MAY 2016. Frédéric Louis, Partner at Wilmer Hale, presented on the essential need for compliance with EU competition law for associations. Indeed, the legal texts specifically refer to inclusion of trade associations in the remit of the law. Frédéric pointed to a trend towards increased enforcement of the competition rules across the EU and ever higher fines, compounded by a dramatic increase of third party damage actions. The penalty imposed by the European Commission for infringement can reach 10% of the worldwide consolidated (all members) turnover of the association.
The rule is that agreements or understandings that restrict members’ commercial independence/individual commercial decision making are prohibited. The definition of an agreement or understanding is very wide leading to a need for heightened awareness of what constitutes a clear infringement such as price fixing or collective boycotting and where caution is required such as for information sharing. Associations operating in Brussels, discussing EU policy developments and seeking to influence legislative outcomes as a united body are particularly at risk.
Frédéric therefore advises best practice with the use of codes of conduct, circulation of meeting agendas in advance and unambiguous and comprehensive minutes. He informed participants of how to actively manage a meeting and to file all legal correspondence and material in a separate file and bookcase marked “privileged and confidential”. Finally, he covered the subject of dawn raids where the investigating authorities will take over your offices for some days and gather all incriminating evidence they wish to analyse into a single small room, to be stored separately until they leave with it. Do not break the seal placed on the door of the room: it cost one company under investigation 38 million Euros!
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