The European Commission confirmed today it would increase fines for companies that enter cartels or practice other antitrust behaviour such as abuse of a dominant position.
Europe's top antitrust watchdog has revised the guidelines for how it calculates fines, putting greater emphasis on punishing large companies and repeat offenders.
Competition Commissioner Neelie Kroes, confirming information a source had told Reuters on Tuesday, said the new guidelines should act as a deterrent to companies breaking antitrust law.
"Don't break antitrust rules. If you do, stop it as quickly as possible, and once you've stopped, don't do it again," she said in a statement.
The Commission can fine a company as much as 10 percent of its total annual turnover for an offence. When calculating the fine, it takes into account factors such as the seriousness of the offence, previous violations, duration and whether the company helped authorities in their investigations. Under the new guidelines, the 10 percent ceiling will not change.
However the way a fine is calculated will change, with the effect that they will rise. The starting point of calculating a fine will now be up to 30 percent of annual turnover in the sector where the offence took place.
This figure will then be multiplied by the number of years the offence took place. Previously the Commission chose a figure depending on the seriousness of the fine. The new guidelines will increase to 100 percent from 50 percent the increment in a fine for previous offences.
The Commission will also start taking into account as previous violations those that were determined by national competition authorities within the 25-member union, not just its own decisions.
The guidelines will also introduce the principle of an "entry fee" for companies involved in cartels, irrespective of how long they participated. "The mere fact that a company enters into a cartel could 'cost' it at least 15 to 25 per cent of its yearly turnover in the relevant product," the Commission said in a statement.