National reform programme 2008-2010 Malta - European Commission

Amendments to the Competition Act (Cap. 379)
The Maltese Government is in the final stages of completing the amendments to the current
legal framework with a view to reflect modern trends and therefore key changes to the
present enforcement system will include:
• a shift from the present criminal fining system to one of administrative fines; this will
empower the OFC to actually impose fines on infringing undertakings, whereas under
the current enforcement system fines may only be imposed upon conviction by a court
of criminal jurisdiction;
• clarifying and improving the standard procedure for investigation of infringements of
Competition law – which include increasing the investigative powers of the OFC and
introducing certain standard procedures into the current decision-making process with
the aim of increasing transparency (in particular, clarifying the OFC’s obligation to issue
a detailed statement of objections and to allow access to the file to the investigated
undertakings);and
• simplifying the decision-making process by entrusting decision making powers to a
single body – namely OFC, whereas currently there is a two tier structure, with the OFC
empowered to conduct investigations of serious infringements of the local Act and
infringements of Article 81 and Article 82 EC while decision-making powers are
entrusted to the Commission for Fair Trading.
The introduction of a leniency programme
The OFC will introduce a leniency programme with a view to counter cartels as these have a
damaging effect on consumers and the economy. This will permit the OFC to carry out its
work in this area more effectively.
In addition, it is to be noted that the current fining system provided for under the Competition
Act (Cap. 379), whereby fines for the infringement of competition law may only be imposed
upon conviction by a criminal court, does not allow for the adoption of any such leniency
policy by the OFC. It must be pointed out that although the Competition Act does not
concurrently contemplate a leniency policy. Nonetheless, it does provide for the possibility of
extinction of criminal liability with regard to competition law infringements, upon signing of an
agreement between the Director of the OFC and the offender. Thus, Article 26B of the Act
provides that the Director of the OFC is to enter into an agreement in writing with the offender
whereby the said offender pays or gives security to the satisfaction of the Director for the
payment of a sum not less than fifty per centum of the minimum penalty applicable for the
offence in question, and not more than seventy per centum of the maximum penalty
applicable for the offence. Upon the signing of such agreement by the Director and the
offender, all criminal liability of the offender under the Act with regard to the offence in relation
to which agreement has been entered shall be extinguished.
To strengthen competition, notably in professional services
The OFC has continued internal consultations with Ministries and professional bodies
responsible for the regulation of the liberal professions, in order to identify existing restrictions
imposed by State legislation or self-regulation by professional bodies which may potentially
raise competition concerns.
The Competition Authority has finalised a first round of meetings with the pertinent authorities
in order to identify possible problem areas. Meanwhile, the Office also conducted an
independent assessment on the implications on each of the six professions. For each
profession the said report deals with each category identified by the Commission as being of
possible anti-competitive areas, that is:
• Entry and Exclusive rights;
• Fee Structure;
• Advertising; and
• Business Structure.
Malta National Reform Programme 2008-2010 - 31 -