Competition

Competition law seeks to ensure that operators compete in the market in a free and fair manner, without distortions to fair competition. It therefore pursues agreements or exchanges of information between competitors that harm their customers or suppliers, as well as situations in which a company takes advantage of its dominance in a market to impose abusive or unfair conditions on its customers or suppliers. Ensure that when there are mergers or agreements between companies to collaborate, competition and freedom of choice for customers continue to exist. Ensure that more and better offers reach end consumers and that they can choose between them. And finally, in the event that a company has distorted competition, it allows those affected (both companies and consumers) to claim damages.

Because the consequences of infringing competition law can be disastrous for companies. Very high fines are imposed (up to 10 % of the company’s annual turnover), managers are also sanctioned (fines of up to EUR 60,000), the company must also pay for the damages caused by its infringement and may be banned from contracting with public administrations.

On the other hand, good advice in this area can prevent a company from being subject to abusive and/or unfair conditions in its contracts or from being the victim of prohibited practices that make it difficult for it to compete in the market and therefore to carry out its business.

As there is a great deal of ignorance in this area, it is quite common for such cases to occur, sometimes without the offender even being aware of it.

On the one hand, the need to avoid the serious consequences of being sanctioned, sometimes even jeopardising the very continuity of the company. On the other hand, the possibility of detecting and reporting infringements of which a company may be a victim, which would prevent it from competing on a level playing field.

Furthermore, in June 2020, the CNMC published a guide on regulatory compliance in which it points out that, in the same way that companies prepare preventive measures in the criminal or data protection field, companies of all sizes and sectors should have a compliance programme on competition law.

Being well advised in this area can avoid serious penalties and the need to pay high compensation, in many cases for practices that the company itself was unaware might be prohibited.

In addition, good advice can avoid falling prey to practices that make it difficult for the company to develop its business through anti-competitive agreements or abusive or restrictive practices.

Absolutely not. While the most publicised cases tend to involve large companies, competition law affects companies in all sectors and of all sizes. In fact, the CNMC sanctions many more SMEs than large companies. And the CNMC has repeatedly pointed out that all types of companies are subject to competition law and must take preventive action. As mere examples, the CNMC has recently investigated companies in sectors as varied as small photographic studios that produce university group photos, funeral service companies, online flat search portals, large and small bus transport companies, professional schools or sports clubs.

It provides the peace of mind of knowing that you have a low exposure to paying large fines and/or compensation because your way of operating and your contracts have a high level of compliance with competition law.

They can also benefit from the possibility of detecting prohibited practices or abusive conditions that other operators or even public administrations intend to impose on them.