The Ministry of Construction, Transport and Infrastructure submitted the Draft law on amendments to the Law on road freight transport to the Commission for the purpose of obtaining opinion.
The text of the Draft law on amendments to the Law on road freight transport contained no provisions that would be considered disputable or contrary to the Law. The identical opinion is also issued in relation to the second request for opinion submitted by the Ministry of Construction, Transport and Infrastructure to an identical legislative text containing minor amendments.

The Ministry of Construction, Transport and Infrastructure submitted the Draft law on railways to the Commission for the purpose of obtaining opinion. In accordance with its competences, the Commission Council enacted an opinion concerning the following legal provisions of the Draft law on railways:

In Article 2(1/21) of the submitted draft, a term ‘exclusive right’ is defined as a right by way of which a railway carrier is authorized to provide certain services of public railway passenger transport on established railway track or network or in individual area, with the involvement of other railway carriers. The mentioned term is further used in the draft text only in Article 113 in relation to railway transport services of public interest – award of contract on public transport obligation in performing activities of public interest in passenger and freight public transport. Considering the above-mentioned, towards removing doubts in terms of the use of this term, the Commission’s assessment is that the above-mentioned definition should be inserted in the section of the Draft law regulating the transport as activity of public interest.

Article 13(3) of the Draft stipulates that a manager of service facilities directly controlled by a railway carrier, which is operative and holds a dominant position on the national railway transport market where the facility is used, must be independent from the railway carrier in terms of organization and decision-making. In relation to this provision, it is indicated that the issue of establishing the dominance is in the exclusive competence of the Commission, performed in a procedure conducted for the purpose of investigating the existence of infringements of competition. Since the Directorate for Railways is not authorized to establish dominance, it is questioned on the manner, criteria and procedure in which the dominance would be established. On those points, it is suggested to amend this provision by deleting the following words: “and holds a dominant position on the national railway transport market”. It is estimated that in such manner, considering the development of our market, a goal set in EC Regulation 2012/34 would be achieved.

It is suggested that in Article 30(4) of the Draft should be stipulated a commitment of the infrastructure manager to secure the publicity and availability of information to all undertakings in terms of criteria of availability and infrastructure capacity allocation potentials, towards allowing the public access to information that might be important in determining the respective business policies.

The provision set out in Article 40(3) of the Draft law stipulates that a priority which might be provided to a specific type of traffic when allocating infrastructure capacity need to be provided in accordance with law governing protection of competition. The Commission believes that although the mentioned provision is transposed from Article 49(3) of the EU Regulation 2012/34, it failed to be adequately carried into the draft. The purpose of the provision set out in Article 49(2) of the EC Regulation is that the decision of the infrastructure manager to give priority to a type of traffic when allocating infrastructure capacity is without prejudice to regulations governing restrictive agreements, abuses of dominance and competences of competition authority in relation to these restrictions, which is not evident from the formulation provided in this paragraph. On those points, the Commission proposed a new paragraph 4 that would read: “The provision of priority must not be contrary to regulations governing competition”. If this proposal would be accepted, it is recommended to delete the following words from paragraph 3 of Article 40: “in accordance with law governing protection of competition”.

In Article 120(4) of the Draft is stipulated that the General Manager of the Directorate for Railways regulates the exchange of information and cooperation of internal organizational units of the Directorate towards preventing adverse effects on the state of competition. The Commission assessed that the formulation: “towards preventing adverse effects on the state of competition” is not adequate, considering competences given to the Directorate and the Commission. Thus is suggested that the said formulation be amended to read: “towards prompting (developing) the state of competition”.

Article 121(6) of the Draft in the part that reads: “monitors the situation pertaining to the competition” should be amended to read: “monitors the state of competition”. The proposed formulation is also in accordance with the Commission’s competences. Accounting information to be provided as stipulated in Article 122 of the Draft is highly significant when monitoring the market behavior of undertakings. Item 2), Subitem (3) of this article stipulates the obligation of accounting information to be supplied upon request relating to the cost and profit information of individual services with the goal of monitoring the price of access to infrastructure and detecting potentially anticompetitive pricing (cross-subsidization, predatory and excessive pricing). The said provision does not stipulate the competence of the Direction to establish the anticompetitive pricing, but only a possibility to detect potential infringements of competition and inform the competent competition authority on the matter. On that point, it is suggested that the wording: “so to detect potential anticompetitive pricing (cross subsidization, predatory and excessive pricing)” be replaced to read: “so to detect potential infringements of competition, on which the Direction informs the competent competition authority”.

In the Commission’s opinion of Dec 25, 2017 is established that the Ministry of Construction, Transport and Infrastructure accepted all comments and recommendations provided by the Commission in an opinion of Nov 27, 2017. Bearing in mind the above-mentioned, the Commission had no comments to the amended text of the Draft law on railways.

Opinion of the Commission to the Proposal of the Law on postal services was not officially requested by the Ministry of Trade, Tourism and Telecommunications, but upon reviewing the bill presented on the official Internet webpage of the National Assembly of the Republic of Serbia, the Commission forwarded its opinion to the said regulation.

The baseline used for the purpose of the Commission’s opinion is the competition incentive principle, as well as cost-effectiveness and efficiency in carrying out tasks related to postal services, as one of the founding principles in carrying out postal services, also envisaged by current Law on postal services (Official Gazette of the RS, 18/2005, 30/2010 and 62/2014). The overall assessment of the Commission is that new legal solutions should enable the establishment of effective competition on the postal services market and contribute to a faster and more significant opening of this market for new undertakings.

The Commission’s opinion related to several provisions of the Proposal of the Law on postal services, specifically on the need to more precisely formulate the public postal operator as a guaranteed provider of universal postal services, on the need to provide opportunity to other postal operators to use the word “post” in their business names and operations, on the need to open a market relating to reserved postal services, need to more precisely define the price threshold for reserved postal services, need to specify the manner of determining postal charges for postal services, the issue of conditions to access the network of other postal operators, proposal that the approval issued by the Republic Agency for Postal Services on postal charges for the universal postal services be granted only to operators with considerable market power, as well as on the period of validity term for licenses for postal services performance. Upon forwarding the opinion concerned, the Ministry of Trade, Tourism and Telecommunications initiated a meeting with the Commission’s representatives, during which the proposed solutions were elaborated in more details. During the meeting, the parties agreed on amendments to the provisions set out in Article 31 and Article 55 of the Proposal of the Law on postal services.

Namely, the provisions of Article 31 of the Proposal of the Law on postal services stipulated that postal charges for postal services cannot imply additional costs, established by the provider of postal services exclusively on the basis of its market power on the postal services market, nor that postal charges can be set below the unit cost price, established with the goal of gaining or maintaining market power on the postal services market. According to the Commission’s assessment, it remained unclear whether the intention of regulatory proponent was to prevent potential infringements of competition by formulating the provision in such manner. In that respect, the Commission underlined that implementation of unfair (predatory or excessive) prices may represent a competition infringement from the standpoint of the Law only if such prices are set or implemented by a dominant undertaking. It also remained unclear what competition authorities are referenced in Paragraph 2, Item 1) of the article, so the need to provide more precise definitions also related to this provision as well. During the above-mentioned meeting between the representatives of the Ministry and the Commission, the provisions set out in Article 31 of the Proposal of the Law on postal services are also reformulated by incorporating the predatory and excessively high prices in a general formulation given as “unfair prices within the meaning of law governing competition”, while in Paragraph 2 is stated that the notice is submitted to the competition authority and not to “competition authorities”, which previously left a room for doubts.

In addition, in the provisions of Article 55(1) of the Proposal of the Law on postal services is stipulated that a public postal operator is obligated to enable other postal operators and consolidators to access the postal network. In Paragraph 2 of Article 55 is stipulated that the Agency for Postal Services more closely regulates the access to postal network, and in Paragraph 3 of Article 55 of the Proposal of the Law on postal services is stipulated that the conditions to access the postal network must be known beforehand, be transparent and nondiscriminatory for all users.

The Commission’s proposal accepted by the Ministry related to Article 55(3) of the Proposal of the Law on postal services, where in addition to the conditions regulating access to postal network is also agreed to regulate that the prices charged for the access to postal network must also be known beforehand, be transparent and nondiscriminatory. In such manner is contributing to the creation of a legislative framework facilitating free competition among providers of postal services.