Competition law in Italy: overview

A Q&A guide to competition law in Italy.

The Q&A gives a high level overview of merger control, restrictive agreements and practices, monopolies and abuse of market power, and joint ventures. In particular, it covers relevant triggering events and thresholds, notification requirements, procedures and timetables, third party claims, exclusions and exemptions, penalties for breach, and proposals for reform.

To compare answers across multiple jurisdictions visit the Competition law 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 Competition Q&As visit www.practicallaw.com/competition-mjg.

For a full list of jurisdictional Cartel Leniency Q&As, which provide a succinct overview of leniency and immunity, the applicable procedure and the regulatory authorities in multiple jurisdictions, visit www.practicallaw.com/leniency-mjg.

Tommaso Salonico and Alessandro Di Giò, Freshfields Bruckhaus Deringer
Contents

Merger control

1. What (if any) merger control rules apply to mergers and acquisitions in your jurisdiction?

Regulatory framework

Mergers, acquisitions and any other transaction amounting to a "concentration" (see Question 2, Triggering events) are subject to compulsory notification prior to closing if certain turnover thresholds are met (see Question 2, Thresholds).

The relevant regulatory framework is set out in the following provisions:

  • The Competition Act (Law No. 287 of 10 October 1990) is the main legal statute. It:

    • establishes the Italian Competition Authority (Autorità garante della concorrenza e del mercato) (IAA);

    • contains the substantive provisions of competition law;

    • contains the main procedural rules;

    • clarifies that its substantive provisions, including those on merger control, must be interpreted in accordance with the principles of EU law.

  • Presidential Decree no. 217 of 30 April 1998 lays down more detailed rules applicable to proceedings for anti-competitive agreements, abuses of dominant positions and concentrations. It clarifies the various procedural steps and defines the fact-finding powers of the IAA.

  • The merger notification form is available on the IAA website (www.agcm.it). It also contains IAA guidelines relating to concentrations.

  • A notice on certain procedural aspects regarding mergers/acquisitions (Procedural Notice), providing the framework for pre-filing contact with the IAA (IAA Bulletin No. 22 of 20 June 2005).

Regulatory authority

The competent authority for anti-trust control of concentrations is the IAA.

See box, The regulatory authority.

 

Triggering events/thresholds

2. What are the relevant jurisdictional triggering events/thresholds?

Triggering events

A transaction qualifies as a concentration when a change of control on a lasting basis over an undertaking (or a going concern), occurs as a result of that transaction. A concentration arises when (Article 5, Competition Act):

  • Two or more undertakings merge.

  • An acquisition of direct or indirect control of the whole or parts of one or more undertakings occurs by one or more undertakings or by one or more persons controlling at least one undertaking.

  • Two or more undertakings create a full-function and non-coordinative joint venture by setting up a new company (see Question 37).

The acquisition of control can take place through the acquisition of shares or assets, by contract or by other means. In this respect, the concepts of concentration and control are interpreted by the Italian Competition Authority (IAA) in line with EU law and practice (as indicated in the Commission's Consolidated Jurisdictional Notice (OJ 2008 C95/1)).

The IAA may take action (such as opening a phase II investigation (see Question 4, Procedure and timetable) or requesting information), against a concentration within 30 days of notification, or from when it had knowledge of it.

Thresholds

A concentration that does not have a Community dimension under Article 1 of Regulation (EC) 139/2004 on the control of concentrations between undertakings (Merger Regulation), must be filed with the IAA when both the following turnover thresholds are met:

  • The combined aggregate Italian turnover of all the undertakings concerned exceeds EUR482 million.

  • The aggregate Italian turnover of the target(s) exceeds EUR48 million.

The turnover thresholds are revised every year by the IAA taking into account the gross domestic product (GDP) price deflator index. The most recent revision of the thresholds occurred on 2 April 2013. Before 1 January 2013, the notification obligation was triggered if just one of the two thresholds was met.

When calculating the thresholds, the following turnover must be taken into account:

  • For the acquiring company, the aggregate domestic turnover of the group (reference must be made to all the controlling and controlled companies, as well as to those controlled by the same controlling company).

  • For the acquired company, the domestic turnover of the undertaking, or parts of the undertaking, being acquired, as well as any company controlled by it.

In order to determine the turnover and to geographically allocate it, the principles indicated in the Commission's Consolidated Jurisdictional Notice (see above, Triggering events) are usually applied.

Different rules apply in relation to the calculation of turnover for:

  • Banks and financial institutions. The relevant figure is the value of 10% of their total assets, excluding memorandum accounts.

  • Insurance companies. The relevant figure is the value of premiums collected.

There is no other test to determine whether a concentration must be filed to the IAA (for example, market shares or asset values) with the exception of the cinema sector (see Question 12).

Exclusions

If a bank or financial institution acquires shares in an undertaking with a view to re-selling them on the market, no acquisition of control, no concentration and no obligation to notify the IAA is regarded as arising, provided the bank or financial institution does not exercise any voting rights vested in those securities while it holds them. The holding period must not exceed 24 months (par. 2, Article 5, Competition Act) (see Question 1).

Intra-group transactions between companies or undertakings which are part of the same group do not constitute a concentration.

Acquisitions of foreign-registered undertakings and the setting up of joint ventures and mergers where at least one of the parties to the transaction is foreign-registered are excluded from the obligation to register with the IAA, where all the following conditions apply:

  • The foreign party does not have any turnover in Italy.

  • The foreign party has not had any turnover in Italy in the previous three years.

  • The transaction does not lead to the target company or new entity operating in the Italian market.

 

Notification

3. What are the notification requirements for mergers?

Mandatory or voluntary

Notification of concentrations meeting the turnover thresholds is mandatory (see Question 2).

Timing

The notification must be filed with the Italian Competition Authority (IAA), before the transaction takes place (closing). Notifications are usually not accepted before the parties have reached an agreement on the essential aspects of the transaction. The requirement to file before the transaction takes place is considered fulfilled if the implementation of the agreement is made conditional on the IAA's approval.

In cases involving a public takeover bid which will result in a concentration meeting the turnover thresholds, the IAA must be notified at the same time as the notification to the Italian Securities and Exchange Commission (Commissione Nazionale per le Società e la Borsa) (CONSOB), under financial regulation rules.

Formal/informal guidance

The IAA is keen to encourage pre-notification contact in order to support stronger co-operation with the concerned undertakings and to facilitate the subsequent assessment of the concentration. The procedure for obtaining pre-notification guidance is regulated by the Procedural Notice (see Question 1).

The procedure can be initiated by submitting to the IAA, at least 15 days before the date on which the parties intend to serve the formal notification, an informal communication, containing the following information:

  • The identity of the parties to the concentration.

  • A short description of the transaction.

  • The description of the relevant markets and the market share held by the parties.

  • Whether or not the concentration must be filed with any competition authorities in other jurisdictions.

Pre-notification discussions with the IAA are strictly confidential.

The IAA does not have any time limit for discussing or commenting on the pre-notification communication that the undertaking has submitted.

Responsibility for notification

The responsibility for notifying a concentration to the IAA lies with the undertaking acquiring control. In cases of merger, acquisition of joint control or the creation of a concentrative joint venture (see Question 37), the responsibility rests with each undertaking acquiring joint control. The parties can make joint applications using the same form. The notification can also be filed by the undertaking which, directly or indirectly, controls the party responsible for filing.

Relevant authority

The notification must be filed with the IAA. For some specific sectors, such as insurance and telecommunications, the IAA requires a non-binding opinion by the relevant regulatory authority before adopting a decision (see Question 12).

Form of notification

There are two different forms of notification, depending on the impact the concentration has on the relevant market(s):

  • Full-form. This form must be used for:

    • horizontal concentrations leading to a combined market share of 25% or more; and

    • non-horizontal concentrations as a result of which one of the parties will have a market share of 40% or more, provided at least one other party to the concentration operates in an upstream or downstream market (except where the market share of the target is below 1%, in which case the full-form notification is not required).

    The full-form notification is a more demanding form of notification. It requires the provision of detailed information on trade marks, the structure of supply and demand, and market entry.

  • Short-form. This form must be used for all notifications not requiring full-form notification.

Filing fee

From 1 January 2013, filing fees have been abolished. A new financing regime has been established to cover the IAA budget.

Under the new regime, all companies based in Italy (regardless of merger activity), with a total turnover in excess of EUR50 million must pay an annual fee to the IAA of 0.08% of their turnover. The maximum fee has been fixed at 100 times the minimum fee (EUR400,000). The annual fee for 2013 had to be paid by 30 October 2012. From 2014, the deadline for payment will be 31 July of each year. The IAA can increase the fee calculation method through a resolution.

Obligation to suspend

There is no obligation to suspend the transaction pending the outcome of the IAA review. However, if the IAA decides to open a formal investigation (see Question 4), it can order the parties not to proceed with the concentration until the investigation is concluded. This power has been used very rarely in practice.

If the transaction is concluded before the IAA has decided on its compatibility with the competition rules and the IAA subsequently does not clear the transaction, the IAA can require measures for restoring conditions of effective competition and removing any effects that distort it (for example, through ordering divestitures) (see Question 8).

 

Procedure and timetable

4. What are the applicable procedures and timetable?

The Italian Competition Authority (IAA) follows two separate procedures, phase I and phase II for evaluating concentrations.

Within 30 calendar days of receiving the notification the IAA must either (Article 16(4), Competition Act):

  • Clear the transaction if an investigation is not necessary, and immediately inform the notifying parties.

  • Commence a phase II investigation, if the IAA considers that the concentration may be prohibited and an in-depth analysis is needed to assess whether the transaction restricts competition.

The 30-day time limit is reduced to 15 days in the case of public takeover bids.

The IAA can request clarification of the information provided and interrupt the 30-day time limit, if the information provided in the notification is either:

  • Inaccurate.

  • Incomplete.

  • Untrue.

If the IAA decides to open a phase II investigation, it must notify the undertakings concerned, within 45 days of commencing such investigation, whether it has decided to (Articles 16(8) and 18, Competition Act):

  • Prohibit the concentration.

  • Clear the concentration unconditionally.

  • Clear the concentration, subject to commitments offered by the undertakings which remove any aspects of the concentration that were initially deemed likely to distort competition (see Question 8).

  • Clear the concentration, subject to measures prescribed by the IAA to prevent the creation or strengthening of a dominant position.

The 45-day period can be extended during the course of the investigation, for a further period of no more than 30 days, where the undertakings concerned fail to provide information and data in their possession on request.

For an overview of the notification process, see flowchart, Italy: merger notifications (www.practicallaw.com/5-504-6062).

 

Publicity and confidentiality

5. How much information is made publicly available concerning merger inquiries? Is any information made automatically confidential and is confidentiality available on request?

Publicity

The Italian Competition Authority (IAA), must publish a notice on its website for each notified concentration fulfilling both turnover thresholds (see Question 2). The notice is published a few days after the transaction is notified. Interested third parties have five days from publication of the notice to submit comments on the transaction.

Prior consent of the notifying parties is required to publish the notice. If consent is withheld, reasons for the refusal must be specified in the notification.

IAA's decisions must be published on its website and in the IAA Bulletin (the official journal of the IAA published in its website on a weekly basis) and includes:

  • Final decisions at the end of a phase I.

  • The decision to start a phase II investigation.

  • Final decisions at the end of the investigation.

Procedural stage

See above, Publicity.

Automatic confidentiality

Any information obtained in the process of enforcing competition law (Article 14(3), Competition Act and Article 12, Presidential Decree no. 217 of 30 April 1998):

  • Can only be used for the purpose for which it was requested.

  • Is covered by Italian official secrets legislation.

  • Cannot be divulged, not even to government departments and authorities (except in respect of reporting obligations under relevant criminal laws and co-operating with European institutions).

Confidentiality on request

A notifying party wishing to withhold or limit access to the procedure files by third parties to safeguard the confidentiality or secrecy of information supplied through the notification and during the proceedings must submit a specific request to the IAA. The request must contain both:

  • Details of the documents or parts of the documents in respect of which the request for denial of access is made.

  • The reasons for the request.

The same procedure applies in respect of information the party wishes to withhold from public disclosure.

In determining requests, the IAA must balance the following issues:

  • The interests of the parties in maintaining confidentiality.

  • The information the IAA needs to mention in its decision on the transaction, in order to both:

    • clarify the reasoning underpinning the decision; and

    • allow interested parties a right to challenge the final decision (see Question 10).

 

Rights of third parties

6. What rights (if any) do third parties have to make representations, access documents or be heard during the course of an investigation?

Representations

Third parties can make representations within five days from the date of publication by the Italian Competition Authority (IAA) on its website of the fact of a notification (see Question 5, Publicity).

Third parties representing public or private interests that might be directly, immediately and currently damaged by the subject matter of the investigation, or by any measures adopted as a result of it, can participate in the proceedings. They must submit reasoned requests to intervene within ten days of the date of publication of the notice of commencement of the investigatory phase. Third parties admitted to the proceedings can produce all of the following written:

  • Submissions.

  • Documents.

  • Arguments.

  • Opinions.

  • Further representations.

Document access

Third parties admitted to the proceedings can access any non-confidential documents in the IAA's file.

Be heard

Third parties who have triggered or contributed to the opening of a phase II investigation and have been notified of its beginning, have the right to be heard by, questioned by and question, the Investigative Unit and the Board of Commissioners of the IAA.

 

Substantive test

7. What is the substantive test?

The relevant test is the dominance test. To decide whether to clear (conditionally or unconditionally) or prohibit a concentration, the Italian Competition Authority (IAA) must evaluate whether the transaction will create or strengthen a dominant position with the effect of eliminating or significantly reducing competition on a lasting basis.

Although the Competition Act has not adopted the "significant impediment to effective competition" (SIEC) test used at EU level, some of the IAA's decisions have clearly seen the test being taken into account.

 

Remedies, penalties and appeal

8. What remedies can be imposed as conditions of clearance to address competition concerns? At what stage of the procedure can they be offered and accepted?

If the Italian Competition Authority (IAA) considers that the proposed concentration raises competition concerns, it can still authorise the transaction subject to certain conditions being imposed. In particular, the IAA can do either or both of the following:

  • Accept commitments proposed by the parties to remove its concerns (Article 18(2), Competition Act).

  • Prescribe necessary measures to prevent the concentration resulting in the creation or strengthening of a dominant position on the domestic market with the effect of eliminating or significantly restricting competition on a lasting basis (Article 6(2), Competition Act).

Commitments and measures can only be proposed during the course of a phase II investigation. They can either be:

  • Structural. This includes the dismissal of either:

    • assets;

    • businesses;

    • participating interests in another undertaking;

    • IP rights.

  • Behavioural. This might include, for example:

    • accepting an obligation to supply competitors with essential raw materials;

    • providing access to infrastructures;

    • dissolving personal links with (even potentially) competing entities.

 
9. What are the penalties for failing to comply with the merger control rules?

Failure to notify correctly

The Italian Competition Authority (IAA) can impose a fine of up to 1% of the previous fiscal year's turnover on any undertaking which fails to notify. If the IAA considers that the non-notified transaction eliminates or significantly reduces competition, fines for implementation after prohibition can also apply (see below, Implementation before approval or after prohibition). For failure or delay in paying, see Question 24, Fines. For breach of remedies or commitments, see below, Failure to observe.

Implementation before approval or after prohibition

The IAA can impose administrative fines on undertakings implementing a prohibited concentration, of 1% to 10% of the turnover of the business forming the object of the concentration (Article 19(1), Competition Act).

Since there is no obligation to suspend a notified transaction pending an IAA evaluation process, fines cannot be imposed on undertakings completing the concentration before clearance is granted. The Competition Act does not expressly provide for a specific fine where the parties infringe an order of the IAA to prevent completion during a phase II investigation (see Question 3). Since there has not yet been a decision on this issue, it is unclear what powers to fine the IAA has in such circumstances.

Some legal commentators have suggested that a concentration completed in breach of the law will be null and void.

Failure to observe

In the case of a failure to observe either commitments voluntarily proposed by the parties or imposed by the IAA (see Question 8), the IAA can impose fines ranging from 1% to 10% of the turnover of the business forming the object of the concentration.

 
10. Is there a right of appeal against any decision? If so, which decisions, to which body and within which time limits? Are rights of appeal available to third parties or only the parties to the decision?

Rights of appeal and procedure

Decisions of the Italian Competition Authority (IAA) can be appealed by the notifying parties before the regional Administrative Court of the Lazio Region (Tar Lazio), which has the power to annul decisions on points of law. Appeals must be notified to the IAA within 60 days from the time the appealing party was notified of the IAA's decision. The filing of an appeal with the regional Administrative Court does not in itself suspend the enforceability of the decision, although the appellant can file a petition for its interim suspension.

The regional Administrative Court's decision can be appealed before the Supreme Administrative Court (Consiglio di Stato), within 30 days of the date the appealing party was notified of the decision or, in the absence of such notification, within three months of its publication.

Third party rights of appeal

Third parties, for example, competitors, (associations of) consumers, (foreclosed or discriminated) suppliers and distributors, alleging anti-competitive harms, and having a qualified and specific interest to act can appeal IAA decisions under the same procedure as the parties to the decision (see above, Rights of appeal and procedure).

 

Automatic clearance of restrictive provisions

11. If a merger is cleared, are any restrictive provisions in the agreements automatically cleared? If they are not automatically cleared, how are they regulated?

The Italian Competition Authority (IAA) follows the principle laid down by the Commission's Notice on restrictions directly related and necessary to concentrations (OJ 2008 C95/1). Accordingly, provisions satisfying the requirements of that Notice can be considered as ancillary to the transaction and automatically cleared, but this is not a mandatory requirement for the IAA. Such restrictions include non-compete obligations:

  • Imposed on the vendor.

  • Not exceeding two years (or three years, if both goodwill and know-how are transferred) duration.

  • Limited to the products forming the economic activity of the business transferred.

  • Limited to the territories where products were offered before transfer.

Provisions not satisfying the requirements of the Commission's Notice will not be covered by the clearance decision and remain subject to a review by the IAA under the rules and procedures relating to restrictive agreements (see Question 13).

 

Regulation of specific industries

12. What industries (if any) are specifically regulated?

Banking sector

Concentrations in the banking sector are subject to both (Article 20(5), Competition Act):

  • Prior notification to the Italian Competition Authority (IAA) provided that relevant thresholds are met.

  • The scrutiny of the Bank of Italy (which assesses the prudential and good governance framework of the undertakings that are party to the proposed concentration).

Both authorities must conclude their respective review processes and make a final decision on the merger within 60 days of filing.

At a request from the Bank of Italy, the IAA can clear a concentration between banks, even if it creates or strengthens a dominant position, in the interests of the stability of one or more of the undertakings involved. The IAA cannot permit restrictions to competition that are not strictly necessary to achieve the goal pursued. For the calculation of the turnover of banks, see Question 2, Thresholds.

Insurance sector

For concentrations involving insurance companies, the IAA makes a decision after the (non-binding) opinion of the Insurance Supervisory Authority (Istituto per la Vigilanza sulle Assicurazioni) (IVASS), which must be issued within 30 days of receiving the relevant documentation from the IAA (article 20(4), Competition Act). If the opinion is not issued within 30 days, the IAA can make its decision without waiting for the IVASS's opinion. In practice, the IAA's phase I decisions are adopted within 60 days of the notification (since the time limits for the IAA to adopt its decision are suspended until the IVASS provides its opinion).

For the calculation of the turnover of insurance companies, see Question 2, Thresholds.

Telecommunications sector

In the case of concentrations involving the telecommunications sector, the IAA must adopt its decision after having considered the (non-binding) opinion of the Telecommunications Authority (Autorità per le garanzie nelle telecomunicazioni) (AGCOM), which must be issued within 30 days of receiving the relevant documentation from the IAA. If the opinion is not issued within 30 days, the IAA must adopt its decision without waiting any longer for the opinion to be issued.

All concentrations concerning the integrated media sector (Sistema Integrato delle Comunicazioni (SIC)) (which includes undertakings with an interest in at least one of the following sectors: TV, newspapers and publishing (including online), radio, sponsorships, cinema and advertising), must be notified to the Authority which exercises regulatory powers (Article 14, Law No. 112/2004). A concentration must still be filed as a separate notification with the IAA.

Cinema sector

Prior notification is required for any concentration leading to an undertaking holding (directly or indirectly), a market share larger than 25% of the turnover from film distribution and, at the same time, more than 25% of the operating movie theatres in any one of the 12 main towns (Rome, Milan, Turin, Genoa, Padua, Bologna, Florence, Naples, Bari, Catania, Cagliari and Ancona) within the indicated film distribution zones (Article 26, Legislative Decree No. 28/2004).

 

Restrictive agreements and practices

Scope of rules

13. Are restrictive agreements and practices regulated? If so, what are the substantive provisions and regulatory authority?

Any agreements or decisions of trade associations and consortiums, and concerted practices which have as their object or effect the significant prevention, restriction or distortion of competition within the national market, or within a substantial part of it, are prohibited (Article 2(2), Competition Act): The wording of Article 2(2) of the Competition Act closely mirrors Article 101(1) of the Treaty on the Functioning of the European Union (TFEU). Like Article 101(1), it contains a (non-exhaustive) list of prohibited agreements and concerted practices which includes:

  • Price fixing.

  • Output limitation.

  • Market allocation.

  • Tying.

  • Discriminations.

Restrictive agreements are null and void under Article 2(3) of the Competition Act.

The Italian Competition Authority (IAA) is the regulatory agency responsible for the enforcement of Article 2, as well as Article 101 of the TFEU at a national level.

 
14. Do the regulations only apply to formal agreements or can they apply to informal practices?

The prohibition contained in Article 2(2) (see Question 13) also applies to informal agreements and practices. In this respect the national practice is substantially the same as that at EU level.

 

Exemptions

15. Are there any exemptions? If so, what are the criteria for individual exemption and any applicable block exemptions?

Under certain circumstances (mirroring Article 101(3), TFEU), the Italian Competition Authority (IAA) has the power to grant individual exemptions for agreements, or categories of agreements, normally prohibited under Article 2, for a limited period of time (Article 4(1), Competition Act). In practice, individual exemptions have not been granted since the modernisation of EU competition law (see Question 17, Notification).

There are no national block exemptions in force, but undertakings can rely on EU block exemptions and related guidelines in carrying out the self-assessment of their business practices.

The IAA can, at the request of the Bank of Italy, authorise an agreement restricting competition, if all the following conditions are met:

  • It is in the interests of the efficiency of the payments system.

  • It is for a limited period of time,

  • The criteria of Article 4 of the Competition Act (the same as those under Article 101(3) of the TFEU) are taken into account.

  • It is strictly necessary to achieve the indicated purposes.

 

Exclusions and statutes of limitation

16. Are there any exclusions? Are there statutes of limitation associated with restrictive agreements and practices?

Exclusions

De minimis agreements or concerted practices can be excluded from the prohibition in Article 2(2) of the Competition Act, provided the conditions set out in the Commission's Notice on agreements of minor importance (de minimis Notice) are satisfied (Article 1(4), Competition Act). These conditions include that:

  • The parties' market shares are below 10% for horizontal agreements.

  • The parties' market shares are below 15% for vertical agreements.

Statutes of limitation

There is a five-year statute of limitations for the imposition of fines, though not for investigations by the Italian Competition Authority. The limitation period starts from the date on which the infringement is committed or, for a continuous breach, ends. The formal opening of an investigation interrupts the limitation period.

 

Notification

17. What are the notification requirements for restrictive agreements and practices?

Notification

Undertakings can in theory notify the Italian Competition Authority (IAA) to request individual exemption (Article 4, Competition Act). However, since the entry into force of Regulation (EC) 1/2003 on the implementation of the rules on competition laid down in Articles 101 and 102 of the TFEU (formerly Articles 81 and 82 of the EC Treaty) (Modernisation Regulation), which abolished the EU notification and exemption system, the IAA has not accepted any further requests for individual exemption.

Informal guidance/opinion

The parties can seek informal guidance from the IAA. However, the parties continue to bear full responsibility for assessing whether their agreement(s) comply with competition law.

Responsibility for notification

Not applicable.

Relevant authority

Not applicable.

Form of notification

Not applicable.

Filing fee

Not applicable.

 

Investigations

18. Who can start an investigation into a restrictive agreement or practice?

Regulators

The Italian Competition Authority (IAA) can start investigations on its own initiative.

Third parties

Third parties (including competitors, public administrations and consumer associations), can file complaints with the IAA regarding alleged restrictive agreements. However, these complaints do not automatically result in the opening of an investigation. The IAA will decide whether to open the investigation based on the relevance of the facts reported, the collection of the information and its internal priorities.

 
19. What rights (if any) does a complainant or other third party have to make representations, access documents or be heard during the course of an investigation?

Representations

Third-party rights during investigations for restrictive agreements and concerted practices are the same as for concentrations (see Question 6). To participate in the procedure, qualified third parties must submit reasoned requests to intervene within 30 days from the date of publication of the investigation in the Bulletin of the Italian Competition Authority (IAA).

The IAA balances third party rights to access documents with the principles protecting confidentiality outlined in Question 5.

Document access

See Question 6.

Be heard

See Question 6.

 
20. What are the stages of the investigation and timetable?

The procedure followed by the Italian Competition Authority (IAA) is structured into three separate stages:

  • Pre-investigation stage.

  • Investigation stage.

  • Post-investigation stage.

Pre-investigation

Before opening a formal investigation, the IAA considers the information at its disposal to decide whether the agreement or concerted practice restricts competition. This might include information received from:

  • Complainants.

  • Leniency applicants.

  • The IAA's own investigations.

If the IAA decides to open an investigation, it will issue a formal decision, which must indicate:

  • The undertakings concerned.

  • The essential elements for alleged infringements.

  • The deadline for completing the proceedings.

  • The name of the person responsible for the proceedings, and the office where the case files can be accessed.

  • The deadline within which the undertakings and other interested persons can exercise the right to make representations.

Investigation

During the investigation, the IAA has the power to dawn-raid the premises of the undertakings party to the proceedings. Dawn raids are normally conducted simultaneously at the premises of all parties, at the moment the undertakings are notified of the decision to start the investigation. A request for information can be sent to the parties or third parties. Requested parties can be fined if they do not reply.

During the investigation undertakings participating in the proceedings can submit documents, defence memos, and request a hearing before the IAA investigation unit dealing with the case.

Following a review of the documents and further information acquired, the IAA authorises a notice of the results of the investigation, the Statement of Objections (Comunicazione delle risultanze istruttorie), to be served on the undertakings under investigation. The Statement of Objections must indicate:

  • The elements supporting the conclusion of the competent IAA investigation unit.

  • Whether a fine might be imposed.

  • The date set for the conclusion of the investigation (the Statement of Objections must be sent to the parties at least 30 days before this date).

Written submissions can be made by the parties participating in the proceedings up to five days prior to the date the investigation is concluded. The final step of the investigation, if requested, is the hearing before the Commissioners of the IAA.

Post-investigation

After the investigation has been completed, the IAA adopts its final decision, indicating whether the agreement or concerted practice restricts competition. Where the IAA concludes that competition has been restricted, the IAA:

  • Orders the cessation of the restricting conduct.

  • May impose fines.

 

Publicity and confidentiality

21. How much information is made publicly available concerning investigations into potentially restrictive agreements or practices? Is any information made automatically confidential and is confidentiality available on request?

Publicity

The non-confidential text of the decisions at both the open and close of an investigation, are published in the Bulletin of the Italian Competition Authority (IAA) and on its website. However, the Statement of Objections is not published.

Automatic confidentiality

See Question 5, Automatic confidentiality.

Confidentiality on request

Confidentiality can be claimed by the party concerned in accordance with the rules for concentrations (see Question 5, Confidentiality on request). If the confidentiality claims are accepted by the IAA, the relevant information will be edited from the published version of the IAA's decisions and resolutions and from the documents in the IAA's file which are publicly accessible.

Where confidential information constitutes evidence of the infringement or contains essential information for the defence of the undertaking concerned, access can be granted to confidential information that is essential for defence purposes.

 
22. What are the powers (if any) that the relevant regulator has to investigate potentially restrictive agreements or practices?

During investigations the Italian Competition Authority (IAA) has the power to:

  • Request information and documents relevant to the case from the undertakings under investigation and/or any third party.

  • Carry out on-the-spot investigations at the premises of those undertakings and/or third parties. During raids, the IAA has the power to search all premises of the undertaking (including vehicles used by employees, but not private homes), and can copy any document, in whatever format, held by the undertaking.

  • Request oral clarifications on the subject matter of the investigation.

 

Settlements

23. Can the regulator reach settlements with the parties without reaching an infringement decision? If so, what are the circumstances in which settlements can be reached and the applicable procedure?

A formal settlement procedure (such as the European Commission's in cartel cases), is not currently available before the Italian Competition Authority (IAA).

Undertakings under investigation can, however, submit commitments aimed at addressing the competition concerns which are the subject matter of the IAA's investigation. If the IAA considers the commitments sufficient to address its concerns, it will both:

  • Adopt a decision making the commitments binding on the undertaking concerned.

  • Close the case without determining any infringement of competition law.

The procedure for the submission and assessment of commitments is set out in the IAA's Notice regarding the procedures for applying Article 14 of the Competition Act (Resolution 6 September 2012 no. 23863).

 

Penalties and enforcement

24. What are the regulator's enforcement powers in relation to a prohibited restrictive agreement or practice?

Orders

If the Italian Competition Authority (IAA) concludes that the conduct under investigation is in breach of national or EU competition law, it will issue an order to cease the unlawful practice. Alternatively, the IAA can accept and render binding, commitments submitted by the party (see Question 23).

Fines

The IAA can levy administrative fines on undertakings of up to 10% of the undertaking's total turnover in the previous fiscal year. The amount of the fine depends on the gravity and duration of the infringement. Individuals can also incur criminal liability under general criminal law provisions in respect of certain specific behaviours such as bid-rigging in public tenders.

Undertakings have 90 days to pay administrative fines from the date when the IAA notified its decision. If this deadline is not met, Article 27 of Law no. 689/1981 provides for default interest to be paid at the legal rate of interest for the first six months starting after the expiry of the 90-day period. Beyond six months, the IAA recalculates the amount due, setting the interest rate at 10% each six months.

Personal liability

The IAA does not have power under Italian competition law to impose fines on individuals. With respect to criminal liability, see above Fines.

Immunity/leniency

The IAA has a leniency policy in place which only applies to secret horizontal competition law infringements. Under this policy the first applicant to submit evidence which is decisive in the finding of an infringement (possibly through a targeted inspection), can be granted immunity from any applicable fines. A reduction of up to 50% of fines can be granted to undertakings that submit evidence which significantly strengthens evidence already in the IAA's possession.

Impact on agreements

A civil judge will declare an agreement containing restrictions on competition entirely null and void if he or she considers that the parties would not have entered into the contract without the infringing clauses or terms (Article 1419, Civil Code).

 

Third party damages claims and appeals

25. Can third parties claim damages for losses suffered as a result of a prohibited restrictive agreement or practice? If so, what special procedures or rules (if any) apply? Are class actions possible?

Third party damages

Third parties (competitors, customers and consumers), can claim compensation before the competent civil courts for damages suffered as a consequence of restrictive agreements or practices.

Special procedures/rules

No special rules apply for actions concerning restrictive agreements or practices. Law Decree no. 1/2012 confers powers on the newly created Tribunal of the undertakings (Tribunale delle imprese) with specialised sections.

Class actions

Class actions are available under Italian law and can be resorted to in this area (Article 140bis, Consumer Code).

 
26. Is there a right of appeal against any decision of the regulator? If so, which decisions, to which body and within which time limits? Are rights of appeal available to third parties, or only to the parties to the agreement or practice?

Rights of appeal and procedure

See Question 10, Rights of appeal and procedure.

Third party rights of appeal

See Question 10, Rights of appeal and procedure.

 

Monopolies and abuses of market power

Scope of rules

27. Are monopolies and abuses of market power regulated under administrative and/or criminal law? If so, what are the substantive provisions and regulatory authority?

Article 3 of the Competition Act prohibits the abuse by one or more undertakings of a dominant position within the domestic market or a substantial part of it. The provision is enforced by the Italian Competition Authority (IAA) which also has the power to enforce Article 102 of the TFEU.

One particular form of abuse is economic dependence which is regulated by Article 9 of Law No. 192/1998. A state of economic dependence exists (regardless of dominance), when an undertaking is in a position to potentially cause excessive disparities in the rights and obligations relating to its commercial relationship with another undertaking. Typical examples of an abuse of economic dependence include the:

  • Interruption of a supply of goods or services.

  • Imposition of discriminatory clauses.

In assessing economic dependence, the IAA will take into account whether there is any real possibility of the abused undertaking finding satisfactory alternatives elsewhere in the market. The IAA has recently been granted the power (Article 62, Law Decree no. 1/2012) to enforce the prohibition in commercial contracts relating to the distribution of agriculture and foodstuff products, of, among others:

  • Grossly unfair terms.

  • Discriminatory and tying clauses.

  • Any other commercially unfair conduct, regardless of whether one of the parties holds a dominant position.

The IAA has adopted a procedural regulation in this area matter (no. 24220/2013) indicating, among other things that investigations must be started within 180 days of the complaint and concluded within 120 days (subject to extension for specific investigatory needs). It also recognises various rights of participation to the proceedings (for example, the submission of documents/defensive memos, hearings).

 
28. How is dominance/market power determined?

The Italian Competition Authority (IAA) determines whether there is a dominant position following the same principles developed by the European Commission and the EU courts.

A dominant position arises if a company has a position of economic strength that enables it to prevent effective competition by affording it the power to behave, to an appreciable extent, independently of its competitors, customers, and ultimately of its consumers (United Brands v Commission (Case C-27/76) [1978] ECR 207).

Dominance is assessed by various factors, including:

  • Market share (a market share of over 50% is presumed dominant, but a share of under 40% is unlikely to be dominant).

  • Market structure.

  • Barriers to entry.

  • The degree of countervailing buyer power.

 
29. Are there any broad categories of behaviour that may constitute abusive conduct?

Article 3 of the Competition Act (mirroring Article 102 of the TFEU) provides four examples of abuse of a dominant position:

  • Imposing unfair purchase or selling prices or other unfair contractual conditions.

  • Limiting or restricting production, market outlets or market access, investment, technical development or technological progress.

  • Discriminating against trading partners, placing them at an unjustifiable competitive disadvantage.

  • Making use of tying practices.

Other types of behaviour can also constitute abuse of a dominant position, and these are interpreted by the Italian Competition Authority following the principles developed by the European Commission and the EU courts.

 

Exemptions and exclusions

30. Are there any exemptions or exclusions?

The provisions on restrictive agreements and abuse of dominant positions do not apply to undertakings which, by law, are entrusted with providing services of general economic interest or operate on the market in a monopoly situation. However, this exemption applies only to the extent strictly necessary for performing the specific services assigned to the undertakings (Article 8(2), Competition Act).

 

Notification

31. Is it necessary (or, if not necessary, possible/advisable) to notify the conduct to obtain clearance or (formal or informal) guidance from the regulator? If so, what is the applicable procedure?

Not applicable.

 

Investigations

32. What (if any) procedural differences are there between investigations into monopolies and abuses of market power and investigations into restrictive agreements and practices?

See Questions 18 to 21 and Question 23.

 
33. What are the regulator's powers of investigation?
 

Penalties and enforcement

34. What are the penalties for abuse of market power and what orders can the regulator make?
 

Third party damages claims

35. Can third parties claim damages for losses suffered as a result of abuse of market power? If so, what special procedures or rules (if any) apply? Are class actions possible?

Third party damages

See Question 25.

Special procedures/rules

See Question 25.

Class actions

See Question 25.

 

EU law

36. Are there any differences between the powers of the national regulatory authority(ies) and courts in relation to cases dealt with under Article 101 and/or Article 102 of the TFEU, and those dealt with only under national law?

The Italian Competition Authority (IAA) has the same powers when applying Articles 101 and 102 of the TFEU and national provisions. However, in notable contrast to the European Commission's powers, the IAA cannot carry out inspections at private dwellings.

 

Joint ventures

37. How are joint ventures analysed under competition law?

Full-function joint ventures are analysed under the rules relating to concentrations (see Question 2, Triggering events). However, if the joint venture has as its principal object or result the co-ordination of behaviour of independent undertakings, it will not amount to a concentration and will be assessed under the rules on restrictive agreements.

 

Inter-agency co-operation

38. Does the regulatory authority in your jurisdiction co-operate with regulatory authorities in other jurisdictions in relation to infringements of competition law? If so, what is the legal basis for and extent of co-operation (in particular, in relation to the exchange of information)?

The Italian Competition Authority (IAA) will suspend any investigation into cases in respect of which the European Commission has opened a formal procedure under Articles 101 and/or 102 of the TFEU, except in relation to aspects which are relevant specifically to Italy.

As a member of the European Competition Network (ECN), the IAA closely co-operates with other competition authorities who are members of the ECN, which includes co-operating in accordance with the Notice on co-operation within the network of competition authorities (OJ 2004 C101/43) (ECN Notice).

 

Proposals for reform

39. Are there any proposals for reform of competition law?

There are currently no significant proposals for the reform of Italian competition law.

 

Online resources

Italian Competition Authority (Autorità Garante della Concorrenza e del Mercato) (IAA)

W www.agcm.it

Description. Official website of the IAA, regularly updated and containing:

  • General and organisation information (also in English).

  • Relevant laws and regulation (some also in English).

  • Forms and notices (in Italian only).

  • Press releases and decisions (also in English) (as well as an internal search engine).



The regulatory authority

Italian Competition Authority (Autorità Garante della Concorrenza e del Mercato) (IAA)

Head. Giovanni Pitruzzella
Contact details. Piazza G. Verdi, 6/a, 00198 Rome, Italy
T +39 06 85 82 11
F +39 06 85 82 12 56
E protocollo.agcm@pec.agcm
W www.agcm.it

Outline structure. The IAA decision-making body originally comprised five IAA Commissioners (including the Chairman). A reform of the composition of all independent authorities, effective from 22 December 2011, has reduced the number of the Commissioners to three (including the Chairman). However, this reform does not apply to the Commissioners currently in charge (four).

Responsibilities. The IAA is responsible for investigating potential breaches of competition law and analysing concentrations. The most relevant IAA units are the Directorate General for Competition and the Directorate General for Consumer Protection (both with several sub-units dealing with specific industries).

The IAA can also submit reports to Parliament and Government and provide them with consultancy services. Further, the IAA now has the power to request that the Administrative Tribunal annul general administrative measures, regulations or resolutions adopted by public bodies which it considers in breach of competition law (Article 36, Law Decree no. 201/2011).

Procedure for obtaining documents. The IAA may, at any stage during an investigation, request undertakings, entities and individuals to supply any information in their possession and exhibit any documents of relevance to the investigation.



Contributor profiles

Tommaso Salonico, Partner

Freshfields Bruckhaus Deringer LLP

T +39 06 69533 311
F +39 06 69533 800
E tommaso.salonico@freshfields.com
W www.freshfields.com

For a full profile see here.

Alessandro Di Giò, Associate

Freshfields Bruckhaus Deringer LLP

T +39 06 69533 311
F +39 06 69533 800
E alessandro.digio@freshfields.com
W www.freshfields.com


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