CCA opens infringement procedure against telecoms and Croatian Employers Association for alleged sharing of sensitive commercial information

Following the indications of alleged sharing of sensitive commercial information, on 28 December 2023 the CCA opened the infringement procedure against the undertakings Hrvatski Telekom d.d. (HT), A1 Hrvatska d.o.o. (A1), Telemach Hrvatska d.o.o. (Telemach) and the Croatian Employers Association (HUP) – Association for information and communications technology (ICT). In the course of the procedure the CCA will investigate into the allegations that the undertakings concerned distorted competition by agreeing on the price coordination applying a so-called index clause (inflation rate adjustment) into their general and special terms of business and thereby concluded a prohibited agreement in the sense of Article 8 of the Competition Act, OG 79/09, 80/13, 41/21.

In other words, the CCA will investigate whether HT, A1, and Telemach, encouraged by the representatives of the HUP ICT, participated in a cartel and exchanged commercially sensitive information about their intent of the price adjustment with the annual inflation rate in their general and special terms of business, i.e., agreements with their accounts, and thereby colluded about their commercial strategy, where the exchange of information could reduce or eliminate  uncertainty  about the future market behaviour of competitors and allow the parties to adapt their own future market behaviour accordingly, which increases the likelihood of limiting competition and indicates collusive behaviour.

It will be necessary for the CCA to establish whether the HUP ICT by tacitly agreed with the exchange of  commercially sensitive information at the meetings of the Telecom Working Group that involved the intent of HT, A1 and Telemach to likely adjustment of the price of their services with the annual inflation rate, i.e., the introduction of the so-called index clause into their terms of service, without having publicly distanced itself from the coordination behaviour of the undertakings concerned, and by having proposed to the Croatian Energy Regulatory Agency to amend the existing Ordinance on discharging electronic communication networks and services by introducing a provision that would regulate the possibility of introducing the index clause into the general terms of service of electronic communication services providers, facilitated the collusive behaviour (cartel), which would mean, it would itself become a member of a prohibited horizontal agreement.

The CCA notes here that the mere opening of an infringement proceeding does not prejudice the infringement of competition rules. Whether the undertakings concerned committed a serious infringement of competition rules by sharing sensitive commercial information, the CCA will decide on the merit of the case according to the established facts of the case.