In 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.

The 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.

Pursuant 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.

Owing 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.

The 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.

The 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.

The 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.

The implementation of a new STATA econometric software package procured by the Commission for Protection of Competition, along with an E-Views software license upgrade, utilizing funds provided by the European Bank for Reconstruction and Development, will ensure more efficient use of econometric analyses in cases pending before the Commission.

Economists employed by the Commission for Protection of Competition have initiated the software training courses. The training sessions are organized in series, one dedicated to the STATA general theoretical training and the other to empirical research based on the CPC data collected in a currently ongoing sector inquiry into the food products retail market.

As a result of the two-year project “Capacity Building for the Serbian Commission for Protection of Competition” approved by the European Bank for Reconstruction and Development, in addition to the software concerned, the Commission has also procured necessary hardware equipment which will be utilized in related econometric analyses.

The Commission for Protection of Competition has instituted ex officio proceedings against company Konica Minolta Poslovna Rešenja SE d.o.o. Beograd, 11a Milutina Milankovića Blvd., Belgrade. The proceedings is instituted in order to investigate the infringement of competition from Article 10 of the Law on Protection of Competition.

During the course of investigation proceedings instituted on May 28, 2018 against companies Original doo Beograd, Mikops doo Niš, Birolinija doo Beograd, Biro print sistemi doo Beograd, Dikti Line doo, Birodeveloping doo Niš, and Birotehnika doo Jagodina, the Commission has gained knowledge indicating that company Konica Minolta Poslovna rešenja SE has also participated in the infringement of competition stipulated in Article 10 of the Law on Protection of Competition. As an importer and distributor of equipment manufactured by Konica Minolta, company Konica Minolta manages the sale of equipment via company Original doo Beograd, from which all other partners are procuring the related equipment, such as Birotehnika, Mikops and Birolinija, not excluding the independent sales. The sales and aftermarket services of equipment manufactured by Develep, owned by company Konica Minolta, are managed via partners Birodeveloping and Dikti Line.

For reasons of procedural economy, given that legal requirements on the consolidation of two proceedings are met, the Commission has enacted a conclusion on conducting single proceedings in this case.

Employees of the Commission for Protection of Competition have attended a two-day training course on lobbying and successful public debating. The course was implemented with a high degree of interaction, covering topics such as – the role of public debate in creating public policies, elements of the organization of public debates, as well as how to conduct a debate.

Attendees of this course, organized through project funding provided by the Kingdom of Norway and the Embassy of the Kingdom of Norway in Belgrade, were provided with an opportunity to learn more about the characteristics of a successful lobbyist, in addition to various tactics and techniques utilized, including practical cases derived from the EU experiences showcasing the implementation of this skill. In such manner, the Commission representatives were presented with an opportunity to advance their advocacy skills, as well as to improve their expertise in disseminating their own knowledge-based capital and practical lessons learned from the competition policy field.

Photo: Fonet – Zoran Mrđa