Kyiv, 6 Ivana Dracha St., of. 15
Your power to winAppeal against fines of the AMCU
Violation of competition law and actions defined as unfair competition entail liability as stipulated by law, including the imposition of fines depending on the type of violation established.
A fine imposed by the AMCU (Antimonopoly Committee of Ukraine) must be paid within two months from the date of receiving the decision on its imposition. This legal requirement is mandatory. In case of non-payment, a penalty of 1.5% of the fine amount is charged for each day of delay.
Within five days from the payment of the fine, the business entity is required to send documents confirming the payment of the fine to the Antimonopoly Committee of Ukraine. In case of late payment of the fine and penalty, the AMCU will collect the fine and penalty through legal proceedings. The amount of the penalty cannot exceed the amount of the fine imposed by the decision of the AMCU. However, there are cases where the penalty equals the fine amount. Thus, late payment of the fine may result in the fine being doubled.
For failure to comply with the decisions of the Antimonopoly Committee of Ukraine or for partial compliance, fines of up to ten percent of the revenue (sales) of the business entity from the sale of goods (products, works, services) for the last reporting year preceding the year in which the fine is imposed may be levied. In the case of unlawfully obtained profit exceeding ten percent of the specified revenue (sales), the fine is imposed in an amount not exceeding three times the unlawfully obtained profit. The amount of unlawfully obtained profit can be calculated using an evaluative method.
However, if there are grounds to believe that the Antimonopoly Committee of Ukraine's decision to impose a fine is unjustified and unlawful, it is necessary to conduct a review and challenge the legality of the penalty imposition, which is an effective way to protect business entities for the following reasons:
- During the review, the authority of the body that imposed the sanction must be established, as well as the method used to determine the revenue (sales) of the business entity from the sale of products.
- While the review or reconsideration of the decision in a case of violation of the competition protection legislation is ongoing, the calculation of the penalty on the fine is suspended.
- During this period, antimonopoly authorities have the right to delay or restructure the payment of the imposed fine through a decision. To do so, it is necessary to apply to the Antimonopoly Committee of Ukraine with a request for postponement and/or installment of the fine payment. The application must include a legal justification and the relevant documents confirming the inability to pay the fine.
It is essential to challenge the Committee's decision if it is evident that the antimonopoly authorities failed to fully investigate the facts relevant to the case, and the conclusions made are not supported by evidence. In such a case, this constitutes the legal grounds for declaring the Antimonopoly Committee's decision invalid. If judicial appeal is chosen, the court may suspend the effect of the Antimonopoly Committee's decision for the duration of the proceedings if there are sufficient grounds for it.
Thus, professional legal assistance when challenging unjustified penalties imposed by the Antimonopoly Committee of Ukraine is the key to choosing the right method of protection against financial sanctions and unlawful decisions by the Antimonopoly Committee of Ukraine.
- Written and/or oral consultation on challenging fines imposed by the AMC and selecting appropriate methods of defense against them;
- Legal analysis of the legality of holding responsibility through the imposition of fines and penalty fees;
- Drafting and preparing documents related to challenging fines imposed by the AMC;
- Preparation of an application for the deferral and/or installment of the payment of the imposed fine;
- Representation of the client’s interests in administrative or judicial procedures related to challenging fines imposed by the AMC.
Although the competition law imposes the responsibility for collecting evidence in a case on the antimonopoly authorities, the business entity must also take an active role in its defense by gathering evidence in its favor to ensure effective protection when appealing an AMC decision.
Gathering and ensuring a proper evidentiary base against the AMC's allegations may also be useful when determining the fine amount as mitigating circumstances. This is because, when mitigating circumstances are applied, the base fine amount can be reduced by up to 50 percent in total.
A mitigating circumstance may include the defendant's cessation of actions (or inactions) that show signs of a violation before the relevant decision or preliminary decision of the AMC is made.
Evidence of compensation for the damage caused by the violation or the elimination of its consequences in another way before the relevant decision of the AMC is also accepted as a mitigating factor.
According to Part 1 of Article 60 of the Law of Ukraine "On Protection of Economic Competition," the applicant, defendant, or third party has the right to appeal the decision of the Antimonopoly Committee of Ukraine, either fully or partially, to the commercial court within two months from the date of receiving the decision. This period cannot be reinstated.
According to the Regulation on the Procedure for Conducting Inspections of Compliance with Economic Competition Legislation, approved by the Order of the Antimonopoly Committee of Ukraine on December 25, 2001, No. 182-r, a planned on-site inspection of the same entity can be conducted no more than once a calendar year within the competence of the Committee (or its division), based on an order from the Chairman of the Committee or the head of the division. The basis for conducting planned inspections is a schedule of inspections approved by the Chairman of the Committee or the head of the division.
An unscheduled on-site inspection is one not included in the Committee's or division's work plan and can be conducted without prior written notice. Such inspections are carried out according to an order from the Chairman of the Committee or the head of the division, or an order from the relevant Committee body at the location of the entity being inspected or its separate structural unit, by authorized personnel from the Committee or division. These inspections are conducted if at least one of the conditions specified in Paragraph 8 of the Regulation is met.
According to Paragraph 31 of the Regulation on the Procedure for Conducting Inspections of Compliance with Economic Competition Legislation, the following documents are required for conducting an inspection: an order (or directive) to conduct the inspection and to establish the Commission; a plan for the inspection; a delegation letter from the Chairman of the Committee, the state commissioner of the Committee, or the head of the division delegating the relevant authority to carry out the inspection.
According to Part 1 of Article 48 of the Law of Ukraine "On Protection of Economic Competition," following the consideration of cases involving violations of economic competition legislation, the authorities of the Antimonopoly Committee of Ukraine make decisions, including those to terminate violations of competition law. However, neither this article nor other provisions of the Law grant the AMC the authority to issue instructions (requirements) to a business entity regarding the methods of eliminating the identified violations. Instead, the business entity required to cease violating economic competition law must independently determine the means (methods) of such cessation in accordance with the law.
Issuing a decision in this manner may be grounds for appealing the decision and declaring it invalid.