The Commission for Protection of Competition hosted traditional, prestigious seminar of the OECD Regional Center for Competition, headquartered in Budapest. The topic of this gathering, as per initiative of the Serbian Commission as a host, was how to enhance competition culture, competition policy advocacy, and estimate on competition policy’s effectiveness in the SEE region.
The conference was opened by the President of the Commission for Protection of Competition, Miloje Obradović, PhD, while main panelists were Sabine Zigelski, OECD Senior competition expert, Šarunas Keserauskas, Chairman of the Competition Council of the Republic of Lithuania, and Kay Weidner, Spokesman for Germany’s Federal Cartel Office.
The President of the Commission for Protection of Competition, Miloje Obradović, PhD, emphasized that among state institution, business and expert public representatives, the judiciary and consumers themselves, still exists an insufficient level of knowledge on the importance of competition legislation.
“I believe that topic on how to develop a competition culture is in common for all regional bodies in the majority of countries that either went, or are still going through a transition. Famous Cambridge sociologist, Ralf Dahrendorf, explained the situation of countries that had a discontinuity in a market economy with a sentence that is very illustrative of the issues we are facing as well: “Transitional countries can change government in six days, enact laws in six months, build institutions in six years, but for a change in the manners of citizens’ thinking and acting – it will take sixty years”.
President Obradovic said that he believes there is a significant room for improvement in this segment of protection of competition bodies’ operations, but that he is not dissatisfied with the results, especially having in mind the fact that this topic has not always been set as a priority.
During the first and second day of the seminar, methods implemented by competition authorities aimed at improvement of competition culture were presented, hypothetical case of presenting to the media competition protection measures imposed on cartel participants was analyzed, as well as effects of the campaigns directed toward enhancing general public’ knowledge of the competition protection policy implemented by institutions for protection of competition of countries participating in the seminar.
The third day of the seminar was dedicated to the instruments for market monitoring (sectoral analysis, studies, hypothetical cases, reports, researches, etc.) with the aim of identifying possible weaknesses in the market and/or the existence of conditions of competition infringements. Representatives of Lithuania, Germany, Ukraine, Romania and Serbia presented their experiences.
By giving their presentations, representatives of the Commission for Protection of Competition passed a particular contribution to the seminar. Dragan Penezeć, PhD, Secretary General, reviewed Commission for Protection of Competition’s activities, Gordana Bulatović, Chief of Staff, presented the implementation of existing advocacy competition tools in cooperation with the media used for enhancing competition culture, as well as Jelena Popović Markopulos, Senior Advisor in the Department for Economic Analysis, who spoke on the Serbian authority experiences in preparing sectoral analysis.
More than 30 participants from 21 authorities for the protection of competition coming from regional countries, European Union and Euro-Asian region participated in the seminar.
The Commission for Protection of Competition of the Republic of Serbia is hosting the OECD Regional Center seminar for competition, to be held in Belgrade from September 27-29, 2016. The Commission is selected among a great number of national authorities for competition law implementation that have applied to host this prestigious gathering.
Following Commission’s recommendation, the seminar will be dedicated to the topic of competition advocacy. The topic holds particular significance having in mind that the awareness on the importance and benefits of competition rules is still not sufficiently developed at the level of executive power, the business community, the judiciary and academic community, as well as among the citizens as consumers.
Part of the program will be dedicated to the utilization of market research and sectoral analyses in the competition protection practice. Within mentioned panel, experienced experts from this area will share their knowledge and prior experiences.
The seminar will be an opportunity for sharing of experiences between countries with different level of competition law development and related implementation practice. These meetings are also of a great significance for countries that are developing competition law implementation, among which is Serbia, as well as an opportunity to inform the general public on the basic issues regarding competition, its significance and influence on the economic prosperity of society.
Organization of the seminar is an additional recognition to the Commission for its work on an international level, especially being organized in the year marking Commission’s tenth year founding anniversary.
The seminar will be attended by more than 30 participants from 21 OECD Regional Center for Competition Seminar Held in Belgrade.
Following Slovenian colleagues’ invitation, the President of the Commission for Protection of Competition, Miloje Obradović, PhD, participated in the “Slovenian competition day”, held in Ljubljana.
The Conference focused on the EU Damages Directive implementation challenges, enacted with the goal of improved implementation of competition rules by providing rights to the damaged parties to exercise the right to compensation as a consequence of infringements of competition rules under national law. Competition protection authorities’ representatives from Austria, Croatia and Slovenia also took part in a constructive debate on the topic, as well as representatives of the academic and business communities, and courts.
Discussions on the modalities of improving relations and cooperation between Slovenian and Serbian competition protection authorities were held on the sidelines of the conference, alongside the plans for continuation of cooperation between the two institutions, regional initiatives concerning expansion of knowledge and harmonization of practices regarding competition rights and policy in the European Union, as well as current issues the two authorities for competition protection are currently involved.
Ms. Nina Vasić, MSc, Adviser in the Department for International Cooperation of the Commission for Protection of Cooperation also took part in the Serbian delegation.
Following the invitation of the Director General of the Austrian Federal Competition Authority, Theodor Tanner, PhD, the President of the Commission for Protection of Competition, Miloje Obradović, PhD, and the Commission’s Secretary General, Dragan Penezić, visited Vienna.
During the bilateral meeting organized on the basis of previously signed Memorandum of Cooperation between the two authorities, plans for the continuation of cooperation between two institutions were discussed, in addition to regional initiatives concerning expansion of knowledge and harmonization of practices regarding competition law and policy in the European Union, as well as current issues in which Austrian and Serbian competition authorities are currently involved.
During the talks on the modalities of improvement of relations and manners of joint operations, it has been agreed that in the following period and before the end of 2016, the Serbian Commission’s team in charge of dawn raids is to hold a training and inspection simulation with Austrian colleagues which will enable acquiring new skills as to on using this very important tool for data and information collection, utilized by all developed competition protection authorities in the world.
The visit is used so that management and employees of the Austrian Federal Competition Authority can be familiarized with the Serbian authority’s activities and plans concerning the further advancement of the Commission for Protection of Competition of the Republic of Serbia.
The Chief Economist of the Commission for Protection of Competition, Siniša Milošević, PhD, attended a three-week professional development program in Japan, part of the Japan International Cooperation Agency (JICA) program in cooperation with the Japan Fair Trade Commission (JFTC).
The professional development program incorporated all segments of competition law and policy, including theoretical and practical implementation. Experiences regarding implementation of the competition policy in the United States of America, South Korea and Taiwan are presented, alongside experiences of the Japanese competition authority.
The goal of this program is improvement of competition law and policy implementation, but also implementation of acquired knowledge for more efficient promotion of competition environment in the Serbian market.
Experiences and knowledge that Siniša Milošević, PhD, as the Head of the Department for Economic Analysis of the Commission for Protection of Competition, gained during his stay in Japan will be implemented in enacting competition rules in the territory of the Republic of Serbia.
The Commission for Protection of Competition, based on the Commission President’s Resolution, dated August 29, 2016, initiated competition infringement procedure ex officio against company “INTER TURS PLUS” from Aranđelovac.
Based on data, information and documents collected, the Commission reasonably assumed a violation of competition having, or likely to have as their object or effect, significant restriction, distortion or prevention of competition.
During the conduct of procedure, the Commission will investigate whether the named company, as a controller of a single bus station in Topola, by increasing bus station platform cost – bus dispatch services, committed the abuse of a dominant position. Bus platform selling price in the amount that is unfairly high, which leads to the exploitation of service users, can constitute an act of the abuse of a dominant position stipulated under Article 16 of the Law on Protection of Competition.
The Commission for Protection of Competition initiated proceedings against 16 wholesale and retail of sportswear, footwear, equipment and accessories undertakings.
The proceedings were initiated on the grounds of reasonable presumption of existence of competition infringement pursuant to Article 10 of the Law on Protection of Competition, an activity restricting the competition on retail and wholesale markets of sportswear, footwear, equipment and accessories market in the Republic of Serbia. The undertakings against whom the proceedings were initiated are as follows: „N SPORT“, „PREDUZEĆE ĐAK“, „OFFICE-SHOES“, „PLANETA SPORT“, „CARVEL“, „SPORTMARKET“, „ZVEZDA FOREVER“, „TOTAL SPORT“, „SPORTIKO“, „UNIVERS-CO“, „EUROSTAR“, „TRIM DOO VRBAS“, „K..G…FASSHION“, „KOPELLI“ and „STR FOKUS“ and „KOMISION SPORT ONE“.
On August 18, 2016, the Commission performed a down raid at the business premises of the „N Sport“ company and acquired information, data and contracts which this company has entered into with its customers. The down raid was conducted due to the existence of a reasonable doubt of danger of disposal or altering evidence held by the party in the proceedings.
According to the collected information and documents, the „N Sport“ company, as the seller, has entered into contracts on business cooperation with other undertakings against whom the Commission has initiated proceedings, which contained an obligation for the customers to comply with the minimum retail price set by the „N Sport“ in the resale of their products. This obligation particularly pertained to the brands PUMA, RUSSELL ATHLETIC, SERGIO TACCHINI and others. Also, the contracts contained a prohibition of special sales actions and other forms of favorable sales without prior approval of the seller, i.e. the „N Sport“.
The Commission reasonably assumed that certain provisions of the concluded contracts represent a mutually agreed obligation, by way of which prices and terms of trade are set in an illegal manner, which constitutes a restrictive agreement and infringement of competition pursuant to Article 10 of the Law on Protection of Competition. Restrictive agreements are agreements between undertakings, the object or effect of which is to considerably restrict, distort or prevent competition on the territory of the Republic of Serbia, and in particular those agreements which directly or indirectly set purchase or sale prices or other terms of trade in the resale of products.
The Commission invites all the parties who may possess data, documents or any other relevant information which may contribute to determining the facts in these proceedings, to submit them at the address of the Commission for Protection of Competition, Savska 25/IV, Belgrade.
The 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.
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 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.