The Danish advisory firm ECIT Account A/S (“ECIT”) has been found to have violated the Danish Competition Act by acting as an advisor in the establishment and maintenance of a market sharing agreement. 

The decision underlines that an advisory firm can also be held co-responsible in cases regarding infringements of competition law. The case here involved market sharing in the Danish market for nightclub services. 

The decision stems from a previous decision from 2021, where 22 nightclubs acknowledged that they had infringed the Danish Competition Act and accepted fines issued by the Danish Competition Council ("DCC”). The nightclubs had collectively established the chain company NOX Network ApS (“NOX”), and ECIT was appointed as chairman of this chain. As part of this, an agreement on market sharing was entered into as the members agreed that each nightclub was not allowed to open branches in the cities, municipalities or within a certain radius of each other respectively. The agreement was valid from 13 July 2004 to 24 March 2020.

In the present case, The Danish Competition and Consumer Authority found that ECIT had been involved in the establishment and maintenance of the market sharing agreement and had thus infringed Article 6 of the Danish Competition Act (the Danish equivalent to Article 101(1) TFEU). 

Of particular importance for the decision is the fact that ECIT, through its leading role in the NOX board, had been responsible for the formulation of the market sharing agreement and the contractual basis hereof. Additionally, ECIT actively participated in meetings involving discussions of the market sharing. On this basis it was found that ECIT had full knowledge of the restrictive agreement and intended to contribute to it and was therefore found to be co-responsible for the overall violation throughout the entire time of the agreement’s existence. 

The decision shows that when an adviser participates in the formation and continuation of a cartel, the adviser can become liable for the violation together with the actual participants in the cartel. This is the case even if the advisor is not active in the market in which the cartel operates.

The case awaits the DCC’s decision on a possible fine to ECIT. 

For interest in the decision regarding the nightclubs click here.

For more information, please contact Morten Nissen,  Alexander Brøchner or Nanna Sofie Krabbe. 

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