A decision of the Constitutional Court of Malta delivered on the 3rd May 2016, confirmed there was an irregularity about Article 13A(1) of the Competition Act which says an appeal may be filed before an Appeals Tribunal from any infringement decision, cease and desist or compliance order, administrative fine and, or daily penalty payment adopted or imposed by the Director General. Article 39(1) of the Constitution of Malta says that any person [...] charged with a criminal offence [...] shall, unless the charge is withdrawn, be afforded a fair hearing within a reasonable time by an independent and impartial court established by law, an echo of Article 6(1) of the European Convention on Human Rights: everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law.
The Malta Competition and Consumer Affairs Authority Act established the Appeal Tribunal to be composed of a judge and two other members from a panel of ordinary members. In a nutshell, the present legislation does not permit the Director General (DG) Competition to impose punitive sanctions because the Competition and Consumer Appeals Tribunal (CCAT), though independent and impartial, cannot be considered a "Court" in the classical sense of the word.
The Government's first proposal was to amend Article 39(1) of the Constitution, however, sections of the Constitution are known in legal jargon as 'entrenched' - this calls for the approval of two-thirds of the House of Parliament for any amendments to go through. The Government does not have such a large majority and this would entail roping in Members of the Opposition to vote for the amendment. More often than not, it happens to be that the Opposition party has valid reasons not for disapproving, thus any attempt at amending the Constitution usually gets shelved.
The said Constitutional Court judgment involved the Federation of Estate Agents (the Federation) contesting investigations carried out by the DG Competition. The Federation was being investigated under Article 5(1) of the Competition Act and Article 101(1) of the Treaty on the Functioning of the European Union which prohibit all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States […]. The Federation reacted to the DG Competition’s allegations by filing a constitutional application before the First Hall of the Civil Court sitting in its constitutional jurisdiction.
The crux of the drafted amendments is that for the sake of protecting the fundamental rights of undertakings, actions of the DG Competition are subject to the further scrutiny of the national courts. In this context, it should be noted different governmental authorities vary in the form of enforcement and sanctioning powers they enjoy. For example, administrative fines imposed by certain authorities may be open to contestation before the Administrative Review Tribunal (ART), presided by a magistrate. When a decision of the ART is final, the grounds of appeal are on a point of law and of fact to the court of Appeal (Inferior Jurisdiction). Instead, the procedure of the CCAT is only allows a right of appeal on a point of law to the court of Appeal (Superior Jurisdiction).
From a bird's eye view, it is a lacuna of Maltese law there isn't the notion of criminal liability for individuals intentionally take part in serious anti-competitive practices, particularly cartels. The Federation of estate Agents began constitutional proceedings for fear it may be charged with a fine running into a million euros. The irony of this is that since its inception in May 2011, the DG Competition only collected a few thousand euros in fines. Every governmental authority is faced with the dilemma of being too lenient or over reactive but in either case something is amiss if it is too much leaning to one side or the other. A reform to the DG Competition was well overdue.