A Q&A guide to cartel leniency law in Norway.
The Q&A gives a succinct overview of leniency and immunity, the applicable procedure and the regulatory authorities. In particular, it covers the conditions to be satisfied, the method of making an application, availability of immunity from civil fines to individuals, the scope of leniency, circumstances when leniency may be withdrawn, leniency plus, confidentiality and disclosure, and proposals for reform.
To compare answers across multiple jurisdictions visit the Cartel Leniency Country Q&A tool.
This Q&A is part of the PLC multi-jurisdictional guide to competition and cartel leniency. For a full list of jurisdictional Cartel Leniency Q&As visit www.practicallaw.com/leniency-mjg.
For a full list of jurisdictional Competition Q&As which provide a high level overview of merger control, restrictive agreements and practices, monopolies and abuse of market power, and joint ventures in multiple jurisdictions, visit www.practicallaw.com/competition-mjg.
The legal basis for the Norwegian leniency programme is section 31 of the Norwegian Competition Act (Act of 5 March 2004 No. 12) (Competition Act) which states that an undertaking's assistance to the competition authorities in the detection of its own and others' infringement must be considered when determining the amount of the administrative fine under section 29 or criminal fines under section 30 of the Competition Act.
The details of the leniency programme are set out in the Regulation on the calculation of and leniency of administrative fines of 22 August 2005 no. 909 (Regulation). Sections 4 to 9 of the Regulation provide further details about full or partial leniency and the relevant procedure. The Regulation, including the provisions concerning leniency, only applies in cases subject to an administrative investigation and not when a cartel is subject to criminal prosecution and/or criminal fines.
The Norwegian Competition Authority (Konkurransetilsynet) (NCA) has not published extensive guidelines on leniency and there are also still very few cases where leniency has been granted.
The leniency programme is administrated by the NCA.
In principle, the leniency programme covers all infringements of section 10 of the Competition Act. Section 10 prohibits agreements and concerted practice between undertakings, and decisions by associations of undertakings that have as their object or effect the prevention, restriction or distortion of competition. The prohibition is modelled on Article 101 of the Treaty on Functioning of the European Union (TFEU). The preparatory works of the Competition Act state that section 10 must be interpreted and applied in accordance with the case law of the courts of the European Union and the European Free Trade Area (EFTA) Court, and the administrative practice of the European Commission (Commission) and the EFTA Surveillance Authority.
In practice, leniency is primarily relevant in cartel cases concerning hard-core infringements such as price-fixing, market sharing and bid-rigging.
Cartel enforcement in Norway can follow either an administrative/civil law track or a criminal law track. The civil law sanctions include orders to cease an infringement, interim measures and administrative fines. The criminal sanctions are fines and imprisonment. Prosecution of individuals (typically management involved in a cartel) is only provided for under criminal law (see Question 7).
There are only a few decisions from the NCA concerning leniency. In the first years after the leniency programme was adopted the NCA received very few leniency applications.
The first major leniency case in Norway was recently decided. On 14 October 2011 the NCA issued a statement of objections (SO) addressed to Veidekke and NCC concerning collusion in the asphalt sector. In a decision of 5 March 2013, the NCA issued fines of NOK220 and NOK140 million respectively, which are by far the most important fines in Norway to date. The case was initiated on the basis of a leniency application from Veidekke and Veidekke was granted full leniency.
Before this case, the NCA has granted leniency in one case only (decision V2011-11 Icopal Tak/Fløysand Tak). Before submitting bids in a competitive tender in the summer of 2008, the two companies co-ordinated their behaviour. The companies were fined NOK350,000 and NOK1.2 million respectively. IcopalTak was granted full leniency after initiating a meeting with the NCA and submitting evidence and otherwise co-operating with the authority during the investigation process.
An undertaking must be given full leniency if it, on its own initiative, is the first to submit evidence that is sufficient for the NCA to either (section 4, Regulation):
Obtain a court order to carry out a dawn raid, provided the NCA, at the time the information is submitted, is not in possession of sufficient evidence to be able to obtain such an order.
Prove an infringement of section 10 of the Competition Act, provided the NCA, at the time the information is provided, is not in possession of sufficient evidence to prove such an infringement.
However, full leniency will only be granted provided that the following conditions are also fulfilled:
The undertaking co-operates with the NCA's investigation on a full and continuous basis.
The undertaking ceases its participation in the infringement no later than when the evidence is submitted.
The undertaking has not sought to coerce other undertakings into participating in the infringement.
Only the first company that satisfies the cumulative criteria may be granted full leniency.
Undertakings that do not meet the conditions for full leniency can still be granted partial leniency if the following conditions are met (section 6, Regulation):
The submitted evidence significantly strengthens the NCA's ability to establish an infringement of section 10 of the Competition Act. It is not required that the company submit all evidence possibly in its possession. However, the extent of co-operation will influence the level of fine reduction (see below).
The undertaking ends its participation in the infringement no later than when the evidence is submitted.
Under this provision, the possible fine reductions are:
1st undertaking: between 30% and 50%.
2nd undertaking: between 20% and 30%.
Subsequent undertakings: up to 20%. (There is no maximum number of undertakings that can benefit from partial leniency under this provision.)
To determine the level of fine reduction within each band above, the NCA considers:
The timeliness of the submission of evidence.
The extent to which the evidence strengthened the case.
The extent to which the undertaking has co-operated with the NCA.
Individuals are not subject to civil fines, only undertakings can be fined in the administrative proceedings.
Immunity or leniency is not available for undertakings and individuals in relation to criminal prosecution.
However, the penalties in the event of criminal prosecution may be reduced if an unconditional confession is made (section 59, Norwegian Criminal Act). This provision cannot repeal the sanctions completely.
Moreover, under the European Convention on Human Rights, if an undertaking is fined by the NCA in the administrative proceedings, criminal fines cannot be imposed on that undertaking (Protocol 7, Article 4). This applies also if partial leniency has been granted. It has been debated whether this principle will apply if full leniency has been granted. However, the NCA has expressed in a policy statement this would also apply when full leniency has been granted.
It has been feared that since individuals were not subject to administrative fines, they could, in principle, be prosecuted. This legal uncertainty has been pointed out as one of the major reasons why the NCA did not receive leniency applications in the first years after the adoption of the leniency system. To remedy this situation, the NCA published a policy statement in 2008 making it clear that the NCA will not report undertakings, or individuals of undertakings, that have submitted a leniency application.
The Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime (Økokrim) will not initiate investigations unless the NCA has reported a case and is in favour of prosecution (section 7-3, paragraph 2, Prosecution Instruction).
The NCA will normally not report individuals whose company is granted leniency for criminal proceedings (see above, Proceedings against employees).
There is no particular time for submitting an application for leniency. However, the sooner an application is made, the more likely the applicant is to be granted leniency and the greater the level of leniency that is likely to be granted (see Questions 4 and 5).
An application for leniency should be submitted to the NCA. There are no legal requirements as to the form and content of an application. An application may be submitted electronically (by e-mail), by fax or by ordinary post. An application may also be submitted orally, by phone or in a meeting with the NCA.
There are no formal requirements as to who can submit an application. It is customary to use an external lawyer in leniency proceedings.
It is possible to obtain informal guidance on a confidential basis before the application is submitted, as follows:
Questions regarding leniency can be posed anonymously to the NCA.
It is possible to submit a hypothetical leniency application. This means that both the type and content of the evidence are clearly described to the NCA, so that the NCA can assess whether the conditions for leniency are fulfilled. If a hypothetical application is submitted, the applicant must submit the real evidence to the NCA within a time frame fixed by the NCA. Undertakings that choose to submit evidence in hypothetical form bear the risk of the initial description being inconsistent with the underlying evidence.
There is no set form of application.
The NCA does not have a so-called marker system where undertakings may reserve a place in line without submitting an application for leniency at the same time.
A leniency application should contain the following:
Information about the applicant (company registration number, corporate structure and contact information).
A detailed description of the infringement, including the purpose of the co-operation, markets involved, activities undertaken and the duration.
An outline of the evidence and documentation that is enclosed.
Names, positions and addresses of the individuals the applicant believes are, or have been, involved in the infringement.
Information regarding other competition authorities the applicant has contacted or plans to contact.
Oral statements are accepted. The NCA will record the oral application.
Not applicable.
There is no formal timetable for leniency procedures. Generally, cartel cases, including cases initiated on the basis of a leniency application, are lengthy processes.
Normally, the NCA starts the examination of the leniency application immediately after it has been received. In addition, the NCA also usually proposes a meeting with the applicant shortly after the application is received. The date and time of the application is also confirmed in writing.
After the examination of the application and the evidence, the NCA informs the applicant whether leniency will be granted and whether the NCA decides to proceed with an investigation.
If the NCA proceeds with an investigation, the NCA normally secures further evidence and takes statements from the relevant persons.
After the investigation of the case, and if the NCA finds it likely that there has been an infringement, the NCA issues an SO, giving the parties involved the opportunity to submit comments before the final decision is adopted (see Question 3).
In the decision the applicant receives the final confirmation of leniency, provided the conditions have been fulfilled.
The granting of full leniency remains subject to the initial conditions, including the obligation of continuous and full co-operation during all of the NCA's investigations (see Question 4). Therefore, full leniency may be withdrawn at any time if the applicant does not fully co-operate with the NCA, or if subsequent information is discovered which reveals that the conditions for leniency are no longer fulfilled.
The scope of leniency protection is normally discussed during the applicant's initial approach of the NCA. The scope of the application may also be further specified and extended during investigations of the NCA.
The concept of leniency plus is not recognised.
Leniency does not affect follow-on damages actions.
The Access to Information Act does not apply as long as the case concerning infringement of the Competition Act has not been finalised.
Generally, the identity of an applicant is not revealed until the NCA has concluded the investigation and issued the final decision. However, in some cases the NCA has identified the undertakings before the final decision, for example, when issuing an SO (see Question 3).
In cases where the NCA has decided not to conduct an in-depth investigation and did not issue a decision, the NCA has not made public the identity of leniency applicants.
Parties. Undertakings and individuals under investigation for violation of the Competition Act have the right to access documents in the file, provided such access does not result in any harm or risk to the investigation or to third parties (section 27, Competition Act).
However, the right to access the file does not apply to documents pertaining only to other undertakings or individuals. In addition, the NCA may deny parties access to, among other things, business secrets and information concerning "other circumstances which for special reasons should not be disclosed" (section 19, Public Administration Act).
Third parties. The Access to Information Act does not apply as long as the case is being investigated. After the case has been concluded, the Access to Information Act applies and third parties have the right to access case documents, unless the document or information in the document is subject to a legal confidentiality obligation (for example, business secrets). The NCA has in previous cases also denied access to the leniency applications as such on the basis of the exemption in section 24 of the Access to Information Act. (This exemption relates to regulatory or control measures and documents relating to offences.)
Under the Competition Act, anyone with a legal interest (for example, victims of cartel activity claiming damages) may be granted access also to confidential information after a case has been concluded, unless such access is unreasonable (section 26).
After a case is finalised the Access to Information Act applies. Under the latter Act, all case documents are in principle to be made public on request, unless one of the legal exemptions applies (for example, business secrets). Therefore, business secrets are normally not made public. Apart from this, no confidentiality requests can be made.
The NCA is subject to the disclosure rules set out in the Civil Procedure Act and the Criminal Procedure Act. These sets of rules include extended right of access to information as part of court proceedings.
Since no cartel cases involving leniency have been brought before the Norwegian courts and there have not yet been any judgments or claims in relation to civil damages in cartel cases involving leniency, it remains to be seen which approach the NCA will take regarding disclosure of leniency documents, including corporate statements.
The NCA may, in fulfilment of Norway's agreements with foreign states or international organisations, provide foreign states and international organisations with any information that is necessary to further the competition rules of either Norway or the state or organisation concerned (section 7, Competition Act). If disclosing information in accordance with this provision, the NCA must make it a condition that the information be passed on only with the consent of the NCA, and only for the purposes covered by the consent.
Norway has entered into an agreement with Denmark, Sweden and Iceland to increase the possibilities of co-operation in competition cases (Avtale mellom Danmark, Island, Sverige og Norge om samarbeid i konkurransesaker). The agreement opens up the possibilities of the exchange of sensitive information, among other things. Information exchange is subject to the following conditions:
The receiving authority must, at a minimum, maintain an equivalent degree of confidentiality with respect to the information as the authority supplying the information.
The information can only be used for the purposes set by the agreement.
The information can only be passed on by the receiving authority with explicit and prior consent from the authority supplying the information and can only be used for purposes covered by the consent.
To avoid undermining the leniency system, it is unlikely that the NCA will disclose leniency documents, including corporate statements, under this agreement unless the leniency applicant would benefit from similar protection in the relevant jurisdiction.
Whether information submitted in foreign jurisdictions can be made subject to discovery orders in the domestic courts will depend, among other things, on any concluded convention or agreement with the state where the leniency information was submitted. For example, if leniency documents are submitted to a competition authority in a Nordic country which is a party to the co-operation agreement referred to above, information may be disclosed to the domestic courts (see above, Domestic submissions and foreign discovery).
Although the NCA is not a member of the European Competition Network (ECN), the NCA participates in meetings regarding ECN policies and has access to ECN information.
The NCA is a member of the European Competition Authorities (ECA), the Organisation for Economic Co-operation and Development (OECD) Competition Committee and the International Competition Network.
See also Question 16, Domestic submissions and foreign discovery.
A committee appointed by the government has conducted a review of the Competition Act. The committee delivered a report in February 2012. This report includes several proposals for amendments to the Competition Act, including a proposal that the grant of full leniency should also imply immunity against criminal sanctions both for the company and for individuals. The review of the Competition Act is expected to be proposed to the Norwegian Parliament in the spring of 2013.
Head. Christine Meyer
Contact details. Postboks 439 Sentrum
5805 Bergen
Norway
T +47 5559 7538
F +47 5559 7597
E lempning@kt.no
W www.konkurransetilsynet.no
Responsibilities. The NCA is responsible for:
Enforcing competition law.
Merger control.
Assessing public schemes and regulations.
Person/department to apply to. To take advantage of the leniency programme an application should be made to lempning@kt.no or directly to the head of investigations Arild Oma by telephone (+47 5559 7586) or by e-mail (arild.oma@kt.no).
Procedure for obtaining application documents. Not applicable.
T +47 2311 1262
F +47 2311 1010
E eis@thommessen.no
W www.thommessen.no
Professional qualifications. Norway, Lawyer, admitted to the Norwegian Bar and qualified to practice law in Norway since 1995.
Areas of practice. Competition law and general EU/EEA law, litigation.
Recent transactions
Thommessen is widely recognised as the leading Norwegian firm within competition law and related matters. Eivind Sæveraas has more than 15 years’ working experience within the field of competition law. He joined Thommessen in 1998 after having worked for the Competition Authority from 1995. Mr Sæveraas is primarily recognised for his work with abuse cases and several high-profile merger cases, as well as other competition law matters, including cartel cases and litigation. He assists clients in a wide range of industries, including construction, energy, telecommunication, publishing, media and transport.
Languages. Norwegian and English.
Professional associations/memberships. Norwegian Bar Association.
Publications. Eivind Sæveraas is also recognised for his academic skills, he is a frequent speaker and writer on competition law matters and is co-editor and co-writer for the commentary to the Norwegian Competition Act that was published in 2009.
T +47 2311 1121
F +47 2311 1010
E eve@thommessen.no
W www.thommessen.no
Professional qualifications. Norway, Lawyer, admitted to the Norwegian Bar and qualified to practice law in Norway since 1987.
Areas of practice. Competition law, state aid, public procurement and general EU/EEA law, litigation.
Recent transactions
Siri Teigum is a partner and head of Thommessen’s EU/EEA and Competition Law practice. Teigum is ranked as one of the leading Norwegian experts in the field. She joined Thommessen in 1992. She mainly works with EU/EEA law, competition law, procurement regulations, state aid, media law and general commercial law.
She is a frequently used advisor in relation to merger control related issues, cartel cases and the responsibilities of dominant undertakings, and assists inter alia during investigations, dispute resolution and litigation in these areas. She has acted as lead advisor in the major leniency case in Norway, and assisted in several less profiled cases.
Teigum took her diploma studies in EU law at Collège d`Europe in Bruges. Prior to joining Thommessen, Teigum was a secretary during EEA negotiations at the EFTA Legal department. She has also worked at the Legislation department at the Norwegian Ministry of Justice. She was a member of the legislative committee that proposed the current Competition Act.
Languages. Norwegian and English.
Professional associations/memberships. Norwegian Bar Association, member of KOFA (Norwegian Complaints Board for complaints of violations of the law on public procurement).
Publications. Siri Teigum is a frequent speaker and writer on competition law matters. In addition to several articles (in Norwegian or English), she was co-writer for the commentary to the Norwegian Competition Act that was published in 2009.
