The Anti-monopoly Committee of Ukraine (AMC) recently approved regulations providing for a merger control amnesty in Ukraine. This means that if an undertaking has previously failed to obtain merger control approval for a transaction – whether domestic or foreign – then for a one-year period, starting from September 15 2015, the undertaking may apply to the AMC to obtain approval and face a minimal fine.
The removal of obstacles to parallel imports has traditionally been the primary enforcement activity conducted by the EU authorities in the pharmaceutical sector. In light of the Ukrainian Anti-monopoly Committee's recent investigation of the pharmaceutical market, it is worth considering whether the same approach should be taken in Ukraine.
Despite the difficult economic situation in Ukraine, competition law enforcement has developed significantly over the past few years, with more cartel investigations, greater control over dominant undertakings and a significant increase in monetary penalties. However, certain further steps still need to be taken.
A proposal has been submitted to Parliament that would significantly amend the Law on Protection of Economic Competition. Among other things, it would simplify the criteria for a presumption of dominant position, redefine the threshold for concentrations and raise the thresholds for merger clearance.
The Anti-monopoly Committee has strengthened its cooperation with the Ministry of Internal Affairs in anti-cartel operations. A new agreement will enhance ongoing consultations and exchange of information during investigations. However, a better option would be to entrust the committee with greater powers, such as those exercised by the US Antitrust Commission in the Department of Justice.
Parliament has approved two draft laws on first reading. The first includes provisions to increase minimum penalties for anti-monopoly infringements. The second addresses jurisdictional issues between the administrative and commercial courts in cases involving the Anti-monopoly Committee; it may help entities that compete fairly to obtain immediate enforcement of commercial court decisions.
In recent months the Anti-monopoly Committee has kept an increasingly close watch on competition-related information from Ukrainian and foreign news sources and other antitrust regulators. The approach is in line with a new draft law, which also sets out the committee's right to request information - including data covered by bank secrecy - from legal entities or private individuals.
The Law on Public Procurement has come into force, introducing new rules to make public procurement procedures non-discriminatory and more transparent. It sets out new duties for the Anti-monopoly Committee, which is vested with the authority to review disputes arising out of public procurement procedures.
The plans of Telenor ASA and Altimo Holdings & Investments Ltd to merge the mobile phone operations of their assets Kievstar and Russian company Vimpelcom have been frustrated by the new approach taken by the Anti-monopoly Committee. The committee recently stayed its decision to approve the concentration of Telenor and Altimo's assets, and began proceedings to reconsider that decision.
Oleksiy Kostusev, the newly appointed head of the Anti-monopoly Committee, intends to introduce criminal liability for individuals involved in unfair collusion, as he believes that this represents the most effective deterrent to anti-competitive activities. Kostusev also plans significant increases in the maximum fines imposed by the committee's regional departments.
At the end of 2009 the Highest Commercial Court issued an overview of court practice relating to antitrust legislation, indicating the development of Ukrainian competition law practice through the establishment of court precedent. Among other things, it confirms that no commercial court has competence to determine the monopoly status of a market participant, either independently or on the basis of expert opinions.
The Anti-monopoly Committee has announced a successful year in anti-monopoly litigation, including significant decisions on violations in the oil, aircraft services and cable television sectors. However, the committee faces greater problems in imposing resolutions on foreign entities.
Towards the end of 2009 the Anti-monopoly Committee carried out frequent inspections of suspected competition violations involving consumer products. Although it has so far focused on pharmaceuticals and petroleum products, it is unlikely to stop there. Producers, distributors and other market participants must consider how best to conduct business in the regulator's spotlight.
Mobile TeleSystems, one of the largest mobile operators in Eastern Europe, has acquired a 57.7% stake in Ukrainian Mobile Communications, the second largest Ukrainian mobile operator, for €194.2 million. Despite negative publicity and strong resistance to the transaction, the Anti-monopoly Committee concluded that it did not adversely affect competition in the telecommunications sector.
Including: Regulatory Framework; Concentrations; Abuse of a Dominant Position; Concerted Practices; Discrimination by State and Local Government Authorities; Remedies; Unfair Competition
A new regulation explains the circumstances in which the participants to a concentration must obtain the prior consent of the Anti-monopoly Committee, and sets out the procedure which must be followed when applying for this consent.
New anti-monopoly legislation has significantly developed the concept of concerted practices. The resolutions explain the kinds of activities which will be considered as concerted practices, and set out the conditions under which the Anti-monopoly Committee of Ukraine will permit such activities to be conducted.
The new Law of Ukraine on Protection of Economic Competition recently came into force. The law is expected to have a significant impact on the Ukrainian competition regime as existing rules and regulations are amended to reflect its provisions.
A new regulation provides for close cooperation between the State Property Fund and the Anti-monopoly Committee with respect to the privatization of integrated property complexes held by strategically important or monopolistic state owned companies.
Substantial amendments were recently made to Ukraine's merger legislation. They set out the circumstances in which the Anti-monopoly Committee of Ukraine's approval is required and the documentation that must be filed in order to obtain this approval.