The publication of measures and administrative fine decisions therefore promotes proper conduct among market participants, including as a result of its deterrent effect. The Federal Cartel Office also uses this tool to ward off threats to competition.

By their very nature, the publication of measures and administrative fine decisions encroaches on the rights of the companies and persons involved, and potentially of third parties as well. The Higher Regional Court (Oberlandesgericht – OLG) in Düsseldorf last year reached an important decision in this connection (case ref. no. VI-Kart 5/14 (V)).

Legal dispute on the personality rights of companies

The Higher Regional Court addressed the question of whether a press release issued by the Federal Cartel Office on 15 July 2014, which has been available on its website since then, violated the personality rights of companies. In the press release, the Federal Cartel Office announced that it had imposed fines totalling approximately EUR 338 million on 21 sausage manufacturers and 33 responsible individuals. The orders imposing the administrative fines were not yet legally effective at the time of publication. Some of the companies affected had already announced their intention to appeal the Federal Cartel Office’s administrative fine decision to the Higher Regional Court in Düsseldorf.

Two of the companies affected lodged a complaint against the publication with the Higher Regional Court in Düsseldorf and simultaneously filed an application to prohibit the Federal Cartel Office (by way of an interim injunction) from presenting their involvement as an established fact before the outcome of the administrative fine proceedings becomes legally effective. The companies withdrew this application following the oral hearing on the filing.

Decision by the Higher Regional Court in Düsseldorf

In its decision, the Higher Regional Court in Düsseldorf agreed that the press release represented an infringement of the companies’ personality rights. However, this infringement was not unlawful in the view of the court. It also ruled that the press release did not violate the presumption of innocence and did not result in any injury to the applicants. According to the court, neither sections 839 (1), 823 (1), or 1004 of the German Civil Code (Bürgerliches Gesetzbuch – BGB) nor Article 34 of the Basic Law (Grundgesetz) or any other legal basis give rise to a right of the company to prohibit the dissemination and/or continued availability of the press release. It argued that, as a general principle, the Federal Cartel Office is authorised to report on matters arising from its activities that are of interest to or affect the public. According to the court, such reporting constitutes the sovereign dissemination of information and does not require special legal authorisation, even if adverse effects may be caused in practice by the reporting. In the court’s view, administrative fine proceedings instituted by the Federal Cartel Office are in principle of material importance to the public.

According to the Higher Regional Court, the information must of course be accurate and proportionate. It ruled that the Federal Cartel Office reported truthfully on the fact that the imposition of administrative fines had been ordered and fines had been imposed on the companies named that were accused of illegal price fixing. In the court’s opinion, truthful statements – even if they are to the detriment of the parties concerned – must be tolerated provided they do not encroach on the privacy or confidentiality rights of the holder of the personality rights, but rather affect its social sphere and in particular its economic activities. It ruled that, considering the facts of the dispute, the applicants’ interest in confidentiality is secondary to the reasonable right to information of the public.

In the court’s view, the Federal Cartel Office does not have to delay the press release until the administrative fines are final and absolute since this would make it impossible in many cases to provide timely information about completed administrative fine proceedings. Experience shows that many companies involved in administrative fine proceedings initially appeal against the imposition of an administrative fine and only withdraw their appeal some months later, usually shortly before the start of or during the course of the court proceedings. In the court’s view, the Federal Cartel Office is likewise not required to delay naming the companies involved until the administrative fines are final and absolute since this would prevent the publication of uniform and consistent press releases about the administrative fine proceedings and compromise their informational value for the public. According to the Higher Regional Court’s decision, the press release contains a truthful communication of the facts. The court sees the investigations as being completed on adoption of the administrative fine decisions. At the same time, this creates a legally effective title that can also be enforced as soon as the decisions take legal effect. In the court’s view, this is also not altered by the fact that the imposition of an administrative fine can be challenged by lodging an appeal.

New European sanctioning regime

The opinion of the Higher Regional Court in Düsseldorf is not only relevant to the publication requirement under section 60b of the KWG, but is also important with respect to the anticipated new rules governing the publication of imposed measures and sanctions. These were previously at the discretion of BaFin. However, section 40b of the Securities Trading Act (Wertpapierhandelsgesetz – WpHG) will be amended as part of the harmonisation of sanctioning regimes across Europe.

The European rules on the publication of decisions under securities law must be implemented by the end of 2015/mid-2016 and provide in principle for the publication of administrative measures, and sanctions imposed as a result of violations, on the website of the competent authority before they become final and absolute.

New European sanctioning regime

• Article 34 of the Market Abuse Regulation
• Article 71 of the Markets in Financial Instruments Directive II
• Article 29 of the Directive amending the Transparency Directive
• Article 29 of the PRIIPs Regulation (Packaged Retail and Insurance-Based Investments Products Regulation)
• Article 62 of the Central Securities Depositories Regulation
• Article 99b of the UCITS V Directive (Fifth Directive on Undertakings for Collective Investment in Transferable Securities)
• Article 24 of the proposed SFT Regulation (Regulation on Securities Financing Transactions)

Furthermore, in Germany, section 26c of the planned amendment to the Capital Investment Act (Vermögensanlagegesetz) will introduce an obligation to publish measures and administrative fine decisions. This is provided for by the Retail Investor Protection Act (Kleinanlegerschutzgesetz) that the Bundestag adopted in April.

Transposition of the Transparency Directive

On 29 April 2015, the Federal Ministry of Finance published a draft act implementing the Directive amending the Transparency Directive of 22 October 2013. One of the main objectives of the amending Directive is to strengthen the ability of market supervisory authorities to enforce transparency requirements, including by imposing effective sanctions and through the mandatory tightening of national publication regimes. The amending directive is the first fundamental revision of the European sanctioning regime. The member states must transpose it into national law by the end of November 2015.

In the future, breaches of certain transparency requirements will be punishable in principle by administrative fines of up to EUR 10 million for legal persons and up to EUR 2 million for natural persons. Higher potential administrative fines apply if 5% of the total revenue as disclosed in the last annual financial statements (legal persons only) or the profit generated or loss avoided by the party concerned as a result of the breach exceeds EUR 10 million or EUR 2 million respectively.

Stricter publication requirements

At the same time, the requirements governing the publication of breaches are to be tightened. In accordance with the draft act implementing the Directive amending the Transparency Directive, the new section 40c of the WpHG will specify that BaFin is only exempt from the requirement to publish measures and administrative fine decisions if the publication of personal data would be disproportionate, publication would seriously jeopardise the stability of the financial markets or ongoing investigations, or publication would cause disproportionate or serious damage to the parties involved. A balance must be struck in future between the right to information of the public and market participants on the one hand, and the interest in confidentiality of the persons affected on the other. Where publication would be disproportionate, BaFin will defer publication of the decision until the reasons for that deferral cease to exist or publish the decision on an anonymous basis.

The opinion of the Higher Regional Court in Düsseldorf can serve as a point of reference in this respect, as it weights the extent of reporting by the Federal Cartel Office on administrative fines in favour of the public. Antitrust violations that disadvantage end consumers are inherently of material interest to the public. The same argument can also apply to information for investors and can be considered to be in the interest of society at large in a properly functioning capital market.