Swiss Federal Council publishes Dispatch on the partial Revision of the Swiss Cartel Act

On 24 May 2023, the Swiss Federal Council adopted the dispatch on the partial revision of the Cartel Act (CartA). The core element of the proposed revision is the change from the current qualified dominance test to the Significant Impediment to Effective Competition test (SIEC test) in merger control, which also applies in the European Union. In addition, civil antitrust law is to be strengthened and the procedure to notify planned potential restrictions of competition improved. Finally, the revision implements three parliamentary motions.

Despite the challenging task with various interest groups involved, the Federal Council presented a balanced revision package. The change to the SIEC test in particular seems overdue. With this test, the possible effects of a merger can be assessed more precisely from an economic point of view. Compared to the current test, the threshold for intervention is lowered. More in-depth examinations and, in particular, conditions are thus more likely. At the same time, efficiency gains resulting from a transaction can be better considered. An adjustment of the notification thresholds was not up for discussion.

Strengthening civil antitrust law is also a step in the right direction. This is to be achieved above all by extending the legitimation (right to sue) to consumers and the public sector, the introduction of suspension of the statute of limitations for civil claims arising from unlawful restraints of competition and the possibility of considering voluntarily made payments of damages when determining fines.

The same applies in principle to the desired improvement of the procedure to notify planned potential restrictions (so called opposition procedure). Currently, companies in Switzerland have practically no suitable instrument to test innovations when notifying a contemplated potentially unlawful restriction of competition without the simultaneous risk of fines. However, it seems questionable whether the restriction of the revival of the risk of fines in the event of an investigation being opened within two months of notification will have the desired effect. With the objection notification, the authorities receive the necessary information to intervene quickly, if necessary also as a precaution. In our view, it would therefore make more sense to dispense with a sanction altogether, as in the case of leniency programmes.

The implementation of three parliamentary motions aims to reintroduce an effects test for the assessment of agreements and to strengthen the rights of parties in investigation proceedings (emphasis on the principle of investigation and the principle of opportunity, introduction of regulatory deadlines and party compensation, clarification regarding consortia) as a reaction to the Gaba (Elmex toothpaste) decision of the FederalCourt.

The dispatch and further materials can be found here (in GE, FR and IT).