Spain: National Authority for Markets and Competition (CNMC)
Spain
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Spain: National Authority for Markets and Competition (CNMC)

Spain: National Authority for Markets and Competition (CNMC)

Spain

Spain: from the enforcer

Address: Alcalá 47, 28014 Madrid, Spain
Tel: +34 914329600
Email: [email protected]
Web: www.cnmc.es

Contacts

image-20201215093822-4
Cani Fernández Vicién
President
Tel: +34 914329601 / 602
Email: [email protected]
Email: [email protected]

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Beatriz de Guindos Talavera
Director for Competition
Tel: +34 917876841 / 842
Email: [email protected]
Email: [email protected]

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Joaquín López Vallés
Director of the Advocacy Department
Tel: +34 917 876 950 / 951
Email: [email protected]
Email: [email protected]

Members of the CNMC’s boardthat are part of the Chamber of competition:

Cani Fernández Vicién
María Ortiz Aguilar
Carlos Aguilar Paredes
Josep Maria Salas Prat
Maria Pilar Canedo

Secretary of the Board

Joaquim Hortalà i Vallvé

Questions and answers

How long is the head of agency’s term of office?

Six yearswithout reappointment.

When is he or she due for reappointment?

The term will finish in June 2026.

Which posts within the organisation are political appointments?

The president, vice president and eight boardmembers are appointed by the government at the proposal of the Ministry of Economy and after a previous exam by the parliament (article 15.1 of Law 3/2013). Board members hold office for six years and may not be re-elected. New appointments of board members are staggered every two years – no board member remains in office for more than six years (article 15.2).The board habitually works through two chambers of five members, the Chamber of competition and the Chamber of regulatory supervision.

The National Authority for Markets and Competition (CNMC) enjoys complete institutional and functional independence in exercising its authority. It has a separate legal personality and full public and private capacity, and it is fully subject to the law and fully independent from the government, public authorities and businesses.

What is the agency’s annual budget?

For 2019, the budget is €60 million. The competition-related budget in 2019 was €15 million.

How many staff are employed by the agency?

At the end of 2019, the CNMC employed 515 staff. A total of 192 staff work in competition-related topics.

To whom does the head of the agency report?

To parliament. The chairman of the CNMC must appear at least once a year before the Economy and Finance Commission of the Chamber of Deputies to set out its basic plan of action and priorities for the future.

Do any industry-specific regulators have competition powers?

The CNMC is the only agency responsible for the public enforcement of competition law. Nonetheless, the CMNC is a multitask regulator that integrates sector regulators responsible for telecommunications and media, energy, transport and postal services. Within the CNMC there are four directorates responsible for competition, telecommunications, energy, postal services and transport.

If so, how do these relate to your role?

The Spanish Competition Act created the CNMC with the aim of guaranteeing, preserving and fostering the correct operation, transparency and effective competition in all of Spain’s productive sectors and markets. The integration of competition and regulation into the same body provides benefits derived from similar supervision duties, methodologies and procedures and, above all, knowledge and experience, the pooling of which is beneficial for the correct assessment of competition and regulation matters.

Coordination between the different directions (telecoms, energy, transport and competition), before taking decisions on how to tackle competition or regulatory problems, is a great opportunity for achieving optimal solutions to difficult challenges. Integrating competition and regulation functions helps introducing more competition in regulated sectors by furthering liberalisation and reduces the risk of diverging opinions by different agencies in conflicts regarding regulated industries.

May politicians overrule or disregard the decisions of the authority? If they have ever exercised this right, describe the most recent examples.

Only in merger cases and under strict rules.

According to article 60 of the Competition Act, the Minister of Economy and Finance may refer the decision on a merger case to the Council of Ministers for reasons of general interest when, in the second phase, the board of the CNMChas decided to block a merger,or has decided to clear the merger conditional to the fulfilment of certain commitments proposed by the notifying parties.

The Council of Ministers mayconfirm the decisionof the CNMC ordecide to authorise the concentration, with or without conditions.This decision must be duly based on reasons of general interest other than protecting competition in accordance with the provisions of article 10.

Only in one occasion has the government made use of this prerogative: the merger between two open TV companies (Antena 3/La Sexta), where the Council of Ministers decided to ease the conditions established by the CNMC to authorise the merger.

Does the law allow non-competition aims to be considered when taking decisions?

Not to the Competition Authority.

Nonetheless, as stated before, the Council of Ministers may assess mergers in light of criteria of general interest other than protecting competition.

Article 10.4 states, in particular, that the following shall be understood as "general interest":

  • defence and national security;
  • protection of public security or public health;
  • free movement of goods and services within national territory;
  • environment protection;
  • promotion of technological research and development; and
  • guarantee of adequate maintenance of the objectives of sectorial regulation.

Which body hears appeals against the agency’s decisions? Is there any form of judicial review beyond that mentioned above? If so, which body conducts this? Has any competition decision by the agency been overturned?

All decisions on competition matters can be appealed against before the National High Court. Decisions can be challenged through an ordinary administrative procedure for any appeal arising from judicial error, or on protection of citizens’ fundamental rights through special civil proceedings.

Similarly, appellants have additional legal recourse insofar as they can appeal CNMC decisions that have been upheld by the National High Court, before the Supreme Court (reviewed in cassation).

In recent years, the majority of CNMC decisions that have come before the Supreme Court or the National High Court have generally been confirmed. In the period 2014–2019, the courts have confirmed 75–80 per cent of the decisions (the substantive analysis and procedural aspects of the decisions), although the courts have ordered a recalculation of the fine (following the Supreme Court’s judgment of January 2015) in all decisions adopted by the CNMC previous to January 2015 whose judicial review were still pending.

Has the authority ever blocked a proposed merger? If yes, please provide the most recent instances.

Not since the Competition Act 15/2007 was passed. However, it is not infrequent that merger proposals be dropped by the parties when the competition concerns pointed out by the CNMC cannot be satisfied.

Has the authority ever imposed conditions on a proposed merger? If yes, please provide the most recent instances.

Since 2007, conditions have been imposed in two cases: Abertis/Axion and Antena 3/La Sexta. More than 40 other mergers were cleared in that period, with remedies voluntarily offered by the parties (five cases in 2019).

Has the authority conducted a Phase II investigation in any of its merger filings?

Yes, in 2019 the CNMC cleared subject to remedies the merger Quirón/Clínica Santa Cristina (healthcare sector) and initiated a Phase II investigation in the merger CIMSA/CEMEX (concrete sector). This investigation is still ongoing.

Has the authority ever pursued a company based outside your jurisdiction for a cartel offence? If yes, please provide the most recent instances.

Yes, among others, in the following cartel cases: decennial insurance, professional hairdressing, packaging of fruits and vegetables, and polyurethane foam.

Moreover, parental companies based outside Spain responsible for the infringements of their subsidiaries may be and, in some case are, pursued (in 2019, for example, in the railway electrification case).

Do you operate a leniency programme? Whom should potential applicants contact? What discounts are available to companies that cooperate with cartel investigations?

Yes, Spain has had a leniency programme since 2007. Applicants should contact:

Isabel López Gálvez
Cartels and Leniency Unit
Tel: +34 91 536 90 58
Email: [email protected]

The CNMC exempts an undertaking or a natural person from the payment of any fine that it may have imposed on them when:

  • it is the first to provide evidence that, in the CNMC’s view, enables it to order an inspection in relation to a cartel, provided at the time of its provision there is not sufficient evidence to order the inspection; or
  • it is the first to provide evidence that, in the CNMC’s view, enables it to verify an infringement of article 1 in connection with a cartel, provided the CNMC does not have sufficient evidence to find the infringement and an exemption has not been granted to an undertaking or natural person by virtue of letter mentioned before.

Regarding fine reductions, the CNMC may reduce the amount of the corresponding fine in relation to undertakings or natural persons that, without meeting the requirements set out for the exemption, provide with evidence of the alleged infringement that represents significant added value with respect to the evidence already in the CNMC’s possession.

The level of reduction of the amount of the fine shall be calculated in line with the following rule:

  • the first undertaking or natural person that fulfils the provisions of the previous section may benefit from a reduction of between 30 and 50 per cent;
  • the second undertaking or natural person may benefit from a reduction of between 20 and 30 per cent; and
  • successive undertakings or natural persons may benefit from a reduction of up to 20 per cent of the amount of the fine.

Guidelines on leniency can be found on the CNMC website (Communication on Leniency Programme: https://www.cnmc.es/ambitos-de-actuacion/competencia/normativa-y-guias).

Is there a criminal enforcement track? Does the authority conduct criminal investigations and prosecutions for cartel activity? If not, is there another authority in the country that does?

The CNMC has no jurisdiction in criminal investigations and prosecutions for cartel activity. It is an administrative regime.

However, there are certain infringements in the current Criminal Code that could also be considered actions against competition:

  • article 262, describing the offence of bid-rigging;
  • article 281, describing the offence of manipulating prices of raw materials or essential goods; and
  • article 284, describing the offence of altering prices.

Nevertheless, there is no full equivalence between the conduct described in the Competition Act and in the Criminal Code. Thus, we cannot state that there is criminal enforcement.

Are there any plans to reform the competition law?

The Competition Act must be reformed since the ECN+ Directive will have to be transposed to the national law. Spanish legislation already includes most of the legal provisions required by the ECN+ Directive, although Spain still needs to apply some legal changes to comply with ECN+, such as, the ability of CNMC of prioritisation and the increase of the maximum level of the fines for abuse and vertical restraints cases. Together with the transposition, the CNMC has proposed some additional amendments to the 2007 Competition Act based on the accumulated experience of the past 10 years. The reform may include new instruments to the CNMC’s toolkit to increase effectiveness in enforcement, such as a settlement procedure in antitrust cases and the extension of deadlines in antitrust cases to ensure effectively the rights of defence for the parties in a case. From 2017, the CNMC has held several seminars with key stakeholders (antitrust lawyers, regional competition authorities and academics) to get their feedback on several proposals for amendment. The Ministry of Economy affairs has opened to public consultation the proposal of the Competition Act amendment last July (https://www.mineco.gob.es/portal/site/mineco/menuitem.32ac44f94b634f76faf2b910026041a0/?vgnextoid=2daedb82f70a3710VgnVCM1000001d04140aRCRD) including the amendments aforementioned.

When did the last review of the law occur?

In 2017, to transpose the Damages Directive (Directive 2014/104/EU).

Do you have a separate economics team? If so, please give details.

Yes, the unit of the chief economic adviser is a separate unit that gives support to the Competition Directorate, the three regulatory directorates (Energy Directorate, Telecommunications and Audiovisual Sector Directorate, and Transport and Postal Services Directorate) and the Advocacy Department. There are also economists working for the different directorates.

Besides, in the second term of 2018, we also set up the Economic Intelligence Unit that now has five people (cartel experts as well as statisticians and IT profiles) fully dedicated to detecting possible anticompetitive practices (ex officio cases). This unit, which is also in charge of the whistle-blowing mailbox, is proving to be useful to boost ex officio investigations. Currently, six bid-rigging cases arising from the work of this unit are being formally investigated (indeed, bid-rigging cases represent around 25 per cent of the cartels dismantled by the CNMC in the past five years). The chances of increasing these numbers are high as we are benefitting from digitalisation with access complete databases with useful procurement data to detect suspicious patterns in bidding processes.

Has the authority conducted a dawn raid?

Yes, CNMC conducted 13 dawn raids in 2019, with 35 companies being inspected, a figure considerably higher than in the previous year (seven dawn raids to 23 companies).

Has the authority imposed penalties on officers or directors of companies for offences committed by the company? If yes, please provide the most recent instances.

In 2015, the CNMC began to apply article 63.3 of the Competition Act, which allows the fining of managers held responsible for infringements. In 2019, 19 managers were sanctioned (close to €800,000, four times the sanctions imposed to individuals the previous year).

What are the pre-merger notification thresholds, if any, for the buyer and seller involved in a merger?

Merger control shall apply to economic concentrations when at least one of the following circumstances occurs:

  • as a consequence of the concentration, a share equal to or higher than 30 per cent of the relevant product or service market at a national level or in a geographical market defined within the same is acquired or increased (the threshold is increased up to 50 per cent if the turnover of the acquired entity does not exceed €10 million); or
  • the global turnover in Spain for all participants in the last accounting year exceeds €240 million, providing at least two of the of the participants achieve an individual turnover in Spain of more than €60 million.

Are there any restrictions on investments that involve less than a majority stake in the business?

Yes, in some cases in strategic or regulated sectors. For example, Act 3/2013 of 4 June 2013, which created the CNMC, in its additional Provision Nine states that the Ministry of Industry shall be notified of the acquisition of holdings in companies or by companies that pursue activities deemed to be regulated activities.


Spain: from the enforcer's competition economists

Address: Alcalá 47, 28014 Madrid, Spain
Tel: +34 914 329 600
Email: [email protected]
Web: www.cnmc.es

Contacts

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Cani Fernández Vicién
President
Tel: +34 914 329 601/602
Email: [email protected]
Email: [email protected]

image 106
Beatriz de Guindos Talavera
Director forCompetition
Tel: +34 917 876 841 / 842
Email: [email protected]
Email: [email protected]

image 107
Joaquín López Vallés
Director for Advocacy
Tel: +34 917 876 950 / 951
Email: [email protected]
Email: [email protected]

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Javier García-Verdugo
Chief Economic Adviser
Tel: +34 917 931 604
Email: [email protected]

Questions and answers

How many economists do you employ?

There are 101 economists working for the CNMC, 44 of them working in matters directly related to competition. Besides, there are six econometricians and statisticians at the CNMC, four of them doing work directly related to competition.

Do you have a separate economics unit, or ‘bureau’?

Yes, the unit of the chief economic adviser is a separate unit that gives support to the Competition Directorate, the three regulatory directorates (Energy Directorate, Telecommunications and Audiovisual Sector Directorate, and Transport and Postal Services Directorate) and the Advocacy Department. There are also economists working for the different directorates.

Do you have a chief economist?

Yes, although the specific name of the position in the Spanish Authority is chief economic adviser.

To whom does the chief economist report?

The chief economic adviser reports to the president. He works in close cooperation with the competition director, the other sectorial directors and the advocacy director. The chief economic adviser may also work directly with members of the Council, at their request.

Does the chief economist have the power to hire his or her own staff?

The chief economic adviser has his own staff, which currently comprises four economists and one statistician. Hiring rules are the same as for other units of the CNMC.

How many of your economists have a PhD in industrial economics?

The chief economic adviser has a PhD in applied economics, since –as said before– he not only supports the Competition Directorate and the Advocacy Department but also the three regulatory directorates. There are other six PhD in economics. There are also more than 20 state economists who currently work at the CNMC Competition Directorate. State economists are the elite public officials of the Spanish public administration specialised in economics.

Does the agency include a specialist economist on every case team? If not, why not?

Yes, there are economists in every unit of the Competition Directorate and each case team habitually includes at least one specialist economist. The members of the unit of the chief economic adviser take part in specific cases when requested by the Competition Director.

Additionally, in the last quarter of 2018, the CNMC set up the Economic Intelligence Unit comprising staff with expertise in cartel prosecution as well as statisticians and IT experts fully dedicated to the ex officio detection of anticompetitive practices.

How much economics work is outsourced? What type of work is outsourced?

The only part of the economics work that is currently outsourced to private companies is that which is concerned with the revision of the accounts of regulated companies supervised by the CNMC. However, to improve the economic work done within the CNMC, part of the economic analysis is carried out with the feedback from public officials working for other departments of the public administration and the input from university professors.

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