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.

Jan Magne Juuhl-Langseth, Per Kristian Bryng and Anders Thue, Advokatfirmaet Simonsen Vogt Wiig
Contents

Restraints of trade

Scope of rules

1. Are restrictive agreements and practices regulated? If so, what are the substantive provisions and regulatory authority?

Regulatory framework

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).

Regulatory authority

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.

 
2. Do the regulations only apply to formal agreements or can they apply to informal practices?

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)).

 

Exemptions

3. Are there any exemptions? If so, what are the criteria for individual exemption and any applicable block exemptions?

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.

  • Specialisation agreements.

  • Vertical agreements and concerted practices in the motor vehicle sector.

  • Research and development (R&D) agreements.

  • Insurance 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

4. Are there any exclusions? Are there statutes of limitation associated with restrictive agreements and practices?

Exclusions

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.

 

Notification

5. What are the notification requirements for restrictive agreements and practices?

Notification

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.

Informal guidance/opinion

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).

Relevant authority

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).

Filing fee

There are no formal notification requirements, and thus no filing fee (see above, Notification).

 

Investigations

6. Who can start an investigation into a restrictive agreement or practice?

Regulators

The NCA can initiate an investigation on its own initiative.

Third parties

Third parties can submit complaints to initiate an investigation and approach the NCA at any stage of the process, formally or informally, to try to influence the NCA's decision.

 
7. What rights (if any) does a complainant or other third party have to make representations, access documents or be heard during the course of an investigation?

Representations

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.

Document access

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.

Be heard

Third parties do not have any right to be heard (see above, Document access).

 
8. What are the stages of the investigation and timetable?

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

9. How much information is made publicly available concerning investigations into potentially restrictive agreements or practices? Is any information made automatically confidential and is confidentiality available on request?

Publicity

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).

Automatic confidentiality

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.

 
10. What are the powers (if any) that the relevant regulator has to investigate potentially restrictive agreements or practices?

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.

 

Settlements

11. Can the parties reach settlements with regulators to bring an early resolution to an investigation? If so, what are the circumstances for doing so and the applicable procedure?

There is no formal early resolution procedure through which the NCA can accept commitments (see Question 12).

 
12. Can the regulator accept remedies (commitments) from the parties to address competition concerns without reaching an infringement decision? If so, what are the circumstances for doing so and the applicable procedure?

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

13. What are the regulator's enforcement powers in relation to a prohibited restrictive agreement or practice?

Orders

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.

Fines

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.

Personal liability

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.

Immunity/leniency

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

14. Can third parties claim damages for losses suffered as a result of a prohibited restrictive agreement or practice? If so, what special procedures or rules (if any) apply? Are collective/class actions possible?

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.

Special procedures/rules

See above, Third party damages.

Collective/class actions

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.

 
15. Is there a right of appeal against any decision of the regulator? If so, which decisions, to which body and within which time limits? Are rights of appeal available to third parties, or only to the parties to the agreement or practice?

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

16. Are monopolies and abuses of market power regulated under administrative and/or criminal law? If so, what are the substantive provisions and regulatory authority?

Regulatory framework

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.

Regulatory authority

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.

 
17. How is dominance/market power determined?

The definition of market power and dominance follows the outlines set out in EU and EEA case law and practice.

Generally, there is a presumption of dominance if an undertaking holds a market share of 40 % to 45 % or more of the relevant market, depending on the market structure.

 
18. Are there any broad categories of behaviour that may constitute abusive conduct?

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

19. Are there any exemptions or exclusions?

There are no statutory exclusions or exemptions available for an abuse of a dominant position. However, efficiencies and objective justifications will be considered in the same way as under EU law.

 

Notification

20. Is it necessary (or, if not necessary, possible/advisable) to notify the conduct to obtain clearance or (formal or informal) guidance from the regulator? If so, what is the applicable procedure?

It is not possible to notify abusive conduct to obtain a clearance from the NCA. However, it is possible to approach the NCA to informally 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.

 

Investigations

21. What (if any) procedural differences are there between investigations into monopolies and abuses of market power and investigations into restrictive agreements and practices?

This is the same as for restrictive agreements and practices (see Questions 6 to 19 and Question 11 to 12).

 
22. What are the regulator's powers of investigation?
 

Penalties and enforcement

23. What are the penalties for abuse of market power and what orders can the regulator make?

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

24. Can third parties claim damages for losses suffered as a result of abuse of market power? If so, what special procedures or rules (if any) apply? Are collective/class actions possible?
 

EU law

25. Are there any differences between the powers of the national regulatory authority(ies) and courts in relation to cases dealt with under Article 101 and/or Article 102 of the TFEU, and those dealt with only under national law?

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.

 

Joint ventures

26. How are joint ventures analysed under competition 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).

 

Inter-agency co-operation

27. Does the regulatory authority in your jurisdiction co-operate with regulatory authorities in other jurisdictions in relation to infringements of competition law? If so, what is the legal basis for and extent of co-operation (in particular, in relation to the exchange of information)?

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.

 

Recent cases

28. What are the recent developments, trends or notable recent cases concerning abuse of market power?

There have been no recent cases on abuse of market power in Norway. The NCA has initiated a task force designated to investigate complaints and cases under the prohibition on abuse of market power. The NCA is currently considering one such case.

 

Proposals for reform

28. Are there any proposals for reform concerning restrictive agreements and market dominance?

On 11 November 2014, a preparatory document was issued. This document suggested introducing an independent Competition Complaints Board (cf. NOU 2014:11). The reform is likely to enter into force in 2016.

 

Online resources

Lovdata

W www.lovdata.no

Description. Original language text of Norwegian legislation (up-to-date), including the Competition Act and regulations passed under the Competition Act.

Competition Act

W www.konkurransetilsynet.no/en/legislation/The-Competition-Act-of-2004

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)

Head. Christine Meyer
Contact details. PO Box 439 Sentrum, 5805 Bergen, Norway
T +47 55 59 75 00
F +47 55 59 75 99
E post@konkurransetilsynet.no
W www.konkurransetilsynet.no

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).



Contributor profiles

Jan Magne Juuhl-Langseth

Advokatfirmaet Simonsen Vogt Wiig

T +47 21 95 55 11
F +47 21 95 55 01
E jmjl@svw.no
W www.svw.no

Professional qualifications. Norway, 1998

Areas of practice. Competition law; EU/EEA regulatory compliance.

Per Kristian Bryng

Advokatfirmaet Simonsen Vogt Wiig

T +47 21 95 57 31
F +47 21 95 55 01
E pkb@svw.no
W www.svw.no

Professional qualifications. Norway, 2005

Areas of practice. Competition law; state aid law.

Anders Thue

Advokatfirmaet Simonsen Vogt Wiig

T +47 21 95 57 04
F +47 21 95 55 01
E ant@svw.no
W www.svw.no

Professional qualifications. Norway, 2003

Areas of practice. Competition law; State aid law, public procurement law.

Recent transactions

  • 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.

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