Largest Serbian Dairy in a Cartel Investigation

Serbia

Largest Serbian Dairy in a Cartel Investigation

The Serbian Competition Commission doesn’t seem to rest – it has launched another antitrust investigation. This time it is investigating Imlek, the largest Serbian dairy, and Kruna-Komerc, a Serbian dairy products trader. The Commission is alleging that the companies engaged in bid-rigging by coordinating their commercial behavior with respect to a public procurement bid.

According to the Commission, Imlek and Kruna-Komerc had entered into a restrictive horizontal agreement in the form of a written cooperation agreement. The parties had agreed, inter alia:

  • To jointly analyze competitive conditions on the market for the procurement of milk and dairy products;
  • Before setting its price in a public procurement bid, Kruna-Komerc had to take into account Imlek’s instructions and market projections;
  • Imlek gave financial incentives to Kruna-Komerc aimed at enabling Kruna-Komerc to be the most favorable bidder in public procurements involving Imlek products.

The Commission is viewing Imlek and Kruna-Komerc as direct competitors, on grounds that in public procurement tenders both companies offer the same types of products. This makes the alleged wrongdoing a cartel.

The maximum fine for each of the companies involved is 10% of the undertaking’s Serbian turnover in the previous year (in this case, in 2016). Since the Serbian Commission in this respect takes into account the entire turnover of the undertaking concerned (not only the relevant turnover), the potential fine can be a hefty one indeed.

Even though there is no deadline for concluding the investigation, based on the previous bid-rigging cases, it can be expected that this one will take a year or so.

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