Regulation 1/2003 does not explicitly address the question whether national competition authorities (NCAs) have the power to prosecute and sanction infringements of Article 101 TFEU beyond their own national borders. This has allowed wide differences to exist between NCAs in respect of the territorial scope of their fines imposed under Article 101. A legal assessment reveals that there is much uncertainty as to the legality of NCAs taking into account foreign effects in sanctioning cross-border cartels. Many of the legal arguments used to either support or object to the right for NCAs to do so are unsatisfactory, at least in the context of the current legal framework. As such a right can significantly enhance the effectiveness of decentralized enforcement of Article 101, it may well be desirable to further explore this new frontier of extraterritorial cartel enforcement within the Union. However, it is submitted that this will require legislative action, so that legal certainty can be provided in accordance with the common views of Member States. Either as part of the new ECN Directive or through an amendment of the Regulation, the necessary procedural rules and safeguards can be put in place to give NCAs the right to fine foreign effects in a way that ensures effective enforcement and proportionate sanctioning while still allowing for sufficient prosecutorial discretion at the national level.
World Competition