Articles

Anticompetitive practices

16 May 2006 (Insight)

The competition legal framework underwent an intense harmonization process over the past three years. Currently both antitrust and merger control regimes reflect most of EU relevant regulations. Competent authorities in the field are the Competition Council and the Ministry of Public Finance.

Differently from concentrations, there is no legal obligation to notify an agreement or practice potentially qualifying as anticompetitive. Concerned undertakings should make their own assessment on the agreement or practice and decide whether to notify it to the Competition Council.

As a general rule, are prohibited any express or tacit agreements (collusion) between undertakings or associations of undertakings and any decisions by associations of undertakings or concerted practices which have as object or may have as effect the restriction, prevention or distortion of competition on the Romanian market or part thereof.

Exemption from the above prohibitions shall be granted upon decision of the Competition Council for individual cases, while exemptions for certain categories of agreements, decisions by associations of undertakings or concerted practices (block exemptions) are established through Competition Council regulations. Intra-group transactions fall outside the scope of antitrust regulations.

The agreements, decisions by associations of undertakings or concerted practices deemed to fall under any of the block exemption regulations are considered legal, without any decision from the Competition Council. Most illustrative examples of agreements falling under the scope of block exemption regulations are the vertical agreements, typically represented by supplier – distributor relationships.

Where a transaction would not fall under any block exemption regulations, concerned undertakings may submit to the Competition Council a notification for individual exemption. In order to obtain the decision, concerned undertakings would have to successfully prove the advantages entailed by envisaged restraints, which should outweigh the negative effects brought to competition.

It is the exclusive authority of the Competition Council to decide upon investigation within the notification authorization process, if the exemption conditions are met. Where the market share of the supplier and/ or distributor exceeds 30%, a vertical agreement normally falling under the block exemption would also require individual exemption.

As alternative route, concerned undertakings may also request the Competition Council closing the case without issuing a formal decision, upon what EU practice refers to as “comfort letter”.