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New Member of the Council of the Commission for Protection of Competition Elected

National Assembly of the Republic of Serbia on its Seventh Sitting of the Second Regular Session, held on December 27, 2016, enacted the Decision on the election of Member of the Council of the Commission for Protection of Competition, Mr. Čedomir Radojčić, for a five year term. The Decision is published in the “Official Gazette of the Republic of Serbia”, no. 106, dated December 28, 2016.

Mr. Čedomir Radojčić is born on September 4, 1959. He graduated as the Bachelor of Laws (LL.B.). He passed the judicial state examination, Ass. jur., in 1992.

He holds a multiyear experience in managerial positions in the revenue-generating and state administration sectors. He is employed by the Commission for Protection of Competition since 2006, when elected as a member of the first Commission Council (as elected member of the Council), where afterwards he worked as the Head of Department for Competition Infringement.

He is one of co-authors of the publication “Competition and Antitrust”. As the Commission for Protection of Competition’s representative, he participated as a lecturer in a series of seminars and workshops held as a part of domestic and international projects.

CONCLUSION on publishing the Decision determining the measure of procedural breach for submitting to the party to the proceeding
Measures for Protection of Competition Imposed on Companies Bora Kečić – Special Transports LLC and Large Transport LLC

Commission for Protection of Competition enacted a decision finding that companies „Bora Kečić – Special transports LLC Belgrade” and „Large transport LLC Belgrade” have agreed on individual participation in the public procurement procedure tendered by the PE “Electro network of Serbia”. By concluding the restrictive agreement they have significantly restricted and distorted competition, and in that sense, the Commission enacted a pecuniary measure to the above-mentioned companies in the amount of RSD 9,792,225.00 and RSD 1,039,300.00 to „Bora Kečić – Special transports LLC Belgrade” and „Large transport LLC Belgrade”, respectively. The said companies are obliged to effect the payment of the aforementioned amounts into the budget of the Republic of Serbia within the deadline of three months.

In the proceeding conducted ex officio, the Commission determined that these companies have agreed on tender pricing, in addition to behavior taken during the conduct of public procurement in relation to offers provided by other bidders. In that sense, the Commission determined the occurrence of competition infringement pursuant to Article 10(2/1) of the Law on Protection of Competition. The objective of “rigged bid” was to eliminate the risk of potentially more favorable bid, to secure that companies „Bora Kečić“ and „Large Transport” in the respective public procurement be elected as the most advantageous bidders, and to acquire a gain higher than the one achieved under the conditions of a free and fair competition

Insurance Market Competition Inquiry, 2012-2015

OSIGURANJEPursuant to the Decision of the Council and Article 47 of the Law on Protection of Competition, the Commission for Protection of Competition conducted the insurance market competition inquiry in the Republic of Serbia for the period 2012-2015.

The main objective of this inquiry is to determine the market structure and relations between main competing parties, their market shares and relevant power. Additionally, the objective of this inquiry is detecting possible market weaknesses that might create conditions causing competition infringement.

Working group comprising representatives of the Commission, National Bank of Serbia, Ministry of Finance and Ministry of Trade, Tourism and Telecommunications will be established in the coming period, formulating a Draft regulation on conditions for group exemption of agreements in the insurance sector, whereby the European regulatory rules and specifics of the insurance sector in Serbia shall be taken into consideration, which are presented in the Report via conclusions and recommendations of the conducted insurance market sector inquiry.

The Commission takes this opportunity to express appreciation to the National Bank of Serbia and all undertakings for submitting requested data for the purpose of this sector inquiry.
The full sector inquiry report, including conclusions and adopted recommendations is published honoring the requests of business entities for protecting data considered as a trade secret.

All undertakings and other expert public are hereby called upon to submit their comments in reference to the Report, no later than February 28, 2017, email: office.kzk@kzk.gov.rs, with the remark: Comment to the insurance market sector inquiry.

Commission Finds Abuse of Dominance by EPS Distribution

EPS DISTRIBUCIJAOn 23 December the Council of the Commission for Protection of Competition adopted a decision finding that the national electricity distribution system operator EPS Distribution LLC Belgrade abused its dominant position as the sole operator on the market for electricity distribution in Serbia. A pecuniary measure for protection of competition in the amount of approximately RSD 330 million (equal to approximately EUR 2.67 million) was imposed on this undertaking, to be paid into the budget of the Republic of Serbia. This is in addition to behavioral measures aimed at providing equal business conditions on the relevant market.

During the course of the proceedings, the Commission determined that the aforesaid undertaking abused its dominant position by placing certain commercial electricity suppliers and, in particular, its sister company EPS Supply, in a more favorable position vis-à-vis their competitors. Such behaviour was, among other things, a consequence of the non-transparent business policy of EPS Distribution.

While contracting access to the electricity distribution system, EPS Distribution imposed a commitment to deposit security instruments on all commercial suppliers except its sister-company, EPS Supply. At the same time, EPS Distribution discriminated between different suppliers in terms of the amount of the deposited security instruments, by setting the amount for some suppliers based on the monthly value of services provided, while for others the amount was based on a trimonthly value. In addition, almost all commercial suppliers of electricity were obliged to deposit their security instruments in just one commercial bank, chosen by EPS Distribution. During a brief period, EPS Supply also enjoyed a much longer grace period for settling its liabilities towards EPS Distribution, compared to all other commercial suppliers.

The abovementioned conduct resulted in increased costs for competing commercial electricity suppliers.

In setting the level of the pecuniary measure for protection of competition, the Commission took into account the cooperation and overall conduct of EPS Distribution during the proceedings. This included, in particular, the amendment of the disputed acts and a demonstration of intent to fully eliminate the harmful effects of the prohibited market behavior.

Commission Representatives Attended the Regional Center for Competition Workshop

SUBOTICAThematic workshop titled “Competition Rules and the Financial Sector” was organized by the OECD-GVH Regional Centre for Competition in Budapest. The three-day conference encompassed lectures and exchange of experiences concerning competition policy aspects specifically related to the financial services, including banks and insurance companies operations and functioning of the payment systems.

This also represented an opportunity to discuss competition policy topics such as restrictive agreements, abuse of dominance, various cases from the competition area, and sector inquiries related to financial markets.
Representatives from the DG Competition, OECD, British Financial Conduct Authority and American Department of Justice were included as the event panelists.

Representatives of the Commission for Protection of Competition were Ms. Sunčica Đorđević from the Department for Competition Infringement and Ms. Aleksandra Ravić from the Department for Economic Analysis. Ms. Sunčica Đorđević held a lecture providing the basic information on conducted sector inquiry related to insurance market in the Republic of Serbia for the period 2012-2015, which was recently completed by the Commission for Protection of Competition.

World Bank Country Manager Visited the Commission

oecdPresident of the Commission for Protection of Competition, Miloje Obradović, PhD, received a visit from the World Bank Country Manager for Serbia, Tony Verheijen.

Dr Obradović presented to Mr. Verheijen activities implemented so far, in addition to the Commission’s plans aimed at the improvement of competition policy in our country. During the meeting, the Commission President specifically emphasized the importance of permanent education in the area of competition policy legislation of all institutions and levels of government, and in particular the judicial authorities.

World Bank Country Manager for Serbia pointed out that this international institution participates in the judicial reform project in the Republic of Serbia, during which they have received a numerous private sector complaints relating to the functioning of the courts in our country, in particular the administrative and commercial courts.

To that end, the joint interest to cooperate with all competent authorities and institutions is identified in order to improve the functioning of the judiciary in Serbia. Also, it has been concluded that both institutions hold an important role in enhancing the competitiveness of our country and in the process of restructuring state owned enterprises and public utility companies.

It has been agreed that communication between the Commission for Protection of Competition and the World Bank Country Office in Serbia will be intensified in the period to come, with the objective of improving the economic environment of our country.
The meeting was also attended by Srđan Svirčev, WB Public Sector Expert, Marko Obradović, member of the Council of the Commission for Protection of Competition, and Nina Vasić, Advisor in the Department for Domestic and International Cooperation of the Commission.

President of the Commission Met with the Head of the Economic Section at the EU Delegation to Serbia

oecdPresident of the Commission for Protection of Competition, Miloje Obradović, PhD, met with Ms. Radica Nusdorfer, newly appointed Head of the Economic and European Integration Section at the EU Delegation to Serbia.

Current issues related to competition policy and Commission’s activities within the EU accession process were discussed during the meeting, having in mind the significance of competition policy in the EU legal and institutional framework.

President Obradović also introduced Ms. Nusdorfer to preparations for improving competition related regulatory framework in Serbia, in addition to the profile-raising activities of competition policy implemented by this institution.

Head of the Economic and European Integration Section at the EU Delegation to Serbia, Ms. Radica Nusdorfer, commended activities of the Commission implemented up to present and proposed more intense cooperation with the EU Delegation to Serbia in the context of our country’s competition policy improvement endeavors.

President of the Commission at the Event Marking the International Anti-Corruption Day

oecdPresident of the Commission for Protection of Competition, Miloje Obradović, PhD, following the invitation of the Anti-Corruption Agency, participated at the conference “Cooperation of the Anti-Corruption Agency with state institutions in the fight against corruption”.

Considering that the Commission for Protection of Competition has signed agreements with numerous state institutions and more intensely cooperates with the Anti-Corruption Agency as well, the latter being confirmed by the Agreement these two institutions have signed together with the Republic Commission for Protection of Rights in Public Procurement Procedures, this event provided the appropriate opportunity for presenting activities that the Commission for Protection of Competition, in line with its legal competences, conducts on a daily basis.

President of the Commission, dr Miloje Obradović, reminded participants of the conference that the Law on Protection of Competition belongs to the group of systematic anti-corruption legislations. “One of the preconditions for increasingly efficient work of the Commission is a constant dialogue and qualitative system of information exchange with the competent authorities in the Republic of Serbia”, dr Obradović emphasized during the symposium, and as an example of successful cooperation specifically pointed to the recently signed agreement with the Anti-Corruption Agency and Republic Commission for Protection of Rights in Public Procurement Procedures. “The objective of this agreement is protection of public interest, reduction of corruption related risks and strengthen institutional integrity”, specified dr Obradović.

Director of the Anti-Corruption Agency, Tatjana Babić, emphasized that the fight against corruption is a joint endeavor of all institutions.
“No single anti-corruption institution is able to achieve much if it doesn’t have the police and courts on its side and if is ill-financed”, said Director Babić. She added that in the fight against corruption is necessary to have a „neverending patience“, as well as to invest enormous efforts in making baby-steps.

Objective of the conference was to highlight the commitment and cooperation achieved so far of all state institutions in the fight against corruption.

Deputy Prime Minister and Minister of Interior, Nebojša Stefanović, PhD, President of the State Audit Institution, Radoslav Sretenović, Dean of the University of Belgrade’s Law School, professor dr Sima Avramović, and directors of the Tax Administration and Public Procurement Office participated in the conference, and other representatives from international organizations, civil society and the media.

Member of the Commission Council at the 15th OECD Annual Conference

oecdMember of the Council of the Commission for Protection of Competition, Veljko Milutinović, PhD, participated at the 15th OECD annual conference – “Global Forum on Competition“.

Traditionally, the annual symposium took place at the headquarters of the Organization for Economic Cooperation and Development (OECD) in Paris.

The main topics of this year’s Forum were: “Promoting competition, protecting human rights”, “The role of market studies as a tool to promote competition”, “Independence of competition authorities – from design to practice”, and “Sanctions in antitrust cases”.
The Commission for Protection of Competition provided written features for the sessions “Sanctions in antitrust cases” and “Independence of competition authorities – from design to practice”.

During the sessions, particularly those related to the independence of competition authorities and sanctions in antitrust cases, dr Milutinović notified colleagues from other national competition authorities, international organizations and academic community representatives that took part in the symposium, of the operating manner of the Commission for Protection of Competition of the Republic of Serbia, and conveyed working experiences gained so far. During the conference, dr Milutinović also had a series of bilateral meetings with competition authorities representatives aimed at improving further cooperation, and also with renowned international experts from the competition field whose know-hows might additionally contribute to the opeartive quality of the Commission for Protection of Competition of the Republic of Serbia.

The conference was attended by more than 90 competition authorities delegations worldwide and other representatives of international organizations, academic community and business associations.