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Competition Law | Lalin Law Office

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Competition Law

General Provisions

This law regulates protection of competition on the market of the Republic of Serbia. The main goal of the law is economic development and welfare of the society, and in particular to the benefit of the consumers. The law is applied on the acts and deeds performed on the territory of the Republic of Serbia as well as on the acts and deeds performed outside its territory that affect or could affect the competition on the territory of the Republic of Serbia. This law applies to all legal and natural entities that perform economic activities in trade of goods and services. The law does not apply to relations between employers and employees.

Connected Undertakings

Connected undertakings are two or more undertakings that are connected in a way that one undertaking is in control of the other, or that two or more of them are controlled by a third undertaking. Control represents the possibility of decisive influence on managing activities of the undertakings. Connected undertakings are considered to be a single undertaking pursuant to this law.

Infringements of Competition

Infringements of competition are the acts or deeds of undertakings with objective or the consequence by which the competition is considerably limited, violated or prevented.

Restrictive Agreements

Restrictive agreements are those made by undertakings with objective or the consequence to considerably limit, violate or prevent the competition on the territory of the Republic of Serbia.

Restrictive agreements could be contracts, certain items in contracts, specified or implicit, concerted practices, as well as the decisions of associations of undertakings, where:

  1. the purchase or sale prices or other conditions of trading are determined directly or indirectly;
  2. the production, market, technical development or investments are limited and controlled;
  3. unequal conditions of operations are applied in same activities for different undertakings, through which the undertakings are put into an unfavourable position in relation to their competition;
  4. the contract or agreement is conditioned with acceptance of additional obligations. that by their nature and trading habits and practice are not connected with the subject of the agreement;
  5. the markets or procurement sources are divided.

Restrictive agreements are prohibited and void, except if excluded from prohibition pursuant to this law. Restrictive agreements could be allowed if they contribute to improvement of the production and trade, or facilitate a technical or economic progress, providing the consumers with a fair share of benefits, under condition they do not impose limitations upon undertakings that are not necessary for achieving the goal of the agreement, or they do not facilitate removing the competition on a relevant market or in its significant part.

Dominant Position

Dominant position in a relevant market is deemed to be the position of an undertaking that has no competition or the competition is insignificant, or it has a substantially better position than the competition considering market shares, economic and financial strength, possibilities for supplies and distribution, as well as legal and factual barriers which impede other undertakings upon their entry into the market.

The abuse of a dominant position in the market is prohibited. Abuse of a dominant position in the market is deemed to be:

  1. direct or indirect imposing of unjust purchase or sale price, or of other unfair business conditions;
  2. limiting the production, market or technical development;
  3. applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;
  4. conditioning the contract with the other party accepting additional obligations, which, by its nature or by commercial practice have no connection with the subject of the contract.

A concentration of undertakings shall be deemed to arise when:

  1. two or more previously independent undertakings merge;
  2. one or more undertakings acquire direct or indirect control of another undertaking;
  3. two or more undertakings invest jointly into a new undertaking or to acquire joint control, pursuant to definition as in article 5 paragraph 2, over an existing undertaking, that performed on a lasting basis and with all the functions of an independent undertaking.

Concentrations of undertakings are allowed except if they would significantly limit, violate or prevent competition in the market of the Republic of Serbia as a whole or in a relevant part thereof, in particular as a result of the creation or strengthening existing dominant position.

The Commission for Protection of Competition

The Commission for Protection of Competition  is an independent organization that exercises competencies in accordance with this law. The Commission has a status of a legal entity. The Commission is competent to:

  1. decide on rights and obligations of undertakings, in accordance with the law;
  2. impose administrative measures according to this law;
  3. be included in defining the rules in the field of protection of competition;
  4. propose to the Government the regulation for implementation of this law;
  5. enact instructions and guidelines for implementation of this law;
  6. monitor and analyze the competition conditions on particular markets and in particular sectors;
  7. submit opinion to the competent authorities on draft rules, as well as on current rules that have an influence of the competition on the market;
  8. issue opinions in view of implementation of rules in the field of protection of competition;
  9. establish international cooperation in the field of protection of competitiveness,
  10. for fulfillment of international obligations in this area, and collecting information on protection of competitiveness in other countries;
  11. cooperate with the state authorities, territorial autonomy and local-self-government bodies, for providing the conditions for implementation of this law and other rules that regulate the issues of importance for protection of competitiveness;
  12. perform activities  with respect to raise awareness on the need for protection of competition;
  13.  keep the records on agreements announced reported, on undertakings that have a dominant position on the market, as well as on concentrations according to this law;
  14. organize, perform and control the implementation of measures with which the protection of competitiveness is provided;
  15. perform other operations in accordance with the law.

The party in the procedure before the Commission is the undertakings that notifies concentration or requests individual exemption, as well as the undertaking against which the investigation procedure is initiated. Claimants, persons that notified potential infringements regarding the competition, providers of information and data, experts and organizations whose analysis are used in the procedure as well as other public entities and organizations cooperating with the Commission in the procedure are not considered as parties in the procedure. The procedure of investigating the infringement of the competition shall be initiated ex officio when the Commission learns on the basis of submitted initiatives, and otherwise available information that there are plausible indications of the infringement.

On the infringement of the competition as well as on individual exemption and approval or prohibition of the concentration, Commission shall pass a decision. Before passing a decision on possible infringement of the competition, Commission shall notify the party on important facts, evidence and other elements on which its decision would be based upon and it shall invite the party to present its case within given timeline.