LAW FIRM DIRECTORY

Competition

Quality comes to life

This year, the economic competition defense practice has developed in perfect harmony with global trends. The focus of the AMCU’s priorities has shifted from the quantity of cases to their quality, and to the significance of the process pertinent to the ending of violations. There is a clear industry-specific differentiation of law-enforcement practice: the Committee is actively working to resolve burning issues. A lot of attention is traditionally paid to communication with business

KHRYSTYNA POSHELIUZHNA

The approaches taken by the Antimonopoly Committee of Ukraine (AMCU) evolve with every passing year. In 2017, the Committee worked on the transition from a post factum response to violation to a preventive response. Today, the focus of priorities has shifted: the quality and significance of the process pertinent to the ending of violations in a competitive market prevail over their quantity (the issue is increasing the economic effect of penalties within the framework of one violation).

During the year, the AMCU’s leadership systematically and consistently repeated: The Committee is not the savior of the Ukrainian economy, it does not have a panacea for all existing ailments, it is not an economic prosecutor and not even a regulator. The AMCU is a law-enforcement authority. It shall deliver fair decisions aimed at solving burning issues.

The AMCU continues to enhance cooperation with international partners: foreign experts provide every possible assistance in overcoming obstacles associated with national challenges.

As for the most common violations, there was no revolution here: the same abuses of monopoly (market power), anticompetitive concerted actions, unfair competition and anticompetitive actions of the authorities.

Olga Belyakova, partner of CMS Cameron McKenna Nabarro Olswang International Law Firm, says that it is difficult to unequivocally answer the question as to which factors predetermined the development of an economic competition market. "The entry of new players onto the market was one of these factors. It was especially noticeable in the electric power industry, namely, in the alternative energy sector", Olga Belyakova says, giving an example. Favorable legislative environment for investment in, and operation of, alternative energy enterprises (the "green tariff"), which may be revised next year, became a prerequisite. "That is why we are now seeing a boom in new investments in our company in this area", the commentator adds, sharing her observations.

According to Olga Belyakova, the transition to online mode and development of online platforms in 2018 also influenced competition in the areas in which the transition to "digital" is appropriate. The development of new technologies (not only in Ukraine, but globally) stimulated competition and made those players that lagged behind move on. "The entry of Glovo (which offers fast delivery of food, groceries, and some pharmaceutical products) into the Ukrainian market this year will, in my opinion, urge on competition in this market", Olga Belyakova predicts.

The expert mentions the active position taken by the AMCU in addressing burning issues (explanatory statements regarding vertical concerted actions, issued at the end of 2017, affirmation of the approach regarding definition of control relations (November 2018), development of an approach on state aid), and constructive dialog with business on the part of the regulator. "Surely, there is always room for improvement, but, in terms of positive points, this was the most significant for me since open dialog always promotes trust and, at the moment, there is a possibility to advise the client regarding the approach of the AMCU on a sufficient number of issues", the commentator emphasizes.

In particular, the Antimonopoly Committee of Ukraine supports the adoption in the second reading of draft law No. 6723 on introducing amendments to the legislation on the protection of economic competition, aimed at improving the efficiency of the work of the national competitive authority.­­ Among other things, the draft law provides for the abolition of penalties for the late payment of fine and establishes a 50% discount for timely voluntary payment, as well as for the decisions of the Antimonopoly Committee to take effect  operative as an executive document.

Among other priorities that the AMCU is working on is the establishment of joint responsibility of a group of companies (which is a single business entity), introduction of joint and several responsibility of the parent company in the event of insolvency of the controlled company — defendant (which was fined), introduction of substantial administrative responsibility of officials for failing to provide information, provision of incomplete information, disinformation, failure to comply with the Committee's decisions and obstructing the work of the AMCU.

There were no "tectonic" shifts in judicial practice on disputes in the area of economic competition, even with the start of operation of the new Supreme Court of Ukraine.  According to Oleksandr  Voznyuk, partner of Asters, reform of the Supreme Court was quite naturally associated with expectations for serious qualitative changes in approaches to consideration of this category of disputes, in the degree of absorption of the court in the economic nature of market relations, in the reflection of the ideas and goals of legal regulation in law enforcement practice, in occurrence of substantially more profound and methodologically significant approaches to law-enforcement inspired by advanced, modern legal thought.

It is still early to say whether these expectations were justified. "Decisions made in the current year do not allow us to state the presence of such trends with certainty. At the same time, a certain vector towards an increase in confidence in the AMCU’s law-enforcement approaches can be observed. I do not think this is the right trend. The severity of courts in assessing the Committee’s approaches has always been important, and now it is very much in demand, no less than before", Oleksandr Voznyuk notes.

But these are already issues of a higher order, which in many respects predetermine the paradigm of dispute resolution that has existed for years. Some of them may eventually be resolved by the Supreme Court in the process of interpretation of legal provisions (for example, the ratio of the tasks and functions of the court when verifying the decisions of the AMCU and the "exclusive" powers of the Committee, when evaluating the legality of its actions under discretionary powers). "Other issues are hampered by the doctrinal ideas of the  economic process itself, reflected in the procedural law: for example, distribution of the burden of proof and presumption of innocence among participants to a process", the expert underlines.

As for landmark or high-profile court cases,  Oleksandr Voznyuk says there were no such disputes. "Certainly, there is always the possibility to choose the most interesting decisions from current practice. Such decisions have been made in the past few months, but it is more for analyzing the details, rather than defining the vectors", Oleksandr Voznyuk says, summing up.

 

LARGEST PUBLIC ANTITRUST LAW TRANSACTIONS

No.

 

TRANSACTION ESSENCE

 

AMOUNT, US Dollars

 

LAW FIRMS

supporting transactions

1

 

Obtaining permission from the Antimonopoly Committee of Ukraine for the acquisition of Shire by Takeda

 

62 bln

 

Sayenko Kharenko on behalf of Takeda and Shire

 

2

 

Obtaining merger approvals and permissions for concerted actions from the AMCU in connection with the acquisition by Blackstone Group of Financial and Risk Units of Thomson Reuters

 

about 17 bln

 

Asters on behalf of Blackstone and Thomson Reuters

 

3

 

Obtaining permissions for concerted actions from the AMCU in connection with the acquisition by Carlyle Group of special chemicals division of AkzoNobel Group

 

about 12.5 bln

 

Asters on behalf of Carlyle and AkzoNobel

 

4

 

Obtaining merger approval from the AMCU in connection with the acquisition by Wabtec of GE Transportation

 

11.1 bln

 

Asters on behalf of General Electric,

Sayenko Kharenko on behalf of Wabtec

5

 

Obtaining merger approval from the AMCU in connection with the acquisition by KKR, a global benchmark investment firm, of BMC Software, a global leader in innovative software solutions for digital enterprises

 

8.3 bln

 

Asters on behalf of KKR and BMC Software

 

6

 

Obtaining merger approval from the AMCU in connection with the acquisition by International Flavors & Fragrances Inc. of Frutarom, a global manufacturer of perfumes and flavors

 

7.1 bln

 

Asters on behalf of International Flavors & Fragrances Inc. and Frutarom

 

7

 

Obtaining merger approval from the AMCU in connection with the merger between Linde and Praxair

 

5.6 bln

 

Sayenko Kharenko on behalf of Linde and Praxair

 

8

 

Obtaining merger approval from the AMCU in connection with the acquisition by Brookfield of Westinghouse, a manufacturer of electrical equipment

 

about 4.6 bln

 

Asters on behalf of Brookfield Asset Management Inc. and Toshiba Corporation

 

9

 

Obtaining merger approvals and permissions for concerted actions from the AMCU in connection with the acquisition by Procter & Gamble of shares and the business of Merck KGaA in the area of consumer health protection

 

4.2 bln

 

Аsters on behalf of Procter & Gamble Company,

Sayenko Kharenko on behalf of Merck

10

 

Obtaining merger approval from the AMCU in connection with the acquisition by UPL Corporation Limited of Arysta Life Science Inc., a global provider of innovative plant protection solutions, from Platform Specialty Products Corporation, as well as obtaining permissions for concerted actions related to merger

 

4.2 bln

 

Asters on behalf of UPL Corporation Limited and Arysta Life Science Inc./Platform Specialty Products Corporation

 

11

 

Obtaining merger approval from the AMCU in connection with the acquisition by Maersk Line of the Hamburg Sud Group of Companies

 

4.2 bln

 

Sayenko Kharenko on behalf of Maersk Line/Hamburg Sud

 

12

 

Obtaining merger approval from the AMCU in connection with the acquisition by Crown Holdings, Inc., a global leader in consumer packaging, of Signo Industrial Group Holdings (Bermuda) Ltd from Carlyle Group

 

3.9 bln

 

Asters on behalf of Crown Holdings, Inc. and Signode

 

13

 

Obtaining merger approval from the AMCU in connection with the establishment of a joint venture by Uber and Yandex Group of Companies

 

3.8 bln

 

AVELLUM on behalf of Uber International C.V.

 

14

 

Obtaining merger approvals from the AMCU in connection with acquisition by Messer and CVC of the majority of Linde and Praxair’s gas business in North and South America and transfer by Messer of its gas business in Western Europe to a joint venture controlled by Messer and CVC

 

3.3 bln

 

Asters on behalf of Messer, CVC Funds, Linde and Praxair

 

15

 

Obtaining merger approval from the AMCU in connection with the acquisition by Advent of the GE's Distributed Power unit

 

3.25 bln

 

Asters on behalf of General Electric,

Sayenko Kharenko on behalf of Advent

16

 

Obtaining merger approval from the AMCU in connection with the sale by Nestle S.A. of its US confectionery business to Ferrero

 

2.8 bln

 

Asters on behalf of Nestle S.A.,

DLA Piper Ukraine on behalf of Ferrero

17

 

Obtaining merger approval from the AMCU in connection with the acquisition by ABB Ltd. of the General Electric Company’s business in the area of manufacturing, selling and servicing components and equipment for low and medium voltage electrical products, as well as permissions for concerted actions in connection with the merger

 

2.6 bln

 

Asters on behalf of ABB Ltd,

Sayenko Kharenko on behalf of the General Electric Company

18

 

Obtaining merger approvals and permissions for concerted actions from the AMCU for Servier in Ukraine in connection with the acquisition of Shire's oncology business

 

2.4 bln

 

BAKER MCKENZIE on behalf of Servier

 

19

 

Obtaining merger approval from the AMCU in connection with the acquisition by Nestle S.A. of Atrium Innovations Inc., an international manufacturer of food additives

 

2.3 bln

 

Asters on behalf of Nestle S.A. and Atrium Innovations Inc.

 

20

 

Obtaining merger approval from the AMCU in connection with the establishment of a joint venture between Sumitomo and Michelin

 

2.3 bln

 

Aequo on behalf of Sumitomo,

DLA Piper Ukraine on behalf of Michelin

21

 

Obtaining merger approval from the AMCU in connection with the acquisition of sole control by Sony Corporation of America of EMI Music Publishing, a global music publishing company

 

2.3 bln

 

Asters on behalf of Sony Corporation of America and EMI Music Publishing

PRACTICE LEADERS. ANTITRUST AND COMPETITION

AUTHORITIES

 

Olexander Martinenko (CMS Cameron McKenna Nabarro Olswang)

 

LEADING FIRMS

1

 

Asters

 

2

 

Sayenko Kharenko

 

3

 

Aequo

 

4

 

Arzinger

 

5

 

Baker McKenzie

 

LEADING INDIVIDUALS

1

 

Igor Svechkar (Asters)

 

2

 

Antonina Yaholnyk (CLACIS)

 

3

 

Vladimir Sayenko (Sayenko Kharenko)

 

4

 

Galyna Zagorodniuk (DLA Piper Ukraine)

 

5

 

Oleksandr Voznyuk (Asters)

 

OTHER ESTABLISHED PRACTICES

AVELLUM

 

CLACIS

 

CMS Cameron McKenna Nabarro Olswang

 

Dentons

 

DLA Piper Ukraine

 

Integrites

 

Kinstellar

 

Marchenko Danevych

 

Redcliffe Partners

 

Vasil Kisil & Partners

 

Ilyashev & Partners

 

OTHER NOTABLE PRACTITIONERS

Oleksandr Aleksyeyenko (Marchenko Danevych)

 

Olga Belyakova (CMS Cameron McKenna Nabarro Olswang)

 

Timur Bondaryev (Arzinger)

 

Sergey Denisenko (AEQUO)

 

Oleksandr Fefelov (Ilyashev & Partners)

 

Andrii Gorbatenko (Legal Alliance Company)

 

Dr. Alexey Kot (ANTIKA Law Firm)

 

Denis Lysenko (AEQUO)

 

Maksym Nazarenko (Sayenko Kharenko)

 

Alexey Pustovit (Asters)

 

Serhiy Shershun (INTEGRITES)

 

Oksana Simonova (Baker McKenzie)

 

Lana Sinichkina (Arzinger)

 

Anastasia Usova (Redcliffe Partners)