The Dutch government is set to merge three non-financial regulators into one. On 1 January 2013, the Competition Authority (“NMa”), the Consumer Authority (“CA”) and the Independent Post and Telecommunication Authority (“OPTA”) will merge into the new Authority for Consumers and Markets (“ACM”).
The move reflects the government’s desire to increase efficiencies, reduce red tape and avoid conflicting decisions between regulators.
Contrary to what the government’s main advisory body recommended, the legislative process will take place in two separate stages. First, the ACM is incorporated as the new regulator. This change will take effect 1 January 2013. Second, the legislature seeks to amend material law and broaden the powers of the ACM considerably. This change is expected to take place in 2014.
In particular this second stage has come under substantial criticism. Stakeholders fear the new regulator lacks sufficient transparency, but also falls short of proper checks and balances.
As an example, it is not at all clear to what extent the ACM would be able to freely exchange information with other government departments, each with their own specific powers and controls, such as the police and the tax authorities. In this regard, past conduct proves at least the Dutch competition authority shows little constraint. Companies are expected to question the reach of the ACM’s powers re information-exchange.
As a deterrent, naming and shaming looks consolidated. It is proposed the ACM must, immediately upon sanction, publish case details. Lawyers worry this may infringe defendant’s rights, as those fined should have a right to defend themselves in court, before being shamed.
In terms of fines and financial issues, stakeholders appear particularly opposed to the proposal that companies under investigation must contribute financially towards the work of the ACM. This is seen as a public task, to be funded publicly as well.
Raising the maximum fine dramatically for those infringements that were previously dealt with by the CA and OPTA has also lifted eyebrows.
All in all, the more controversial piece would be the second stage legislation. As the proposal moves through Dutch Parliament, BANNING will keep companies and governments up to date for any change that could have substantial impact on their day-to-day business.
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