Mechanisms for preventing the violations of competition legislation

Contents

  1. Mechanisms for identifying and preventing the violations by the AMCU
  2. Procedure for obtaining AMCU conclusions on the contemplated actions
  3. Written application for conclusions
  4. Application fee
  5. Conclusions of the AMCU on the presence or absence of elements of violations of legislation

When achieving competitive advantages over other market participants in its business activities, the company should also focus on trends that regulate the competitive relations. Companies often find themselves in a state of uncertainty as a result of actions of the authorities, changes in legislation, or actions of other business representatives making their business activities dependent on their decisions.

In turn, the Antimonopoly Committee of Ukraine (hereinafter referred to as the “AMCU”), as a body responsible for the competition policy of the state, is authorized to prosecute violations that adversely affect the economic environment in the country. However, the legislation provides for another way of responding aimed at achieving positive aspects of competition by business entities. Such a tool is economic competition advocacy. In its activities, the Antimonopoly Committee of Ukraine extensively uses the provision of recommendations, proposals for amendments to regulations and covers its activities in the media.

Mechanisms for identifying and preventing the violations by the AMCU

 Currently, the main work on advocacy in different areas of economy of the country is carried out by the AMCU following the application by certain companies or consumers who might suffer adverse impact. The AMCU has no specific mechanism for identifying such situations on various markets on its own. It is partly due to the possibility to foresee the violations of competition legislation itself, since both the legislation and behavior of markets participants often undergo changes in various areas of economy. Participation of the authorities should be specifically noted since they too often pose obstacles to the understanding between the business, consumers and state.

The issue of identifying and preventing such violations of competition legislation may be resolved through the activity of not only the AMCU, but also of other authorities and business in general.

It is the indifference of business entities and business associations in building transparent and clear relations enables to create a favorable environment for business and economy of the state.

Procedure for obtaining AMCU conclusions on the contemplated actions

Business representatives may also use to foresee and prevent the manifestations of potential violations of the competition legislation such a tool as application to the Committee’s bodies for the conclusions in the form of advisory explanations concerning the contemplated actions.

Such conclusions shall be provided for the assessment of risks of violation of the legislation in the form of anticompetitive concerted actions or abuse of monopolistic (dominating) position on the market before the agreement is concluded or before the manifestations on the part of the market participants, which may be recognized as illegal. Conclusions in the form of advisory explanations may be provided concerning the advertising materials and labeling on products in respect of prevention of the dissemination of misleading information. Furthermore, Article 29 of the Law of Ukraine “On the Protection of Economic Competition” provides for the option of obtaining by business entities of preliminary conclusions concerning the contemplated concerted actions and concentration.

Written application for conclusions

To obtain conclusions in the form of advisory explanations concerning the contemplated actions, a business entity should file a written application with the Antimonopoly Committee of Ukraine. The following is to be specified in the application: name of the body, information about the business entity filing the application, content of the contemplated actions, list of documents and data being the substantiation for the circumstances presented. The application shall be signed by an authorized officer of the applicant or his/her representative, or individual entrepreneur applicant or his/her representative.

Please note that conclusions in the form of advisory explanations shall be provided only based on the information presented in the application and supporting documents attached thereto. The AMCU is not authorized to conduct further research or engage third parties during the consideration of such an application. If the contemplated actions concern Articles 6, 10 or 13 of the Law of Ukraine “On the Protection of Economic Competition”, it is advisable to provide information about the market on which the business entity operates, position on such market, information about the goods or service sold.

Application fee

The application shall also be accompanied by the original document confirming payment of the application fee. The Law of Ukraine “On the Protection of Economic Competition” provides for a fee for applying for the conclusions under Article 14, Article 29 of the Law, in the amount of 320 tax-exempt minimum incomes of citizens. Should no such document confirming the payment of the fee be provided, the AMCU shall leave the application without action and notify the applicant thereof.

Conclusions of the AMCU on the presence or absence of elements of violations of legislation

Following the results of considering the application, the AMCU shall conclude on the presence or absence of elements of violation of the legislation on the protection of economic competition. The Committee may also state that the information presented in the application is insufficient for the definitive provision of conclusion on the presence or absence of elements of violation in the actions of a business entity. Such a conclusion shall be provided should there be no information confirming the completeness, accuracy and authenticity of relevant data or information, which makes it possible to conclude on the potential impact of relevant data on the consumers’ intentions to purchase or sell certain goods, works, services of a business entity (in particular quality specifications, price indices, etc.). If the Committee provides a conclusion that the information is insufficient for the provision of definitive conclusion on the presence or absence of elements of violation of the competition legislation, a business entity may re-apply to the AMCU.

Pavlo Loginov

Pavlo Loginov

Partner, Head of Antitrust and Competition practice, Attorney at law

Practices | Sectors

948

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