Spain’s National Commission on Markets and Competition (CNMC) has adopted updated guidance on how it calculates fines for companies that violate competition law, introducing for the first time a specific section addressing sanctions for company executives. The new document reflects the authority’s recent enforcement practice and incorporates principles established by the courts.
The updated guidance replaces the provisional indications issued by the CNMC in October 2018, which were adopted after the Spanish Supreme Court annulled the authority’s previous fining methodology. In its judgment of 29 January 2015, the Supreme Court invalidated the methodology contained in a 2009 communication issued by the former National Competition Commission (CNC), prompting the CNMC to adjust its approach to ensure compliance with the ruling.
The newly published document consolidates the methodology that the CNMC has applied in recent years and introduces clarifications based on the authority’s sanctioning practice, which has been repeatedly confirmed by Spanish courts. According to the CNMC, the aim is to provide greater transparency and legal certainty regarding how fines are determined in competition law cases.
The authority has the power to impose sanctions for a range of anticompetitive conduct, including cartels, abuses of dominant position and certain acts of unfair competition. These practices are prohibited under Articles 1, 2 and 3 of Spain’s Competition Act (Law 15/2007) as well as Articles 101 and 102 of the Treaty on the Functioning of the European Union.
Under the updated guidance, the basic methodology for calculating fines for companies remains unchanged. The CNMC first determines a sanction rate reflecting the gravity and duration of the infringement. This rate is then applied to the total worldwide turnover of the infringing undertaking. In a subsequent step, the authority verifies whether the resulting amount is proportionate and sufficiently deterrent, adjusting it if necessary.
The most significant development in the new guidance is the addition of a dedicated section on fines for company directors and other responsible executives. The CNMC explains that this section reflects criteria developed in case law regarding when and how individuals can be sanctioned for their role in competition law violations.
Spanish competition law provides for the possibility of imposing fines on both companies and individuals involved in anticompetitive conduct. By incorporating guidance on executive liability into its methodology document, the CNMC aims to clarify how these sanctions may be assessed in practice.
The authority also notes that the guidance describes the general approach it intends to follow when determining fines. However, it retains the possibility of applying alternative methods in cases where the standard approach would not be appropriate or reasonable, provided that such decisions are properly justified.
