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The Commission Found Infostan Tehnologija’ Commitments and Suspended Established Competition Infringement Procedure

Infostan TehnologijeThe Council of the Commission for Protection of Competition, based on the Resolution enacted on August 15, 2016, suspended competition infringement procedure established on October 26, 2015, against PUC Infostan Tehnologije from Belgrade. The Resolution found commitments of the PUC Infostan Tehnologije, the acting of which shall be regularly supervised by the Commission and in case of, during the period of the subsequent three years, a significant change of circumstances occurs based on which the resolution on suspension of established competition infringement procedure was set, the competition infringement procedure shall be reestablished.

The PUC Infostan Tehnologije from Belgrade commits to permanently alter their business policy in the following segments so that:

- New commercial services listing is performed either on the basis of written consent of the City of Belgrade citizens that are in the system of consolidated collection of utility services, or via notifications to the user, in accordance with the offer, that only by making a payment on the special payment slip will provide a consent for listing of particular items on the Infostan utility bill

- Listing of items from the bill derived from the system of consolidated collection of utility services is performed upon user’s request, i.e. City of Belgrade citizens that are in the system of consolidated collection of utility services, with the obligation to accept at their counters every written request for listing of commercial items from the utility bill, and that the same item be listed as from the following bill onwards, in addition to informing provider of the specific service on the performed operation

- Insurance companies are not provided with abstracted information on users that are not insured. For the purpose of implementation of this commitment, the option of providing information on users that are already insured by that specific insurer is allowed in order for offers not to be sent to those that are already insured by the same company

- Mandatory publish on the Infostan Tehnologija Internet page every new option for new items listing, with detailed explanation to the users

- In the following three years submit to the Commission for review purposes, every subsequent contract concluded with a third party interested for utilization of commercial conditions provided by the Infostan, with the request for providing an opinion

The Commission’s Council enacted decision on the suspension of established competition infringement procedure keeping in mind that by adopting of measures, danger of continuation of performing acts and activities on the market that led to a reasonable assumption of competition infringement is completely removed, based on which the competition infringement procedure was initiated ex officio, as well as that mentioned measures prevent the possibility of the same or similar future infringement occurrence.

The Commission Determined Conditional Approval of Concentration of Sunoko d.o.o Novi Sad Company over Star Šećer d.o.o. Senta Company and TE-TO Senta a.d. Sugar Factory

During the session held on August 11, 2016, the Commission for Protection of Competition’s Council enacted decision on conditional approval of implementation of concentration created by the change of control of the Sunoko d.o.o Novi Sad company over Star Šećer d.o.o. Senta company, and consequently over TE-TO Senta A.D. sugar factory.

Based on the state of the matter determined during investigation procedure, the Commission concluded that by implementing of concentration, the Sunoko’ dominant position shall be strengthened, foremost in the sugar production and sugar distribution markets in the Republic of Serbia. For those reasons, implementation of the mentioned concentration can be approved only if accompanied by certain conditions prescribed by the decision. The Commission for Protection of Competition believes that by determining behavioral measures referring to Sunoko d.o.o Novi Sad, secures a prevention of potential adverse effects of the concentration in question.

The decision imposed conditions in a form of behavioral measures and mandatory regular reporting towards the Commission with the goal of securing market structure and retaining all production capacities, including the TE TO Senta sugar refinery on the market, transparent monitoring of the level, alterations in sugar prices on the market, improvement of sugar sale policy’s transparency and consumer business relations, as well as full disclosure of information to the Commission on the level and type of investments to be implemented in the TE TO Senta with the aim of increased production effectiveness, in the following manner:

1. Reporting on the processed sugar beets and manufactured sugar, separately for each of the sugar refineries owned by Sunoko.

2. In the case of liquidation, or Sunoko’ decision resulting in permanent closing of some of sugar refineries under their management, Sunoko is obliged to previously publically announce the sale of sugar refinery’s equity or property in no less than three daily newspapers regularly distributed in the whole territory of the Republic of Serbia, and in one foreign newspapers specialized in economy and finances and published in the territory of the EU, or on an Internet portal usually utilized for distribution of business related news.

3. Obligation of reporting on prices, on consequential changes in sugar prices individually for the Serbian market, EU, CEFTA and eventually the third market, on FCO sugar refineries parity, VAT free, with the submission of a rationale on samples and intensity of consequential changes.

4. Obligation to, no later than in six months, submit to the Commission a document with which it defines its domestic costumer sugar sale policy.

5. Reporting on possible alterations of existing contracts between TE-TO Senta A.D. sugar factory and costumers, and a rationale of those.

6. Commitment of submitting annual reports on measures and activities taken with the goal of maintaining business operations of the TE-TO Senta A.D. sugar factory, which may include, but are not limited to the following: repayment or debts, assumption of other financial expenditures, transfer of technical and technological know-how and experiences, transfer of managerial know-how and experiences, measures that influence increase of production effectiveness and reduction of sugar cost prices, as well as other, direct or indirect, financial, technical and technological, managerial, and other measures.

Ordered measures (except under Item 5), shall be implemented until the abolition of customs duties and levies on sugar imports in the Republic of Serbia, and no longer than for period of subsequent five years from the Commission decision’s legal validity date. Measure under Item 5 shall be implemented ending 2017.

Throughout the investigation procedure, the Commission obtained necessary data, information, as well as opinions on the effects of concentration from competitors as the concentration participants, their biggest suppliers and customers, in addition to the state authorities and organizations in charge of data relevant to this proceeding.

During the determination of conditions for approval of concentration, the Commission also kept in mind opinions and views on the effects of concentration that other undertakings have presented in the course of the proceeding, particularly industrial costumers.

The Commission also had in mind financial position of the TE-TO Senta A.D. factory. Regulated conditions, deadlines and manners for monitoring of their execution should eliminate Commission’s concerns related to securing efficient protection of competition, via preserving production capacities, implementation of planned investments that can achieve increased production efficiency, and thus, lower sugar cost prices, alongside transparent sale policy (discount policy) and price policy (intensity and causes of price alternations).

The Commission Initiated Proceedings against the EPS Distribucija Company

The Commission for Protection of Competition, based on the Commission President’s Resolution, initiated competition infringement proceeding ex officio against (Electric Power Industry of Serbia – Distribution) EPS Distribucija company.

During the proceeding in question, the Commission will investigate if the mentioned company, as a single electric power distribution system operator in the Republic of Serbia has misused privileged position by placing the EPS Snabdevanje in a competitive advantage against all other commercial suppliers of electric power.

The EPS Distribucija has, as per reasonable assumption of the Commission, in the course of contracting access to the electric power distribution system imposed an obligation of depositing funds on restricted (guarantee) deposit for securing payment for system access service for all distributive system users, apart from its affiliate company, the EPS Snabdevanje.

City Of Pančevo will Amend Regulations in Order to Enable Providing of Burials Services to all Interested Parties

The City of Pančevo Assembly informed the Commission for Protection of Competition on taking into account its opinion, and that has during the City Council’s session determined draft amendment to alter disputed decisions’ provisions regulating public utility burials and cemetery management service.

A decision on amendments to the Decision on burials and cemeteries, as per information sent to the Commission, shall be adopted by the City of Pančevo Assembly by end-July.

The Commission previously sent opinions to the Assemblies of Cities of Novi Sad and Pančevo on the necessity to amend, i.e. precise disputed provisions of decisions arranging this utility service, in order not to distort competition and enable monopoly to the public utility companies in those cities.

The Commission uses this occasion once more to emphasize the importance of the City of Pančevo Assembly’s conduct since the adoption of amendments to the disputed provisions of the Decision will have a positive impact on the competition. These amendments will enable performing of certain burial services to all interested parties, i.e. not only to the public utility company but also other companies, entrepreneurs, and other business entities.