Italian Competition Law Update - New investigative and fining powers for the Italian CA

The 2021 Annual Law on Market and Competition (Law No 118/2022) has made significant changes to the Italian Competition Law (Law No 287/1990, the "ICL"). In this post, we focus on how the amendments have strengthened the investigative and fining powers of the Italian Competition Authority ("ICA"). These amendments enhance the ICA's powers when reviewing both behavioural and merger control cases. 

The latest reforms must be considered together with the amendments to the ICL by the Italian Legislative Decree No 185/2021 which transposed the ECN+ Directive (Directive (EU) 2019/1). 

Key takeaways

• The ICA has the power to conduct inspections at both business and domestic premises.
• The ICA has the power to seize copies of books and relevant business records and to continue their review at another premises.
• The ICA can impose fines on both companies and individuals for obstructing an investigation or failing to provide information requested by the ICA.

What you need to know 

When carrying out investigations, the ICA may: 

• enter and search any premises, including the private homes, land or means of transport of directors, managers or other staff members of the undertaking. To do so, the ICA will require prior authorization from the public prosecutor.
• seize copies of books and relevant business records. The ICA may also continue to review these documents (and any copies/extracts taken) at the ICA's premises or any other premises designated by the ICA.

Both prior to launching formal proceedings and during the proceedings, the ICA has the power to seek information and documents from any entity or person. The requested information must be provided within a reasonable deadline, which will not exceed 60 days but may be extended upon submission of a reasoned request. 

In relation to fines, the ICA may impose:

• fines on undertakings and associations of undertakings of up to 1% of their total worldwide turnover for: obstructing the investigation; destroying seals; providing inaccurate or misleading information (either during a dawn raid or in response to a request for information); or failing to appear at a hearing or interview. The ICA my also impose periodic penalty payments of up to 5% of the average daily worldwide turnover for each day of delay/continued failure to comply. These fining powers apply even before official proceedings have been launched.
• impose fines and periodic penalty payments on individuals for: obstructing inspection; providing incomplete, inaccurate or misleading information; failing to provide the requested information; or failing to appear at a hearing or interview.

Comment

The amendments provide the ICA with a more effective toolbox for enforcing competition law and bring the ICA's investigative powers more in line with those of the European Commission. In light of these new powers, it will be increasingly important for companies to carry out thorough and regular competition law compliance training for their directors, managers and other staff to ensure all staff understand how to respond to inspections and investigations by the ICA. 

Ashurst has recently launched its dawn raid app, Raid Assist, to provide companies with support preparing for and responding to dawn raids. The app is free to download from the App Store and Play Store with no registration needed, and it provides a structured set of key response actions and materials to help all those involved in the raid respond appropriately during what can be a stressful and pressurised event.