The European Antitrust Review 2014 • Section 3: Country chapters
Slovakia: Antimonopoly Office
Last year, the Antimonopoly Office of the Slovak Republic (AMO) dealt intensively with the assessment of its activities and functioning. With the aim of building a modern and respected competition authority focused on consumer welfare, the AMO identified areas requiring reform and prepared a set of legislative, organisational and technical changes and measures ensuring higher efficiency of the its activities and more vigorous enforcement of competition in Slovakia.
The AMO has officially introduced prioritisation of its activities through a soft-law document, with no changes in legislation. It thus intends to allocate its capacities to the most serious infringements of competition policy with real impact on large group of consumers. Hence, it will primarily deal with anti-competitive conduct with negative impact on consumer welfare. In the coming year, priority will be given to the following anti-competitive practices:
- Cartels – cartels have been set as a priority as they represent one of the most serious infringements of competition rules. In this matter, the AMO established a cartel division, which deals with their detection and sanctioning.
- Bid rigging in public procurement – in cartel investigation, the AMO mainly focuses on bid rigging in public procurement. Cartel agreements in public procurement may occur in various forms, but all of them prevent consumers from getting the products and services at the lowest prices, decrease public trust in competitive process and reduce advantages of the competitive market environment.
- Unnotified mergers – recently, the AMO observed unnotified mergers with the aim of preventing from competition harm resulting from potentially prohibited mergers and with the aim to increase the undertakings’ discipline, the AMO will focus on the detection of such mergers.
- Financial sector – the financial sector represents one of the most important driving sectors of the economy. Recent AMO analyses and continuous monitoring of this sector refer to the fact that the position of financial entities in Slovakia has been relatively stable on a long-term basis, what may encourage the tendency to collusion. Banking sector in Slovakia is characterized, for instance, by high switching costs. This has been proved by more complaints that the Office dealt with in past.
- Food sector – the efficiency of an economy in this sector directly affects all consumers; moreover, Slovak consumers are generally extremely price sensitive. A relatively high concentration of production in some markets; the establishment of various undertakings’ associations (associations, unions); repeated complaints about supranational retail chains; of distribution networks or increasing prices of single products may raise competition concerns.
- Heating sector – the AMO perceives this sector as problematic, namely in terms of systematic deficiencies resulting from structural problems and insufficiently set legal adjustments and regulation. This has been stressed by repeated complaints. In order to better understand the function of this sector and identify possible anti-competitive practices, the AMO is currently preparing a sector inquiry.
Prioritisation will also cover the AMO’s approach to solving competition issues in order to use the most efficient way. In accordance with the nature of the problem, the AMO will select the most appropriate way, such as an administrative proceeding, competition advocacy or sector inquiry.
The AMO’s issues over the coming year cover legislative changes that will solve problems arising from the practice, but also legally confirm changes in recent approach towards assessment of competition cases. Soon, it will submit amendments to the Act on Protection of Competition. The most significant amendments to the Act concern acceleration and the simplification of a merger control, support to alternative case solution, a more transparent and attractive leniency programme and the unification of decision-making practices of the executive divisions.
These changes are currently still in the initial stage of a legislative process and were subject to public consultation. Received comments were processed and currently the AMO is preparing the draft legislation for the next legislative proceeding.
For better work allocation and balanced use of its capacities, the AMO has made some changes to its internal organisation. First of all, in harmony with the European trends, the AMO has been striving for a long time to shift from a formal assessment of competition cases to a so-called more economic approach. The establishment of the division of chief economist in 2012 was a significant step in this direction. The division consists of top competition economists and will unify and strengthen the economic approach of the whole AMO. The second major change is discussed above. The division of agreements restricting competition (now the division of cartels) will focus only on the revealing and sanctioning of cartels, and the assessment of vertical agreements will fall within the competence of the division of abuse of a dominant position and vertical agreements.
The AMO is in the process of making changes in the area of international and public relations; its agenda has been concentrated and enhanced. At the same time, the AMO intends to improve its communication strategy nationally. It will continue to strengthen its competition policy towards the public by organising conferences, workshops and seminars.
We firmly believe that all the above-mentioned changes will contribute to a higher level of competition protection in the Slovak Republic and will constitute a benefit to consumers.
Next Chapter: Slovakia: Overview