The number of decisions made by the bodies of the Antimonopoly Committee of Ukraine (hereinafter referred to as the “AMCU”, “Committee”) on violations related to information inquiries has increased over the past two years. Currently, the so-called information violations hold the leading position by the number of decisions made by the Committee’s bodies.
One can only imagine to which processes such activity is due, yet receiving a request from the AMCU bodies provokes a high degree of tension for each business entity.
Let us consider the main aspects worth your attention if you have received a request for information, as well as peculiarities of communicating with the AMCU bodies.
AMCU powers on the requested information
The AMCU bodies are vested with rather wide powers when requesting information. This is due to the special status of the body and tasks assigned to it in the formation and implementation of state competition policy. In turn, special legislation establishes the obligation to provide information at the request of the AMCU.
Part 1 Article 22-1 provides that business entities, associations, state authorities, local self-government bodies, administrative and economic management, and control bodies, other legal entities, their structural subdivisions, branches, representative offices, their officers and employees, individuals must submit documents, items or other information media, explanations, other information, including restricted information, required for the AMCU, as well as its territorial departments to perform the tasks stipulated by the legislation on the protection of economic competition and on state support to business entities, following the request of the AMCU body, head of the territorial department of the AMCU, employees of the AMCU and territorial department of the AMCU authorized by them.
It means that the AMCU bodies have de facto no restrictions as to the range of persons to whom the request for information is sent. The same applies to the scope of the requested information. The only condition to be met when sending a request is the performance of the tasks of the AMCU bodies stipulated by the legislation.
Grounds for sending information requests
There are main grounds for sending a request, which include, inter alia:
- when considering the applications and cases on violation of the legislation on the protection of economic competition, conducting inspections and in other cases stipulated by legislation, when monitoring compliance with the legislation on the protection of economic competition;
- in connection with the implementation of control over concerted actions and concentration;
- during the implementation of powers in the field of formation and implementation of competition policy, promotion of competition, regulatory and methodological support of the AMCU’s activity, and application of legislation on the protection of economic competition;
In practice, the requests for information are usually sent: in connection with the implementation of state control over compliance with legislation on the protection of economic competition, clarifying the presence/absence of elements of violation of the competition legislation when considering applications, cases, conducting market research, etc.
Preparation and deadline for response
After receiving a request from the AMCU, one should primarily pay attention to the grounds for sending a request to your particular recipient, determine the scope of information, in what form and under which procedure such information or copies of documents are to be sent, and deadline. The scope of information requested is usually rather large, and the deadline for providing it can be approximately a week (in some cases 3 to 5 days) without taking into account any circumstances affecting the entity. In this case, it is advisable to exercise the right to prolong the deadline for response by filing a relevant motion with the requesting body of the Committee. If necessary, it is also possible to contact the AMCU to clarify the content of the request, clarify the form and method of providing the requested information. It is important to remember that all motions should be filed with the AMCU before the expiration of the deadline set in the request.
The deadline for response will commence on the day following the date of receipt by the authorized person of the AMCU request. The authorized person shall put a signature in the registered mail service logbook at the post office with the date of receiving the letter. Signature of the authorized person in the logbook and on the return receipt of service of the registered mail shall indicate that the request has been properly served.
It should also be noted that should it be impossible to serve the request on the recipient, the AMCU shall in some cases publish such requests on its official website with publication in the Uriadovyi Kurier (Governmental Courier) newspaper or regional publication with reference to the website and indication of the recipient.
Such an approach is extremely ineffective and, consequently, in most cases, business entities are held liable for failure to provide information at the request since, according to regulations, the AMCU request is deemed served 10 days after such publication, irrespective of whether or not the recipient is aware of such a publication.
The request must contain mandatory grounds for requesting information, deadline for responding to the request, warning of the liability in case of failure to submit, submission of incomplete information or submission of inaccurate information with reference to the relevant provisions of legislation.
The response must be drawn up taking into account the form specified in the request. The request usually contains a list of questions, list of required documents, explanations, tabular forms (if statistical data is requested). It is important to provide clear and unambiguous answers to avoid double interpretation of information by the AMCU.
The legislation also provides for the right of the AMCU to obtain restricted information, confidential information, and banking secrecy. If the response to the request contains confidential data, it is necessary to specify which information is restricted, including which documents or parts of documents contain restricted information. It is advisable not to neglect the right to consult the Committee’s bodies on the classification of information and documents as restricted. Such consultations aim at determining the scope of restricted information, providing non-confidential versions of documents (information), and preventing the disclosure of such information. This right is enshrined in Article 22-1 of the Law of Ukraine “On the Antimonopoly Committee of Ukraine”.
Information and explanations at the request shall be presented in the form of a letter with the indication of the AMCU body, information about a person (recipient of the request), explanations and information on each question of the request in the established order. Attachments and copies of documents must be duly certified, and the number of pages and copies must be indicated at the end of the letter of response. The response to the request shall be signed by the authorized person (head) or representative under a power of attorney. The response to the request must be sent by registered mail, return receipt requested, since if the Committee receives no response to the request, the only admissible evidence of sending it will be a mark of the post office on receipt of your letter (part 3 Article 62 of the Law of Ukraine “On the Protection of Economic Competition”).
Liability for failure to comply with the AMCU requests
Legislation on the protection of economic competition provides that failure to submit information within the set deadline, submission of incomplete information or submission of inaccurate information at the request of the Committee is a violation of the Law of Ukraine “On the Protection of Economic Competition” (clauses 13, 14 and 15 Article 50 of the Law of Ukraine “On the Protection of Economic Competition”).
It is important to remember that missing the deadline for response at the AMCU request by at least one day will have elements of violation in the form of failure to submit information within the deadline set by the Committee’s bodies. The same applies to the submission of incomplete information, especially when the AMCU raises several difficult questions in one item, which are difficult to interpret. In this case, it is advisable to immediately file a motion for clarification of such a question in order to avoid further misinterpretations by the AMCU, and as a result — bringing to liability.
For violations stipulated by clauses 13, 14 and 15 Article 50 of the Law of Ukraine “On the Protection of Economic Competition”, liability is provided in the form of a penalty of up to 1% of the income (revenue) of a business entity from the sale of products (goods, works, services) during the last reporting year preceding the year in which the penalty is imposed (part 2 Article 52 of the Law “On the Protection of Economic Competition).
In most cases, when challenging the AMCU decisions on information violations, the Commercial Courts take the Committee’s side explaining it by broad powers enshrined by the legislation. One should also keep in mind that the AMCU, like all state authorities, has become bureaucratic, and in some cases has a rather formalized approach to brining to liability. Hence, to make sure that your business continues to successfully exist, we suggest paying close attention to the details and timely responding to the requests for information.