On January 11, the newly elected Australian Labor government issued draft legislation to criminalize "serious cartel conduct". Acting on a November 2007 election promise to introduce criminal penalties for cartel conduct within the first 12 months of gaining office, the new Government issued a Discussion Paper, and is seeking public comment on two principal issues: (i) how to distinguish the proposed criminal prohibitions from civil prohibitions; and (ii) whether telephone interception powers should be available to the Australian Competition and Consumer Commission (ACCC) in relation to the new criminal cartel offences. The draft legislation would create criminal offences for making, or giving effect to, a contract, arrangement or understanding (CAU) that contains a cartel provision "with the intention of dishonestly obtaining a benefit". A cartel provision is defined in the draft legislation as a provision of a CAU that relates to: price- fixing; restricting outputs in the production and supply chain; allocating customers, suppliers or territories; or bid-rigging by parties "that are or otherwise would be in competition with each other". The draft legislation also proposes jail terms of up to five years, and fines of AUS$220,000 for corporate executives found guilty of engaging in cartel conduct. Companies face exposure to fines of at least AUS$10 million. The draft legislation also creates new civil cartel offences which parallel the criminal cartel offences. These civil offences do not require proof of "dishonest intent".
On January 23, the European Commission announced fines totaling €34.2 million on the Bayer and Zeon groups of companies for infringing Article 81(1) of the EC Treaty by participating in an alleged price-fixing cartel in the nitrile butadiene rubber (NBR) market. NBR is a type of synthetic rubber widely used in car manufacturing for fuel and oil handling hoses, seals, o-rings and water handling applications. In March 2003, the Commission conducted unannounced inspections at the premises of NBR producers, following the receipt of an application for leniency by an unnamed third party. The Commission alleged that, at least between late 2000 and 2002, Bayer and Zeon operated a cartel to fix prices of NBR. In particular, the EC alleged that the companies held regular meetings to both discuss prices and co-ordinate price increases, to exchange sensitive commercial information, and to follow up the implementation of their agreements. The Commission alleged that each of the companies involved infringed Article 81(1) of the EC Treaty, and imposed the following fines on the infringing companies: Bayer - €28.87 million with the benefit of a 30% reduction under the Leniency Notice, but also with a subsequent 50% increase for recidivism; and Zeon - €5.36 million with the benefit of a 20% reduction under the Leniency Notice, and a further reduction for being the first to disclose the first period of the cartel to the Commission. The Commission noted the co-operation of both Bayer and Zeon in the investigation, but also the fact that it increased the fine imposed on Bayer as a repeat offender. This increase, however, was limited to 50%, although the fining guidelines do allow for an increase of up to 100% for each prior infringement. The Commission considered that as the several infringements by Bayer took place over a similar period of time they were parallel infringements and a 50% increase was sufficient.
On January 9, the UK Consumers' Association – Which? - announced that it had reached an agreement with JJB Sports plc (JJB) to settle the damages action brought by it under section 47B of the Competition Act 1998 on behalf of a number of individual consumers. Which? brought this action in March 2007 after JJB was refused leave by the House of Lords to appeal the Court of Appeal's judgment upholding the Competition Appeal Tribunal's ("CAT") judgments relating to JJB's infringement of the Chapter I prohibition, by allegedly fixing the prices of replica England and Manchester United football kits, and confirming a fine of £6.7 million. The CAT had adjourned the first case management conference in the action whilst settlement negotiations continued. This is the first and only consumer damages action brought so far under section 47B of the Competition Act. Under the settlement agreement, customers who joined the damages action and who purchased England and Manchester United football shirts during specific periods in 2000 or 2001 will receive a payment of £20 each. In addition, consumers who did not join the action will be entitled to claim either £5 or £10 if they provide proof of purchase of one of the affected shirts or the shirt itself at a JJB store before 5 February 2009. JJB has stated that it does not, in settling the action, acknowledge or admit that any consumers suffered loss giving rise to an action for damages as a result of its words, actions, or behavior.
On January 25, details were published of an appeal lodged by Akzo Nobel Chemicals Ltd and Akcros Chemicals Ltd with the European Court of Justice (ECJ) against a Court of First Instance (CFI) judgment upholding a decision of the European Commission that documents seized during a Commission investigation were not covered by legal professional privilege. On September 17, 2007, the CFI upheld the Commission's decision that documents seized during its investigation were not covered by legal professional privilege. Although the CFI acknowledged that preparatory documents could be privileged, the main purpose of such documents had to be to seek external legal advice. This was not the position in relation to the documents in this case. Further, the CFI concluded that the concept of independence meant that privilege would not cover advice from a lawyer in a relationship of employment with its clients. The CFI was not persuaded that the concept should be extended so that advice from in-house legal advisers was covered by legal professional privilege. The CFI, therefore, confirmed that communications between in-house counsel and internal clients are not privileged in relation to Commission competition investigations. Akzo Noble and Akcros Chemicals have brought an appeal against the CFI's judgment, seeking orders that the CFI's judgment be set aside insofar as it rejected the claim of legal professional privilege for communications with Akzo Nobel's in-house lawyer and that the Commission's May 2003 decision be annulled. Akzo Noble and Akcros Chemicals argue that the CFI (i) breached the principle of proportionality by incorrectly interpreting the principle of legal professional privilege as explained in AM & S v Commission (Case 155/79  ECR 1575); (ii) infringed the general principles of protection of the rights of defense and of legal certainty by refusing to reinterpret the principle of legal professional privilege in view of the significant developments in the legal landscape; and (iii) infringed Article 5 of the EC Treaty (principle of attribution of competence) and the principle of national procedural autonomy.
On February 4, the Organization for Economic Co-operation and Development (OECD) published a paper which summarized the outcome of discussions on issues connected with the private enforcement of competition cases. Between October 2004 and June 2006, the OECD Competition Committee held a series of roundtable discussions on issues connected with private enforcement of competition cases. The OECD's paper draws together the outcome of each of these discussions. In particular, the paper contains submissions by member countries, papers prepared by experts and a summary of each of the discussions. Although the discussions took place in the context of the ongoing consideration of the issue of private enforcement by the European Commission, the discussions considered the experience of private enforcement in countries such as Australia and Canada, as well as the US. No agreed "best practices" on private enforcement were established as a result of the discussions. Rather, a range of views were heard and general consideration was given to the challenges that face each jurisdiction in designing private enforcement rules that move a competition regime towards optimal enforcement, seek to maximize deterrence, but which avoid excessive costs and burdens. These discussions are of interest given the European Commission's work in this area, and its much anticipated White Paper on private actions, which it is due early in 2008.
On January 16, the Bulgarian Commission for Protection of Competition (CPC) fined 13 manufacturers of vegetable cooking oil and their industry association (the Union of the Manufacturers of Vegetable Oils and Oil Products in Bulgaria (UMVOOPB)) for participating in an alleged cartel. The total amount of the fines imposed exceeded 1.86 million Bulgarian levs or almost €1 million. The CPC alleged that during the UMVOOPB management board meetings, for the period 2006-2007, the members of the cartel colluded to fix the purchase price of their main raw material (sunflower seeds) and the selling price of their end product (sunflower cooking oil). Further, the CPC alleged that the manufacturers also exchanged other sensitive commercial and sales data, enabling them to co-ordinate their market behavior. For their role in the price-fixing scheme, the competition authority imposed on the three largest manufacturers in the country fines of BGN300,000 (approximately €153,000), which is the maximum fine currently allowed under Bulgarian competition law. The fines followed the CPC's dawn-raids at the end of September and the first half of October 2007 in the offices of several industry associations, including the UMVOOPB.
On December 26, the Office of Economic Law of the Brazilian Ministry of Justice (SDE) and the Brazilian Federal Police entered into a cooperation agreement with respect to the investigation, and prosecution of alleged cartels. During the past few years, the Brazilian antitrust authorities have been increasingly taking action against cartels. In 2007, the SDE conducted 84 dawn raids in connection with alleged cartel infringements. The SDE and the Federal Police also recently announced they intend to create a single investigatory team to co-ordinate the exchange of information and documents. They will also coordinate their investigations by harmonizing their searches of documents such as electronic records, and create individual task forces for specific cases.
On January 18, Slovakia's Anti-monopoly Office fined 16 companies from seven countries a total of SKK 350 million (€10.3 million), in the first ever application of the office's leniency program. The fines ranging from SKK10 million (€295,000) to SKK50 million (€1.47 million), were imposed in respect to an alleged illegal agreement between suppliers of gas-insulated switchgear that lasted from 1988 to 2004. ABB, a Swiss producer of the gear, was granted immunity from fines by cooperating with the Slovak authorities under the terms of its leniency program. Switchgear is used to protect and isolate electrical equipment in power grids. The decision follows a similar ruling the European Commission in which fines of over €750 million were imposed. However, the EC's decision related only to the 15 European Union member states between 1988 and 2004, and there was still a case to answer in Slovakia who joined the EU in 2004.
On January 21, Egypt's attorney general ordered 20 cement company officials to appear at the criminal court in Nasr City on alleged cartel charges after an investigation into the companies by Egypt's Competition Commission found evidence of alleged price-fixing and collusion to restrict the marketing of certain products. The Egyptian courts can impose fines ranging from 30,000 to 10 million Egyptian pounds (€1.2 million) but cannot impose any custodial sentences. Last November, the Egyptian trade and industry minister, Mohamed Rachid, announced plans to amend the country's antitrust law. He said current fines and sanctions were not high enough, and that the country's existing antitrust rules, established in 2005, had become redundant. Mona Yassine, chairperson of the commission, welcomed the attorney general's decision: "The authority is trying by all possible means to stop any anti-competitive practices, and to create a competitive environment to attract investment and to achieve consumer welfare".
On December 18, the lower house of the Chilean Congress approved and passed to the Senate a bill that reforms the Anti-trust Law. The draft bill mainly consists of an increase in the investigatory powers of the National Economic Prosecutor's Office; the introduction of a leniency statute; the increase of the amount of fines that the Antitrust Court can impose; and, regulations dealing with the membership of the Antitrust Court.