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A Strengthened Framework for Competition Enforcement in Romania

In a market deemed a sanctuary for anti-competitive practices, a company may be discouraged from engaging in business activities. It may also be deterred from exercising its right of establishment and from providing goods and services effectively and freely.

As the preamble to the European Directive states, consumers are denied the benefits of effective competition. Their confidence in the internal market is consequently undermined.

Romania has recently transposed Directive (EU) 2019/1 into its national legislation by adopting GEO 108/2023. This step helped avoid infringement proceedings that could have been initiated by the European Commission.

On 6 December 2023, Government Emergency Ordinance no. 108 of 29 November 2023 entered into force. GEO 108/2023 amends and supplements Competition Law no. 21/1996 and other related pieces of legislation. Through this ordinance, Romanian authorities finally transposed Directive (EU) 2019/1 into national law. The directive aims to empower competition authorities of Member States to enforce rules more effectively and ensure internal market functionality.

GEO 108/2023 allows the use of documents, oral statements, electronic messages, recordings, and other information-containing objects as evidence. Such evidence is admissible before the Competition Council, regardless of its form or the medium on which it is stored. According to the authority’s statement, this strengthens the Competition Council’s inspection powers significantly. Inspectors are now authorised to access any information held by the inspected company, regardless of its nature or storage medium.

According to the new provisions, minutes issued by the Competition Council to impose fines or set fees are enforceable titles. These minutes are enforceable within 15 days from the date of their communication, without any additional formalities required.

Enhanced Inspection Powers and the Leniency Policy under GEO 108/2023

The leniency policy introduced in GEO 108/2023 is a new policy. It requires a participant in an anti-competitive practice to actively cooperate in a Competition Council investigation. Alternatively, the participant can help initiate an investigation by providing information about the anti-competitive practice. The participant must voluntarily disclose their role in the practice.

In exchange for providing the information, the participant shall be granted immunity from fines. Alternatively, the participant may receive a reduction of fines. This applies to fines that would otherwise be imposed for the participant’s involvement. The immunity or reduction is subject to a decision or termination of the proceeding. The instructions of the leniency policy application are to be regulated by the Competition Council.

The leniency policy extends to current and former directors, managers, and other employees of the company. This extension is applicable provided that the conditions of the Competition Law are met. Victims who have been adversely affected by a violation of competition law are entitled to complete restitution for their losses. The entitlement of victims to restitution remains valid.

GEO 108/2023 provides that information obtained by the Competition Council from a natural person during an inspection. This includes information provided in response to a request for information or following an interview. Such information shall not be used as evidence to impose sanctions on that natural person or their family members.

Legal Safeguards, Client-Attorney Privilege and Procedural Guarantees

The limitation of the attorney-client legal privilege. The law provides that the enterprise seeking to safeguard its communication with the lawyer is obligated to furnish the competition inspectors with a sufficient justification. It must also provide relevant elements in light of the arguments presented for this purpose.

However, disclosure of the content of the communication is not required.

If, in accordance with the relevant case-law of the CJEU, the competition inspectors conclude that the request is not justified,

and that such protection cannot be granted,

they have the right to immediately review the contents of the communication with the lawyer.

They are also entitled to obtain a copy of it..

The amendments made by GEO 108/2023 are necessary in order to bring Romanian legislation into line with European legislation, especially since the deadline of 22 March 2021 for this harmonisation has been exceeded.

Source: the Government Emergency Ordinance no. 108 dated 29 November 2023 amending and supplementing Competition Law no. 21/1996 and other legislation; Explanatory Note to the Emergency Ordinance amending and supplementing Competition Law no. 21/1996; Directive (EU) 2019/1 of the European Parliament and of the Council dated 11 December 2018 to empower the competition authorities of the Member States to be more effective enforcers and to ensure the proper functioning of the internal market.