New provisions in Bulgarian Competition Protection Act - Introduction of the control over the undertakings with a stronger bargaining position
- Tuesday, October 6, 2015
Contact: Hristo Koparanov, Popov & Partners (Bulgaria)
On July, 2015 on second hearing was adopted amendment in the Competition Protection Act (CPA). Similar amendment was adopted by the National assembly in 2014, but the president vetoed them. The amendment, adopted in 2015 in comparison to this in 2014, is more limited towards the expansion of the scope of the control that the Commission on Protection of Competition (CPC) exercise, but they introduce a notable structural change – the members of the CPC could not be elected for second term immediately after the first.
The changes affect mainly the expansion of the scope of the control that CPC exercises on undertakings with certain significant role on the market. They are focused primarily on the group of forbidden activities that are associated with certain unilateral conduct of undertakings which regard to its position on the market are able to distort the competition on the relevant market or damage the interests of their partners.
The expansion of the regulatory intervention of the CPC over the activities of conditionally speaking "larger" undertakings on the market is about the range of enterprises whose unilateral activity is subject to regulatory control in terms of possible abuse - alongside the existing control over the undertakings with a "monopolistic position" and "dominance" is introduced a control over the undertakings with a "stronger bargaining position".
Unlike the originally proposed bill, in which it was foreseen for undertakings with "a significant market power" (this term has dropped out in the adoption of the bill from 2014) to apply the same prohibition as a dominant undertaking, the finally adopted approach is another. The prohibition of abuse with a "stronger bargaining position" is formulated in a way which is different with the one of the prohibition of abuse with monopolistic and dominant position.
It is necessary to outline that the adopted in 2015 amendment, unlike the proposed bill in 2014, which was not adopted, do not widen of explicitly the actions listed as prohibited of the undertakings with dominant and monopolistic position on the market. However, it should be pointed out that the text, with which in the bill from 2014 was introduced a new concrete manifestation of abuses of the dominant undertaking, can be assessed as editorial and clarifying. According to that text, it was explicitly identified as prohibited the unjustified direct or indirect impact on the undertaking having the purpose or effect his removal from the relevant market. The text has focused on this form of abuse, but prior to its formulation there had been no doubt that such actions represent the so-called "structural abuse". Art. 21 of the CPA governing the prohibition of abuse of dominant position, has always been clear that it includes a non-exhaustive, indicative list of prohibited actions, and prohibited is any action of the dominant undertaking which has the purpose or effect to prevent, restrict or distort the competition and to affect the interests of consumers.