New Competition Regulations In Kosovo – Kinstellar

[Liz Seyi]

Kosovo has over at the end of summer 2023 adopted a set of new regulations on competition law matters to underpin the Competition Act adopted in June 2022. Following up on our previous announcements regarding changes to competition rules in Kosovo, we provide below an overview of the latest changes.
New merger control regulation
The new Merger Control Regulation in Kosovo — Administrative Instruction on the Procedure for Submitting a Request to Clear a Review of a Concentration No. 02/2023 — sets out the procedure for submitting a notification of a concentration and defines the required content and document format, as well as the data that must be provided with the form. An important change brought by the Merger Control Regulation is that it raises the merger control fee for a clearance decision from EUR 3,000 to EUR 6,000. Additionally, this fee must now be paid in advance.
The Merger Control Regulation also deals with substantive merger control issues. Namely, it further specifies who qualifies as a participant in a concentration and which company is obliged to submit the request. Additionally, the Merger Control Regulation addresses the relevant turnover calculation and its constituent components. The burden of proof in the procedure rests with the applicant, and participants are required to submit the request before signing the final agreement. Most of the substantive rules of the Merger Control Regulation are aligned with the approach of the European Union for the review and processing of merger applications.
New rules on the definition of the relevant market
The Administrative Instruction for Determining the Relevant Market (No. 01/2023) defines the methods and criteria to determine the relevant market. It defines the relevant product market as one that includes all products that consumers consider mutually comparable (due to their characteristics, price, purpose, etc.). The relevant geographic market is defined as a geographic area where companies offer or purchase products. The new rules align Kosovo’s market definition approach with international theories and practice.
New leniency regulation
Kosovo now has in place a leniency program, established by the Instruction on the Procedure and Criteria for the Release or Reduction of a Fine (No. 04/2023) (“Leniency Regulation”), which defines the procedure and criteria according to which the Kosovo Competition Authority will make decisions on the release from or reduction of fines on companies involved in a prohibited agreement.
The Leniency Regulation includes the general criteria for the release from or reduction of a fine. Companies must terminate their involvement in the cartel and cooperate with the Kosovo Competition Authority by providing all relevant information related to the cartel. In order for the company to be exempted from a fine, it is required to declare its participation in the cartel through a detailed company statement that includes a description of the cartel and information about the cartel’s activities and participants. In addition to the initial applicant for leniency, who can be fully released from the obligation to pay the fine, subsequent applicants for leniency could also be granted a fine reduction
New instructions on fine calculation
The criteria that the Kosovo Competition Authority must consider when imposing fines on enterprises for violations is now set out under the Administrative Instruction on Fine Issuance Criteria (No. 03/2023). Fines aim to penalise violators but also have a corrective purpose to eliminate harmful effects, deter violations, and ensure free and effective competition.
Penalties are determined by the Kosovo Competition Authority on a case-by-case basis. The fine is based on the basic fine amount, which depends on the gravity of the violation, as well as the company’s income (up to 30%) multiplied by the number of years of the violation. The basic amount is adjusted based on the aggravating or mitigating circumstances, effecting the final fine amount.
Please note: The content of this article is intended to provide general information on the subject matter. Specialist advice should be sought about your specific circumstances.
For more information please contact Olga Šipka, Special Counsel, Head of competition & state aid law firm, at [e-mail], and Dušan Đurić, Junior Associate, at [e-mail].
Olga Sipka Special Counsel
[phone]
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