Serbia: European Commission comments on Western Balkan countries' level of harmonisation of antitrust rules

05 November 2020 | newsletters

authors: Zoran Šoljaga and Srdjana Petronijević

The European Commission recently adopted the 'enlargement package' for 2020, which encompasses reports on candidate and potential candidate countries' progress towards EU accession. The progress reports contain, among other things, an assessment of the level of harmonisation of the Western Balkan countries' national competition laws with EU competition law and practice.

Legislative frameworks

According to the European Commission, the legislative frameworks regarding antitrust and merger control in Serbia, North Macedonia and Bosnia and Herzegovina are broadly in line with the EU acquis. The European Commission stated that there is a good level of alignment in Montenegro, while Kosovo's system is in the early stage of competition law regulation and enforcement. In 2019 the majority of countries made no progress in the harmonisation process (ie, Serbia, North Macedonia, Montenegro and Bosnia and Herzegovina) and only Kosovo and Albania have implemented new pieces of legislation. Kosovo has adopted administrative instructions on technology transfer agreements and specialisation agreements while Albania has adopted guidelines on certain rules governing action for damages in competition law matters. The European Commission has invited the Western Balkan countries to continue with the harmonisation process, particularly with regard to adopting implementing regulations (ie, Serbia, North Macedonia, Kosovo and Bosnia and Herzegovina.

Institutional frameworks and enforcement capacities

As for their institutional frameworks and enforcement capacities, all of the Western Balkan countries have established operational independent authorities that have powers to:

  • investigate competition infringements;
  • assess mergers; and
  • adopt implementing legislation.

Each competition authority in the Western Balkans has the power to impose fines, except in Montenegro where the imposition of fines falls within the competencies of the misdemeanour court. The administrative capacities of most of the authorities are limited and have yet to be strengthened. The additional training of case handlers is required for the authorities in North Macedonia, Bosnia and Herzegovina and Kosovo. Serbia has a good administrative capacity with 34 case handlers with adequate levels of expertise. Moreover, the Serbian Competition Authority is one of the most active competition authorities in the region, having ruled in five decisions on restrictive agreements and five decisions on the abuse of dominance and imposed approximately €860,000 in fines in 2019. The number of decisions decreased or stagnated in the reporting period in Montenegro and North Macedonia. Kosovo's Competition Authority did not have a large number of cases, but imposed the largest fine of €4 million on undertakings active in the oil derivatives sector. The European Commission stated that the overall level of enforcement is still insufficient and that local authorities do not (sufficiently) use powers to conduct dawn raids, which should be changed in the future. The European Commission also highlighted that further steps should be taken to promote leniency programmes and other tools for cartel detection.

Judiciary review

The judiciary review remains the weakest link in competition law enforcement in the Western Balkans. The European Commission stated that the capacity and specialisation of the judiciary to deal with competition cases are modest and must be significantly improved.

Comment

The European Commission assessed that most of the Western Balkan countries are moderately prepared in the area of competition law (ie, Serbia, Montenegro, North Macedonia and Albania), while Bosnia and Herzegovina and Kosovo still do not fulfil the majority of its criteria. The European Union will continue to monitor and support the development of competition policies in the Western Balkan region, focusing most directly on enforcement records.

This article was first published in International Law Office.

legal service:

eu & competition

country:

serbia