It was December 2020. People kept their corona distance, while filling their shopping baskets with mulled wine and pork chops. The grocery industry was able to record an economic peak year. But just before Christmas Eve itself, the shock letter arrived. The Norwegian Competition Authority believed that three grocery players had colluded prices illegally. It had destroyed competition in the market. Put another way: the total on your cash register could have been lower. Such price cooperation would sting, the authority’s bureaucrats believed. They announced fines totaling NOK 21 billion. Bureaucratic language This case is about infringement fees and supervisory bodies. The words are a bit convoluted. An infringement fee is money required from people or companies who have broken the law. The fee is therefore a kind of punishment, but the police are not involved. For the sake of simplicity, we can call it a bot. A supervisory body checks whether laws and regulations in society are being followed: Finanstilsynet controls banks. The Norwegian Food Safety Authority checks how food is prepared and animals are treated. The Norwegian Labor Inspection Authority checks whether people have safe workplaces and receive the right wages. Senior inspector Magne Kristensen in the Norwegian Labor Inspection Authority during an inspection at the fish farm on Måsøya in Finnmark. Photo: Ksenia Novikova / news But even if the Norwegian Labor Inspection Authority reveals that people are exploited in the worst way, or risk life and health at work, their fines are small change compared to the Norwegian Competition Authority’s fines. The Norwegian Labor Inspection Authority’s maximum fine is only NOK 1.65 million – regardless of how serious the offenses are. Law and philosophy How severe punishments a society should have is, in a way, a philosophical question. Sven Arntzen, professor of practical philosophy at the University of Southern Norway, reacts to the large fee differences: – Price cooperation means that you and I have to pay a little more for eggs and bread. Social dumping, on the other hand, has enormous personal consequences for the individual worker. I find the fee difference very problematic. Professor Arntzen is not alone in his opinion. The Storting is considering a change in the law In the Storting, several parties will change the law, so that the Norwegian Labor Inspection Authority has free rein on fees. It happens after news reported in June that a shipyard company made a profit, even after being fined for breaking the law. It is completely contrary to the way the Working Environment Act was intended. news has now investigated 17 supervisory bodies. How much fines can they give? The mapping shows major differences: Some inspectorates have no upper ceiling – i.e. no limit to how large a fine they can issue. Some have a specific amount as an upper limit, for example NOK 1.65 million. Others can collect up to 10 percent of the turnover of the company that has broken the law. (At the bottom of the case is an overview of the largest fines from each authority.) The mega fines from the Competition Authority are an example of the last bullet point. – In this case, fees have been notified where the upper limit of 10 per cent of annual turnover has been used, says department director Beate Berrefjord. The case has not been finally decided. Facts about the Competition Authority’s mega fines The Competition Authority has notified infringement fines of: 8.8 billion to Norgesgruppen. They own Kiwi, Meny and Joker, among others. 7.4 billion to Rema 1000 4.8 billion to Coop. The case has not been closed and the fees have not been finally approved. Animal welfare vs. finance At the other end of the scale is the Norwegian Food Safety Authority. NOK 24,460 is the maximum fine they can give individuals. If the fine is for a business, the upper limit is NOK 1.65 million. What are the Norwegian Food Safety Authority’s guidelines for fines? – The fee must be in proportion to the seriousness of the infringement. Consideration can also be given to profits from the infringement and the inspectorate’s costs in the case, says section advisor Kirsti Brox. The Norwegian Food Safety Authority investigates animal welfare in Norway. Photo: Norwegian Food Safety Authority The largest fine the Norwegian Food Safety Authority has issued is NOK 400 million. DNB had to pay it. The bank had been too poor at preventing and detecting money laundering. When Finanstilsynet has to issue a fine, they have a lot of freedom: Up to 10 percent of turnover. Or NOK 9 million to individuals, or NOK 44 million to the company. Alternatively, a fine twice the amount of the proceeds of the offense (if it can be calculated). Then the fine can be huge. Director of Finanstilsynet, Morten Baltzersen, during a press conference in Oslo. The inspectorate has three options when issuing fines. Photo: Gorm Kallestad / NTB Speculating on offences? Philosopher and former ethical adviser for the Oil Fund, Henrik Syse, puts his finger on a paradox: – It is unfortunate if the fees are so low that some people speculate about breaking the law. If they are caught, they can only pay the fine and still profit from breaking the law. – Why are there such large differences in the level of fines? – This is probably due to a lack of coordination. We have so many things that need laws and regulations that it is difficult to see everything in context. He recommends that the politicians take a closer look at the fine levels. They must be assessed in the light of severity and ethical perspectives, he believes. Philosopher Henrik Syse believes politicians should take a closer look at the levels in the light of severity and ethical considerations. Photo: Heiko Junge / NTB scanpix For fear and warning The number of fines for infringements has increased dramatically. Before 1990, only three laws allowed it. In 2011 there were 30, while in 2016 there were around 50 laws that gave access to it. – In that sense, one could perhaps have expected more harmonization between the amounts, says Sigrid Stokstad. She is an expert in administrative law at the University of Oslo. – One can ask questions about whether low rates, such as at the Norwegian Labor Inspection Authority, are suitable for achieving the purpose of the fee. – Are the fines too low to deter large companies from breaking the law? – Yes I believe. The Minister of Labor hesitates The Government still does not want any change now. Labor Minister Marte Mjøs Persen (Ap) will assess the effect of the signals she has given the Norwegian Labor Inspection Authority. They have been told to issue larger and more frequent fines. Photo: Stian Lysberg Solum / Stian Lysberg Solum Labor Minister Marte Mjøs Persen (Ap) writes in a recent letter to the Storting that she will first assess the effect of the signals she has given the Norwegian Labor Inspection Authority. She has instructed the supervisory authority to issue larger and more frequent fines. She also writes that “it is important that the infringement fee has a preventive effect and that infringements of the regulations should not pay off.” Read the entire letter here. news has asked Persen how the Norwegian Labor Inspection Authority will ensure that violations of the rules do not pay off, in cases where the profit from the violations is greater than the current fee limit of NOK 1.65 million. – If the crime is of a more serious nature, it is not the Norwegian Labor Inspectorate, but the police, who will investigate, she says. – Other fines and sanction options will then apply. The Norwegian Labor Inspection Authority should therefore report the matter to the police if the gain from the offense is considered to be greater than the fee limit, adds Persen. On 24 November, the Storting will vote on the proposal to remove the Labor Inspectorate’s upper fee limit. Below you can see the list of the largest fines from various inspections. The largest infringement fines from the Competition Authority: NOK 8.8 billion. to Norgesgruppen (announced, not finally adopted) NOK 7.4 billion. to Rema 1000 (announced, not finally adopted) NOK 4.8 billion. to Coop Norge (announced, not finally adopted) NOK 788 million to Telenor for abuse of its dominant position. (Paid) Finanstilsynet: NOK 400 million to DNB for non-compliance with the Money Laundering Act. (Paid) Norwegian Data Protection Authority: NOK 65 million to the dating app Grindr for breach of privacy. (Accepted and appealed. Complaint not processed.) National Communications Authority (Post and Telecommunications Authority): NOK 15 million to Telenor for breach of the duty of non-discrimination in the market. (Paid) Norwegian Consumer Protection Authority: NOK 4 million to an online store for misleading marketing. (Accepted and appealed. Complaint not processed.) Norwegian Labor Inspection Authority: NOK 1.4 million to a company in the construction industry that underpaid workers. (Adopted) Norwegian Food Safety Authority: NOK 1.4 million to a farming company for poor fish health in the cages. (Paid) The Norwegian Civil Aviation Authority: NOK 1 million to Avinor for breach of common European security regulations. (Paid) The Norwegian Media Authority: NOK 700,000 to SBS Radio for breach of license conditions. (Paid) Justerveseten: NOK 140,000 to a company in the fishing industry for incorrect scales. (Paid) Other supervisory bodies: The Norwegian Food Safety Authority and the Norwegian Petroleum Safety Authority are allowed to issue infringement fees, but have not yet issued one. The Norwegian Railway Authority can issue an infringement fee, but has not informed news whether they have issued one. The Norwegian Health Authority, the Road Safety Authority, the Lotteries and Foundations Authority and the Authority for the Universal Design of ICT are not allowed to issue infringement fees.
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Billions in fines from public inspections – news Dokumentar
