In November 2023, the Italian Competition Authority (“ICA”) asked the Italian Council of State to clarify the scope of application of Article 1, paragraphs 5 and 6, of Decree Law 104/2023 (as converted by Law 136/2023) that granted new enforcement powers to the ICA with respect to anticompetitive conducts put in place by carriers active in the air passenger transport sector.

In particular, the ICA was seeking clarifications as to whether - in the light of the amendments made to the wording of the law, as converted - the scope of the powers introduced by Article 1, paragraphs 5 and 6, above should be considered to be limited to the air passenger transport sector or can be assumed to extend, in general terms, to all fact-finding investigations that will be carried out by the ICA.

To recall, as mentioned in our previous article, the intervention of the Italian legislator was an attempt to curb rising prices on air routes to the Italian islands, especially when implemented through algorithms and consumer profiling techniques. The ICA already made use of its new powers by launching, in November 2023, an ex-officio fact-finding market investigation on the use of pricing algorithms in passenger air transport on routes between the Italian peninsula and the two main Italian islands. Nevertheless, the ICA was looking for a broad and transversal interpretation, not limited to the passenger transport sector. 

With the opinion published in January 2024, the Italian Council of State has agreed with the interpretation of the provisions at stake, as suggested by the ICA. The opinion delivered by the Council of State establishes that the new ICA powers operate without sectoral or product-related restrictions, and thus apply to all sectors and products for which the ICA intends to activate its fact-finding investigative powers.

The Council of State thus explicitly recognised that the relevant powers granted to the ICA by the relevant law (namely, the power to: (i) formulate specific requests for information, with sanctions in the event of non-compliance or incomplete or untruthful answers; (iii) carry out inspections; and (iii) impose structural or behavioural measures on concerned companies) are of a general nature and scope, without sectoral and/or product-related limitations.

In the Council of State’s view, a sectoral limitation of the ICA powers to a specific product sector would be unreasonable and contrary to the objective pursued by the legislative provisions (i.e., ensuring that effective competition is restored in contexts in which the weakening of competition between operators results neither from the adoption of concerted practices, nor from regulatory restrictions, but from the market structure itself).

The Opinion of the Council of State (available in Italian at the following link) plays a crucial role, also considering that the ICA's fact-finding investigative powers fall within the wider cognitive powers of the ICA, aimed at guaranteeing support to the Italian legislative institutions, with a view to promoting competition in the country, and consequently, adjusting the principles of competition embedded in the Italian legal framework to the economic reality.

If you need more information or further guidance in this area, please contact Federico Marini Balestra, Lucia Antonazzi and Chiara Horgan.

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