Commission for Protection of Competition
Procedure initiated against 26 market participants providing geodetic services

President of Commission for Protection of Competition issued, on the basis of Article 35, paragraph 2 of the Law on Protection of Competition, Resolution on initiation of procedure ex officio against 26 participants in the market of provision of geodetic services, for investigation of infringement of competition as stipulated in Article 10 of the Law on Protection of Competition.

The procedure was initiated following an initiative received by the Commission on April 12, 2016. The initiative stated that on several public procurement procedures for obtaining geodetic services, it was established that, as of the end of 2015, the bidders submitted bids with prices that significantly exceeded the estimated value of public procurement, which accordingly, led to suspension of respective procedures.

After a detailed analysis of all allegations and documents, Resolution on initiation of procedure was issued on April 19, 2016. Dawn raids were conducted at several locations in the premises of market participants.

We invite all persons who have data, documents or any other relevant information which may contribute to determining the factual situation in this procedure, to submit them to the address of Commission for Protection of Competition at Savska 25/IV, Belgrade.

Resolution on the initiation of procedure was published in the ”Official Gazette of the Republic of Serbia” no. 45/06.05.16.

Guest of the Commission Prof. William Kovacic gave an interview to the monthly magazine „The New Economy“

kzk-ekofTo mark a decade of work of the Commission, guest of Commission for Protection of Competition was William E. Kovacic, Professor at the George Washington University and Director of the Competition and Market Agency of the United Kingdom (CMA). On this occassion, Prof. Kovacic gave an interview for the May issue of the monthly magazine The New Economy. Link to interview with Prof. Kovacic can be found here.

Additional training of staff in Commission to use forensic tools during dawn raids

kzk-ekofThe employees in Technical Service of Commission for Protection of Competition attended a two-day workshop on the use of modern forensic tools during dawn raids. At the workshop, the employees went through a simulation scenario test, and analysis of results for the use of forensic software and equipment.

The aim of training is to improve further knowledge of authorized officials of Commission for Protection of Competition on techniques for data collection and triage, as well as evaluation of the nature and the amount of data examined by forensic tools, in order to achieve maximum efficiency of the procedure in dawn raid.

Dawn raid is an instrument that is provided by Law on Protection of Competition, by which a sudden inspection of premises or data, documents and items is made, about which party is informed only at the time of conducting investigation on the spot. Authorized officials carry out dawn raid if there is a reasonable doubt that there is a danger of removal or altering of evidence in the hands of a party or third party.

An official who conducts an investigation is obliged to show official identification and resolution on conducting the investigation at the business premises, i.e. to request undisturbed entry.Items of importance for decision making in the procedure, may be seized during dawn raid until identification of all relevant data and facts that are contained in these items, but no longer than until the end of procedure,

This is an efficient instrument for gathering evidence and detection of cartel agreements and other forms of infringements of competition.

Commission imposed a measure of procedural penalty

Commission for Protection of Competition determined a measure of procedural penalty i.e. fine to the market participant, company “MB-Gas OIL”, Belgrade, in the amount of 12,000 euros for failure to act upon the Request of the Commission ordering provision of information dated February 26 of this year. Such Request obliged the mentioned company to submit data necessary for sector inquiry of the state of competition in the market of whole and retail sale of oil derivatives in the Republic of Serbia.

Given that the deadline for submission of the required data expired on March 7, 2016, and that this company did not contact the Commission with a request to extend the deadline for submission of data, or otherwise reported to Commission the reasons for its failure to act upon the Request of the Commission, the Council of the Commission issued a decision on determination of measure of procedural penalty. The amount of money of procedural penalty i.e. fine, is fixed at 500 euros for each day of non-compliance with the Request of the Commission.

Procedural penalty in the amount of 500 to 5,000 euros for each day of conduct contrary to the order of the Commission, or non-compliance with its order, is defined by the provisions of Article 70 of the Law on Protection of Competition. Company ”MB-Gas OIL” must pay stated amount within two months from the date of the decision, under the threat of forced execution. The amount of money of the measure of procedural penalty i.e. fine shall be paid to the account of budget of the Republic of Serbia.

In determining the amount of procedural penalty, i.e. fine, the Commission shall apply the criteria prescribed by the Law on Protection of Competition, Regulation on criteria for determining te amount to be paid on the basis of measure for protection of competition and procedural penalty, manner and deadlines for payment and conditions for determining these measures, as well as Guidelines for the implementation of that Regulation, that was passed by the Council of the Commission on May 19, 2011. The Law on Protection of Competition specifies that procedural penalty i.e. fine cannot be more than ten percent of the total amount of turnover calculated in the manner provided by the Law.

Commission marked ten years of its activities

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On the occassion of the Competition Day and marking of ten years of successful work, Commission for Protection of Competition has organized an international conference dedicated to competition policy.

The conference was opened by the Vice President of the Government, Prof. Kori Udovicki, Ph.D., President of Commission for Protection of Competition Miloje Obradovic, Ph.D., Aleksandra Tomic, Ph.D., President of the Committee of Economy, Regional Development, Trade, Tourism and Energy of the National Assembly and Stefan Hudolin from the Delegation of the European Union.

President of Commission for Protection of Competition, Miloje Obradovic announced, on that occassion, passing of the new law, which would enable more efficient work of the Commission. ”We will open a broad debate in order to find best solutions and ideas, which would result in proposal of a new, high-quality Law on Protection of Competition”, he said. President Obradovic said that the current Law is based on EU acquis, but its changes are necessary, because, after all, it has certain weaknesses that may create possible legal uncertainty. He also noted that there is a significant room for improving the institutional capacity of the Commission and added that the sustainable functional independence of the Commission is important.

”Already we are proud that a qualitative shift was made regarding the importance of initiated procedures and their professional conduct before the Commission. We consider as significant the number of confirmed decisions, because these decisions issued by the Commission are directly aimed at the establishment of effective competition. Big steps were also made towards harmonisation with EU standards, which was a joint conclusion after a very successful bilateral screening of Chapter 8 in Brussels. The Commission also started with the implementation of important legal instrument – dawn raid to combat distortion of competition rules,” he pointed out.

Vice President of the Serbian Government Kori Udovicki expressed support for the work and functions of the Commission. ”We are willing to give support to the improvement of regulatory frame for building a stronger competition,” she said. According to the words of Vice Presicent Udovicki, it is important that this institution exists, regardless of the ultimate outcome of the road to the EU and also, that the activities and influence of the Commission should extend.

Vice President Udovicki also said that the biggest challenge for Serbia is to create business environment, which will be more receptive and productive.

President of the Parliamentary Committee for Economy, Aleksandra Tomic said that Serbian National Assembly, and in particular Committee for Economy, Regional Development, Trade, Tourism and Energy has a completely proactive stance that relates specifically to the process of preparation and adoption of amendments to the Law on Protection of Competition, participation in the presentation of the Report on the work of the Commission and, the last but not the least important, forwarding of materials of relevance for competition to Commission, of which the Committee expected and received substantiated and timely responses.

Representative of Delegation of the European Union in Serbia Stefen Hudolin said that Serbia, supported by EU has come a long way in competition protection and added that the Serbian regulations governing this field are largely harmonized with European legislation.

In the professional part of the conference attended by around 120 guests, the participants were Theodor Tanner, President of Austrian competition authority, William Kovacic, professor at the George Washington University, Hassan Qaqaya, former Director of Competition Policy and Consumer Protection of the UN Conference on Trade and Development, Bogdan Marius Chiritoiu, President of Romanian Council for Competition, Jana Mikhailova, President of the Board of Foreign Investors Council, Mladen Cerovac, President of Croatian Competition Agency and Andrei Kasavarov, Deputy President of Federal Antimonopoly Service of the Russian Federation, officials of regulatory authorities, academic institutions, as well as representatives of chambers of commerce, law firms and business associations.