The CNC: part of the solution to the financial crisis – CNC

Since its creation in 2007, Spain’s Comisión Nacional de la Competencia (CNC) has had evident success in raising not only the public awareness of competition issues but also thestakes for companies engaged in anti-competitive behaviour. Much of the energy driving the CNC emanates directly from its high profile President, Luis Berenguer, say competition lawyers.

“In the context of the financial crisis thework of the CNC is part of the solution. Wecannot simply be reactive we have to be proactive in our mission to protect Spanish consumers and to help reinvigorate the economy,” he says.

Berenguer’s goal is to position the CNC among the top tier of European competition authorities, and its performance already is clearly impressive. It has launched 52 cartelinvestigations and conducted 56 dawn raids,and in February announced its first convictions under the 2009 Leniency Act.

Five companies in the hair gel sector werecumulatively fined €8.3m, with a 100% reduction for the whistle-blower, Henkel.

Despite some market criticism of excessive fines, Berenguer is entirely comfortable with the penalties being imposed and the message it sends out to the market. “The cartel focus is driven by the belief that they are fundamentally anticompetitive and harmful to the wider economy. Our ability to use new legal instruments – whistle-blowing and leniency tools – is clearly having an impact, and has exceeded even our own expectations.”

He admits to having faced challenges in unifying and consolidating the two distinct entities that previously managed competitionissues – the Ministry of Economy’s Servicioand the decision-making Tribunal for the Defence of Competition – while some competition lawyers question the intensity with which the CNC goes about its work.

Berenguer says the CNC enjoys bothpublic and political support particularly forthe increasing role it is playing as a market‘watch dog’. Among the most recent marketreports are competition investigations into therole of professional associations, IP collectionsocieties, automotive fuel sector, and evenprofessional colleges and Court Procurators.

“Our reports may be dictated by specific issues but also by a general uneasiness with certain market practices. Where there is an evident lack of regulation, or uncertainty, then we will feel compelled to investigate.”

He denies however that suchinvestigations are one-sided, and believes there are opportunities for market participants to engage in the process. “Part ofthe demand for this kind of work is tocounter the, often very strong, lobbyingefforts of specific industry groups,” he says.

“In such instances the consumer only gets to hear half of the story, our job fundamentally is to throw light on questionable practices and particularly in the current economic situation to present another side to the debate.”