Competition Ordinance/Part 4

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PART 4
Enforcement Powers of Commission

Division 1—Commitments

60. Commitments

(1) The Commission may accept from a person a commitment to—

(a) take any action; or

(b) refrain from taking any action,

that the Commission considers appropriate to address its concerns about a possible contravention of a competition rule.

(2) The action referred to in subsection (1)(a) does not include making a payment to the Government.

(3) If the Commission accepts a commitment under this section, it may agree—

(a) not to commence an investigation or, if it has commenced an investigation, to terminate it; and

(b) not to bring proceedings in the Tribunal or, if it has brought proceedings, to terminate them.

(4) If the Commission accepts a commitment under this section, it may not—

(a) commence or continue an investigation; or

(b) bring or continue proceedings in the Tribunal,

in relation to any alleged contravention of a competition rule in so far as that investigation or those proceedings relate to matters that are addressed by the commitment.

(5) To avoid doubt, the Commission may still commence or continue an investigation or bring or continue proceedings in the Tribunal, after accepting a commitment under this section—

(a) in relation to matters that are not addressed by the commitment; or

(b) in relation to persons who are not subject to the commitment.

(6) If the Commission decides to accept a commitment under this section, it must, as soon as practicable after accepting it—

(a) give notice in writing of that decision to the person who made the commitment, together with a copy of the commitment; and

(b) register the commitment on the register of commitments maintained under section 64 (Register of commitments).

61. Withdrawal of acceptance of commitment

(1) The Commission may, by notice in writing given to the person who made the commitment, withdraw its acceptance of a commitment, with effect from the date specified in the notice, if—

(a) it has reasonable grounds for believing that there has been a material change of circumstances since the commitment was accepted;

(b) it has reasonable grounds for suspecting that the person who made the commitment has failed to comply with the commitment; or

(c) it has reasonable grounds for suspecting that the information on which it based its decision to accept the commitment was incomplete, false or misleading in a material particular.

(2) If the Commission is satisfied that any information—

(a) on which it based its decision to accept the commitment; and

(b) which was provided to it by the person who made the commitment,

was incomplete, false or misleading in a material particular, the date specified in the notice given under subsection (1) may be earlier than the date on which the notice is given.

(3) If an acceptance is withdrawn under this section—

(a) the commitment is no longer binding on the person who made it; and

(b) subject to subsection (4), the Commission may—

(i) commence an investigation; or

(ii) bring proceedings in the Tribunal,

with respect to any alleged contravention of the relevant competition rule that has occurred after the date specified in the notice given under subsection (1).

(4) The Commission may not bring proceedings authorized by subsection (3) more than 2 years after the date specified in the notice given under subsection (1).

62. Variation, substitution and release of commitment

(1) At any time after the Commission has accepted a commitment, it may accept from the person who has made it—

(a) a variation of the commitment; or

(b) a new commitment in substitution for it,

if it is satisfied that the variation or new commitment will address its concerns about a possible contravention of a competition rule.

(2) The Commission may release any person from a commitment that the person has made under this Part if—

(a) it is requested to do so by that person; or

(b) it has reasonable grounds for believing that its concerns about the alleged contravention of the competition rule no longer arise.

63. Enforcement of commitment

(1) If the Commission considers that a person has failed to comply with any commitment that the person has made under this Part (including a commitment to comply with the requirements of an infringement notice) and which has been accepted by the Commission, it may apply to the Tribunal for an order under subsection (2).

(2) If the Tribunal is satisfied that a person has failed to comply with a commitment that the person has made under this Part and which has been accepted by the Commission, the Tribunal may make all or any of the following orders—

(a) an order directing the person to take such action or refrain from taking such action, as is specified in the commitment;

(b) an order directing the person to pay to the Government an amount not exceeding the amount of any profit gained or loss avoided by that person as a result of the person’s failure to comply with the commitment;

(c) an order directing the person to compensate any person for any loss or damage caused by the person’s failure to comply with the commitment; and

(d) any other order that the Tribunal considers appropriate.

64. Register of commitments

(1) The Commission must establish and maintain a register of commitments made under this Part (including commitments to comply with the requirements of an infringement notice) containing—

(a) a copy of all commitments accepted under this Part (including any commitment accepted in substitution for another);

(b) a copy of all variations of commitments accepted under this Part;

(c) where any acceptance of a commitment has been withdrawn, notice of that withdrawal; and

(d) where any commitment has been released, notice of that release.

(2) The Commission may omit confidential information from any entry made in the register under this section; and where confidential information has been omitted, that fact must be disclosed on the register.

(3) The Commission must make the register available for inspection by any person—

(a) at the offices of the Commission during ordinary business hours;

(b) through the Internet or a similar electronic network; and

(c) in any other manner the Commission considers appropriate.

65. Procedural requirements regarding commitments

Schedule 2 has effect regarding the procedural requirements for—

(a) the acceptance of commitments;

(b) the withdrawal of acceptance of commitments; and

(c) the variation and release of commitments,

under this Division.

Division 2—Infringement Notices

66. Interpretation

In this Division—

“compliance period” (遵守限期) means the period within which a person who has notified the Commission that the person proposes to comply with the requirements of an infringement notice must make a commitment to comply with the requirements of the notice;

“notification period” (通知限期) means the period (being a period of not more than 28 days) within which a person to whom an infringement notice has been issued must notify the Commission whether or not the person proposes to comply with the requirements of the notice.

67. Commission may issue infringement notice

(1) Subsection (2) applies where—

(a) the Commission has reasonable cause to believe that—

(i) a contravention of the first conduct rule has occurred and the contravention involves serious anti-competitive conduct; or

(ii) a contravention of the second conduct rule has occurred; and

(b) the Commission has not yet brought proceedings in the Tribunal in respect of the contravention.

(2) The Commission may, instead of bringing proceedings in the Tribunal in the first instance, issue a notice (an “infringement notice”) to the person against whom it proposes to bring proceedings, offering not to bring those proceedings on condition that the person makes a commitment to comply with requirements of the notice.

(3) The requirements of an infringement notice may include, but are not limited to, the following requirements—

(a) to refrain from any specified conduct, or to take any specified action, that the Commission considers appropriate; and

(b) to admit to a contravention of the relevant conduct rule.

(4) The action that may be specified by the Commission under subsection (3)(a) does not include making a payment to the Government.

68. Person not obliged to make commitment

A person is not obliged to make a commitment to comply with the requirements of an infringement notice, but if a person does not make the commitment within the compliance period, the Commission may bring proceedings against that person in the Tribunal in relation to the alleged contravention of the conduct rule.

69. Contents of infringement notice

An infringement notice must—

(a) identify the conduct rule alleged to have been contravened;

(b) describe the conduct that is alleged to contravene that conduct rule;

(c) identify the person whose conduct is alleged to constitute the

contravention;

(d) identify the evidence or other materials that the Commission relies on in support of its allegations;

(e) specify the requirements to be complied with by the person to whom the notice is addressed;

(f) specify both the notification period and the compliance period; and

(g) be accompanied by a copy of section 68 (Person not obliged to make commitment).

70. Notice of proposal to issue infringement notice

(1) Before issuing an infringement notice to any person under section 67, the Commission must—

(a) give that person a notice under this section; and

(b) consider any representations made in accordance with the notice.

(2) A notice under this section must—

(a) state that an infringement notice is proposed to be issued;

(b) contain a draft of the proposed infringement notice; and

(c) specify a period, being a period of not less than 15 days, within which representations may be made as to why the infringement notice should not be issued.

(3) If a person makes a representation in response to a notice issued under this section—

(a) evidence or information provided to the Commission in that representation may not be used against that person; and

(b) no person may obtain discovery of that information or evidence against the Commission,

in any proceedings, other than proceedings against that person for an offence under section 172 (Provision of false information).

71. Decision not to issue infringement notice

If after considering any representations made in response to a notice given under section 70, the Commission decides not to issue an infringement notice, it must give notice of that decision to the person to whom the notice under section 70 was given.

72. Effect of issue of infringement notice

(1) If an infringement notice has been issued to any person, no proceedings may be brought by the Commission against that person in respect of the contravention referred to in the notice if—

(a) the compliance period has not expired; and

(b) the infringement notice has not been withdrawn.

(2) The Commission may not publish an infringement notice (or disclose the whole or any part of its contents)—

(a) before the expiry of its compliance period;

(b) if a commitment to comply with the requirements of the notice is not made within the compliance period; or

(c) if the Commission has withdrawn the notice.

73. Withdrawal of infringement notice

The Commission may at any time before the expiry of the compliance period, by notice in writing given to a person to whom an infringement notice has been issued, withdraw the infringement notice with effect from a date specified in the notice.

74. Extension of compliance period

(1) The Commission may, either of its own volition or on application made to it in writing, extend the compliance period specified in an infringement notice if it considers that there is a good reason for doing so.

(2) An application for an extension under subsection (1) must be made before the expiry of the period sought to be extended.

75. Effect of commitment to comply with requirements of infringement notice

If a person makes a commitment to comply with the requirements of an infringement notice within the compliance period, the Commission may not bring proceedings in the Tribunal against that person in respect of the alleged contravention specified in the notice.

76. Failure to comply with requirements of infringement notice

(1) This section applies where a person has made a commitment to the Commission to comply with the requirements of an infringement notice.

(2) Nothing in section 75 prevents the Commission from bringing proceedings in the Tribunal, where it has reasonable grounds for suspecting that the person who has made the commitment has failed to comply with one or more of the requirements of the infringement notice.

77. Registration of commitments

The Commission must register commitments made under this Division in the register maintained by the Commission under section 64 (Register of commitments) and the provisions of that section also apply, with any necessary modifications that the circumstances require, to commitments made under this Division.

78. Publication of infringement notices If a person has made a commitment under this Division to comply with the requirements of an infringement notice, the Commission may publish the infringement notice—

(a) through the Internet or a similar electronic network; and

(b) in any other manner the Commission considers appropriate.

Division 3—Leniency

79. Interpretation

In this Division—

“officer” (高級人員) means—

(a) in relation to a corporation, a director, manager or company secretary of the corporation, and any other person involved in the management of the corporation; and

(b) in relation to an undertaking (other than a corporation or partnership), any member of the governing body of that undertaking.

80. Commission may make leniency agreements

(1) The Commission may, in exchange for a person’s co-operation in an investigation or in proceedings under this Ordinance, make an agreement (a “leniency agreement”) with the person, on any terms it considers appropriate, that it will not bring or continue proceedings under Part 6 for a pecuniary penalty in respect of an alleged contravention of a conduct rule against—

(a) if the person is a natural person, that person or any employee or agent of that person;

(b) if the person is a corporation, that corporation or any officer, employee or agent of the corporation;

(c) if the person is a partner in a partnership, that partnership or any partner in the partnership, or any employee or agent of the partnership; or

(d) if the person is an undertaking other than one referred to in paragraph (a), (b) or (c), that undertaking or any officer, employee or agent of the undertaking,

in so far as the contravention consists of the conduct specified in the agreement.

(2) The Commission must not, while a leniency agreement is in force, bring or continue proceedings under Part 6 for a pecuniary penalty in breach of that leniency agreement.

81. Termination of leniency agreement

(1) The Commission may terminate a leniency agreement if—

(a) the other party to the agreement agrees to the termination;

(b) it has reasonable grounds to suspect that the information on which it based its decision to make the agreement was incomplete, false or misleading in a material particular;

(c) the other party to the agreement, or if the agreement was made by a person as an officer, employee or agent of an undertaking, that undertaking has been convicted of an offence under Part 3; or

(d) it is satisfied that the other party to the agreement, or if the agreement was made by a person as an officer, employee or agent of an undertaking, that undertaking has failed to comply with the terms of the agreement.

(2) The Commission may terminate a leniency agreement by giving notice in writing to the other party to the agreement and to any other person who appears to the Commission to be likely to benefit from the agreement, stating—

(a) the date of the termination; and

(b) the reasons for the termination.

(3) A notice under subsection (2) must specify the period within which representations may be made to the Commission about the proposed termination.

(4) The period specified for the purpose of subsection (3) must be a period of at least 30 days beginning after the day on which the notice is given.

(5) Before terminating a leniency agreement, the Commission must consider any representations about the proposed termination that are made to it.

Division 4—Warning Notices

82. Warning notices

(1) If the Commission has reasonable cause to believe that—

(a) a contravention of the first conduct rule has occurred; and

(b) the contravention does not involve serious anti-competitive conduct,

the Commission must, before bringing proceedings in the Tribunal against the undertaking whose conduct is alleged to constitute the contravention, issue a notice (a “warning notice”) to the undertaking.

(2) A warning notice must—

(a) describe the conduct (the “contravening conduct”) that is alleged to constitute the contravention;

(b) identify the undertaking (the “contravening undertaking”) that has engaged in the contravening conduct;

(c) identify the evidence or other materials that the Commission relies on in support of its allegations;

(d) state—

(i) that the Commission requires the contravening undertaking to cease the contravening conduct within the period (the “warning period”) specified in the notice, and not to repeat that conduct after the warning period;

(ii) that, if the contravening conduct continues after the expiry of the warning period, the Commission may bring proceedings in the Tribunal against the contravening undertaking in respect of the contravening conduct; and

(iii) that, if the contravening undertaking repeats the contravening conduct after the expiry of the warning period, the Commission may bring proceedings in the Tribunal against the contravening undertaking in respect of the contravening conduct and the repeated conduct; and

(e) indicate the manner in which the contravening undertaking may cease the contravening conduct.

(3) In determining the warning period, the Commission must have regard to the amount of time which the contravening undertaking is likely to require to cease the contravening conduct.

(4) After the expiry of the warning period—

(a) if the Commission has reasonable cause to believe that the contravening conduct continues after the expiry, the Commission may bring proceedings in the Tribunal against the contravening undertaking in respect of the contravening conduct; and

(b) if the Commission has reasonable cause to believe that the contravening undertaking repeats the contravening conduct after the expiry, the Commission may bring proceedings in the Tribunal against the contravening undertaking in respect of the contravening conduct and the repeated conduct.

(5) To avoid doubt, proceedings under subsection (4) may not be brought in respect of any period that precedes the warning period.

(6) The Commission may, either of its own volition or on application made to it in writing, extend the warning period specified in a warning notice if it considers that there is a good reason for doing so.

(7) An application for an extension under subsection (6) must be made before the expiry of the period sought to be extended.