Competition & Antitrust Law Guide / Poland

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Competition Law / Poland

At Polish national law level, the general antitrust legal regulations are mainly set out in:

  1. Act of 16 February 2007 on protection of competition and consumers [ustawa z dnia 16 lutego 2007 r. o ochronie konkurencji i konsumentów (“Polish Competition Act” or “Polish Competition Law”)].
  2. Act of 8 March 2013 on counteracting excessive payment delays in commercial transactions [ustawa z dnia 8 marca 2013 r. o przeciwdziałaniu nadmiernym opóźnieniom w transakcjach handlowych (“Excessive Payment Delays Law” or “Excessive Payment Delays Act”)].
  3. Act of 21 April 2017 on claims for compensation for damage caused by violation of competition law (ustawa z dnia 21 kwietnia 2017 r. o roszczeniach o naprawienie szkody wyrządzonej przez naruszenie prawa konkurencji).

Competition Law Poland: 1. Abuse of dominant position, 2. Anti-competitive agreements; 3. Excessive payment backlogs; 4. Abuse of contractual advantage; 5. Violation of consumer collective rights; 6. Merger control.

EU Competition Law

The general antitrust provisions are articles 101 and 102 of the Treaty on the Functioning of the European Union (“TFEU”):

  1. Article 101(1) TFEU prohibits all agreements between undertakings and concerted practices (formal or informal, written or unwritten) which have as their object or effect the prevention, restriction or distortion of competition within the internal market, such as price-fixing or cartels, amongst others.
  2. Article 102 TFEU prohibits any abuse by undertakings of a dominant position within the internal market or in a substantial part of it.

The main pieces of competition law provisions regarding horizontal agreements are:

  1. Commission Regulation No 1218/2010 of 14 December 2010 on the application of article 101(3) Treaty to categories of specialization agreements.
  2. Commission Regulation No 1217/2010 of 14 December 2010 on the application of article 101(3) Treaty on the functioning of the EU to categories of research and development agreements.
  3. Commission Guidelines on the applicability of article 101 of the Treaty on the Functioning of the EU to horizontal co-operation agreements (“Horizontal Guidelines”).

The main pieces of legislation regarding vertical agreements are:

  1. Commission Regulation (EU) No 330/2010 of 20 April 2010 on the application of article 101(3) Treaty on the Functioning of the EU to categories of vertical agreements and concerted practices (“Block Exemption Regulation” or “VBER”).
  2. Commission Regulation (EU) No 316/2014 of 21 March 2014 on the application of article 101(3) Treaty on the Functioning of the EU to categories of technology transfer agreements Text with EEA relevance (“Technology Transfer Regulation”).
  3. Commission notice — Guidelines on Vertical Restraints (“Guidelines on Vertical Restraints”).

The main piece of legislation regarding abuse of dominance is the Communication from the Commission — Guidance on the Commission’s enforcement priorities in applying article 82 EC Treaty to abusive exclusionary conduct by dominant undertakings.

The main piece of legislation regarding merger control is Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (“EU Merger Regulation”).

Regulatory / Enforcement Authorities

EU antitrust rules have the force of law throughout the EEA. They are enforced both at a European and at a national Polish level, in the latter case only where trade between Member States is affected.

EU and national regulatory / enforcement authorities cooperate extensively with each other, including in the exchange of confidential information necessary to prove an infringement of the EU competition rules.

EU Competition Authorities

At EU level, European Commission (“EC”) is the authority in charge of enforcing antitrust rules. The EC is organised into policy departments, known as Directorates-General(“DG”). The DG in charge of competition policy is DG COMP, based in Brussels. The European Commissioner responsible for competition matters is Margrethe Vestager. There are nine different Directorates within DG Comp, each of which is in charge of a different economic sector / competition area.

In principle, the EC will generally be seen as the best placed authority to deal with any case where:

  1. the relevant market affected by the agreement or conduct concerns more than three Member States;
  2. the agreement or conduct is closely linked to other EU rules that may be exclusively or more effectively applied by the EC;
  3. EC’s decision is needed to develop EU competition policy; or
  4. it is appropriate for EC to act to ensure effective enforcement of the antitrust rules.

However, the decision will be taken on a case-by-case basis. The decision by the EC to initiate proceedings shall relieve national competition authorities of their competence.

The EC has substantial enforcement and investigation powers. For example, it can:

  1. require companies to provide information;
  2. conduct surprise inspection visits (so-called “dawn raids”) at company premises or employees’ homes within the EU;
  3. impose fines for substantive infringements of antitrust regulations as well as for procedural infringements, such as a failure to provide information;
  4. impose structural remedies such as breaking up a dominant company.

EC decisions can be appealed to the General Court in Luxembourg under article 263 TFEU. In turn, General Court judgments be questioned within appeal proceedings based on legal arguments to the Court of Justice, also in Luxembourg.

Polish Competition Authorities

In the case of Poland, the national competition authority is the President of Office of Competition and Consumer Protection[Prezes Urzędu Ochrony Konkurencji i Konsumentów, (“President of UOKiK”)]. The President of UOKiK is supported by the Office of Competition and Consumer Protection [Urząd Ochrony Konkurencji i Konsumentów, (“UOKiK”)].

Technically it is the President of UOKiK that takes decisions, however in practice he is supported by extensive internal structure of UOKiK, recently organized in 6 offices and 14 departments.

UOKiK has broad investigative and inspection powers, mirroring those of the EC under the Merger Regulation.

The decision of the President of UOKiK can be appealed to the Court of Competition and Consumer Protection [Sąd Okręgowy – Sąd Ochrony Konkurencji i Konsumentów (“SOKiK”)] within the process of competition litigation. The judgement of SOKiK can be appealed to the Court of Appeal in Warsaw (“Sąd Apelacyjny w Warszawie”). As a measure of extraordinary judicial review, the judgement of the Court of Appeal in Warsaw may be questioned in the cassation appeal (“skarga kasacyjna”) to the Polish Supreme Court(“Sąd Najwyższy”).

Anti-competitive agreements

Prohibited agreements in Poland – Art. 6 of the Competition Act

Article 6 of Polish Competition Act defines general prohibition of concluding agreements distorting competition on the relevant market. As a result, the entrepreneurs shall not enter into horizontal or vertical agreements which seek to or result in eliminating, restricting or otherwise distorting competition on the relevant market. This prohibition shall not apply to intra-group agreements.

In particular, the entrepreneur shall not agree any of the following group of specific practices (which are prohibited in all cases):

  1. price fixing, whether directly or indirectly, and other conditions of purchase or sale of goods;
  2. limiting or controlling production or sale, also technical progress or investment;
  3. dividing markets of sale or purchase;
  4. applying in similar contracts with third parties onerous or disparate contract conditions, thereby subjecting these parties to disparate competitive conditions;
  5. making a contract conditional upon the acceptance or fulfilment by the other party of a performance that is unrelated either by its substance or by customary practice to the object of the contract;
  6. restricting market access or eliminating from the market entrepreneurs not being party to the agreement;
  7. entrepreneurs entering into tendering, or these entrepreneurs and an entrepreneur who organizes the tendering, agreeing terms of submitted tenders, in particular the scope of works or price.

It shall be also explained that agreement shall be defined widely to cover:

  1. all contracts entered into by entrepreneurs, association of entrepreneurs, also by entrepreneurs and associations of entrepreneurs, or certain provisions of such contracts;
  2. arrangements, in whatever form, agreed by two or more entrepreneurs or by associations thereof;
  3. resolutions or other deeds adopted by associations of entrepreneurs or their constitutive bodies.

Any agreement containing such clauses will be automatically void in full or in relevant part. Sanctions for concluding such agreement for the entrepreneur or / and its managing staff are presented in section penalties.

Anticompetitive agreements – exemption criteria

The Entrepreneur may conclude an agreement that falls under definition of prohibited agreement (Article 6 of Polish Competition Act) if it is established after careful evaluation that such agreement may benefit from one of the exemptions provided by Polish Competition Act. Currently the Act provides three types of exemptions from the prohibition of concluding agreements distorting competition:

  1. de minimis exemptions;
  2. block exemptions, incl. block exemptions of vertical agreements; and individual exemptions.

De minimis exemption

Even if the particular agreement falls under the definition of forbidden agreement (Art. 6 of the Competition Act), entrepreneurs can enter into this type of agreement if it is entered into by:

  1. Competitors if their combined share in the relevant market that the agreement concerns is no higher than 5 per cent;
  2. Non-competing entrepreneurs, where a market share held by any of them in the relevant market that the agreement concerns is no higher than 10 per cent.

With regards to the agreements already concluded by the entrepreneurs and operating underde minimis exemption – they may be continued if the shares in the relevant market referred above have not been exceeded by more than two percentage points during the period of two consecutive calendar years within the agreement’s validity period.

However, it shall be noted that significance of de minimis exemptions is very limited in Poland as they are NOT applicable to the following agreements:

  1. fixing, whether directly or indirectly, prices and other conditions of purchase or sale of goods;
  2. limiting or controlling production or sale, also technical progress or investment;
  3. dividing sale or purchase markets;
  4. entrepreneurs entering into tendering, or these entrepreneurs and an entrepreneur who organizes the tendering, agreeing terms of submitted tenders, in particular the scope of works or price.

As a result, the entrepreneurs may not relay on de minimis exemptions in case of above listed agreements.

Block Exemptions

Under art. 8.3 of Competition Act the Counsel of Ministers has powers to issue executive ordinances that exempt in blocks certain types of agreements from prohibition of concluding agreements distorting competition.

As a result, if the agreement falls under the definition of forbidden agreement (art. 6 Competition Act), entrepreneurs can enter into this type of agreement if it is established after careful evaluation that such agreement would be exempted under the terms and conditions of one of the executive ordinances issued by the Council of Ministers.

Currently there are three ordinances in force, issued by the Council of Ministers, setting out conditions for exemption of:

  1. Certain categories of technology transfer agreements (“Technology Transfer Ordinance”) [Rozporządzenie Rady Ministrów w sprawie wyłączenia niektórych rodzajów porozumień o transferze technologii spod zakazu porozumień ograniczających konkurencję z dnia 17 kwietnia 2015 r. (Dz.U. z 2015 r. poz. 585)];
  2. Certain categories of specialization agreements and research and development agreements (“Research and Development Ordinance”) [Rozporządzenie Rady Ministrów w sprawie wyłączenia określonych porozumień specjalizacyjnych i badawczo-rozwojowych spod zakazu porozumień ograniczających konkurencję z dnia 13 grudnia 2011 r. (Dz.U. Nr 288, poz. 1691)];
  3. Certain categories of vertical agreements (“Vertical Agreements Ordinance”) [Rozporządzenie Rady Ministrów w sprawie wyłączenia niektórych rodzajów porozumień wertykalnych spod zakazu porozumień ograniczających konkurencję z dnia 30 marca 2011 r. (Dz.U. Nr 81, poz. 441)].
Exemption for certain categories of technology transfer agreements
Binding force

According to Technology Transfer Ordinance the exemption for certain categories of technology transfer agreements will remain in force until 30 April 2027.

General exemption

As an exception to general prohibition of concluding agreements distorting competition, the entrepreneurs may conclude a technology transfer agreement if:

  1. the agreement is concluded between competitors and their combined share in the relevant market or markets in the year preceding conclusion of the agreement is no higher than 20 per cent and subject to no hardcore restrictions in the agreement;
  2. the agreement is concluded between non-competing entrepreneursand their combined share in the relevant market or markets in the year preceding conclusion of the agreement is no higher than 30 per cent and subject to no hardcore restrictions in the agreement.
Hardcore restrictions in any type of technology transfer agreements (i.e. between competitors and non-competing entrepreneurs)

The entrepreneurs may never agree to include in technology transfer agreement any of hardcore restriction, i.e. any clauses (arrangements) that are directly or indirectly are designed to:

  1. Impose an obligation on the licensee to grant an exclusive license to the licensor or to a third party designated by the licensor or to transfer the rights to the licensor or such third party, in whole or in part, in relation to its own improvements to the licensed technology or its own new applications of this technology developed by the licensee;
  2. Impose an obligation on the party not to question the validity of intellectual property rights held by the other party in the European Union, with the option of terminating, in the case of an exclusive license, the technology transfer agreement if the licensee questions the validity of any of the rights to the licensed technology.
Hardcore restrictions in technology transfer agreements between competitors

In the technology transfer agreement with the competitor the entrepreneurs may never agree to include any of hardcore restrictions, i.e. any clauses (arrangements) that are directly or indirectly designed to:

  1. restrict the freedom of setting the prices of goods by either party for entities that are not parties to the agreement;
  2. restric production, with the exception of production restrictions on the contract goods imposed on the licensee in a unilateral technology transfer agreement or imposed on only one of the licensees in a bilateral technology transfer agreement;
  3. Divide markets or customers, except for:
    1. obligations of the licensor or licensee in a unilateral technology transfer agreement not to produce goods using the licensed technology rights in the exclusive area reserved for the other party or not to sell in the exclusive area or exclusive customer group reserved for the other party,
    2. a restriction, imposed by a unilateral technology transfer agreement, on active sales by the licensee in an exclusive territory or to an exclusive customer group that have been allocated by the licensor to another licensee, provided that the licensee was not a competitor of the licensor at the time the license was granted,
    3. the obligation on the licensee to manufacture the contract goods solely for its own use, provided that the agreement does not restrict the licensee from selling the contract goods as spare parts for its own goods;
    4. obligations of the licensee in the unilateral technology transfer agreement to produce the contract goods only for the customer named in the agreement, if the license was granted to create an alternative source of supply for that customer;
  4. Restrict licensee’s rights to use its own technology rights or restriction of the rights of any party to the agreement to conduct research and development, provided that the restriction of the rights of any party to the agreement to conduct research and development is necessary to prevent the disclosure of the licensed know-how to third parties.
Hardcore restrictions in technology transfer agreements between non-competing entrepreneurs

In the technology transfer agreement with non-competing entrepreneur – the entrepreneurs may never agree to include any of hardcore restrictions, i.e. any clauses (arrangements) that are directly or indirectly designed to:

  1. restrict the freedom to determine the prices of goods by either party, while retaining the possibility of setting a maximum selling price or recommended selling price, provided that this is not tantamount to applying a fixed or minimum selling price determined as a result of pressure or incentives of either party;
  2. limit the area or customers in which or for which the licensee may sell goods covered by the agreement passively, except for:
    1. restrictions on passive sales in the area of the exclusive or exclusive group of customers, which are reserved to the licensor,
    2. the obligation to manufacture the contract goods solely for its own use, provided that the licensee is not restricted in selling the contract goods as spare parts for its own goods;
    3. obligations to produce contract goods only for the recipient indicated in the agreement, where the technology transfer agreement was concluded in order to create an alternative source of supply for that customer,
    4. restrictions on sales to end users by a licensee operating at the wholesale level,
    5. restrictions on sales to unauthorized distributors by participants in a selective distribution system;
  3. restrict sales to end users by the licensee operating in the selective distribution system, which operates at the retail level, with the exception of the restriction of their ability to sell in premises that do not meet the criteria specified in the agreement on which the selective distribution system is established;
  4. Restrict the licensee’s entitlement to use the rights to its technology or restricting the right of any of the parties to the agreement to conduct research and development, except in the case of where this restriction is necessary to prevent the disclosure of the licensed know-how to third parties.
Exemption for certain categories of specialization agreements and research and development agreements
Binding force

According to Research and Development Ordinance the exemption for certain categories of specialization agreements and research and development agreements will remain in force until 31 December 2023.

General exemption – type of agreements

As an exception to general prohibition of concluding agreements distorting competition, the entrepreneur may conclude a specialization agreement (subject to market share requirement and no hardcore restrictions) with two or more entrepreneurs with regards to:

  1. unilateral specialization between entrepreneurs operating on the same market of goods – under which one of the parties undertakes to completely or partially cease or discontinue the production of certain goods and to purchase them from the other party or other parties who undertake to produce and deliver these goods;
  2. mutual specialization between entrepreneurs operating on the same market of goods – under which the parties undertake, on a reciprocal basis, fully or partially to cease or discontinue the production of specific but different goods, and undertake to purchase these goods from other parties to the agreement that agree to produce and deliver them;
  3. joint production – under which the parties undertake to produce specific goods jointly.

As an exception to general prohibition of concluding agreements distorting competition, the entrepreneur may conclude a research and development agreement (subject to market share requirement and no hardcore restrictions) with two or more entrepreneurs with regards to:

  1. running research and development activities jointly in relation to the contract goods or processes and to jointly use the results of these activities;
  2. joint use of the results of research and development in relation to the contract goods or processes carried out jointly under an agreement previously concluded between the same parties;
  3. conducting research and development activities jointly in relation to the goods or processes covered by the agreement, excluding the joint use of the results of these activities;
  4. carrying out paid research and development in relation to the contract goods or processes and share the results of these activities;
  5. sharing the results of the paid research and development with the contract goods or processes in an agreement previously concluded between the same parties;
  6. carrying out paid research and development in relation to the contract goods or processes, excluding the sharing of the results of those activities.
Market share requirement

The entrepreneur may conclude a specialization agreement if the total share of the parties to the specialization agreement and their capital groups in any relevant market does not exceed 20% per cent for each of the goods covered by the specialization.

The entrepreneur may conclude a research and development agreement if the total share of the parties to the specialization agreement and their capital groups in any relevant market does not exceed 25 per cent for each of the goods covered by the specialization.

Hardcore restrictions in specialization agreements

In the specialization agreement the entrepreneur may never agree to include any of hardcore restrictions, i.e. any clause (arrangement) that directly or indirectly, alone or in combination with other factors dependent on the parties, are designed to:

  1. determine the selling prices of goods covered by the specialization to third parties;
  2. limit the production or sale of goods covered by the specialization;
  3. divide sales markets for goods covered by the specialization.
Hardcore restrictions in research and development agreements

In the research and development agreement the entrepreneur may never agree to include any of hardcore restrictions, i.e. any clauses (arrangement) that directly or indirectly, alone or in combination with other factors dependent on the parties, are designed to:

  1. fix prices or fees in the case of selling contract goods or licensing the contract processes to third parties;
  2. limit production or sales, except for:
    1. determining the lines of production, if the joint exploitation of the results includes the joint production of the goods covered by the agreement,
    2. determining the directions of sales, if the joint use of the results includes the joint distribution of goods or joint licensing,
    3. specialization in the exploitation of results,
    4. restricting the freedom of the parties to manufacture, sell or transfer rights in goods or processes, or to license goods or processes that compete with the contract goods or processes during the period in which the parties have agreed to use the results jointly;
  3. restrict areas or assign customers where or to whom the parties may passively sell the contract goods or license the contract processes, with the exception of the requirement to grant the other party an exclusive license to exploit the results;
  4. eliminate or restrict the active sale of the contract goods or processes in such areas or to customers that are not exclusively allocated to one of the parties as part of the exploitation specialization;
  5. oblige the parties to refuse to meet demand from customers in the areas allocated to the parties to the agreement or from customers otherwise allocated between the parties as part of a performance exploitation specialization that would market the contract goods in other areas;
  6. make it difficult for buyers, including resellers, to obtain the contract goods from other resellers;
  7. limit the freedom of participation of the parties to the agreement in carrying out research and development activities independently or in cooperation with third parties in an area other than that covered by the agreement, or after termination of joint research and development activities or paid research and development activities in the field to which the activity relates or related;
  8. prohibit questioning, after completion of research and development activities, the validity of intellectual property rights, including industrial property rights, which are at the disposal of the parties to the agreement, which are relevant for this activity;
  9. prohibit undermining, after the expiry of the research and development agreement, the validity of intellectual property rights, including industrial property rights held by the parties to the agreement, protecting the results of research and development activities;
  10. oblige not to grant third parties a license to produce goods covered by the agreement or use processes covered by the agreement, except where the agreement provides for the use of the results of research and development activities or paid research and development activities by at least one of the parties against third parties.
Permissible restrictions in research and development agreements

Research and development agreement may still benefit from the exemption if:

  1. all parties to the agreement have full access to the final results of the joint research and development activity or the paid research and development activity, in particular to all intellectual property rights arising from this activity, including industrial property rights, or which constitute know-how, for the purpose of further research and use of their results, from the moment the final results are available, however:
    1. it is permissible to limit the parties’ access to the results in order to use them, in particular in the case of specialization in the use of the results,
    2. parties that conduct research and development on a commercial basis, for which the exploitation of results is not their main focus, may agree to limit the use of results only for the purpose of further research,
    3. the research and development agreement may provide for mutual compensation of the parties for gaining access to the results for further research or for using the results, but the compensation must not be so high as to effectively hinder such access;
  2. each of the parties to the agreement has access to any pre-existing know-how of the other parties necessary to use the results of research and development or paid research and development, if the agreement provides only for joint research and development or paid research and development; the research and development agreement may provide for mutual compensation of the parties for gaining access to already existing know-how, but the compensation may not be so high as to effectively hinder such access;
  3. the joint use of the results of research and development or paid research and development concerns only results protected by intellectual property rights, including industrial property rights, or constituting know-how, insofar as these results are decisive for the production of goods or processes covered by the agreement;
  4. obligated undertakings, as part of the specialization in the use of results, to produce the goods covered by the agreement, are required to fulfil orders from other parties to the agreement for the supply of these goods, except where the research and development agreement also provides for joint distribution, or when the parties have agreed that only the party producing the goods may distribute the goods covered by the agreement.
Exemption for certain categories of vertical agreements
Binding force

According to Vertical Agreements Ordinance the exemption for certain categories of vertical agreements will remain in force until 31 May 2023.

General exemption

As an exception to general prohibition of concluding agreements distorting competition, and subject to market share requirement and no hardcore restrictions, the entrepreneur may participate in a vertical agreement between:

  1. Entrepreneurs not being competitors;
  2. Entrepreneurs being competitors – only with regards to non-reciprocal vertical agreement – if:
    1. the supplier is a manufacturer and distributor of non-services goods and the buyer is a distributor and is not a competitor at the manufacturing level, or
    2. the supplier provides services at several levels of trade and the buyer delivers goods or services at the retail level and is not a competitor at the level of trade where it purchases the services covered by the vertical agreement;
  3. Association of entrepreneurs and their members or association of entrepreneurs and their suppliers if:
    1. all association members are retailers of non-service goods, and
    2. the turnover of any association member, including the turnover of entrepreneurs belonging to its capital group, in the previous calendar year did not exceed the equivalent of EUR 50 million.
Vertical agreements with IP and know-how

As an exception to general prohibition of concluding agreements distorting competition, and subject to market share requirement and no hardcore restrictions, the entrepreneur may enter into vertical agreements containing provisions relating to the assignment or use by the buyer of intellectual and industrial property rights or know-how, if these provisions do not constitute the principal object of such agreements and are directly related to the use, sale or resale of the goods covered by the agreement.

Market share requirement

The entrepreneur may conclude a vertical agreement if the total share of the supplier and its capital group in the market of sales of goods covered by that agreement does not exceed 30% per cent and total share of the buyer and its capital group in the market of purchases of goods covered by that agreement does not exceed 30% per cent.

Hardcore restrictions in vertical agreements

In vertical agreement the entrepreneur may never agree to include any of hardcore restrictions, i.e. any clauses (arrangements) that directly or indirectly, alone or in combination with other factors dependent on the parties, are designed to restrict:

    1. buyer’s right to freely determine the selling price – by the supplier imposing minimum or fixed selling prices for goods covered by the vertical agreement;
    2. territory or circle of customers in which or to which the buyer may sell goods covered by a vertical agreement, except for the restriction:
      1. relating to the premises or land on which the buyer conducts business,
      2. active sales to a specific territory or a specific group of customers reserved for the supplier or allocated by the supplier to another buyer, if these restrictions do not hinder the buyer’s customers from selling goods covered by a vertical agreement,
      3. sale to end users through a wholesale distributor, distributors operating in the selective distribution system for the resale of goods covered by the vertical agreement to distributors not belonging to this system, in the territory where the supplier is established or has taken steps to show that he intends to operate in this system,
      4. the buyer’s right to resell the components covered by the vertical agreement to other entrepreneurs who would use them to produce goods which, given their purpose, price and properties, including quality, are considered by buyers to be substitutes for the goods sold by the supplier;
    3. retail distributors operating in the selective distribution system the possibility of selling to end users, except for limiting the possibility of selling them in premises that do not meet the criteria specified in the vertical agreement being the basis for establishing a selective distribution system;
    4. cross-supply between distributors operating in the selective distribution system, including distributors operating at different levels of trade;
  • supplier’s rights to sell components covered by the vertical agreement – as spare parts – to end users, repair plants or other service providers that the buyer has not entrusted with the repair or servicing of goods manufactured with the use of these components.
Non-hardcore restrictions in vertical agreements

In vertical agreements the entrepreneur shall not directly or indirectly prohibit:

  1. competing for a definite period of time longer than five years or for an indefinite period, unless the buyer sells goods covered by a vertical agreement at the premises or in the premises of which the supplier is the owner, perpetual usufructuary, tenant or lessee, or which the supplier rents or leases from third parties not related with the buyer, and the duration of such an obligation does not exceed the time the buyer occupies the premises or land; a non-compete obligation which is tacitly renewed after five years is considered to be concluded for an indefinite period;
  2. distributors operating in the distribution system of selective – sale of goods only of certain competitors of the supplier;
  3. buyers – to manufacture, purchase, sale or resale of goods – after the expiry of the vertical agreement, unless the validity of such clauses:
    1. relates to goods which, due to their intended use, price and properties, including quality, are considered by their buyers as substitutes for goods covered by the vertical agreement, and
    2. is limited to the premises or land on which the buyer carries out business during the term of the vertical agreement, and
    3. it is necessary to protect the know-how transferred by the supplier to the buyer

– and their duration is limited to one year after the expiry of the vertical agreement, except for the possibility of imposing a restriction that does not have a time limit on the use and disclosure of know-how.

Individual Exemption

If the agreement falls under the definition of forbidden agreement (art. 6 Competition Act) and cannot be exempted under any of Block Exemptions (art. 8.3 Competition Act) the entrepreneur can enter into the agreement if such agreement meets at the same time all of below listed conditions:

  1. it causes further improvement of production, distribution of goods, or technical or economic progress;
  2. it ensures for buyers or users an appropriate share of benefits resulting therefrom;
  3. it does not impose on entrepreneurs restrictions which are not indispensable to the attainment of these objectives;
  4. it does not make it possible for these entrepreneurs to eliminate competition on the relevant market in respect of a substantial part of certain goods.

The entrepreneurs shall be very careful in exercising the Individual Exemption. The burden of proof of the circumstances referred above shall be on the entrepreneur. Conclusion of the agreement exempted under the Individual Exemption shall be always preceded by careful evaluation of above conditions and consultation with relevant legal department.

Abuse of dominant position

Abuse of dominance in EU

A dominant position is a situation where the economic power held by a company allows it to hinder the maintenance of effective competition in the relevant market by behaving to an appreciable extent independently of its competitors, customers and ultimately consumers. As a general rule of thumb, a company is unlikely to be dominant if it has a market share of less than 40%. For these purposes, it is necessary to define the relevant product market, as well as the relevant geographic market (which may be EU-wide, national or even local).

Holding a dominant position is not itself unlawful. However, dominant undertakings have a special responsibility to behave in a way that does not damage or hinder competition. Where a company has a dominant position, it will be in breach of EU competition rules if it “abuses” that position.

Abuse of dominance in Poland

Concept of dominant position in Poland is generally similar as in EU, and as a result above remarks are also valid with regards to Polish regulations.

In Poland dominant position is defined in art. 4.10. of the Competition Act and shall be understood as the position of an entrepreneur which enables it to prevent effective competition on the relevant market by creating the possibility of acting to a large extent, regardless of competitors, contractors and consumers; it is presumedthat the entrepreneur has a dominant position if its share in the relevant market exceeds 40%.

Specific forms of abuse in EU

If the entrepreneur holds a dominant position in a particular market, it shall not:

  1. charge excessive prices (i.e. which do not bear reasonable relationship to the economic value of the supplied goods).
  2. limit production, distribution or technical developments to the unjustified prejudice of undertakings or consumers.
  3. refuse to supply: if entrepreneur is in a dominant position, it must have a reasonable and fair commercial reason for cutting off supplies to an existing customer or denying supply to a new customer.
  4. margin squeeze: charge a wholesale price for an essential input to compete in the downstream market (where entrepreneur is also present), that prevents those companies from effectively competing in the downstream market with the dominant company may amount to an abuse of a dominant position.
  5. apply materially different trading terms (to prices or other conditions) to equivalent transactions in the absence of an objective justification.
  6. apply incentives to induce customers to purchase exclusively or to a large extent from entrepreneur. In particular, to apply conditional and/or retroactive rebates / discounts that have the effect of foreclosing competitors.
  7. make the conclusion of contracts subject to supplementary obligations that bear no link to the subject matter of the contract leading to the foreclosure of competitors.
  8. price at unfairly low levels (e.g. below average avoidable cost), particularly if there is evidence of entrepreneur’s intent to drive a competitor out of the market.

Specific forms of abuse in Poland

If the entrepenur holds a dominant position in a particular market, it shall not:

  1. impose, whether directly or indirectly, unfair prices, including excessively high or drastically low ones, distant payment dates, or other conditions of purchase or sale of goods;
  2. limit production, sale or technical development to the detriment of contracting parties or consumers;
  3. apply, in similar contracts with third parties, onerous or dissimilar contract conditions, thereby subjecting these parties to disparate competitive conditions;
  4. make a contract conditional upon the acceptance or fulfillment by the other party of a performance that is unrelated either by its substance or by customary practice to the object of the contract;
  5. obstruct development of conditions essential to the emergence or development of competition;
  6. impose onerous contract conditions to obtain unfair benefits;
  7. divide the market according to territorial, product-line or by-subject criteria.

Liability and penalties

Administrative liability for competition law infringements at EU level

At EU level, infringements of antitrust regulations can result in the imposition of fines up to 10% of the worldwide aggregate turnover of the corporate group to which entrepreneur belongs (so turnover not only of the company that has directly participated in the infringement). In setting the amount of the fine, EC will take into account the nature, gravity and duration of the infringement. EC can also impose periodic penalties of up to 5% of entrepreneur’s average daily aggregate turnover for delays in complying with obligations or supplying information.

Administrative liability for competition law infringements in Poland

At Polish level , infringements of antitrust regulations can result in the imposition of fines up to 10% of the entrepreneurs worldwide aggregate turnover. In setting the amount of the fine, the President of UOKiK will take into account the nature, gravity and duration of the infringement.

Fines of up to EUR 50,000,000 can be imposed on the entrepreneur in case of even unintentional obstruction of audit or search run by the President of UOKiK or providing false or not providing requested information to the President of UOKiK.

Fines of up to PLN 2,000,000 can be imposed in Poland on entrepreneur’s managing staff for intentional infringements of selected antitrust regulations by the entrepreneur.

Fines of up to 50-fold of medium remuneration can be imposed in Poland on entrepreneur’s managing staff for even unintentional infringements of selected antitrust regulations.

Fines of up to EUR 10,000 can be imposed on the entrepreneur for each day of delay in execution of the President of UOKiK decisions.

Summary fines for antirust infringements in Poland

Fine for entrepreneur for antirust infringement up to 10% of the entrepreneurs worldwide aggregate turnover
Fine for entrepreneur for search / dawn raid obstruction up to EUR 50,000,000
Fine for managing staff for intentional infringement up to PLN 2,000,000
Fine for managing staff for unintentional infringement up to 50-fold of medium monthly remuneration in Poland

Criminal liability for competition law infringements in Poland

At EU level there are no criminal sanctions for competition rules infringements.

At Polish level, the system does not directly establish criminal sanctions for antitrust infringements, i.e. there are no crimes defined in the Competition Act. As an exception there is one offence (not crime) defined in art. 114 Competition Act establishing a fine not lower than PLN 2,000 for not providing requested information to Consumer Ombudsman. Nonetheless, it shall be noted that some acts posing infringements of antitrust regulations may be covered by certain offences defined directly in Penal Code, e.g. illegal interference in public tenders (art. 305 Penal Code).

Civil liability for competition law infringements in Poland

Infringements of antitrust rules can give rise to civil liability. Any business or citizen that have been harmed as a result of an antitrust infringement (e.g. higher prices, lost profits) has the right to full compensation for the harm caused to them by an infringement of the EU antitrust rules. On 26 November 2014, a Directive was passed to ensure that anyone who has suffered harm caused by an infringement of antitrust law can effectively exercise the right to claim full compensation by setting out rules fostering undistorted competition in the internal market, removing obstacles to its proper functioning and ensuring equivalent protection throughout the EU.

In Poland the Directive was implemented by enactment of separate legal act, i.e. Act on claims for compensation for damage caused by infringement of competition law of 21 April 2017 (Journal of Laws No. of 2017, item 1132) [ustawa o roszczeniach o naprawienie szkody wyrządzonej przez naruszenie prawa konkurencji z dnia 21 kwietnia 2017 roku (Dz.U. z 2017 r. poz. 1132)]. The Act constitutes key rules of Polish private enforcement of competition law. It provides a right for every injured party to file a claim for damages caused by infringement of competition law. Such claims benefit from longer – five years – limitation periods and are heard by the District Courts regardless of the value.

Expert team leader DKP Legal Michał Dudkowiak
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