Competition Law Review – News From the Nordics

In this article we will focus on the Nordic region, covering trends highlighted during our research into the competition law market in Norway, Sweden, Finland and Denmark.

Foreign Direct Investment was a key talking point for lawyers across the region, with the general consensus being that it had led to an increase in work, and a similar increase is expected with the introduction of the Foreign Subsidies Regulation.  As Sweden already had a security act, lawyers there were well prepared for the introduction of FDI.  They mentioned that while the transactional market in Sweden may have seen a slight slowdown, this has not had an impact on the number of merger clearance notifications being filed, which remain high – to the extent that the authority is not currently able to investigate all of them and some are being cleared despite concerns.  The Swedish authority is however, an active user of the power to refer mergers that fall below both national and European Union thresholds to the EU Commission for review. 

Lawyers in Finland were divided in their thoughts around merger clearance.  The more pessimistic ones highlighted the downturn in M&A work that was also observed in Sweden and feared this would negatively impact the amount of work for competition lawyers.  The more optimistic ones though were hoping for an increase in work since merger control remains the main focus of the Finnish authority and the threshold for notifying mergers has recently been lowered.

Although merger clearance remains a major topic of conversation and a key source of work in the Nordic region, lawyers did report that the majority of this work was comparatively simple with only a handful of Phase II investigations across the entire region in the past year.  Indeed, one Norwegian lawyer estimated that 97% of the filings before the Norwegian authority were under the simplified proceedings.

It will come as no surprise to anyone who has followed the news over the past year, that competition authorities in the Nordic region are particularly alert for anti-competitive behaviour in the energy and food sectors. 

Authorities in Norway and Sweden have been particularly active in conducting market inquiries in these industries.  Danish and Norwegian lawyers also highlighted the pharmaceutical and technology sectors as being big areas of focus for the authorities currently.

The Finnish authority appears to be the least active in behavioural matters currently.  By contrast, the Swedish authority has recently imposed its highest ever fine for retail price maintenance, while in Denmark there have been cartel investigations in the retail and entertainment sectors, as well as in the topical area of the energy industry.  The recent focus in Norway has been on the illegal exchange of information.

The Norwegian Competition Authority has a reputation for imposing higher fines than other authorities in the region, which naturally gives a strong incentive to companies to appeal any adverse decisions.  Interviewees estimated that over the past 15 years there had been (on average) at least one major fining decision a year.  However, they were unsure how much longer this would continue as they felt that the number of leniency applications was falling, which would make it more difficult to conduct investigations in future.  This is a trend that was mentioned in many European jurisdictions, but Sweden seems to be bucking this trend and has seen an increase in the number of leniency applications in the past year. 

This should perhaps though be taken with a pinch of salt since in previous years the number of leniency applications had been so low that there was debate around whether they should be done away with altogether.  It may therefore not be the case that Sweden will see a huge upsurge in leniency applications, but possibly simply that it will start to reach similar levels to the rest of the region – as those jurisdictions see numbers dropping off.

In common with most jurisdictions in Europe, the number of damages actions is increasing in the Nordic region.  Of course, the trucks cartel action is a headline case in all jurisdictions, but Norway in particular has several other enforcement actions starting to appear.

Looking to the future, there may well be more work for lawyers in this area in the coming years and more causes for caution for their clients.  As of the middle of 2024, the Danish authorities are expecting to be able to call in mergers that would normally fall below the threshold, which is a power that the Norwegian authorities already have.  The Danish authorities are in line to gain the power to impose higher fines and to carry out so-called ‘preventative’ investigations – powers which the Norwegian authority also hopes to gain.

Over in Sweden, the government is in the process of carrying out an investigation to determine whether the authority needs more power.  Depending on the outcome of this investigation, lawyers may find the last few months of 2024 busy dealing with questions from clients on how to deal with these potential new powers that may come into effect in 2025.  The Norwegian rules around Public Procurement are also under review, which may again lead to changes appearing in 2025.

One change that may not immediately appear relevant to the competition sphere is the Danish Payment Services Act.  However, this has overlaps in the area of abuse of dominance and because the thresholds for an investigation are lower than under Danish competition law.  It will therefore be important for companies to ensure they are in compliance with this act as well as the competition law regulations.

Although there have not yet been any significant decisions or concrete developments around the use of sustainability as a defence in competition law cases, lawyers in both Denmark and Norway highlighted it as being an area of focus for the authorities and it will be interesting to see how this focus develops over the course of 2024.

In the Nordic region, Public Procurement is often treated as a related practice area to Competition law and in both Norway and Denmark, we have Public Procurement as a subtable of our Competition law tables.  We have this year introduced a new Procurement law subtable in Finland to reflect the growing activity in this area.  In Sweden we have a separate table for Public Procurement as this appears to be the jurisdiction with the greatest focus on procurement in the region, with numerous projects taking place in the North of the country around green energy and transport infrastructure.

Across the region, there is a strong focus on projects involving the renewable energy sector, which is of course understandable given the focus on fighting climate change.  However, climate change is having an additional impact on procurement work, with several jurisdictions in the region making the climate change and environmental impact a key aspect of tender processes – with some reports in Norway suggesting that this could account for 30% of the weighting when deciding which contractor to choose.

What does all of this tell clients or lawyers hoping to do business in the Nordic region in 2024?  For the most part, the key sector focuses and trends are reflective of what firms and companies will be seeing in their home jurisdiction, though the specific recent focus of each authority may be a useful guide for companies. 

The role of procurement may make the Nordic region stand out from competition law areas in the rest of Europe and particularly the focus on environmental impact could be a useful insight for companies.

Additionally, given the potential for changes to the powers of the competition authorities in the region in the second half of this year and early in 2025, it seems clients planning to do business in the Nordics may be well advised to do so as early as possible in 2024 to take advantage of the current certainty.