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23 April 2015
The Competition Agency acts ex officio where it initiates proceedings concerning abuse of a dominant position, as set out in Article 13 of the Competition Act. However, any legal or natural person may request the agency to institute proceedings that fall under its purview – which usually occurs in abuse of dominant position cases. This option is often explored by competitors which perceive certain practices of a dominant undertaking as problematic.
This procedural pattern arose in a recent case brought before the agency. A competitor requested the agency to institute abuse of dominance proceedings against Gemicro,(1) which had allegedly concluded 'non-poaching' agreements with the leasing companies which were its buyers, thereby restricting competition and creating significant barriers to entry into the relevant market.
It appears that the agency highlighted several aggravating obligations in the non-poaching agreements, which prevented:
According to the agency, such agreements allegedly led to adverse effects on the market for the provision of specialised IT services to leasing companies,(3) in which Gemicro primarily operated.
Gemicro offered commitments to eliminate the indicated negative effects, in accordance with Article 49 of the act – this is a procedural option at the disposal of an enterprise during abuse proceedings instituted against it. The commitments were published and the agency is expected to accept them, thus avoiding problematic and difficult proceedings for both parties.
This is the first time that the Competition Agency has examined this type of agreement as problematic and assessed - albeit not thoroughly - its actual or potential adverse effects from the competition law perspective. Although the agency's acceptance of the commitments does not constitute a ruling on the merits, it will certainly raise many questions. In their day-to-day business activities, companies should be aware of the following issues:
In light of the above, parties should tbe particularly vigilant when evaluating their market positions and should not disregard the fact that certain products or services may be assessed independently as a separate product market. Further, non-poaching agreements should not immediately be perceived as intelligible and justified; rather, they should be checked carefully in order to avoid the scrutiny of the Competition Agency.
For further information on this topic please contact Mislav Bradvica attorney at law in cooperation with Schoenherr by telephone (+385 1 4813 244) or email (firstname.lastname@example.org). The Schoenherr website can be accessed at www.schoenherr.eu.
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