Restraints of trade and dominance in Norway: overview
A Q&A guide to restraints of trade and dominance in Norway.
The Q&A gives a succinct overview of restraints of trade, monopolies and abuses of market power in Norway. In particular, it covers the regulatory authorities and the regulatory framework, the scope of rules, exemptions, exclusions, statutes of limitation, notification, investigations, penalties and enforcement, third party damages claims, EU law, joint ventures and proposals for reform.
For information on merger control, regulatory framework and regulatory authorities, relevant triggering events and thresholds in Germany, visit Merger control in Norway: overview.
This Q&A is part of the global guide to competition and leniency. For a full list of jurisdictional Restraints of Trade and Dominance Q&As visit www.practicallaw.com/restraintsoftrade-guide. For a full list of jurisdictional Merger Control Q&As visit www.practicallaw.com/mergercontrol-guide.
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-guide.
Restraints of trade
Scope of rules
The Competition Act (section 10) harmonises Norwegian law with the EU and EEA prohibitions concerning agreements and concerted practices restricting competition (Article 101, TFEU and Article 53, EEA Agreement).
All agreements between undertakings, decisions by associations of undertakings and concerted practices, which have as their object or effect the prevention, restriction or distortion of competition in Norway are prohibited (section 10, Competition Act). Examples of agreements that restrict competition listed in the Competition Act include those that:
Directly or indirectly fix purchase or selling prices, or any trading conditions.
Limit or control production, markets, technical development or investment.
Share markets or sources of supply.
Apply dissimilar conditions to equivalent transactions with other trading parties, which places them at a competitive disadvantage.
Make the conclusion of a contract subject to the other parties accepting supplementary obligations which, by their nature or according to commercial use, have no connection with the subject of the contract.
The NCA, Ministry and King in Cabinet control restrictive agreements and practices (see below, Regulatory authority).
Breach of the prohibitions in the Competition Act can give rise to both civil and criminal sanctions (see Question 13).
The competition authorities are the:
Government, "King in Cabinet", as a regulatory authority implementing Regulations vested under the Competition Act.
Ministry of Trade, Industry and Fisheries (Ministry), as an appellate body and regulatory authority.
Norwegian Competition Authority (NCA) (see box, The regulatory authority).
The NCA is the main supervisory authority. The Ministry deals with complaints against individual NCA decisions.
Similarly to Article 101 of the TFEU and Article 53 of the EEA Agreement (Competition Act):
The regulations apply to all agreements between undertakings, decisions by associations of undertakings and concerted practices, whether written or oral.
There is a distinction between concerted practices (which are prohibited) and independent, parallel behaviour (which is not prohibited, but which may be caught by the prohibition against the abuse of a dominant position (see Question 16)).
As with Article 101 of the TFEU and Article 53 of the EEA Agreement, the prohibition does not apply to an agreement, decision by associations of undertakings or a concerted practice if all of the following apply:
It contributes to improving the production or distribution of goods, or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefit.
It does not impose on the undertakings concerned restrictions that are unnecessary to attain the above objectives.
It does not allow the undertakings to eliminate competition for a substantial part of the products in question.
The King in Cabinet can issue detailed block exemption rules. Block exemptions equivalent to those under Article 101(3) of the TFEU and Article 53(3) of the EEA Agreement have been adopted for:
Vertical agreements and concerted practices in the motor vehicle sector.
Research and development (R&D) agreements.
Technology transfer agreements.
New block exemption rules for vertical agreements and concerted practices in the motor vehicle sector have been implemented under Norwegian law. These are equivalent to the new rules set out in Regulation (EU) 461/2010 on the application of Article 101(3) of the TFEU to categories of vertical agreements and concerted practices in the motor vehicle sector. In addition, new block exemption rules for specialisation agreements and R&D agreements came into force in 2012. Finally, new block exemption rules for vertical agreements and for insurance agreements, passed by the European Commission in 2010, have been implemented into Norwegian law during 2010.
Exclusions and statutes of limitation
The de minimis exclusion under Article 101 of the TFEU applies under the Competition Act. This means that there must be an appreciable restriction or effect on competition, for the provisions on restrictive agreements to apply.
The NCA has not published a de minimis notice, but it typically uses the Commission's notice for its assessment.
Statutes of limitation
Fines cannot be imposed after ten years for infringements of the provisions under sections 10 and 11 of the Competition Act (the provisions regarding restrictive agreements and abuses of a dominant position) (section 29, Competition Act) (see Questions 1 and 16).
The statutory limitation period for other infringements is five years.
These time limits are suspended once the NCA either:
Takes steps to secure evidence under section 25 of the Competition Act.
Informs an undertaking that it is suspected of infringing the Competition Act or decisions made under the Act.
There are no formal notification requirements. In line with EU rules, the notification system for individual exemptions has been abolished. It is the responsibility of the parties to an agreement to:
Ensure it complies with the Competition Act.
Assess it in its full economic and legal context, taking into account the scope of the exemption criteria and block exemptions.
It is possible to approach the NCA informally or confidentially to discuss a case. The NCA must provide guidance to undertakings on the interpretation of the Competition Act, its scope and its application to individual cases (paragraph 2, section 9, Competition Act).
Responsibility for notification
There is no formal notification requirement (see above, Notification).
It is possible to approach the NCA informally (see above, Informal guidance/opinion).
Form of notification
There are no formal notification requirements (see above, Notification).
There are no formal notification requirements, and thus no filing fee (see above, Notification).
During its investigation, the NCA can question relevant third parties (such as customers or competitors) directly. Anyone (including third parties) must provide the NCA with the information it requires to perform its responsibilities under the Competition Act (section 24, Competition Act). This includes any type of information and access to the sources of that information.
Third parties that become involved in the proceedings, by submitting comments, do not have any rights to access documents or to be heard. This is because the Access to Information Act 2006 does not apply to open cases concerning infringement of, among other things, section 10 of the Competition Act (which regulates restrictive agreements and practices) (section 26, Competition Act).
Once the case is closed, the Access to Information Act applies. However, as a general rule, third parties cannot access leniency applications. In court proceedings, the courts may order access to documents that would not be subject to disclosure under the Access to Information Act.
Third parties do not have any right to be heard (see above, Document access).
There is no procedure for obtaining informal guidance. This is done through informal discussion.
The NCA starts its investigation either on its own initiative or following a complaint. On this basis, the NCA either:
Requests information from the investigated party(ies).
Carries out a dawn raid.
During the investigation, the NCA carries out meetings and/or other communications with the investigated party(ies) to clarify the subject matter, or requests information.
Finally, the NCA either:
Closes the case.
Makes a decision ordering the party(ies) to bring an infringement to an end.
In addition, the NCA can:
Impose an administrative fine.
Bring charges by reporting the crime to the Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime (Økokrim).
Publicity and confidentiality
The details made public vary from case to case. Sometimes, the NCA publishes the fact that an investigation has been started. The Access to Information Act does not apply to cases concerning, among other things, a potentially restrictive agreement, as long as the case has not been brought to its conclusion (section 26, Competition Act) (see Question 7).
Investigated undertakings or persons by the NCA can access case documents on request, provided that this access does not harm or risk the investigation or third parties. The Access to Information Act does not apply to potentially restrictive agreements, so third parties do not have the right to demand access to the investigation documents before the case has been closed (section 26, Competition Act).
Once a case has been closed, anyone with legal interest in the matter can demand access to the documents. This right includes access to confidential information, provided this is not unreasonable to those to whom the information relates.
Confidentiality on request
The parties, and third parties, can request that information be kept confidential.
When investigating potentially restrictive agreements or practices, the NCA can:
Request any information and access to sources it deems necessary to assess compatibility with the Competition Act.
Obtain and exchange information (including confidential information) with competition authorities in other jurisdictions. This power is used if it is necessary to meet obligations under a treaty with a foreign state or international organisation.
When there are justifiable reasons to assume that the Competition Act or decisions under the Act have been infringed, the NCA can, with prior court authorisation:
Demand access to premises, land, means of transport and other places of storage where evidence can be found.
Demand access to homes if there are special reasons to assume that evidence may be kept there.
Confiscate items that may be significant evidence for further examination.
Seal business premises, books or business documents during the investigation and for as long as deemed necessary.
There is no formal early resolution procedure through which the NCA can accept commitments (see Question 12).
In a behavioural infringement case, the parties may offer commitments to the NCA. These commitments can be made binding through a formal decision which will end the investigation, provided the commitments are abided with. There are no formal procedures for accepting commitments in behavioural cases.
Penalties and enforcement
The NCA can order undertakings or associations of undertakings engaging in a prohibited agreement or practice to end the infringement. The order can include any measure necessary to achieve this. Structural measures can only be ordered if there are no equally effective behavioural measures, or if behavioural measures are a greater burden to the undertaking.
Infringing undertakings or individuals responsible for infringement can be subject to both administrative and criminal sanctions.
An undertaking can be subject to administrative fines of up to 10% of its worldwide turnover if it (or someone acting on its behalf) intentionally or negligently violates the prohibition. The NCA can also impose periodic penalty payments until the situation has been rectified.
Criminal fines can be imposed on individuals.
If fines are not paid, the authorities can either:
Use the decision issuing the fine as a basis for debt enforcement proceedings.
Initiate bankruptcy proceedings.
Any person, including a director or manager of a relevant undertaking, who infringes the Competition Act is liable to a fine or imprisonment (although no-one has yet been imprisoned). Only criminal fines can be imposed on private persons. Civil fines only apply to undertakings.
When determining the amount of administrative fines, the NCA considers any assistance that an undertaking has provided in relation to its own or others' violations (section 31, Competition Act). A leniency programme was introduced on 12 August 2005, based on the Notice on immunity from fines and reduction of fines in cartel cases (OJ 2002 C45/03).
Impact on agreements
Any part of an agreement that restricts competition in violation of the Competition Act is void. If it would be unreasonable to enforce the rest of the agreement, the whole agreement is void.
Third party damages claims and appeals
Third party damages
The Competition Act does not regulate third party claims. Claims for compensation must be based on non-statutory rules governing damages. These rules only allow for damages to cover economic loss suffered by the claimant. The Norwegian courts can rule directly on agreements, decisions or practices under sections 10 and 11 of the Competition Act, in addition to Articles 53 and 54 of the EEA Agreement.
Third parties, both natural and legal persons, who have suffered an economic loss can act as claimants. There is designated provision on statutory limitation in the Competition Act (section 34).
The recent adoption of Directive 2014/104/EU on actions for damages under national law for infringements of competition law provisions of the member states (Anti-trust Damages Directive) is relevant under the EEA Agreement. This directive will also be implemented in Norwegian law.
See above, Third party damages.
Chapter 35 of the Civil Procedures Act has introduced class actions. The discussions in the preparatory works indicate that third party damages resulting from violations of competition law are covered by the new class action rules.
Rights of appeal and procedure
The parties to an infringement, or any third parties, can appeal an NCA order to end an infringement or a decision rejecting a request to issue such an order to the Ministry. There is a time limit of 15 business days for filing an appeal.
Decisions imposing administrative or criminal fines, or imprisonment, can be appealed to the courts. The courts can assess all factual and legal aspects.
Third party rights of appeal
Third parties may have rights of appeal (see above, Rights of appeal and procedure).
Monopolies and abuses of market power
Scope of rules
Any abuse by one or more undertakings of a dominant position in Norway is prohibited (section 11, Competition Act, corresponding to Article 102, TFEU and Article 54, EEA Agreement). Firstly, it must be assessed whether the undertaking in question holds a dominant position on a Norwegian market and, if it does, whether its behaviour, actions or omissions constitute an abuse of market power under the Competition Act.
The NCA, Ministry and King in Cabinet are the regulatory authorities responsible for controlling the abuse of a dominant position (see Question 1, Regulatory authorities).
There are no criminal sanctions.
Examples of abuse listed in the Competition Act include (section 11, Competition Act):
Directly or indirectly imposing unfair purchase or selling prices, or other unfair trading conditions.
Limiting production, markets or technical development to the prejudice of consumers.
Applying dissimilar conditions to equivalent transactions with other trading parties, therefore placing them at a competitive disadvantage.
Making the conclusion of a contract subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial use, have no connection with the subject of the contract.
Exemptions and exclusions
See Question 10.
Penalties and enforcement
Undertakings that abuse a dominant position are subject to periodic penalty payments and administrative fines of up to 10% of their annual worldwide turnover. If they do not pay these fines, the authorities can use the decision issuing the fine as a basis for debt enforcement proceedings, or initiate bankruptcy proceedings. There are no sanctions against individuals for an abuse of a dominant position.
Third party damages claims
See Question 14.
Regulation (EC) 1/2003 on the implementation of the rules on competition is relevant under the EEA Agreement and was implemented on 19 May 2005 by Act No. 11 concerning the implementation and enforcement in Norway of the competition rules of the EEA Agreement. There is no difference between the powers of national and EU regulators.
The application and enforcement of Articles 53 and 54 of the EEA Agreement and sections 10 and 11 of the Competition Act are likely to be similar, although some differences may occur due to disparities in the objectives of the rules, their scope and sources of law.
The Competition Act does not specifically regulate joint ventures. The creation of a joint venture performing, on a lasting basis, all the functions of an autonomous economic undertaking is a concentration, and its co-operative effects must be assessed under the merger control provisions in the Competition Act.
The creation of a non-concentrative joint venture and co-operation through joint ventures are governed by the rules on restrictive agreements (see Questions 1 to 15).
The NCA does not directly participate in the European Competition Network (ECN), as Norway is not a member of the EU.
However, the EFTA Surveillance Authority and the NCAs of the EFTA states can participate in ECN meetings, although only for the purpose of discussing general policy issues (Protocol 23, EEA Agreement). The EFTA Surveillance Authority and the EEA/EFTA countries have established their own network for co-operating in the enforcement of cases that fall under the EFTA's scope.
In addition, the NCA has entered into several inter-agency agreements with other national competition authorities, such as the Nordic countries' competition authorities.
Proposals for reform
Description. Original language text of Norwegian legislation (up-to-date), including the Competition Act and regulations passed under the Competition Act.
Description. English-language translation of the Competition Act, and other related regulations. English translations are non-binding and meant for guidance only.
The regulatory authority
Norwegian Competition Authority (Konkurransetilsynet) (NCA)
Outline structure. The market monitoring departments are responsible for supervising markets and evaluating and implementing measures to combat competitive restrictions.
The Market Monitoring Departments are divided into:
Section M1: Finance and Communications.
Section M2: Construction, Industry and Energy.
Section M3: Food, Trade and Health.
The Corporate Investigation Department operates dawn raids and other investigations. The NCA has its main office in Bergen and a satellite office in Oslo.
Responsibilities. The NCA investigates all cases under the Competition Act and handles all merger notifications.
Procedure for obtaining documents. Requests for documents are made in writing to the NCA. Decisions, legislation, general information, the submission of notifications and press releases are published on the NCA's website (see above).
Jan Magne Juuhl-Langseth
Advokatfirmaet Simonsen Vogt Wiig
Professional qualifications. Norway, 1998
Areas of practice. Competition law; EU/EEA regulatory compliance.
Per Kristian Bryng
Advokatfirmaet Simonsen Vogt Wiig
Professional qualifications. Norway, 2005
Areas of practice. Competition law; state aid law.
Advokatfirmaet Simonsen Vogt Wiig
Professional qualifications. Norway, 2003
Areas of practice. Competition law; State aid law, public procurement law.
- TeliaSonera's acquisition of Tele 2 in Norway.
- Leif Hübert's acquisition of Norsk Stål.
- Consolis Group's acquisition of Betong AS.
- SOS International AS' takeover of NAF's road assistance business in Norway.