We would like to ensure that you are still receiving content that you find useful – please confirm that you would like to continue to receive ILO newsletters.
14 January 2021
The Croatian Competition Agency (CCA) recently closed the infringement proceeding against Croatia osiguranje dd – Croatia's largest insurer – which had been opened ex officio. The proceeding concerned the exclusivity clauses in Croatia osiguranje's commercial lease agreements; the CCA's main concern was that the clauses prevented landlords from cooperating with other insurers and thus restricted potential competition in the insurance market.
The CCA found that a number of provisions in Croatia osiguranje's commercial lease agreements (where it was the lessee) were problematic from an antitrust perspective – namely, the provisions that the lessor could not:
Similarly, the CCA held that in lease agreements in which Croatia osiguranje was the lessor, the provision that the lessee could not sublease the business premises to Croatia osiguranje's competitors was problematic from an antitrust perspective.
At an early stage of the proceedings, Croatia osiguranje offered commitments to end the investigation and avoid penalties in case the CCA established infringement. Croatia osiguranje proposed that it would conclude a new standard commercial lease agreement which would contain no exclusivity obligation preventing lessors or lessees from entering into agreements with its competitors.
Croatia osiguranje also offered to send its business partners the proposed new agreement and give them 60 days to decide whether to accept its terms and conditions. In addition, Croatia osiguranje stated that immediately after receiving the CCA's decision, it would issue a revocation statement that would clearly and undoubtedly waive any possible right arising from the stated provisions contained in the concluded commercial lease agreements.
The CCA found Croatia osiguranje's proposed commitments to be sufficient to eliminate the possible competition concerns and restore effective competition in the insurance market.
Unfortunately, the decision contains no detailed assessment of the legality of exclusivity clauses in lease agreements as the investigation did not end with an infringement decision. Thus, it remains uncertain whether the CCA would take a formal approach and consider exclusivity as a restriction per se or whether it would follow the 'effect' approach (applied by the EU courts), under which such clauses would be deemed restrictive only if they have anti-competitive effects. In any case, this decision shows that exclusivity clauses in lease agreements could be subject to antitrust scrutiny – as such, market participants should carefully review such agreements. An assessment of the legality of such clauses should include:
For further information on this topic please contact Ana Marjančić at Schoenherr by telephone (+385 1 4813 244) or email (firstname.lastname@example.org). Alternatively, please contact Zoran Šoljaga at Moravčević Vojnović and Partners in cooperation with Schoenherr telephone (+381 11 320 26 00) or email (email@example.com). The Schoenherr Croatia website can be accessed at www.schoenherr.eu/croatia/office.
The materials contained on this website are for general information purposes only and are subject to the disclaimer.
ILO is a premium online legal update service for major companies and law firms worldwide. In-house corporate counsel and other users of legal services, as well as law firm partners, qualify for a free subscription.