Answer ... As competition law infringements are considered administrative offences (misdemeanours), there are no criminal proceedings in this respect. This general rule applies to both companies and individuals.
Answer ... No penalties are available in civil proceedings for a competition law infringement. Penalties can be imposed by the Portuguese Competition Authority (PCA) or the courts only in the context of administrative proceedings for misdemeanours.
Any prohibited agreements are null and void pursuant to Article 9(2) of the Competition Act, and may incur civil law sanctions.
Civil proceedings involving competition law are usually damages actions, although they may also involve other competition law infringements (eg, where a company seeks a declaration of nullity of a certain agreement; a judicial declaration or injunction; or a verdict of unjust enrichment) – that is, actions where there are no pecuniary amounts at stake.
In the case of damages actions, a court may award compensatory damages only; punitive damages are not commonly available (although both doctrine and jurisprudence have accepted punitive damages that were contractually provided for). Compensation covers the harm actually suffered by the injured party (actual loss) plus interest, and lost profits or advantages that the injured party missed as a result of the infringement.
Answer ... The legal framework on the setting of fines for competition infringements is set out in the Competition Act and the PCA’s Guidelines on the Method for Setting Fines (following the guidelines and practice of the European Commission).
The main factors taken into account when determining the fine are as follows:
- the seriousness of the infringement;
- the duration of the infringement;
- the nature and size of the affected market;
- the level of involvement in the infringement;
- the gains that resulted from the infringement;
- whether the infringement has been terminated and damages have been compensated;
- the financial and economic situation of the company;
- whether the company is a repeat offender; and
- the level of cooperation with the PCA.
Penalties imposed in other jurisdictions are not taken into account.
The PCA then calculates the fine according to a three-step methodology:
- The basic amount is established according to the value of sales of goods or services to which the infringement relates (depending on the seriousness of the infringement, up to 30% of the value multiplied by the number of years of participation);
- The amount is adjusted taking into account any aggravating or mitigating circumstances; and
- The amount may be increased or reduced for reasons of deterrence or proportionality.
Fines can reach up to 10% of the turnover of each participating undertaking, or of the aggregate turnover of the members of an association of undertakings (which are jointly and severally liable for the fine under certain conditions), in the year preceding the issue of the PCA’s final decision. For individuals, fines may reach up to 10% of the individual’s total annual income in the last complete year of the breach. Liability arises when individuals knew or should have known of the infringement, but failed to take appropriate measures to bring it to an end.
In addition, if the seriousness of the infringement so justifies, the PCA may impose ancillary sanctions as follows:
- publication in the Official Gazette and in a national newspaper, at the offender’s expense, of the decision relating to the infringement; or
- a ban on participation in procurement proceedings for a maximum period of two years.
The PCA is also entitled to impose a periodic penalty in case of non-compliance, imposing a fine or ordering the application of certain measures of up to 5% of the average daily turnover of the infringing undertaking in the year preceding the decision for each day of delay.
The PCA guidelines are purposefully vague, making it difficult for companies to calculate the risk of the infringement in terms of a potential fine.
Answer ... No specific provision prevents a company from paying the penalties and/or legal costs imposed on its (former or current) employees.