The Commission for Protection of Competition of the Republic of Serbia has adopted a new Instruction for detecting bid rigging in the public procurement procedure, in the light of the new legal solutions (Law on Public Procurement, amendments to the Criminal Code) that were adopted after the 2011 Instruction.

The Commission for Protection of Competition recognized the need to emphasize and raise the level of awareness among market participants about the need and ways of business compliance with current regulations and regulations in the field of competition protection.

The aim of issuing the Instruction is to prevent and foil the implementation of “rigged or falsified offers” (bid rigging), as the most severe forms of cartels. The consequence of such agreements between competitors – bidders regarding the offered price is the elimination of competition between them, which is why the contracting authority would pay more for the subject of procurement than it would pay under the conditions of competition.

The OECD Guidelines for Combating Bi Rigging in Public Procurement and the Notice of the European Commission in accordance with the needs of cooperation between the Commission and the Public Procurement Office were used in the preparation.

Representatives of the Commission for Protection of Competition of the Republic of Serbia participated on the 21st ICN Annual Conference and 21st International Conference on Competition in Berlin, hosted by the German competition authority (Bundeskartellamt).

The Bundeskartellamt is bringing together two of the most renowned international events dealing with competition policy and competition law enforcement, the International Conference on Competition (ICC) and the Annual Conference of the International Competition Network (ICN). In 1982 the International Conference on Competition was launched by the Bundeskartellamt in Berlin, where the Bundeskartellamt was based at the time, and has since then been held every two years. This year the Bundeskartellamt was also hosted the annual conference of the ICN, the International Competition Network founded in 2001, which today counts 140 member agencies from 130 jurisdictions.

The main topics were the issue of relationship between competition law and policy with other areas, primarily consumer protection and access and use of confidential data, regulatory and other measures necessary to establish and strengthen competition on digital platform markets, as well as other current issues from the areas of anti-trust, concentration assessment, competition protection advocacy, etc.

Approximately 450 participants from over 80 countries attended the conferences, highest representatives of competition authorities, judges, university professors, anti-trust lawyers, representatives of German ministries and other governmental bodies, international companies, etc.

The Commission for Protection of Competition initiated an ex officio procedure of investigation of infringement of competition against the company Polet-keramika Novi Bečej, in order to examine the existence of restrictive agreements referred to in Article 10 of the Law on Protection of Competition, which restricts competition on the market of wholesale ceramic tiles in the Republic of Serbia, and performed an unannounced investigation.

The commission conducted an analysis of the state of competition in the distribution channels of ceramic tiles and sanitary ware, within which it also obtained sales contracts that the manufacturer Polet-keramika Novi Bečej concluded with buyers for further sale. The analysis of contracts, their addendums and annexes revealed provisions that point to the existence of a practice known as resale pricing by the manufacturer/seller, which restricts the buyer to make independent business decisions related to pricing policy, which is a restrictive agreement, constituting an infringement of competition under Article 10 of the Law.

In the investigation procedure, the commission shall undertake all necessary evidentiary actions in order to correctly determine the factual situation, examine the existence of a competition infringement, and make a final decision upon finalization of the procedure.

All persons having data, documents or other relevant information that can contribute to establishing the factual situation in this procedure are hereby invited to submit them at the address of the Commission for Protection of Competition, Savska 25 / IV, Belgrade.

Pursuant to Article 47 of the Law on Protection of Competition, the Commission conducted a sectoral analysis of the state of competition in the distribution channels of ceramic tiles and sanitary ware.

A comprehensive analysis of the distribution channels of ceramic tiles and sanitary ware was conducted, in the market of the Republic of Serbia for the period from 2018 until 2020. This also implied determining the relationship between competitors – manufacturers, importers, wholesalers and retailers in the market of ceramic tiles and sanitary ware, assessing their market share and relative strength, analysis of contractual relationships, and the effects that these relationships may have on competition. The focus of the analysis was on the wholesale market of ceramic tiles and sanitary ware, while the market for the production of ceramic tiles and sanitary ware and the retail market of ceramic tiles and sanitary ware were processed in certain segments, solely in order to fully understand the distribution chain of the subject products.

An extensive network of trade in the said products was observed, wholesalers and retailers cooperating with a large number of suppliers, almost all of which are profiled as multi-brand stores with a wide range of different manufacturers, distributors and suppliers. Apart from the afore said, the analysis of the contract indicates that there are certain phenomena that may be potentially controversial from the aspect of competition protection, and the Commission will therefore continue monitoring the behavior of market participants and circumstances that indicate to violations of the Law on Competition.

The Commission would like to thank all market participants who provided the requested information in the course of the analysis.