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Successful Public Debate in Kragujevac

FICThe Commission for Protection of Competition has organized a public debate in Kragujevac dedicated to examining potential solutions towards the improvement of competition policy and law in the Republic of Serbia.

Professors of the Faculty of Law and Faculty of Economics of the Universities of Kragujevac, Niš and Novi Sad, Dr Milan Kostić, Prof Dr Boban Stojanović and Dr Sandra Fišer-Šobot, respectively, took part in the panel discussion, as well as representatives of the City of Kragujevac, companies and business clusters from the Region of Šumadija.

Gordana Lukić, member of the Working Group on drafting new competition act and Head of the Merger Investigation Division, began by welcoming the audience and underlying that the new legal framework governing competition policy should enable the improvement of procedural rights of the parties in specific administrative procedures initiated before the Commission, with due regard for specificities of the proceedings from that area, and in particular for the need for economy and efficiency.

It is established that a new legal framework governing competition policy is needed, both against the background of continued harmonization against EU acquis, and on account of strengthening the existing institutional capacity of the Commission for Protection of Competition. It is also underlined that this is the first time that all relevant stakeholders are taking part in drafting new regulation, specifying that besides representatives of the Ministry of Trade, Tourism and Telecommunications and experts from the Ministries of Economy, Justice, Public Administration and the Commission for Protection of Competition, the Working Group is comprised of representatives from numerous associations of undertakings as well.

The public debate is organized as part of the project “Increasing economic growth through support to the promotion of competition policy”, supported by the Royal Norwegian Ministry of Foreign Affairs. Further three more public debates are planned, to be held in Niš, Novi Sad and Belgrade.

President of the Commission – Commission’s Focus is the Well-being of Citizens

FICPresident of the Commission for Protection of Competition, Dr Miloje Obradović, gave a keynote address at the “Competition and Personal Data Protection” conference, traditionally held by the Law Firm Karanović & Partners and the German Friedrich Naumann Foundation for Freedom.

This year’s conference was focused on the experiences in competition law enforcement in the context of interplay between the competition law enforcement and economics, as seen through the prism of Serbian and EU experiences, state aid control, as well as on the implementation of new legal solutions governing personal data protection.

Dr Obradović underlined, inter alia, that the contribution of effective competition policy and law enforcement in promoting economic growth and well-being of citizens of the Republic of Serbia remains challenging, but that the Commission is fully aware of the importance of its mission and assigned tasks.

One of the conference’s panelists was Marko Obradović, CPC Council member, who informed the audience about the Commission’s plans and perspectives against the background of competition policy improvement in the Republic of Serbia.

Commission Supports the Establishment of the Corporate Compliance Association

FICBy participating at the inaugural meeting, the Commission for Protection of Competition has supported the start of operations of the Corporate Compliance Association. The Association gathers companies from various industries opened to further advance their related know-hows and more efficiently harmonize respective business operations against the current regulatory framework.

It is in the interest of the Commission to advocate and promote harmonization of business operations of undertakings against competition rules, since such conduct correspondingly reduces the risk of infringing competition which occurs, inter alia, also due to the fact that companies lack practices harmonized against competition rules and regulations, said Dr Miloje Obradović, President of the Commission for Protection of Competition, in its opening speech given at the inaugural meeting.

The compliance also affects the growth of business in full and complete conformity with competition rules, and likewise enables the internal identification of potential anticompetitive behaviors. Since the prevention of such adverse consequences is among the primary objectives of the Corporate Compliance Association, the Commission for Protection of Competition strongly supports its establishment and operations, underlined Dr Obradović.

Within the framework of the Association’s inaugural meeting, a panel discussion was held on “Why is corporate compliance important for each of us?”. The goal of this panel session, where Čedomir Radojčić, CPC Council member, has taken part as well, was to raise the level of awareness on the importance of this topic by defining the purpose and meaning of corporate compliance, but also to present concrete examples on its implementation in specific business operations of various undertakings.

FICRepresentatives of undertakings involved in relevant corporate compliance-related activities also took an active role during the panel session, as well as representatives of the private and public sector, the Association of Serbian Banks and the University of Belgrade Faculty of Law.

„Regulatory Impact Analysis on Markets and Competition“ Seminar Held

FICIn cooperation with the International Finance Corporation (IFC), a member of the World Bank Group, and the Public Policy Secretariat of the Republic of Serbia, the Commission for Protection of Competition of the Republic of Serbia has held a two-day seminar „Regulatory Impact Analysis on Markets and Competition“.

The principal goal of this seminar was to provide support to representatives of the Serbian Government institutions to further improve the implementation of a regulatory impact analysis towards establishing and assessing potential market restrictions, and improving regulatory quality and effectiveness. The seminar also served as a platform showcasing international experiences on the integration of competition policy principles into drafted regulations.

The seminar participants were able to hear from Marijana Mišković-Vukašinović, CPC Council member, Bojana Tošić, Acting Director of the Public Policy Secretariat of the Republic of Serbia, Maciej Drozd, WB economist, as well as from Eugeniu Osmochescu, WB Team leader.

During panel sessions, Marko Obradović, CPC Council member, gave a well-perceived presentation on the Commission’s respective experiences, titled “How the Commission for Protection of Competition and the Public Policy Secretariat of the Republic of Serbia promote drafting regulations in support of businesses and competition”, while Dr Veljko Milutinović, CPC Council member, spoke on the topic “Rules reinforcing dominance or barriers to entry”. Representatives of the Mexican Federal Competition Commission and the National Regulatory Improvement Commission, Rodrigo Rios and Francisco Parra, respectively, have presented Mexico’s experiences gained in their efforts to accomplish regulatory framework harmonization against competition principles. Otherwise, Mexico is considered to be one of the global leaders in this particular area. Furthermore, WB Chief Economist, Tania Begazo, has presented examples encountered by this international institution in their attempts to exert an influence via numerous globally implemented projects focused on passing of regulations not restrictive to competition.

The second day of this seminar was organized as an interactive workshop, serving as a platform for the exchange of experiences gained from ensuring the inclusion of competition provisions into regulations. Representatives of the Mexican Federal Competition Commission and the National Regulatory Improvement Commission have presented in more detail the tools used in their regular practice.

This event is organized as a part of the Serbia Investment Climate Project, implemented by the International Finance Corporation in cooperation with the UK Good Governance Fund and the British Embassy in Belgrade.

Commission Hosts Prestige Economics Conference – ACE

FICThe Commission for Protection of Competition of the Republic of Serbia will host the annual 2020 ACE Conference (Association of Competition Economics) in Belgrade. This decision was made during last week’s conference held in Bologna, Italy.

With the notable participation achieved this year also, designated representatives of the Serbian competition authority, Dr Siniša Milošević, Head of the Economic Analyses Division and Jelena Popović-Markopulos, Senior Advisor at the Economic Analyses Division, have been provided with an opportunity to present a Commission’s case study before 276 participants, European and other international competition economists. The manner in which the economic expertise is used in the presented case is recognized as notable, thus placing Serbia among nine other countries to present their case studies during the Conference.

As every year, the 2018 Annual ACE conference in Bologna has gathered numerous representatives of European competition authorities, reputable consulting firms and academia, providing them with an opportunity to exchange respective experiences concerning the assessment of competition and consumer protection authorities’ operating efficiencies.

Since its creation in 2003, the main activity of ACE is the annual conference that brings together competition economists.

The Commission for Protection of Competition of the Republic of Serbia perceives this announcement on the selection of the host authority as an additional recognition of the results achieved during the last couple of years in advancing economic expert opinions, consequently reflecting on the quality of its enacted decisions.

Notice of Filing of the Proposal of Commitments by MasterCard Payment Organization Representatives

FICPursuant to Article 58 of the Law on Protection of Competition, the Commission for Protection of Competition hereby publishes the Notice of Filing of the Proposal of Commitments, which companies MasterCard Incorporated, MasterCard International Incorporated and MasterCard Europe S.A., as legal entities representing the MasterCard payment organization, are voluntarily willing to undertake in order to eliminate possible infringement of competition, with a call inviting all interested parties to submit commentaries, views and opinions in writing with reference to the commitments proposed.

CPC Representative Takes a Professional Training Course in the Republic of Korea

kzkOwing to the intensified cooperation achieved between the Commission for Protection of Competition and the Embassy of the Republic of Korea in Belgrade, in addition to the agreement reached by CPC President, Dr Miloje Obradović, and recent Ambassador of the Republic of Korea in Belgrade, H.E. Dae Jong Yoo, designated representative from the CPC Division for Assessment of Concentrations, Ms Ivana Cvijović, has attended a ten-day practical training course at the Korean Fair Trade Commission, KFTC, offered as a part of its technical assistance program.

The goal of this technical assistance program is to advance the competition law and policy enforcement, as well as to enable the practical use of know-hows in order to allow more efficient promotion of competitive market environments of the program’s participating counties.

Each year, representatives of dozens of competition authorities from around the globe apply for the internship program at the Korean Fair Trade Commission, which is known as one of the most efficient competition authority in the world. The professional development program includes the advancement of theoretical and practical aspects and know-hows of competition law and policy enforcement relating to the areas of competition infringement and merger investigations. This is the first participation of a representative of the Commission for Protection of Competition of the Republic of Serbia in this program.

However, this is not the first time that the Republic of Serbia and the Republic of Korea cooperate in the field of competition policy. The Commission for Protection of Competition and the Embassy of the Republic of Korea in Belgrade have co-organized the “Knowledge-sharing seminar on Korean and Serbian competition law enforcement” in October 2017. As this type of event has proven highly beneficial in strengthening the knowledge of undertakings on competition policy in the Republic of Serbia, events of a similar kind are already planned for 2019.

Exemption of Imlek/Meggle Srbija Restrictive Agreement Approved

kzkThe Commission for Protection of Competition of the Republic of Serbia has approved individual exemption of restrictive agreement from the prohibition – Manufacturing Services Agreement, entered into by companies AD Industrija mleka i mlečnih proizvoda Imlek and Meggle Srbija doo Kragujevac.

FIC Notes Positive Developments in the Commission’s Work

kzkThe Foreign Investors Council (FIC) in Serbia has presented its traditionally published edition, the White Book 2018, an overview of the business climate in Serbia containing recommendations aimed at supporting economic growth and business climate improvements from the investors’ point of view.

The document notes significant progress achieved this year also by the Commission for Protection of Competition of the Republic of Serbia in its work and welcomes the efforts to enhance the legal framework aimed to further improve the efficiency of competition policy enforcement in Serbia.

According to the Foreign Investors Council’s assessment: “The Commission continued making progress in competition advocacy and public relations. The Commission regularly informs the public on its activities and publishes a great majority of its decisions on its official website. The Commission has published on its website the Guidelines on Rights and Obligations of the Parties during Dawn Raids, as well as the Leniency Policy Leaflet. This positive development concerning competition advocacy is important as it contributes to the overall improvement of the current legal framework and to better understanding on the part of the general public and the media of competition policy rules and activities and the importance of the Commission’s role. Finally, it is commendable that the Commission increasingly implements economic analyses in inquiries into competition infringements and complex mergers.”

The investors’ recommendations for the Commission is to continue to adopt bylaws defining certain core categories of the antitrust framework, as well as to issue clear guidelines and instructions containing the manner of application of certain provisions of the Law, in addition to publications of the relevant definitions of product markets.

Instituted Proceedings against VISA Payment Card Organization

kzkThe Commission for Protection of Competition has instituted an ex officio proceedings for the investigation of infringement of competition on the payment cards market against the MasterCard payment card organization’s respective market competitor as well, that is, against the following three companies: VISA Incorporated and VISA International Service Association, with registered seat in Foster City, California, and VISA CEMEA Holdings Limited, with registered seat in London (hereinafter, VISA payment card organization).

The analysis of competitive conditions pertaining to the payment cards market in the Republic of Serbia has demonstrated the necessity to also institute a proceedings against VISA payment card organization based on the same facts and legal basis. Namely, the Commission has reasonably assumed that VISA payment card organization, as a form of association of undertakings in the market of the Republic of Serbia, within the meaning of Article 10 of the Law on Protection of Competition, also sets the fallback interchange fees in an unfair amount, implemented by banks in the territory of the Republic of Serbia within the VISA payment card system. In such manner, VISA payment card organization has exercised an influence on the merchant service charge increase – a merchant bank fee paid for each payment card transaction, charged by banks to merchants for accepting a card for payment (hereinafter, merchant fee). The largest portion of merchant fees (approx. 60-70%) account for the interchange fees. The interchange fees in the Republic of Serbia are currently several times higher than in the EU markets. This further indicates that merchants accepting a card for payment pass on a part of the costs of merchant fee to consumers through higher retail prices, regardless of whether the payment is made by payment cards or in cash. Consequently, the competition on the card acquiring market in regard to merchant fees offered to merchants for the card acquiring service is restricted, with potential adverse influence on the state of competition on the card issuing market in the territory of the Republic of Serbia, given the incentive of banks to offer payment cards yielding the highest interchange proceeds for services provided in relation to POS (point of sale) transactions.

All persons in possession of data, documents or other relevant information which could contribute to the accurate fact-finding in this proceedings are called upon to submit said evidence to the Commission for Protection of Competition to the address 25/IV Savska St., Belgrade.