During 2017, the activities of the Montenegrin competition authority continued to be focused on merger control, with antitrust enforcement a bit in the shadow. In the authority’s own words, one of the main obstacles towards a more effective competition law enforcement in Montenegro is the procedure for imposing fines for competition law infringements. Will things change in 2018?
Antitrust: A Dawn Raid the Highlight of the Year?
Perhaps the most exciting event in Montenegrin antitrust during 2017 was a dawn raid the watchdog performed in March. Based on scarce information the Agency provided about the event, the target of the raid was the company Sava Trans, based in the town of Cetinje. The official Agency statement stated only that the company was cooperative during the raid but did not provide further information what the raid was about.
At the moment, the Competition Agency’s website does not indicate how many antitrust proceedings were initiated during 2017 (if any). Presumably, the Agency started at least one official investigation during this period (in the case where it performed a dawn raid). For official confirmation we will have to wait until the Agency publishes its official annual report for the year.
Also related to antitrust: in Montenegro, unlike the EU, there is no self-assessment for individual exemption of restrictive agreements – you need to notify such agreement to the Agency in advance in order to be able to escape prohibition. On that front, it seems it was a quite year in Montenegro, with only one individual exemption published so far.
Lack of Power to Impose Fines Affecting the Effectiveness of the Agency’s Activities?
One of the issues the Agency highlighted in its annual report for 2016 was the ineffectiveness of the system for imposing fines which is currently in place in Montenegro. Specifically, in Montenegro the Competition Agency does not have the power to impose fines but can only initiate misdemeanor proceedings before a misdemeanor court. And competition law enforcement before such courts has so far had mixed effects – to say the least.
Another problem perceived by the Agency are, in the Agency’s view, inadequately short limitation periods for competition law infringements. According to the Agency, combined with the procedural rules allowing parties to challenge not only the final decision but also other decisions the Agency renders during a proceeding, the currently applicable limitation periods hinder the effective enforcement of competition law in Montenegro and should be extended.
Merger Control: Phase I Clearances Rule
Unlike the antitrust sphere, in the field of merger control the Competition Agency actually rendered a fairly high number of decisions. Based on what has published so far, during 2017 the Agency rendered 35 merger decisions – and all were Phase I merger clearances.
Such a high number of merger decisions (in comparison to the size of the economy) is the result of fairly low merger filings thresholds applicable in Montenegro, which lead to around a 30 merger cases each year. For instance, in 2015 the Agency issued 33 merger decisions, in 2016 28, and, as mentioned above, in 2017 that number reached 35.
How will the Agency Deal with the Influx of State Aid Matters?
As reported earlier, in addition, to its current competences, the Montenegrin Competition Agency is soon to start covering State aid matters. It remains to be seen how this will affect the watchdog’s enforcement zeal in the “traditional” competition law sphere – concerning restrictive agreements, abuse of dominance, and merger control.