Competition Switzerland - Q 4 2010

Author:Mr Silvio Venturi and Pascal Favre
Profession:Tavernier Tschanz


FCC imposes fines for price-fixing in doors components sector

On November 4, 2010, the Competition Commission (FCC) fined four undertakings CHF 7.6 million for agreements on prices between competitors in relation to the distribution of doors components (doorknobs, hinges, locks, etc.). The investigation has shown that the undertakings colluded in determining the moment and the amount of price increases. An investigation for the same facts is currently under way in the EU.

In 2007, after an undertaking had reported its involvement in a qualified hard-core cartel, the FCC launched a regular investigation, by dawn raiding the offices of the principal market participants. Later in the course of the investigation, information on a second (still hidden) cartel was brought to the attention of the FCC by a cartel participant. The undertaking that provided information which made it possible for the FCC to start the regular investigation qualified for full immunity from fines. A reduction in fines of 60% was granted to the undertaking that disclosed the second (still hidden) hard-core cartel.

Under Swiss competition law, the FCC has power to fine undertakings up to 10% of their turnover in Switzerland for the past three years. However, pursuant to Article 49a(2) of the Competition Act, the FCC operates a leniency programme, which applies to restrictive agreements that are subject to fines because they contain hard-core clauses that eliminate competition. Full immunity from fines is available for the first undertaking that reports its involvement in a qualified hard-core cartel and delivers information enabling the Secretariat to start a regular investigation, provided that among others such undertaking has not instigated the cartel activity. A reduction in fines by up to 50% is available, at any time in the procedure, to an undertaking that does not qualify for full immunity, if and to the extent the applicant cooperates with the investigation and ends its involvement in the prohibited agreement at the time evidence is provided. In addition, the fine for a particular infringement can be reduced by up to 80% if an undertaking discloses information or evidence relating to a second, still hidden, hard-core cartel ("bonus plus"). This reduction is without prejudice to any possible full exemption or partial reduction of fines of the newly disclosed cartel.

This decision is notable in that it is the first time that the FCC has reduced a fine...

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