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Commission’s View on the Implementation of Article 10 of the Law on Protection of Competition in the Case of Affiliated Undertakings in the Public Procurement Procedures

The Commission for Protection of Competition during the previous period has received а great number of initiatives for initiation of proceedings for infringement of competition, related to bid rigging in public procurements.

In order to establish a future practice, and with the goal of enabling a higher level of legal security and transparency, the Commission presents the view on the implementation of Article 10 of the Law on Protection of Competition in the case of affiliated undertakings in the public procurement procedures.

The Ministry Accepted Comments and Suggestions of the Commission on the Draft Law on Amendments to the Law on Utility Services

kzk-ekofThe Ministry of Construction, Transport and Infrastructure accepted comments and suggestions of the Commission for Protection of Competition and altered the Draft Law on Amendments to the Law on Utility Services.

The bill proposer’s willingness to fully cooperate with the Commission is the best example of joint efforts directed toward more qualitative regulation that will enable more efficient market competition, which should contribute to the economic prosperity and wellbeing of society, and in particular for the benefit of consumers.

The Commission has sent remarks to the previous Draft Law text providing the Chamber of Commerce and Industry of Serbia to issue an act on the fulfillment of conditions for performing utility services to a public enterprise, company, entrepreneur or other business entity. According to the Commission’s opinion, this regulation would have presented an additional barrier to the entrance of new, as well as to the continuation of business operations of current market undertakings that are registered for providing utility services.

In the final version of the Draft Law, the Ministry also incorporated Commission’s suggestions that certain services which can be performed independently and are related to the utility services, be clearly determined as the services of a commercial nature (burial service) that can be provided by undertakings registered under equal conditions, and not exclusively by a public company or a company in which the Republic of Serbia or local self-government unit owns minimum 51% of shares.

Infostan Tehnologije Belgrade Ready to Assume Commitments for Removal of Possible Competition Infringements

Infostan TehnologijeThe Commission for Protection of Competition is publishing Draft commitments that the party in proceedings, the PUC “Infostan Tehnologije” from Belgrade is prepared to voluntarily assume for the removal of possible competition infringements, with the conditions and deadlines for the fulfillment of proposed measures. Also, the Commission calls upon all interested parties to submit written suggestions, views and opinions referring to draft commitments, in written form within 20 days from the announcement of notification.

On October 26, 2015, the Commission for Protection of Competition initiated proceeding ex officio against PUC “Infostan” for investigation of competition infringement pursuant to Article 16 of the Law on Protection of Competition (abuse of a dominant position).

On June 30, 2016, pursuant to the provisions of Article 58 of the Law on Protection of Competition (hereinafter: the Law), the party in proceeding – “Infostan”, submitted a proposal on suspension of proceeding with the precise listing of commitments – measures that is ready to voluntarily take for the removal of possible competition infringements, with the conditions and deadlines for execution of proposed measures.

The Commission determined the “Infostan Tehnologije” said application to be admissible, timely and submitted by the authorized party.

Pursuant to Article 58, Paragraph 1 of the Law, the Commission may pass a resolution on suspension of competition infringement procedure relating to issuing measure stipulated under Article 59 of the Law, if the party, based on the content of conclusion on the initiation of proceeding, i.e. facts determined during the proceeding, submits a draft commitments that is ready to voluntarily execute in order to eliminate possible competition infringements, with the conditions and deadlines for the fulfillment of listed measures.

Paragraph 2 of the said article of the Law prescribes a deadline in which party in the proceeding may present such proposal.

City of Novi Sad Informed the Commission on the Readiness to Amend Provisions of the Decision Prescribing Utility Service Conditions for Burial and Cemetery Management in Manner to Permit Performing Certain Funeral Services for all Interested Parties

Grad Novi SadFollowing analysis of the initiative for investigation of possible competition infringement, the Commission sent opinions to the City of Novi Sad and Pančevo Assemblies on the necessity to amend, i.e. precise provisions of the decisions in question regulating burial and cemetery management utility services, in order not to distort competition and give monopoly to the public utility companies in those cities.

The City of Novi Sad Assembly positively reacted and informed the Commission that the City of Novi Sad Administration for Utilities has prepared a Draft decision on amendments to the Decision on performing utility services of burial and cemetery management, which will be adopted during the first working session of the City of Novi Sad Assembly, as per notice sent to the Commission.

The Commission emphasizes the importance of the City of Novi Sad Assembly’s conduct since the adoption of amendments related to disputed provisions of the Decision will have a positive impact on the competition and enable performing of certain burial services for all interested parties, i.e. not only the public utility company but also other companies, entrepreneurs and other business entities, an activity that needs to be performed in a competitive environment.

The Commission expects that the City of Pančevo Assembly will follow the City of Novi Sad Assembly’s behavior as well, and commence amending disputed provisions of the Decision on burial and cemeteries, as pointed out by the Commission.

Submission of Notification of Concentration Based on the Letter of Intent or in Other Manner in Which Undertakings Can Show Genuine Intent for Conclusion of Agreement

Every undertaking that uses the option of submitting notification of concentration based on a genuine intent for implementation of concentration, i.e. for the conclusion of an agreement, can do so during any period of time following formal expression of such intent (by signing of a letter of intent, memorandum, compliance of wills, or in other manner that precede the act stated in Article 63, Paragraph 1 of the Law on Protection of Competition).

In those cases, notifying party shall not be imposed a measure of procedural penalty if it fails to notify concentration within the time limit, as stipulated in Article 63, paragraph 1 of the Law.

Signing of the Memorandum of Cooperation Between “Sunoko” and Austrian “Agrana” will not Influence Investigation Procedure

Miloje ObradovicSigning of the Memorandum of cooperation between “Sunoko” and Austrian “Agrana” will not in any manner influence investigation procedure conducted by the Commission for Protection of Competition, said the President, Miloje Obradović, PhD, to “Fonet” agency.

He reminded that in mid-May, the Commission passed a resolution on initiation of investigation procedure ex officio regarding concentration of “Sunoko” and “Star šećer” company, the former being the owner of TE TO Senta sugar factory. The procedure has been initiated in order to investigate on any kind of competition distortion in this case.

– We are currently collecting necessary information related to the purchase of sugar beets, sugar production, processing and sale. It is quite certain that we will comply with the legally determined deadline for enacting of a decision, Mr. Obradović said.

The President of the Commission for Protection of Competition emphasized that if a change of ownership in “Sunoko” company occurs in a meanwhile, it must be reported to the Commission.

- That would constitute a new notification of concentration on which the Commission could not be able to decide before closure of the ongoing investigation procedure. These two procedures must be absolutely separated, Mr. Obradović concluded.