The amount of fines that can be imposed by the GVH has increased

By: Trademagazin Date: 2024. 09. 12. 11:58

From August 1, 2024, the Economic Competition Office (GVH) may impose even higher fines on businesses that violate the law. On September 1, 2023, the maximum amount of the fine that could be imposed rose from 10% to 13%, and less than a year later to 15%. The primary goal of the GVH is not to impose fines, but at the same time, the increase in the possible monetary sanction has a serious deterrent effect.

The Competition Council of the GVH imposed HUF 2.2 billion in fines in 2023, for a total of 97 businesses. The amount of competition fines imposed so far in 2024 already exceeded HUF 2 billion in August of this year.

The specific fine amount is calculated by the Competition Council of the GVH within the discretionary framework provided by the Competition Act and the fine notices issued by the authority, taking into account all the circumstances of the given case. The maximum fine that can be imposed is determined by the previous year’s net sales of the company concerned – even at the company group level.

In order to increase the deterrent force related to legal violations, the maximum amount of fines that can be imposed on companies was increased from 10% to 13% of the previous year’s net sales on September 1, 2023.

Since then, the GVH Competition Council has imposed fines in several cases, three of which already applied the higher maximum fine ceiling of 13%. The amount of fines imposed in this way was close to HUF 700 million. The GVH imposed the maximum fine on an illegal e-cigarette distribution company and an online lamp retailer due to unfair commercial practices. In the third case, in a follow-up investigation, the GVH imposed a record fine on a company operating the global online accommodation booking platform Booking.com, considering the follow-up investigations, because the company did not fully fulfill its obligations previously prescribed by the authority.