In 2001-2002, a so-called cost basis for a law firm was drawn up by the Law Society of Iceland (LMFÍ). In November 2002, the LMFÍ published the cost basis to its members, with information on what lawyers' hourly rates should be at a minimum, based on the basis. In the opinion of the Competition Council, the LMFÍ encouraged an increase and harmonisation of lawyers' fee structures by having the cost basis negotiated and published. The Competition Council concluded that the Law Society had breached the prohibition on illegal collusion in the Competition Act.
Illegal collusion between companies, or the encouragement of such conduct by trade associations, is one of the most serious breaches of competition law. The Competition Council considers it appropriate for the LMFÍ to pay a fine of 3.5 million krónur to the state treasury for the breach. With reference to the knowledge of competition law that can be expected of LMFÍ, and in light of the fact that the association has previously breached competition law1, the Competition Council considers there is all the more reason to impose fines to ensure that the association complies with the prohibition provisions of competition law in in the future.
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