LAW FIRM DIRECTORY

Competition

YURII TERENTYEV,
chairman of the Antimonopoly Committee of Ukraine

To produce effect

The deliverables of any competition authority are usually visible for longer than one year. In 2018, the Committee continued its systematic work to improve both external and internal efficiency, develop primary and secondary regulatory frameworks, and the overall consistency and transparency of its work. The direct provisions of the Association Agreement that Ukraine signed with the EU and the recommendations of the 2016 OECD expert report are the action plan for such systematic development of the AMCU.

Completed, significant, and high-quality investigations, following the results of which sound legal and economic decisions were made that show the real economic effect for the economy of Ukraine are, first of all, the deliverables of the AMCU. The economic effect can be scaled by the initiatives on competition advocacy when factors restricting access to a market or market competition can be eliminated through other actions, and not just through the imposition of fines or obligations. Since 2016 we have been using the indicator of economic effect from the AMCU’s activities calculated according to OECD methodology both for evaluation and for planning our work. In 2016, this indicator came to UAH 1.4 billion and in 2017 it was UAH 2.56 billion. This is 20 times more than the budget of the AMCU.

Ukrainian society expects the AMCU to take decisive actions to quickly fix problems that cause the economic freedom of the subjects to be limited or end users to suffer. Quite often, markets become problematic, where there is inefficient government intervention and regulation, a high degree of state presence, state-owned companies, and high concentration. Traditionally, public procurement has been an area of increased attention for the AMCU. About 400 facts of concerted actions were disclosed in 2017 alone.

Since 2015, the AMCU has paid particular attention to the electric power, natural gas, gasoline and liquefied gas, pharmaceutical, telecommunications services, retail and basic consumer goods markets, as well as to the activities of ports and airports. In 2018, investigations were completed or new ones opened in all of these markets. Work in the area of combating unfair competition is gaining momentum: in 2018, a number of decisions were adopted, especially in terms of fake alcoholic products.

Challenging public procurement and government assistance became fully-fledged areas of practice. In 2017, the AMCU received 5,700 complaints related to public procurement and in 2018 this value will increase by at least 25 %. The AMCU works to systematize the practice of a panel on key issues, developing draft laws and proposals for new legislative instruments, and also on training subjects — participants in procurement procedures and customers.

The law on state aid to business entities has been in force since August 2017.  As of year-end 2018, a secondary regulatory framework was formed to assess the admissibility of state aid for competition according to EU standards, an electronic register was launched, more than 20 general explanations were approved at committee level, and over 1,000 notifications of state aid were received. The first complaints from private entities regarding the inadmissibility of state aid received by their competitors are being considered. In 2019, the priorities of the AMCU will be assessment of the admissibility of state aid in the banking sector and coal mining, systematic assessment of the activities and funding of public utilities, which can be established both to perform public functions and to operate on competitive markets.

The AMCU’s development is greatly assisted by international partners: the EU Twinning project with Bundeskartellamt (Federal Cartel Office) and the Lithuanian Competition Authority and the technical assistance project with the US Federal Trade Commission.