Government bill proposes changes to competition law
On 24 May 2018, the Finnish Government issued a government bill (HE 68/2018), proposing changes to the Finnish Competition Act. According to the bill, an obligation to separate accounting records shall be added to the Competition Act, obligating public entities (i.e. municipalities, federations of municipalities, provinces, the state, and any entity under their command) to keep independent accounting records of their economic activities on a competitive market. Additional obligations for public entities regarding allocation, documentation and follow-up of earnings and costs are included as well. The aim of the provision is to strengthen competition neutrality, i.e. to remove the competitive advantages public entities may have due to their status.
The government bill also proposes changes to section 32 of the Competition Act concerning the order of priority of the Finnish Competition and Consumer Authority’s (FCCA) tasks by adding a new prioritization criterion, according to which the FCCA does not have to investigate a matter if the restriction of competition is unlikely to significantly affect the conditions of competition. The aim is that the FCCA would be able to focus on the most significant and most harmful restrictions on competition.
According to the Competition Act, the FCCA can conduct un-announced, inspections (dawn raids) at a company’s premises in order to investigate competition restrictions. Said right is now clarified to be independent of the storage medium, meaning that the FCCA can also investigate mobile phones and other electronic formats or devices. In addition, the FCCA would be allowed to continue the investigation at its premises, meaning that the FCCA can temporarily copy electronical data (data processing records and data) and conduct data searches at its own premises.
The exchange of information between authorities will be expanded by increasing the amount of authorities (for example preliminary investigation authorities and the Tax Administration) that are obliged to provide information and documents to the FCCA in spite of confidentiality regulations. In addition, the Tax Administration is given the right to provide tax information to the FCCA on its own initiative.
The bill gathers the public and private sectors’ obligation to provide information to the FCCA into the same provision, according to which the FCCA’s access right is the same, regardless of what kind of competition law infringement the FCCA is investigating. In other words, public entities would be obliged to provide information when private enterprises’ competition restrictions are investigated, and private enterprises would be obliged to provide information about public entities’ competition neutrality infringements.
If it is necessary to prevent a competition restriction immediately, the FCCA can issue an interlocutory injunction, prohibiting a company, for example, to apply certain contractual terms. If the FCCA has issued an injunction, it must solve the matter within 60 days. It is suggested in the government bill that said period would be extended from 60 to 90 days, since the 60-day deadline has proven to be unrealistic and has not been applied at all.
In addition, the government bill includes changes to time limits for merger control. The FCCA’s one-month time limit to provide a merger control decision is changed to 23 working days, and the three-month time limit for further investigations is changed to 69 working days. The Market Court’s right to extend the time limit with two months is changed to 46 working days. The aim of the changes is that the time available for investigating a merger would not vary depending on when the application is filed (i.e. the length of the calendar month or public holidays would no longer affect the investigation time).
The aim is that the changes shall come into force as soon as possible, save for the separate accounting obligations that would come into effect on 1 January 2020.
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