GERMANY Law and Practice Contributed by: Christina Malz and Sebastian Gröss, SZA Schilling, Zutt & Anschütz
es to gravity and duration of the infringement, including: • type and quality of the infringement; • importance of products or services con - cerned; • way of execution of the offence; • repeated offences; and • mitigating behaviour. The FCO’s revised internal fining guidelines still serve as rules for the FCO’s internal administra - tive practice. In the revised fining guidelines, the calculation method was partly overhauled and rendered somewhat more flexible. It is worth noting that the FCO is now explicitly required to consider compliance efforts ‒ implemented before and after an infringement ‒ as a mitigating fining parameter (see 5.6 Relevance of Effec - tive Compliance Programmes ). The FCO has so far generally not considered such efforts as a mitigating factor and only rather reluctantly accepted such efforts in the course of settle - ment negotiations. The FCO must also take a company′s financial capacity into account. Appeals The Higher Regional Court of Düsseldorf, which has jurisdiction over appeals against the FCO′s fining decisions, is not bound by the FCO′s assessment of these fining parameters. It is also not bound by the FCO′s different interpretation of the upper fine limit (ie, 10% of the undertak - ing’s total turnover). As a result, there have been a series of cases where an appeal effectively led to a reformatio in peius with substantially higher fines. Given that the latest legislative amend - ments have not addressed this aspect, such discrepancies between the fines imposed by the FCO and the court remain possible. It should be noted, though, that the FCO’s revised fining guidelines also appear to reflect aspects of the
appeals court’s approach. There have not yet been any judgments based on the new fining guidelines, and it remains to be seen whether the gap between the appeals court’s approach and the FCO’s approach has narrowed. Liability of Controlling Entities Since 2017, the ARC provides that controlling entities can be held liable for an infringement if a fine cannot be effectively recovered either because the offending undertaking ceased to exist following the start of the investigation or because important assets were removed from the undertaking in question. In 2023, the FCO prominently made use of this provision in the Industrial Construction case. Interim Measures The FCO can issue cease-and-desist orders (Section 32 of the ARC) or impose interim meas - ures (Section 32a of the ARC). In administrative proceedings, the parties can also offer commit - ments that can be declared binding by the FCO (Section 32b of the ARC). Intervention Without Infringement The 11th amendment to the ARC grants the FCO new intervention tools similar to those available to other competition authorities (in particular, the CMA). Following a sector inquiry (Section 32e of the ARC), the FCO is able to intervene on the basis of the results of the inquiry. Such interven - tions do not require an infringement of competi - tion law, but merely the finding of “continuing malfunctioning of competition” (Section 32f of the ARC). The possible intervention measures include behavioural or structural remedies with the aim of reducing market entry barriers and in exceptional cases even unbundling by ordering the sale of shares or assets. The FCO opened its first proceedings on the basis of this new provi -
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