The European Antitrust Review 2014 Section 3: Country chapters

Greece: Hellenic Competition Commission

The ongoing financial crisis markedly exposed the structural rigidities and inefficiencies of the Greek economy. In this context, the strategic planning of the Hellenic Competition Commission (HCC) had to be realigned in order to increase the exercise of its consultative and advocacy powers regarding regulatory obstacles to competition, thereby complementing the Authority’s core enforcement action. Over the past three years, the HCC has devised and implemented a renewed policy revolving around four themes:

  • maintaining a consistent level of core enforcement action (antitrust investigations and merger control work) compared to previous years, albeit the economic downturn and the inherent challenges in pursuing a diversified agenda;
  • considerably expanding the Authority’s advocacy efforts in order to promote much needed structural reforms, pledged in the context of Greece’s Economic Adjustment Programme;
  • placing renewed emphasis on market monitoring actions, notably by making more use of sector inquiries, while further increasing cooperation with other stakeholders; and
  • adapting swiftly to the new institutional framework set by the revised Competition Act.

The HCC has broadened its enforcement record, focusing more on abuse of dominance cases and horizontal collusion practices (notably in the context of trade associations). In the course of the past year, important precedents have been set, in particular following the Tasty Foods abuse of dominance findings, which were upheld by the Court of Appeals. The case concerned Tasty Foods’ single, consistent and targeted policy in the market of savoury snacks that sought to exclude its competitors from the distribution channel of smaller retailer outlets (kiosks, small grocery stores and mini markets) and to limit their growth possibilities by employing various abusive practices (exclusivity agreements at the wholesale level; agreements for the provision of cabinets on the basis of exclusivity, aimed at capturing the available space at smaller retailer shops and raising entry and expansion barriers to the exclusion of competitors; target rebates at wholesale and retail level; and rebates conditional upon the commitment of all or the most substantial part of available shelf or store space for its products). Moreover, the Authority’s swift response to the restructuring of the banking sector, which involved the complex review of consecutive mergers and acquisitions involving Greece’s systemic banks, set new grounds for its merger control work. In parallel, the HCC further consolidated its practice concerning commitment decisions by issuing two such decisions to resolve abuse of dominance investigations, including a landmark case in the market for distribution of natural gas, which involved an extensive set of commitments made binding on Greece’s gas incumbent, DEPA, aimed at the unbundling and opening up of reserved capacity to ensure sufficient access to Greece’s gas transmission network. The HCC’s diversified enforcement record also included interim measures and obstruction of dawn raids decisions, as well as the issuing of statement of objections in a broad cartel investigation concerning producers of poultry meat. Overall, considerable fines totalling €21 million were imposed, notwithstanding the inherent constraints posed by the economic downturn.

At the same time, the HCC has gone on the offensive by considerably expanding its advocacy efforts in order to promote much needed structural reforms. This was facilitated by the enhanced role envisaged for the HCC in the context of Greece’s Economic Adjustment Programme. Advocacy reached 30 per cent of total output between 2011 and 2012, setting a new record of formal opinions aimed at identifying and removing regulatory-driven obstacles to competition in a number of sectors and professional activities. In this context, the HCC embarked on the most far-reaching and sustained intervention in the area of liberal professions (issuing 17 formal opinions, with recommendations affecting more than 55 regulated professional activities), while also targeting other regulatory-driven rigidities of the food supply chain (including the reform of the product and market regulation code and the removal of restrictions concerning the selling of infant formulas solely in pharmacies). Furthermore, following an agreement between the OECD and the Greek government, the OECD Competition Assessment Project, in partnership with the HCC, was launched in December 2012 to assess the costs and benefits of regulations restricting competition in designated sectors of the economy and to propose specific recommendations for change. The HCC’s partnership with the OECD underlines our commitment to expand our advocacy agenda and promote structural reforms at large. Finally, in October 2012 the Authority published the findings of its sector inquiry into the fuel sector, which included 31 recommendations aimed at removing regulatory restrictions that impede effective competition.

The HCC also placed renewed emphasis on market monitoring actions, in particular by launching sector inquiries. This was effectively prompted by the ongoing economic crisis and the ensuing need to better understand the price formation and price transmission mechanisms that link commodity and producer prices with end-consumer prices. The ultimate goal has been to make more informed policy choices and to pursue more targeted competition enforcement and advocacy.

Moreover, the Authority sought to adapt swiftly to the new institutional framework set by the revised Competition Act, which entered into force in mid-2011. The new Competition Act did not entail any significant changes with respect to substantive law provisions, but introduced several provisions of procedural nature aimed at increasing the effectiveness of the HCC. In this context, the Authority’s efforts focused on streamlining prioritisation procedures and consolidating internal organisation. Aside from the adoption of new rules of procedure, two new Notices concerning the prioritisation of cases encapsulate the HCC’s policy on this front. Prioritisation is now firmly based on the criterion of public interest, as illustrated in the HCC’s Notice of Enforcement Priorities. The Authority is required to assess the public interest considerations arising from each individual case, in light of the nature of the alleged infringement and its estimated impact on the functioning of effective competition, and especially on consumers. In addition, based on the follow-on Notice for the Quantification of Priority Criteria, the HCC has been applying a new internal management tool in the form of a ‘point system’, the aim being to increase its overall systemic effect. Pursuant to that point system, pending investigations are ranked on a scale of 1 to 10, depending mostly on the nature of infringement, its anticipated impact and the economic importance of the products or sectors under investigation. The HCC will not investigate, but most likely reject, cases that are awarded three points or less. It is still premature to assess fully the effectiveness of the new prioritisation system, particularly given that its implementation is still ongoing and that, more importantly, rejection decisions on priority grounds have not yet been tested in administrative courts. Nonetheless, preliminary indications are positive, as expedited rejection decisions for unfounded cases has tripled as compared to 2011, while it is estimated that the reduction of backlogged files may reach 40 per cent once the streamlining project is fully implemented.

In the context of the ongoing economic crisis, the HCC has a crucial role to play in safeguarding the conditions of effective competition and in fostering a genuine ‘competition culture’ in Greece. The realignment of its strategic planning along the four pillars described above underlines its resolve in solidifying that precise role.

Next Chapter: Greece: Overview

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