EU Competition Law: 14 Portuguese Banks Exchanged Information

Aug 16, 2024 Benn-Ibler Rechtsanwälte

For more than 10 years, 14 Portuguese credit institutions have been exchanging information with each other. This could constitute a restriction of competition by object, according to a Portuguese national court. The case has been referred to the European Court of Justice for a preliminary ruling on the matter.

In September 2019, the Portuguese competition authority fined 14 credit institutions EUR 225 million in the case to be decided. The authority found that by participating in an extensive monthly exchange of sensitive information on a reciprocal basis for more than ten years between 2002 and 2013, these credit institutions had infringed national and EU competition law.

The subject matter of the exchange of information was the markets for mortgage loans, consumer loans and corporate loans. It concerned, inter alia, certain current and future terms and conditions of business, in particular credit spreads and risk parameters. The Authority considered that this exchange of information was an autonomous exchange of information, as it was not linked to a restrictive concerted practice, such as a price agreement or market sharing. Nevertheless, the Authority considered that there was a restriction of competition by object. Most of the credit institutions concerned challenged the authority's decision before the Portuguese national courts. They argued that the exchange of information in itself was not sufficiently harmful to competition to be considered a restriction of competition by object.

The national court concerned would now like the preliminary ruling procedure to clarify when an exchange of information can be classified as restricting competition by object.

The ECJ has now ruled as follows:

An autonomous exchange of information between competitors may constitute a restriction of competition by object. It is sufficient that the exchange constitutes a form of co-ordination which, in the context of the exchange itself, must be regarded as detrimental to the proper functioning of normal competition. For a market to function under normal conditions, market participants must be able to determine independently the policy they wish to pursue and remain uncertain as to the future behaviour of other market participants.

ECJ C-298/22 (29 July 2024)