The chapter argues that the prevention of competition harms should be placed at the core of the functioning of competition authorities, including competition advocacy work. The legislative proposals of competition authorities can also be seen as a preventive tool. Fines are not a stand-alone tool in the toolbox of competition authorities when it comes to the prevention of harms. Rather, they are one of several tools that can be used by authorities to prevent harm and create public value. In order for competition authorities to carry out their protective role effectively and shield the public from harm, they must make full and consistent use of the preventive tools at their disposal. This necessarily requires the use of not only fines, but also regulatory initiatives and, where appropriate, the consistent application of divestitures.

Belgian antitrust enforcement has gradually been strengthened. Applicable provisions are mostly copied from EU law, but national accents remain. Sanctions on natural persons were introduced, and abuse of relative dominance (abuse of economic dependency) was recently prohibited. Some provisions, such as the extension of the scope of EU exemptions to purely national cases, were innovative. Also creative is also the National Competition Authority (NCA)’s hybrid institutional structure, largely separating investigation and fining within one institution. No criminal antitrust sanctions currently exist. Room for improvement remains. The NCA clearly faces budgetary and human resource constraints. The power balance appears to be gradually moving towards the Auditorat. The settlement rate is very high and fines are generally low, weakening the deterrent effect of enforcement. As to private enforcement, there is a long tradition of injunctive relief, although applicants may face a high burden of proof, especially in dominance cases. Belgium duly implemented the EU Damages Directive, introducing the envisaged advantages for claimants but also the hurdles, such as the ‘passing-on defence’.

In Spain, sanctions can be of three types: (1) administrative, (2) civil or (3) criminal. The first two are the most important while the third is residual and scarce, although there has been a long-running debate, especially in the academic sphere, about the convenience of greater criminalization. (1) Competition authorities can impose administrative sanctions, mainly fines, on infringers, both on companies and their directors. Exclusion of public tenders can also be imposed on entities that have been sanctioned (final sanction) for anticompetitive behaviour. (2) Commercial courts can award compensation to victims for antitust damages. These awards are always compensatory and not punitive, so they cannot exceed the damage caused. (3) Although there is no specific cartel offence, some anticompetitive conduct can also fall into some criminal types. Although the Spanish Criminal Code has since 1848 had provisions intended to penalise individuals who carry out conduct aiming at altering or manipulating prices, recourse to criminal proceedings for the sanction of these behaviours has been highly exceptional. The current trend is towards intensifying administrative and civil sanctions (higher corporate fines, more frequent and harsher fines for directors and exclusions of public tenders, while enhancing award of damages).

The chapter highlights the main legal arguments under the European Convention on Human Rights and in the jurisprudence in the European Court of Human Rights which resulted in the Menarini judgment declaring Italian competition law to be quasi-criminal and thereby enabling the effective protection of Article 6 of the ECHR. Both EU and Hungarian competition law are quasi-criminal – mainly – due to the increased level of fines imposed by the relevant competition authorities. Article 6 requires effective judicial review in the form of full review, which however is a question that is still not answered satisfactorily in both Hungarian and EU law. This chapter only focuses on the review of fines, where the practical judicial oversight is compatible with the de facto full review requirement of the Menarini judgment.

The authors analyze corporate governance and competition sanctions. Despite their extensive powers, shareholders cannot (legally) interfere directly in the management of a company. It is hard to imagine that any competition law infringements attributed to the company could happen without the knowledge, or even more the active participation, of its directors or other executives. Consequently, if a competition law fine or other sanction is applied on the company, directors appear to be particularly well placed to be sued for compensation for this harm caused in their management activity. On the other hand, shareholders are the main beneficiaries of successfully completed cartels, i.e. those which remain undetected by competition authorities. The chapter investigates whether the financial burden of infringement sanctions should be borne by the company as the main potential beneficiary of excess profits, or should be fully, or at least partially, transferred to the directors who effectively committed or overlooked the breaches. Clarifications are gained from the study of managerial liability in the context of competition law infringements, followed by a deeper analysis of the consequences of the damages suffered by the company in the form of competition law fines or compensations paid as a result of private enforcement

Breaches of competition law may incur severe sanctions in Austria. Besides heavy administrative fines and nullity of contracts contravening competition law, antitrust infringers must expect private damage action claims from customers or suppliers harmed by antitrust violation. However, only very few final decisions have been rendered in Austria’s private antitrust litigation so far. Under Austrian criminal law, cartel collusion in tendering procedures may qualify as fraud or bid-rigging. Criminal convictions may in turn lead to the withdrawal of trade licences and pose a risk for the company of being 'blacklisted' – at least temporarily – in public procurement procedures. Under exceptional circumstances, dissolution of the company may be ordered if a director has committed an offence in the course of the company’s business activities; the latter possibility only applies to limited liability companies. Under Austrian company law, a director is liable to reimburse all damages caused by not applying the standard care diligence of a prudent business manager, including the compensation of damages incurred through infringements of competition law. This liability exists towards both the company and business partners.

Competition law sanctions in Japan are described after first dividing the issues into cartels and non-cartels. Regarding non-cartels, although the 2009 Amendment introduced administrative fine systems, there are only a few orders, arguably because the Japan Fair Trade Commission (JFTC) tends to avoid orders that addressees would be likely to contest in the courts. As a result, the JFTC stresses the importance of advocacy instead of frequently enforcing the law. In contrast, regarding cartels, the JFTC has repeatedly issued administrative fine orders. The 1977 Amendment introduced the fine system against cartels, and the 2005 Amendment introduced a leniency system. If the violator is either a repeat offender (recidivism) or a cartel ringleader, the fine becomes 1.5 times higher (if both, 2.0 times higher). There are no fining guidelines. Thus far, the sanctions related to cartels seem to work effectively; quite a few cartels seem to have been deterred. The chapter also describes the framework of the 2019 amendment that took effect in December 2020.

Andras Gyorgy Kovács researched the effectiveness of competition sanctions from the perspective of an administrative judge. Undertakings in breach of competition law rules are most likely expected to be fined. His hypothesis, ,to be examined through the courts’ case law, is that the level of competition fines is significantly higher than that of criminal penalties. Nevertheless, it is not unusual for the very same undertaking to be reinvestigated by the competition authority for a second or even third time. It seems that the expected legal policy aim of fines in competition matters, i.e. the individual and general prevention of anticompetitive practices, cannot be achieved in all cases. His chapter aims at identifying the reasons thereof and presenting a number of conclusions, to be drawn from the Hungarian administrative courts’ jurisprudence, in respect of the effectiveness of the imposition of fines. He argues that judicial case law can resolve some of the efficiency problems, while others require modification of the legislation. As regards repeated infringements, evaluating this as an aggravating factor may be used in an effective and reassuring way when imposing a fine. He argues for laws which stipulate the imposition of fines proportionate to the infringing undertakings’ income and assets.

The chapter examines four economic models, the implications of behavioural economics and the main normative implications of the sanctioning policies. Classical economic analysis of sanctions and crimes presumes that decision-makers are sanctioned directly, personally. Yet this model can only be applied in the case of competition law sanctions levied on the company, if the decision-maker of the firm is at the same time the owner of the company. If companies are sanctioned, the key issue is whether they apply internal sanctions against the decision-maker. Such sanctions can be ex-ante or ex-post, fitted perfectly of imperfectly to the goals of the decision-maker. However, not all companies apply sanctions, some because of agency problems, others because the owners of the company are not able to learn who should be sanctioned and when. There are also cases where the owners are not interested in preventing unlawful decisions even if the company is later sanctioned. The reason for that might be that they do not bear the burden of the sanctions or they make a credible commitment not to levy full (or any) sanctions on managers in order to induce them to take more risks.

Polish competition law is characterized by the strong predominance of public enforcement. The crucial component of the Polish system of sanctions has always been administrative corporate fines regulated in much the same way as under EU Law. So far, however, the Polish competition law does not recognize the concept of the single economic unit. This means that the amount of fine is always calculated on the basis of the whole or a part of a direct infringer's turnover. Similarly the fines imposed on associations of undertakings are calculated exclusively on the basis of an association’s turnover. Such a concept of undertaking contributes to the intensification of one of the problems related to enforcement of Polish competition law: the low level of fines imposed by the Competition Authority (CA). The 2014 ACCP amendment introduced into the Polish system individual administrative fines of up to PLN 2 million (c. EUR 450,000) for intentional infringements of the prohibition of anticompetitive agreements, and remedies which may be imposed with or without a fine. These amendments may have significant impact on the effectiveness of the Polish competition law system, in particular by strengthening the deterrent effect of the decisions of the CA.

This chapter gives an overview of UK competition law sanctions and their objectives, and provides a critical analysis of: the method for calculating fines; the Competition and Markets Authority (CMA)’s leniency and settlement policies; review by the appropriate court; private enforcement; the level of enforcement and compliance with UK competition law; and other sanctions against undertakings and individuals. The major issues in the UK centre on the comparatively low number of cases completed by the CMA and the potential chilling effect of its criminal cartel offence. Brexit creates new opportunities for the UK to design and apply its sanctions in a more effective way and outside of the constraints of EU Competition Law, but it also creates significant challenges – in particular in requiring the scaling-up of the CMA’s enforcement to include cases that were previously investigated by the European Commission on the UK’s behalf.

The chapter looks into the effectiveness of commitment decisions by reviewing selected examples from the European Commission’s jurisdiction. Proceedings with a considerable or often a very high degree of similarity in the air traffic, energy and payment-card industries provide useful insights into the extent to which the preceding decisions influence the behaviour of market participants and the approach taken by the Commission. The author concludes that commitment decisions are likely to be followed by other commitment decisions in similar cases and there is little evidence to suggest that market players voluntarily adjust their behaviour following a commitment case. A few recent examples suggest that this approach might not hold universally, leaving the actual impact of the commitment decisions challenging to forecast. It is argued that the limited deterrence and negative effect on legal certainty in the end limits the advantages of commitment decisions, as procedural efficiencies might evaporate if similar proceedings occur time after time. This, ultimately, may call into question the effectiveness of this tool, as practical examples suggest that the theoretical advantages are often not realised, while the negative effects on legal certainty and the limited deterrence effect are prominent.