Spanish markets and competition authority levies token fines on collective bargaining agents in the stevedore dockworkers’ sector

The Court of Justice of the European Union (CJEU) has declared that it has no jurisdiction to reply to the request for a preliminary ruling that had been submitted to it by the Spanish Markets and Competition Commission (CNMC) over whether it was legal for the obligation to take over the contracts of the stevedore dock workers to be imposed through collective agreements and labor agreements as required in the amendment to the Fourth Framework Agreement. In a judgment delivered on September 16, 2020 (Case C-462/19), the European court did not admit the request for a preliminary ruling because the CNMC is not a court or a tribunal.

This decision prompted the CNMC’s recent decision (decision of December 18, 2020; proceeding S/DC/1619/17) on the penalty proceeding it commenced against the parties that signed that amendment of the Fourth Agreement which had been stayed until a reply was obtained to the request for a preliminary ruling. The CNMC concluded that the conditions determining that obligation (making it mandatory and on terms that are not objective, transparent or fair) fall outside the contents of collective bargaining, and therefore, besides rendering them void, it held to be proven that a very serious infringement had taken place. 

However, because the Fourth Agreement was amended to put a transitional arrangement in place until a Fifth Framework Agreement could be approved (subject to Royal Decree Law 8/2017 amending the regime for workers providing port services for cargo handling), and because the parties negotiating the terms of this agreement have been submitting successive drafts to the CNMC for consultation in good faith, the Commission has taken into consideration the parties’ intention for the Fifth Agreement to observe the requirements in the legislation for liberalization of the sector and the maintenance of effective competition, and as a result it ultimately only imposed a sanction consisting of a token fine totaling €70,000 as opposed to its original proposal of a multi-million euro fine in the region of €7,000,000.

Although the CNMC’s decision is not final, since it has already been appealed to the National Appellate Court, we consider that the CNMC will oversee that the Fifth Agreement (if and when it takes shape) actually satisfies the requirements ensuring competition concerning the taking over of the employees’ contracts.