EU Will Offer Out-of-Court Settlements to Illegal Cartels

Companies caught operating illegal price-fixing cartels will get a chance to avoid lengthy court procedures and settle the cases, following a European Commission decision on Monday, June 30.

The new method "will reinforce deterrence by helping the (European) Commission deal more quickly with cartel cases, freeing up resources to open new investigations," EU Competition Commissioner Neelie Kroes said in a statement.

The European Commission is responsible for enforcing the bloc's competition laws.

Officials say that companies which the commission has found guilty of price-fixing often challenge the verdict in the European court -- not to dispute their guilt, but to get the fine reduced. This has forced commission officials to focus on the court cases rather than on further investigations.

Companies get a break

The commission has therefore introduced a rule under which it can send companies it suspects of cartel involvement a summary of its suspicions and the evidence which it has for them. Companies which decide that the commission has enough evidence to find them guilty can reply by confessing and asking for a settlement -- thereby speeding up the legal process.

If the commission agrees to a settlement, it can reduce the company's fine by 10 percent.

Officials in Brussels stressed that the settlement procedure was not a way to introduce plea-bargaining, but was simply a way to reward cooperative behavior. The EU already has a policy of rewarding companies who reveal the existence of a cartel by granting them a partial or total amnesty.

The new settlements procedure will come into force as soon as it is published in the EU's official journal.