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1 Second Annual Conference on Competition Enforcement in the Recently Acceded Member States Brno 23 April 2010 Development of Competition Enforcement in.

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Presentation on theme: "1 Second Annual Conference on Competition Enforcement in the Recently Acceded Member States Brno 23 April 2010 Development of Competition Enforcement in."— Presentation transcript:

1 1 Second Annual Conference on Competition Enforcement in the Recently Acceded Member States Brno 23 April 2010 Development of Competition Enforcement in the Czech Republic Important Decisions Robert Neruda Vice Chairman Office for the Protection of Competition, the Czech Republic

2 2 Overview Background Cartels Abuse of dominance Mergers Courts Conclusions

3 3 Background Organisational changes –structure of the Competition Section –Chief economist department –Cartel department –Devil's advocates' panel Policy changes –willingness to enforce signaled –more economic approach –Prioritisation

4 4 First instance decisions

5 5 Cases Opened

6 6 Overview Background Cartels Abuse of dominance Mergers Courts Conclusions

7 7 Cartels Cases RPM campaign provisionally finished Export bans –Sokolovská uhelná (lignite) –KMV (soft drinks, settled) Pending –bid rigging (evidence submitted by the police)

8 8 Cartels Other important developments Leniency program –rules on access to leniency file –seeking a balance between LP and settlements –joint application Self incrimination rules

9 9 Overview Background Cartels Abuse of dominance Mergers Courts Conclusions

10 10 Abuse of dominance Development Focus on exclusionary conduct Pricing (margin squeeze, predatory pricing) But still some room for investigation of exploitation! –RWE Transgas excessive advances for gas supply compensation of damages in settlement procedure

11 11 Abuse of dominance Cases MUS (lignite) –complaint on refusal to supply and discriminatory (excessive) pricing –mutual business dependence between MUS and heating plant –no dominance found despite very high market share (> 60 %) countervailing buyer power (dominance on purchase market) vertical integration of competitors –case closed … … with controversy

12 12 Abuse of dominance Commitments RWE Transgas –access to gas storage facilities –parallel investigations by the Office and the regulator (ERU) –commitments outside formal proceeding making 20 % of storage capacity available to competitors shortening of capacity reservation by 12 years –lessons learned

13 13 Overview Background Cartels Abuse of dominanceAbuse of dominance Mergers Courts Conclusions

14 14 Mergers Crisis? What? Scarce interventions –but structural commitments only (Agrofert/Agropol) –painful revision of commitments Concept of undertaking –definition of economic activity –health insurance is not economic activity (HZP/ZP Agel) Are some mergers abandoned because of the threat of MEA?

15 15 Overview Background Cartels Abuse of dominanceAbuse of dominance Mergers Courts Conclusions

16 16 Courts Supreme Administrative Court –Petrol stations cartel succession of liability - a Pyrrhic victory? automatic legal or economic continuity not available in the Czech law –except for cases where transformation of company was motivated (at least partially) by the intention to evade consequences of violation of competition law fully applicable for 2001, but situation might have changed after 1 May 2004 (1 September 2009)

17 17 Overview Background Cartels Abuse of dominanceAbuse of dominance Mergers Courts Conclusions

18 18 Conclusions Significant change of competition policy –from formal to effect based approach Due process in cartel investigation Balance between leniency program and settlements Mergers as usually

19 19 Thank you for your attention. For further information: Robert Neruda robert.neruda@compet.cz www.compet.cz


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