The Competition Act has changed again: What impact will this have on businesses?

The amendment to the Competition Act that came into force on May 10, 2024, have brought significant changes to several areas of the previously known system. The amendment affects cartel prohibition, de minimis rules and the statute of limitations for claims based on competition law violations.

Cartel Prohibition

Under the new regulation, an agreement between companies — which would generally be considered anti-competitive — are no longer subject to cartel prohibition if

• the agreement is concluded between a company and one of its joint controllers and is related solely to behavior in markets where the jointly controlled company operates.

This means that such agreements between these companies — e.g., between a subsidiary and one of its parent companies — are generally exempt from the prohibition on anti-competitive agreements.

For instance, exclusive purchasing agreements and the exchange of sensitive information between the mentioned companies may now be permitted under the new rules.

De Minimis Rules on Exemption for Minor Agreements

The purpose of the de minimis rules is to focus competition law enforcement on genuinely anti-competitive behavior while excluding minor activities that do not significantly affect market operations. These rules ensure that competition authorities use their resources efficiently and that companies are not subjected to unnecessary legal uncertainty over minor agreements.

The latest amendment to the Competition Act has also changed these regulations. From May 10, 2024, coordinated behaviors that constitute anti-competitive practices may also fall under this category, which practices may involve, for example:

• setting purchase or selling prices, or other business terms;
• restricting production or distribution;
• dividing markets, including collusion on tendering;
• import or export restrictions.

Statute of Limitations in Competition Law Violations

The statute of limitations rules for claims based on competition law violations have also been amended as of May 10, 2024. The statute of limitations rules (that came into force on January 15, 2017) apply in competition law damages claims, in case:

• the violation occurred before January 15, 2017, but
• it was established by a decision of the Hungarian Competition Authority or the European Commission issued after January 15, 2017, provided that the statute of limitations had not yet expired by January 15, 2017, and
• the related lawsuit was filed after May 10, 2024.

Summary

The above detailed changes are expected to ease the operation of companies that have controlling relationships with each other, ensuring that common corporate governance practices can now be applied without breaching competition law. The new statute of limitations rules provide greater legal certainty for victims of competition law violations, enabling them to assert their claims within a reasonable time frame.