On 19 August 2026, the German Federal Cartel Office (FCO) published a revised guidance note on settlements in cartel fine proceedings (Revised Guidance), replacing the previous version from February 2016 (Previous Guidance). Settlements allow the FCO to conclude cartel fine proceedings more efficiently through consensual resolution. For companies, settlement can offer two strategic advantages: a shorter fine notice that typically contains significantly less detail about the alleged offence, potentially reducing exposure in follow-on damages proceedings; and a fine reduction in recognition of the expedited resolution.
While the maximum discount of 10% for horizontal cartel cases remains unchanged, the Revised Guidance streamlines the process and shifts the procedural dynamic firmly towards the FCO's discretion. This tighter procedural control mirrors concerns recently voiced by the European Commission, where settlement efficiencies have been frustrated by subsequent appeals. The FCO's repeated emphasis on acceleration signals that it may be less willing to tolerate settlement talks that do not deliver meaningful time savings.
What you need to know
- The FCO decides who settles and when: The bilateral language about either side initiating talks has been removed. The FCO retains full discretion over whether to offer settlement discussions, will terminate them if they do not promise acceleration and simplification, and now signals a clear preference for comprehensive resolutions involving all parties. A single party's refusal may cause the FCO to abandon the settlement route for the entire proceeding.
- One shot to settle: The settlement process now compresses to typically a single meeting or a written offer – down from the multi-step sequence of explanation, access to file, fine indication, hearing and proposal under the previous regime. Companies must take a fully formed position on the facts and the fine before that single interaction. There may be no second round, and the FCO can set a deadline for declaring willingness to settle before substantive discussions begin.
- No more confession: The FCO no longer requires a confession-type submission. Instead, parties must declare a waiver of contestation – a purely procedural declaration, not a factual narrative.
Cartel settlements and their purpose
A settlement allows the FCO to conclude cartel fine proceedings by way of a consensual resolution. Instead of pursuing the full administrative procedure – including detailed hearings, comprehensive access to file and a fully reasoned fine notice – a settling party does not contest the FCO's findings and receives a reduced fine in return. The resulting fine notice is issued in short form, typically without an individualised assessment of the evidence or detailed legal reasoning.
The FCO's Revised Guidance sets out the conditions, procedure and consequences of such settlements. It is an exercise of the FCO's discretion under Section 81d(4) of the Act against Restraints of Competition (ARC), which empowers the FCO to set out general principles for the conduct of its fine proceedings. The Revised Guidance therefore serves as the sole authoritative reference for how the FCO approaches consensual resolutions in practice.
The Revised Guidance in detail
The settlement declaration
One significant substantive change concerns what a settling party must declare. Under the Previous Guidance, a settlement required a confession-type submission. The party had to acknowledge the facts of the offence and the circumstances relevant to determining the fine, effectively providing its own account of the infringement. Unlike the leniency programme, which aims to obtain evidence, settlements accelerate and simplify proceedings once the essential evidentiary material has already been gathered.
The Revised Guidance replaces this with a declaration of waiver of contestation. The party declares that it does not contest its participation in, and responsibility for, the infringement as set out by the FCO. The Revised Guidance expressly classifies this as a procedural declaration – consistent with the EU-wide definition under the ECN+ Directive (Directive (EU) 2019/1) – meaning it references the FCO’s account rather than containing the party’s own factual narrative.
As under the Previous Guidance, the party must also accept the fine up to the amount indicated by the FCO. A waiver of the right to appeal remains explicitly excluded from the settlement declaration.
The Revised Guidance also introduces a clearer framework for cooperation outside the leniency programme. While the Previous Guidance referred only to leniency applications, the Revised Guidance clarifies that cooperation contributions outside the formal leniency programme (i.e. outside the statutory whistleblower immunity rules) are taken into account separately. The settlement discount then applies on top of any reduction already granted for such cooperation. Statements made outside the settlement process or outside formal cooperation contributions remain possible at any time and will be assessed on a case-by-case basis.
A streamlined process on the FCO's terms
The FCO has substantially compressed and reoriented the procedural framework towards its own discretion. The Previous Guidance described a multi-step procedure in which the FCO would explain the facts, grant at least partial access to file, indicate the prospective fine, hear the party, and then transmit a settlement proposal with a deadline for acceptance.
The Revised Guidance compresses this considerably.
- As a rule, only one meeting with each party takes place, or alternatively, the FCO may send a written settlement offer with a deadline. Unlike under the Previous Guidance, the fine amount indicated by the FCO now already includes the settlement discount.
- The FCO may also transmit a draft fine notice in the context of a hearing, on the basis of which the party can submit a settlement declaration without any settlement discussion at all.
- The FCO may set a deadline within which a party must declare its willingness to settle – i.e. even before the substantive exchange begins.
This compressed format demands that companies clarify their position on the facts, the fine range and any cooperation contributions internally at an earlier stage of the settlement proceedings. There may simply not be a second round of discussions.
No entitlement to settlement talks
The Previous Guidance stated that settlement discussions could be initiated "at any time by either side". The Revised Guidance removes this bilateral language entirely. It now provides that the FCO can offer and conclude settlements in the exercise of its procedural discretion, but that there is no entitlement to the FCO entering into or continuing settlement talks.
The FCO will only pursue settlement discussions for as long as, in its assessment, they are likely to achieve an acceleration and simplification of the proceedings.
Preference for comprehensive settlements
The Previous Guidance expressly stated that a settlement did not require all parties in a given case to agree to a consensual resolution. The Revised Guidance reverses this emphasis: the FCO now considers whether a comprehensive settlement with all parties is achievable. While individual settlements remain possible, the FCO signals a clear preference for resolving an entire case at once.
Access to file
The Revised Guidance provides that, before a settlement concludes, the defence is granted access to file on request – a general right under German criminal procedural law. The explicit reservation in the Previous Guidance that full access is excluded where investigations against other parties are ongoing and could be jeopardised has been dropped. This does not mean that full access must be granted in such cases, as there is an explicit reservation under German criminal procedural rules. Rather, it may be a hint that the FCO will generally only be willing to enter into settlement talks when the key evidence against all parties to the proceedings has already been gathered and a comprehensive settlement with all parties is achievable.
Consequences of an appeal
The Revised Guidance, like its predecessor, confirms that a waiver of the right to appeal is not part of a settlement declaration. The Previous Guidance stated that upon objection, the FCO would withdraw the short decision and formulate a detailed fine decision. The Revised Guidance states that the FCO will set aside the fine notice and issue a new fine notice based on the state of investigations at that time. The practical significance of the revised formulation appears to be a clarification that the FCO will not reopen the investigation under Section 66 of the German Act on Regulatory Offences (OWiG).
What has not changed
Several core features of the settlement framework remain unchanged. The maximum settlement discount continues to be capped at 10% in horizontal cartel cases, and the discount is still applied on top of any reduction already granted for leniency cooperation. Settlements remain voluntary, and companies can pursue them independently of any leniency application.
A waiver of the right to lodge an objection is still not required as part of a settlement declaration. The party’s right to submit observations before a settlement concludes also remains expressly preserved, even under the streamlined procedure. Neither EU nor German law prescribes detailed requirements for settlements in administrative fine proceedings, and the Revised Guidance continues to operate as soft law, without binding legal force. The fine notice issued after a settlement still contains only the minimum particulars required by law (identification of the conduct, the legal basis and the sanction) and typically omits any individualised evidentiary or legal assessment.
Practical implications
The Revised Guidance does not fundamentally alter the economics of settling – the discount remains the same, and the outcome is still a short-form fine notice. What changes is how companies must prepare for and engage with the process. With a compressed timeline and limited room for iterative negotiation, companies facing FCO cartel investigations should be ready to take a position on the facts, the fine range and any cooperation contributions before settlement talks begin. Internal alignment between management, in-house counsel and external advisers therefore needs to happen earlier than under the previous regime.
Author: Sergej Bräuer, Partner.
Other authors: Dimitra Karakioulaki, Associate; Sarah Schaible, Transaction Lawyer and Aamir Hajjout, Research Assistant.
