Office for the protection of consumer interests was expanded. The Office’s activity on the Polish market is considered essential and the institution itself is seen as credible and independent. The organization of the Office was regulated by the Act of 16 February 2017 on competition and consumer protection. The most important body of the Office is the President of the Office for Competition and Consumer Protection.

Explanatory proceeding

Explanatory proceedings may be initiated by the President of the Office ex officio. This is undertaken by way of a decision after the fulfilment of the conditions set out in the Act, namely when the facts indicate the possibility of violating the provisions of the Act.

It is intended primarily to first determine whether there has been a breach of the provisions of the law, which may form the basis for initiating antitrust proceedings. In addition, explanatory proceedings may aim at market research (defining its structure and degree of concentration). The duration of explanatory proceedings is up to 4 months from the date of their initiation. However, if the case is particularly complicated, the proceedings may take up to 5 months. The completion of the proceedings takes the form of a decision.

Antitrust proceedings in Poland

Antitrust proceedings in Poland are conducted as two types of proceedings – antitrust proceedings on competition restricting anti-competitive practices and antitrust proceedings on merger cases.

Antitrust proceedings on anti-competitive practices are initiated ex officio. Everyone has the right to notify the President in writing in the form of a notice in which suspicions of restrictive practices are raised. Reported suspicions must include justification. In addition, the notice must meet the formal legal requirements, namely the indication of the entity accused of the practice of restricting competition, the description of the facts, the indication of the provision of the national law or of the TFEU, the breach of which is the subject of the notification and the likelihood of its violation as well as the identification of the notifier. The notice must be accompanied by all documents which may constitute evidence in the case. If in the course of the proceedings it is determined that the entrepreneur’s alleged practice may cause serious threats to competition, the President of OCCP will be able to take appropriate action in this regard. In this situation, the President, by way of a decision, will impose on the trader the obligation to cease specific actions set forth in the decision during its term. The decision cannot impose penalties. In view of speeding up the proceedings, the President may request the parties, either ex officio or upon a request, to use the procedure of voluntary punishment. The proceedings should be completed within 5 months of the date of their initiation. However, no proceedings are instituted for restrictive practices if five years have elapsed since the end of the year in which they ceased to apply.

Antitrust proceedings on merger cases can be initiated ex officio and upon application. If the proceedings are initiated upon request, a fee is charged (the amount is determined by the Council of Ministers by way of a regulation). If the fee has not been paid with the application, the President shall call the applicant to make the payment within 7 days. If the fee is not paid on time, then the application is left without further examination. The obligation to notify the intention of the merger is binding on jointly merging undertakings, controlling undertakings, jointly all undertakings taking part in the creation of a joint venture and on the trader acquiring part of the property of another entrepreneur. The President of the OCCP has the right to return the notification of the intention to concentrate if the intention is not notified. In addition, the President may also return the notification within 14 days of its submission, if it does not meet the conditions, and may also call upon the notifiers to complete the notification within the deadline. Concentration proceedings should be completed within 1 month from the date of their initiation. If the matter is particularly complex, the time limit may be extended by 4 months.

Financial penalties

It is one of the powers conferred on the President of the OCCP to impose fines on an entrepreneur in antitrust proceedings. The President may, by way of a decision, impose on the trader the following fines:

• Up to 10% of the turnover achieved in the financial year preceding the year of imposition of the penalty, e.g. for the abuse of a dominant position or for entering into a restrictive agreement,
• Up to 50 000 000 euros, for example, for providing false information when reporting a concentration,
• Up to 2 000 000 euros per person managing a business for concluding an agreement restricting competition,
• Up to 10 000 euros for each day of delay in implementing the decision,
• Up to fifty times the average monthly remuneration for a member of managerial staff if he / she has not made a decision or a judgment, or has not declared his / her intention to concentrate,
• Up to 5 000 zlotys per witness or expert for unreasonable refusal to testify or unjustified failure to appear in the proceedings.

Abstract: Polish economic Law, Polish antitrust law

The article was prepared by KG LEGAL KIEŁTYKA GŁADKOWSKI based in Cracow, Poland, specialising in cross border cases, with its focus on investments in Poland, new technologies, IT and life science. It discusses antitrust proceedings of the Polish Office of Competition and Consumer Protection in Poland.

Paweł Dyrduł, associate lawyer (specializing in banking law, financial law) from KG LEGAL KIEŁTYKA GŁADKOWSKI – PROFESSIONAL PARTNERSHIP based in Cracow, specializing in cross border issues and servicing life science and IT companies, discusses antitrust proceedings conducted by the President of the Polish Office of Competition and Consumer Protection.