{"id":2517,"date":"2019-05-10T10:48:40","date_gmt":"2019-05-10T10:48:40","guid":{"rendered":"https:\/\/vila.es\/en\/?p=2517"},"modified":"2020-11-05T15:36:44","modified_gmt":"2020-11-05T15:36:44","slug":"competition-law-members-of-the-management-bodies-of-companies-may-be-fined-even-if-they-do-not-have-powers-of-representation","status":"publish","type":"post","link":"https:\/\/vila.es\/en\/corporate\/competition-law-members-of-the-management-bodies-of-companies-may-be-fined-even-if-they-do-not-have-powers-of-representation\/","title":{"rendered":"COMPETITION LAW: MEMBERS OF THE MANAGEMENT BODIES OF COMPANIES MAY BE FINED EVEN IF THEY DO NOT HAVE POWERS OF REPRESENTATION"},"content":{"rendered":"

On 30th<\/sup> June 2016, the Spanish National Commission for Financial Markets and Competition (\u201cCNMC\u201d) published a decision regarding dossier S\/0519\/14 on RAILWAY INFRASTRUCTURES, pursuant to which several companies and individuals forming part of corporate management bodies were fined, for having fixed market share and prices, as well as other commercial conditions.<\/p>\n

Such activities imply a breach of competition law. In Spain they are regulated by Law 15\/2007, of 3rd<\/sup> July, the Competition Act, and by the Treaty on the Functioning of the European Union (TFEU), in article 101 and thereafter.<\/p>\n

Specifically, in accordance with the decision of the CNMC, the conduct which had taken place contravened what is set forth in sections a) and c) of the Competition Act and 101 of the TFEU.\u00a0 The first establishes:<\/p>\n

\u201cThe following shall be prohibited as ncompatible with the internal market: all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market, and in particular those which: <\/em><\/p>\n

a) directly or indirectly fix purchase or selling prices or any other trading conditions; <\/em><\/p>\n

b) (\u2026)<\/em><\/p>\n

c) share markets or sources of supply;\u201d<\/em><\/p>\n

In accordance with article 62.4 of the Competition Act, the conduct pursued implies an infringement classified as \u201cvery serious\u201d:<\/p>\n

\u201cThe following are very serious infringements:<\/em><\/p>\n

a) The development of collusive conduct as defined in Article 1 of the Act consisting of cartels or other collective agreements, decisions or recommendations, arranged practices or consciously parallel conduct between actual or potential competitors. (\u2026)\u201d<\/em><\/p>\n

And, as a consequence of the infringement committed, the CNMC proceeded to impose the corresponding fine upon all of the implicated companies, in accordance with the stipulations of section c) of article 63.1:<\/p>\n

\u201cThe competent bodies may impose the following sanctions on economic agents, companies, associations, unions or groups of those who, deliberately or negligently, infringe the provisions of this Law: (\u2026)<\/em><\/p>\n

c) very serious infringements with a fine of up to 10 per cent of the total turnover of the infringing company during the financial year immediately prior to that in which the fine is imposed.\u201d<\/em><\/p>\n

Furthermore, following what is stipulated in article 63.2, the resolution imposed a financial penalty on the legal representatives and members of the management bodies involved in the agreement or decision, and published the resolution in its entirety, including the names of those sanctioned. Said article reads:<\/p>\n

\u201c In addition to the sanction established in the previous section, when the offender is a legal entity, a fine of up to 60,000 Euros may be imposed upon each of its legal representatives or upon those forming a part of the management bodies who have intervened in the agreement or decision.\u201d<\/em><\/p>\n

The fact that the penalty fell upon not only natural persons as representatives of the companies, but also that it included the members of the management bodies who do not hold powers of representation, such as the Vice Secretary of the Board of Directors of one of the companies, as a \u201ccomponent of the management body of the company\u201d is particularly interesting.<\/p>\n

Hence, the latter appealed the fine, initially before the Provincial Courts and finally before the Supreme Court, where the Contentious-Administrative Chambers passed judgment STS 430\/2019, on 28th<\/sup> March, ruling in favour of the CNMC and dismissing the corresponding appeal, presenting the following argument to the questions raised:<\/p>\n

1) The inclusion of the appellant is relevant since, as Vice Secretary of the Board of Directors, he forms part of the company’s governing body and, in that capacity, he also attended the meetings at which the resolutions were adopted. The judgment indicates that \u201cthose persons who, forming part of the collegiate management bodies, did not attend the meetings or who voted against the agreements or dissented<\/em>\u201d have not been fined.<\/p>\n

2) The complete publication of the fine does not infringe the right to intimacy guaranteed by article 18 of the Spanish Constitution, as the prohibited conduct has not taken place within the scope of one\u2019s private life, instead it is a matter of professional conduct, which has been carried out voluntarily.<\/p>\n

 <\/p>\n

 <\/p>\n

Pedro Blanco<\/p>\n

Vil\u00e1 Abogados<\/p>\n

 <\/p>\n

For more information, please contact:<\/p>\n

va@vila.es<\/span><\/a><\/p>\n

 <\/p>\n

10th<\/sup> May 2019<\/p>\n","protected":false},"excerpt":{"rendered":"

On 30th June 2016, the Spanish National Commission for Financial Markets and Competition (\u201cCNMC\u201d) published a decision regarding dossier S\/0519\/14 on RAILWAY INFRASTRUCTURES, pursuant to which several companies and individuals forming part of corporate management bodies were fined, for having fixed market share and prices, as well as other commercial conditions. Such activities imply a […]<\/p>\n","protected":false},"author":4,"featured_media":4734,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[73],"tags":[],"class_list":["post-2517","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-corporate"],"yoast_head":"\nCOMPETITION LAW: MEMBERS OF THE MANAGEMENT BODIES OF COMPANIES MAY BE FINED EVEN IF THEY DO NOT HAVE POWERS OF REPRESENTATION - Vil\u00e1 Abogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/vila.es\/en\/corporate\/competition-law-members-of-the-management-bodies-of-companies-may-be-fined-even-if-they-do-not-have-powers-of-representation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"COMPETITION LAW: MEMBERS OF THE MANAGEMENT BODIES OF COMPANIES MAY BE FINED EVEN IF THEY DO NOT HAVE POWERS OF REPRESENTATION - Vil\u00e1 Abogados\" \/>\n<meta property=\"og:description\" content=\"On 30th June 2016, the Spanish National Commission for Financial Markets and Competition (\u201cCNMC\u201d) published a decision regarding dossier S\/0519\/14 on RAILWAY INFRASTRUCTURES, pursuant to which several companies and individuals forming part of corporate management bodies were fined, for having fixed market share and prices, as well as other commercial conditions. 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