Fine of one million euro
On 28 May 2019, the Competition College of the Belgian Competition Authority (“BCA”) found that the Order of Pharmacists (l’Ordre des pharmaciens – Orde der apothekers) had infringed competition law by implementing restrictive practices aimed at hindering the MediCare-Market group’s development on the market for pharmacists’ services, or even expelling it from this market. That decision was discussed in one of our earlier blog posts. To calculate the fine to be imposed on the Order of Pharmacists, the BCA used the relevant turnover achieved by Belgian pharmacies throughout Belgium – estimated at 5,599 billion euros in 2017) - as the basis of its calculation. It then considered that a fine of one million euros was sufficient to take into account the seriousness of the infringement found and to act as a deterrent, without being excessive. The BCA noted, for the sole purpose of providing perspective, that this amount corresponded to the average annual turnover achieved by a single pharmacy out of a total of some 5000 pharmacies.
The Belgian law applying at the time of the facts provided only for a maximum fine of 10% of an association’s own turnover
The Order of Pharmacists appealed the BCA’s decision before the Brussels Market Court (part of the Brussels Court of Appeal). Regarding the facts of the case, the Court upheld the BCA’s decision, confirming that the practices of the Order of Pharmacists towards MediCare-Market restricted competition. However, as to a procedural claim regarding the fine, the Court sided with the Order of Pharmacists. The Court noted that fines imposed by the BCA are of a criminal nature. Therefore, those fines must be subject to judicial control with full jurisdiction, the BCA should state sufficient reasons regarding the fines, and the fines must be based on a legal provision. The legal provisions that applied at the time of the facts in this case only provided that a fine could be imposed on an undertaking or an association of undertakings to a maximum of 10% of the undertaking’s or association’s annual Belgian turnover. At the time of the facts, the Belgian law thus did not allow the BCA to impose a fine on an association of undertakings of a maximum of 10% of the sum of the annual turnover of the association’s members. Consequently, the Court has ordered the BCA to amend the fine, taking into consideration that the maximum for that fine is 10% of the Order’s own annual Belgian turnover, and not 10% of the sum of the annual turnover of the Order’s members – according to the Order, the maximum fine can therefore be 249.884,79 euros at most.
Today’s Belgian competition law provides for a maximum fine of 10% of the sum of the annual Belgian turnover of the association’s members
Following the Court’s judgment, it is now up to the BCA to amend the fine accordingly. The Court has further ordered that the state organ that is responsible for the receipt of fines, should pay back the difference between the old and the new fine to the Order of Pharmacists. While this judgment has a significant impact on the fine due by the Order of Pharmacists, the relevance of this judgment is rather limited for the future. Indeed, it should be noted that today’s Belgian competition law, in Article IV.84 §3 limb 3 of the Code of Economic Law, provides that if a fine is imposed on an association of undertakings, then the relevant turnover for calculating the 10% maximum for the fine is the sum of the annual Belgian turnover of all the members of the association active on the relevant market.