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  • Public Consultation – Antitrust Damages Directive

    The Office for Competition has launched a public consultation on implementing the Antitrust Damages Directive in Malta.

    The draft legislation relates to Malta’s obligation to transpose Directive 2014/104/EU (the “Antitrust Damages Directive”). This Directive sets rules for actions for damages under national law when competition law is infringed. It applies to both individual and collective actions in EU Member States.

    Current Legislation

    Maltese law already allows businesses to recover damages for competition law violations under Article 27A of the Competition Act. This is supported by procedural rules in the Code of Organisation and Civil Procedure. Recently, a court has awarded damages in a case involving abuse of competition law.

    The Directive and the draft legislation aim to better align private and public enforcement of competition law.  The changes will allow private enforcement of decisions by national competition authorities across all EU Member States.

    Key changes

    Key changes that the Directive and draft legislation introduce, include:

    • Easier access to evidence: Parties can now obtain court orders to access evidence held by other entities. Courts will ensure that disclosure is proportionate, protecting confidential information.

    • Proof of infringement: A final decision by a national competition authority will serve as full proof of the infringement in that country’s courts. In other Member States, it will be prima facie evidence.

    • Clear limitation periods: Victims of antitrust infringements will have at least 5 years to file claims for damages, starting from when they could have discovered the harm. This period pauses if a competition authority starts an investigation. Once an infringement decision is final, claimants have at least 1 year to file.

    • Passing-on of harm: If an infringer raises prices, indirect customers may be entitled to compensation. The Directive assumes indirect customers suffered harm unless the infringer can prove otherwise.

    • Full compensation: Victims may claim full compensation, covering actual losses, lost profits, and interest from the time the harm occurred.

    • Rebuttable presumption of harm in cartels: Cartels are presumed to cause harm, based on the finding that 90% of cartels lead to price increases. In rare cases where this is not true, infringers can prove no harm occurred.

    • Joint and several liability: All participants in an infringement are liable for the full harm caused, with the possibility of recovering a share from others. However, leniency programme participants who cooperate with authorities will be liable only to their direct and indirect customers. SMEs facing bankruptcy can apply for a narrow exception from joint and several liability

  • Fuel Sector – Violation of Competition Law

    A recent decision of the Office for Competition found there to be a violation of the competition law rules in a vertical agreement, which took effect when a fuel station, having reduced its price for diesel from a particular supplier, later raised its price again, having succumbed to pressure from that supplier in order to do so.

    The Office found there to be a violation of competition law in terms of there being an agreement to maintain high prices for the said diesel. The supplier violated the law in submitting the fuel station owner to raise its prices (and thus to reverse the price reduction). The fuel station owner, to a lesser extent, was declared to have violated competition law by succumbing to that pressure.

    This, and other decisions of the Office for Competition, can be downloaded Decisions of the Office for Competition.

    Such decisions are subject to appeal to the Consumer and Competition Appeals Tribunal.

    By virtue of a recent Constitutional Court judgment, the Office for Competition is currently unable to impose fines when finding infringements of competition law.

  • Google – EU competition law breach accusations

    The European Commission sent a statement of objections to the tech firm, alleging that it has breached EU competition law.

    Google is accused of placing onerous requirements on firms using Android and stifling competition.

    Google has 12 weeks within which to reply and, if found to be abusing its dominant position, could face large fines and have to change its practices with respect to companies opting to obtain a licence to use its apps on their products (smartphones).

    Read the BBC article here.

    Article 102 of the Treaty on the Functioning of the European Unioni prohibits abuses of dominant positions as follows:

    Any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States.

    Such abuse may, in particular, consist in:

    (a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions;

    (b) limiting production, markets or technical development to the prejudice of consumers;

    (c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;

    (d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

    In particular, under established case law, a dominant position has been defined as:

    […] a position of economic strength enjoyed by an undertaking which enables it to prevent effective competition being maintained on the relevant market by giving it the power to behave to an appreciable extent independently of its competitors, customers and ultimately of its consumers.

    In general a dominant position derives from a combination of several factors which, taken separately, are not necessarily determinative.

    This definition has now been adopted widely as the concise definition on which dominance is assessed in case law.

    The Court of Justice of the European Union publishes its case law here.

  • EU Single Market Forum to be modernised over 2016

    Note: This post reflects insights from the 2016 EU Single Market Forum. It has been retained for archival purposes. Any queries on updates can be sent through our Contact Form.

    The Government has issued a press release on the new EU Single Market Forum, one of the Commission’s agenda items for 2016.

    One of the aims of the European Commission for 2016 is to modernize the current Single Market Strategy. The Ministry for the Economy, Investment and Small Business, in collaboration with GRTU and the Malta Employer’s Association, held a seminar entitled “Single Market Forum – Tackling internal barriers to movement of goods and labour,” seeking to better gauge the  Maltese position and to listen to suggestions relating to policy changes.  The Forum aims to carry out these objectives.

    The full press release can be found here.

  • Deficiencies in Ships – Merchant Shipping Notice

    This article discusses Merchant Shipping Notice 124 issued in 2015. Procedures and regulations may have changed since then. Please refer to the latest notices from Transport Malta for current information.

    Transport Malta has recently issued a Merchant Shipping Notice to ships visiting US Ports.  It noted that many detentions arise from the deficiencies in terms of environmental protection and fire safety.

    Therefore, Transport Malta requires ships to notify the relevant directorate of their intentions before entering US Ports. The Master and the ISM Manager are responsible to make this notification in the appropriate time.

    MS Notices are issued regularly by Transport Malta as directions to ships and shipowners in the operation of their vessels, assisting better compliance with the laws and international conventions. They are published on the Transport Malta Website.

  • Thoughts on sanctions in the legal system

    While reading the news on various media sites today, I have come across a number of irate comments by the general public, over fines which are either excessively high or excessively low. So yesterday, the news hit the media with a man who was fined 20 Euros for masturbating in public, decidedly a lewd act under Maltese criminal law, with minimum and maximum fines between 6.99 and 58 Euro. The fact that the amounts appear laughable is not the fault of the courts, but the fact that the fines have not been amended to reflect the current cost of living. I imagine that when they were originally drafted, they were quite high, to indicate the outrage that they would cause.

    On the contrary, two people swimming in the nude in one of our bays were fined 100 Eur each – a far greater amount for a far less serious offence. Indeed, to my mind, the fact that a person swims in the nude (and often cannot be seen by anyone when under water anyway) cannot be offensive because this is how God made us – it would not bother me if they left me alone. I would, however, be very offended and uncomfortable (even at my age, no longer being a teenager) if a man (or even a woman, really) were to be masturbating in the open anywhere around me. I find it oppressive and harrassing, and yet fined at levels less than what probably was considered by the carefree nude bathers a natural pleasure without bothering anybody.

    However, the trouble with this whole matter is the fact that no authority has sat with the Code of Police Laws, the Criminal Code and other legislation to evaluate the punitive measures, especially the pecuniary ones (though not only). In many cases, the value of the punishment (money and / or time) no longer reflects society’s morals. Possibly, in some cases, the fines or penalties should be increased – either in terms of monetary value or because their seriousness is now no longer overlooked. The same should happen (or rather, the reverse) for acts which are no longer considered to strike at the core of society’s values.

    The core of this whole set of arguments is the legal maxim which we learnt at law school, indeed in our first year: that justice must not only be done, but must be manifestly done. While in many cases, comments seen on the public media are plain idiotic, the message behind them seems to be that there is far too much leniency (e.g. giving two suspended sentences, when the law only contemplates a first one, which should be followed by consecutive serving of these sentences if followed by another period). On the other hand, growing prison populations are a worldwide problem so that the courts are faced with the dilemma of how to sentence, in the knowledge that they ought to reserve such punishments for the harsher, or harshest of crimes. Indeed, prison grounds are known to have hardened or created criminals and it is in this perspective that the lesser sentences are meted out.

    All in all, a balance still needs to be created, between appropriate financial penalties which would not cause derisory laughter, and between creating a rational balance between the action and the sanction. It is not an easy balance to achieve; it must start at the level of the legislator and be continued in court, with the prosecution (and defence) properly carrying out their roles in between in the interests of the delivery of justice to the people.

     

    [The opinions of the author expressed in this article are her own personal views and are in no way endorsed by any authority or entity. They are served as an expression of academic and social thought only, and are not sought to garner any political argument. Political comments, particularly partisan politics, and irrelevant or inane comments will be reported as spam and deleted.]

  • European court grants compensation to Zabbar property owners who had rights violated

    The Times of Malta reported today that the European Court of Human Rights ordered Government to property owners in Zabbar for the violation of their rights, since they were not allowed to seek an increase in rent for their property to reflect current market values.

    The court ordered the government to pay Carmel Zammit and Doris Attard Cassar €40,000 in respect of pecuniary damage and €10,000, plus any chargeable tax, in respect of costs and expenses. It said that Government did not strike a balance between community interests and the rights of the plaintiffs to enjoy their property.

    Read more here, or you can look up the case on the Justice Website.

  • The ECJ confirms Commission’s power to impose high fines in cartel cases

    Peter Citron, of Hogan Lovells, Belgium, has alerted today that on the 9th July the ECJ has endorsed the power of the European Commission to impose large fines on multinational companies operating at various levels of the manufacturing and supply chain. It confirms that, for the purposes of cartel fine calculation, the Commission may take into account non-EEA sales of cartelized inputs if these inputs have been built into finished products and subsequently sold to a third party in the EEA by a vertically integrated company.

    This case is a prime example of the extra-territorial jurisdiction exercised by the EU when the effects are felt within EU territory (Effects Doctrine).  You can read the full summary here.

  • Public Authorities under Maltese Competition Law

    When Is a Public Authority an “Undertaking”? Insights from Maltese and EU Competition Law

    In a recent decision, the Competition and Consumer Tribunal upheld the position of the Office for Competition. It confirmed that a public authority is not considered an “undertaking” under Maltese competition law unless it performs a commercial function.

    The Case: Tourism Subsidies and Alleged Discrimination

    The dispute concerned a subsidy granted by the Malta Tourism Authority (MTA) to various tourism operators. One operator claimed it had been unfairly treated in comparison to others. However, the Office for Competition concluded that the MTA did not qualify as an undertaking under Articles 5 and 9 of the Competition Act (Chapter 379, Laws of Malta). This was because the MTA’s role is regulatory in nature, not commercial.

    Legal Framework and EU Law Perspective

    EU case law, including decisions by the Court of Justice of the European Union (CJEU), defines an “undertaking” as any entity engaged in an economic activity, regardless of legal status or funding method. Economic activity means offering goods or services in a market.

    According to Article 5(2) of the Malta Travel and Tourism Services Act, the MTA must follow government policy to promote tourism and may only invest with ministerial approval. These functions are inherently public, regulatory duties—not economic or commercial ones.

    Distinguishing Regulatory from Commercial Functions

    Although public authorities can sometimes be considered undertakings under EU law, this only applies if they are conducting economic activities. If their actions are linked to the exercise of public authority, they fall outside the scope of competition law.

    One relevant case is the CJEU’s Corinne Bodson v Pompes Funèbres case. Here, the court  emphasised that tasks serving the public interest and forming part of essential State functions do not amount to economic activity.

    The Tribunal agreed that MTA, in managing these subsidies, acted in the public interest and not in a commercial capacity. As such, its actions were not subject to competition law provisions.

    Past Precedents and Final Ruling

    The complainant referenced a previous case which had concluded that the MTA was an ‘undertaking’. However, the Tribunal clarified that the earlier decision was specific to a different context—relating to board composition involving private entities—and could not apply here.

    Citing authoritative texts like Jones & Sufrin’s work on competition law, the Tribunal reiterated that activities linked to public authority powers are not economic in nature. Thus, it held that the MTA is not an ‘undertaking’ and dismissed the complaint.

    Final Thoughts: Competition Advocacy Still Matters

    The Office for Competition continues to play an advocacy role. It regularly reminds public authorities to ensure that their policies and measures do not distort or hinder competition, particularly in sector-wide initiatives.