CCA accepts committments made by Orion

The Croatian Competition Agency (CCA) accepted the committments made by the undertaking Orion that will redress competition concerns and restore the normal competitive conditions in the resale of pyrotechnic products. Orion made the commitments on its own initiative.

Namely, the CCA opened the ex officio proceeding following the initiative made by the undertakings Jorge pirotehnika from Križevci and Weco pirotehnika from Omišalj.

The analysis carried out by the CCA involved the assessment of the compliance of particular provisions contained in the agreements entered into between Orion and its partners who sell its products with competition rules.

These were concretely the lease agreements and business cooperation agreements on the basis of which Orion leases business space of the undertakings who sell Orion’s pyrotechnic products in the period form 15 December to 31 December.

In the sense of competition rules the provisions of the said contracts that raised competition concerns were the ones that prohibited the lessors to re-sell pyrotechnic products from suppliers other than Orion during the lifetime of the agreement. The agreements were concluded for seven years and where the lessor would terminate the agreement earlier the restriction not to sell the pyrotechnic products from suppliers other than Orion would remain in force until the original date of expiry set in the agreement concerned.

Shortly after the proceeding was opened by the CCA, Orion proposed concrete remedies to eliminate competition concerns on its own initiative. In other words, it proposed the revision of the disputable lease and business cooperation agreements without delay so as to enable the lessors to sell pyrotechnic products from Orion but also from other suppliers on the same business premises.

The CCA found that the proposed remedies were viable and proportionate to possible negative effects on competition. The CCA took into account that the remedies were proposed freely at an early stage of the proceeding and found that they would swiftly and effectively restore competition in the relevant market avoiding lengthy infringement proceedings.

The CCA found the commitments involving the removal of the disputable provisions sufficient and adequate to restore competition in the market and in that sense it ordered Orion to comply with the said measures until 15 December 2015. Should Orion not comply with the commitments addressed to restore competition until the set deadline the Agency will re-open the infringement proceeding in this particular case.