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New draft 11th Amendment to the German Competition Act

The German Federal Ministry of Economics and Climate Action (BMWK) has proposed a small, but almost revolutionary 11th amendment of the German Act Against Restraints of Competition. It is expected to come into effect in early 2023. The proposed reform would bring about three key changes.

First, it empowers the Federal Cartel Office (FCO) to impose remedies, including (as a last resort) divestitures, to address “significant persistent or repeated disruptions to competition” following the completion of a sector inquiry. This “fourth pillar” of German antitrust law (alongside conventional rules on anti-competitive agreements, abuse of market dominance and merger control) seeks to fill a perceived enforcement gap in situations where harm to competition is not attributable to anti-competitive conduct but to non-competitive market structure.

Second, it promotes the effective enforcement of the Digital Markets Act (DMA) by providing a legal basis for the FCO to conduct investigations and to support the European Commission (EC) in enforcing the DMA. It also establishes the procedural and substantive rules for private enforcement of the DMA in Germany.

Third, it facilitates the skimming off of undertakings’ profits derived from infringements of antitrust laws by the FCO, proposing a new rebuttable presumption that the anti-competitive gains amount to 1% of the undertakings’ sales of goods or services affected by the antitrust infringement.

Please read our full client alert below which highlights the key elements of the proposed reforms and comments on their likely impact.