CCA webinar – 2021 Reviews of the Competition Act

In the introduction to the panel discussion, Mirta Kapural, PhD, member of the Competition Council of the Croatian Competition Agency (CCA), explained that the main reason for the adoption of 2021 Reviews of the Competition Act was the fact that the Republic of Croatia was obliged to transpose the Directive (EU) 2019/1 of the European Parliament and of the Council of 11 December 2018 to empower the competition authorities of the Member States to be more effective enforcers and to ensure the proper functioning of the internal market OJ L 11, 14.1.2019 (ECN+ Directive). In addition, the ten-year-application of the Competition Act in practice has indicated the need for some fine tuning regarding certain provisions with the view to resolving any possible doubts in the interpretation thereof. Finally, she added that the Revised Competition Act 2021 introduces new legal tools, such as: “interview”, “periodic penalty payment”, “settlement in cartel cases” and specifies the imposition of fines where the infringement is committed by an association of undertakings.

At the same time, she pointed out that the Revised Competition Act 2021 establishes the CCA as a general, national regulatory authority in charge of competition in all markets and ensures a greater degree of its independence and additional operational resources. At the same time, and in line with the ECN+ Directive, the CCA will be able to set its own enforcement priorities regarding the complaints it receives, in other words, after having inspected its content, the CCA is now empowered to dismiss any initiative for the initiation of the proceeding ex officio on the grounds that it does not consider such a complaint to be an enforcement priority. Furthermore, with respect to the monitoring of structural and behavioural measures provided in Article 9 of the Revised Competition Act 2021, she specified that the “Statement of the facts of the case” was revoked on the account of the fact that it made the proceeding unnecessarily unproductive. Lastly, the novelty is that the limitation periods for the imposition of fines or periodic penalty payments by the national competition authorities are suspended or interrupted for the duration of enforcement proceedings before the national competition authorities of other Member States or the Commission.

The member of the panel discussion, Jasminka Pecotić, PhD, lecturer at the Department for Law of the Faculty of Economics and Business in Zagreb, appreciated the efforts of the CCA in transposing the ECN+ Directive into the Croatian legislative framework. She emphasised the main objective of the ECN+ Directive to ensure a uniform and effective enforcement of competition law based on the cooperation of the national competition authorities which is designed to work as a cohesive whole based on close cooperation within the European Competition Network. She highlighted the importance of the strengthening of the independence of the national competition authorities whereby the normative independence does not suffice but it should be connected with the enforcement. In conclusion, she said that the time will tell whether the revisions concerned will strengthen the CCA independence.

The attorney and partner in the law firm Divjak, Topić, Bahtijarević & Krka, Mario Krka, having been the only attorney that provided its comments during the public consultations about the revisions of the Competition Act, focused its comments on the power of the CCA to conduct interviews regarding the power to set its own priorities in deciding whether to open a particular proceeding or not. He argued that the interviews stand for coercive collection of information outside the proceeding and that it would be necessary in the sense of the adversarial principle to ensure the parties to actively participate and respond to the allegations of other persons and take part in the immediate interview itself. In his opinion, the application of this new instrument has not been adequately explained in the Revised Competition Act 2021. It is his standing, that the statements received in interviews should not be used as evidence in the proceedings carried out by the CCA but should be used merely as circumstantial evidence required for the opening of the proceeding. On the other hand, the possibility of the CCA to dismiss the complaint due to the fact that it is not considered a priority in the enforcement of the CCA, could diminish the willingness of the undertakings to supply the information to the CCA.

Professor Siniša Petrović, PhD, from the Department of commercial and company law of the Law Faculty in Zagreb, concentrated on three issues relating to the subject concerned: digital markets, the functioning of competition and secret cartels. He welcomed the possibility of priority setting for the CCA where the significant effect on competition should remain the main criteria in setting of the priorities in the work of the CCA in handling concrete cases. On the other hand, he argued that the main function of competition rules is protection of the consumers, the idea that is the ultimate objective that is not reflected in the wording of Articles 101 and 102 TFEU. They merely emphasise the idea that competition ensures the functioning of the internal market but do not emphasise its role in the realization of the key objective which is welfare and benefit for all EU citizens. He thought that it is about time to revise the wording so that it reflects the content which already applies in practice.

The discussion concentrated on the regulatory activities of the CCA, the revision of the notion of an undertaking under control of another undertaking, the possibility of proposing committments after the receipt of the Statement of Objections. In conclusion, all the participants agreed that the recent revisions of the Competition Act should contribute to the strengthening of the role of the CCA and even better enforcement of competition rules in the Republic of Croatia.