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Water supply and sewage operator challenged to abuse a dominant position

Based on the initiative of the undertaking Brunat d.o.o., the Agency adopted a decision to start the proceeding against the undertaking Vodoopskrba i odvodnja d.o.o. from Zagreb.

In the proceeding the Agency will decide whether certain provisions of general and technical conditions for the provision of water services that the undertaking Vodoopskrba i odvodnja d.o.o. adopted in July 2013 represent abuse of a dominant position on the relevant public water supply market with effects on the market in the provision of services involving water meter and telemetry devices installation for the measurement of water consumption, providing data for billing and reporting, in the territory the city of Zagreb, Samobor, Sveta Nedjelja and the municipality of Stupnik.

In the course of the proceeding, the Agency will primarily analyse the provisions of General Terms which introduced the obligation for the existing inside water meters in the old buildings to be connected with the automatic water meter reading network (AWMR network). AWMR is a system of long distance reading which Vodoopskrba has only started to introduce in the old buildings. In other words, this is the market on which Vodoopskrba has not been present so far.

For the undertakings which so far have been involved in the installation of telemetry devices, reading and billing of so collected data on water consumption, have been as of 1 January 2014 prohibited to install telemetry devices in the old buildings whereas new competitors have been prevented from entering the market. Moreover, on 1 January 2014 also started a transitional period in which these undertakings are still allowed to perform distant readings from local networks. Upon the expiration of this transition period distant reading will be exclusively provided by Vodoopskrba i odvodnja.

In the sense of competition law it is not advisable or justifiable to re-regulate a once liberalized market if there are no concrete indicators which would point to objectively justified reasons for such a practice.

For all the reasons stated above, the Agency also adopted a decision on interim measure and ordered the undertaking Vodoopskrba i odvodnja to temporarily cease-and-desist the application of the provisions under the General and Technical conditions for water supply services which prevent the undertakings from the provision of services which they had been discharging before the challenged provisions entered into force and preventing final consumers from freely choosing the provider of the services concerned.

Besides, the Agency ordered Vodoopskrba i odvodnja to continue issuing the licences for the installation of water meters in the old buildings which are to be connected to the automatic measurement system which is not connected to the AWMR network and to ensure that at least one apartment with an inside water meter which is not included in the AWMR network should be connected to the automatic measurement system.

The interim measure is applicable for six months and is to be published on the web site of the water supply and sewage operator in question.  

The Agency determined the interim measure in duration of six months and undertaking Vodoopskrba i odvodnja is obliged to display decision on interim measure visibly on its home web site.