NEWSLETTER

monitoring the main news on competition issues of the Romanian newspapers and other relevant regional publications; presentation of important events, training sessions, controversial issues; publication of press releases, announcements, and various reports on competition.

Summary:


EU LEGISLATION and STANDARDS

Regulations, supervision, inspections,  penalties, prevention of conflicts

Anti trust policies: national bodies; EU Commission

Unfair competition

Success stories

 

  FIGHT AGAINST UNFAIR COMPETITION

Brands/patents/trademarks/logos counterfeit

Legal aspects

Trainings


EU LEGISLATION and STANDARDS

    The final stage in BCR privatization. Erste Bank (Austria) and Millenium (Portugal) have qualified in the final stage of BCR’s privatisation and they must submit till 20 December 2005 the final financial offer for the 62% of the stock exchanges. According to the Minister of Finance, the Romanian Government will choose the best offer and will sign the contract with the winner the next day, on 21 December.

Source: BBC News, 12 December 2005. Read more...   

 

    Flamingo discuss a probable merger with  Flanco. Flamingo company, specialized in IT&C commerce is going to realise an alliance with Flanco, and in the end the two companies should fusion giving birth to a company with a annual sales volume of 170 million Euro. The two firms hope to ameliorate through this move the business administration and to occupy a better position on the IT&C and electronic markets. 1,5

Source: Ziarul Financiar, 8 December 2005. Read more...   

 

    Petrom wants to be the leader on the gas market. Petrom company could become the biggest natural gas provider on the Romanian market overtaking Romgaz, the current leader. The company’s strategy announces that this change is expected to happen in five years but the experts appreciate that the change of hierarchy could happen even quicker because the gas reserves of Petrom-OMV are superior to those of Romgaz. Petrom also announced the founding of a Special Commercial Division for Natural Gas through the overtaking of the society Petrom Gas SRL Bucharest.

Source: Averea, 8 December 2005. Read more...   

 

    Romania gets new yellow cards for competition from the European Commission. DG Competition has sent to the Romanian Government four warnings regarding the competition acquis and related to the anticompetitive regulations regarding the minimum price for tobacco and alcohol, tax facilities, and the pharmacies law. Fabrizio Barbaso, the author of the Report, demanded explanations to the Romanian authorities. Source: Averea, 07 December 2005. Read more...   

 

    Huge fine for the French mobile phones operators. The French Officials fined the three operators Orange, SFR and Bouygues with a record sum of 534 millions Euro. The reason for this punishment was the division of commercial data between the companies and the establishing of joint sells strategies, furthermore the three companies discussed each months these details and this practice was lasting for 6 years. This is the biggest fine ever gave by the French Competition Council and at EU level is the third most expensive fine. Source: Sofpedia.com, 4 December 2005. Read more...   

 

    According to the USA Embassy the pharmacy law limits the competition. The US Embassy statement says that the pharmacy law would constraint the pharmacies and would artificially limit the competition. Source: Hotnews.ro, 2 December 2005. Read more...   

 

    The Competition Council of the Republic of Lithuania examined the conclusions of the investigation concerning the actions of UAB Žvilgsnis iš arčiau while advertising their services in the Internet and passed the appropriate decision. Some of the statements announced by the company were recognized as misleading advertising. The company was recognized as having violated the requirements of Art.5 of the Law on Advertising and subjected to a fine of LTL 13 500. Furthermore, the company was obligated, in an established manner, to cease the use of the misleading advertising and issue corrective statements regarding the claims made thereby in the homepages of the indicated websites.

Source: The Competition Council of the Republic of Lithuania, 29 November 2005. Read more...   

 

    The spectacular growth of Romanian insurance market. This year’s biggest insurance company is Allianz-Tiriac, with gross premiums of 563 million (155,6 million Euro), followed by Asirom, with 415 million RON (114,7 million Euro, and Omniasig Group WS, with 292 million RON (80,8 million Euro). The three companies had together 47,97% of the Romanian market. The small companies are in danger of disappearing at the middle of the next year if they would not increase their share capital.

Source: Cotidianul, 28 November 2005. Read more...   

 

    The Romanian energy market players will have a clearer reglemented and more transparent regime. The deregulation of energy market raised this year at 83%, and in 2006 the market opening will be of 100%. Source: Saptamana Financiara, 28 November 2005. Read more...   

 

    The competition increases on the auto market. The deregulation of the auto market has determined the main actors to invest in the development of the dealers networks. Starting with 2006, the producers of a car mark will be allowed to give the importer feature to various firm as so the competition between them will increase. In Romania the biggest dealers networks are Dacia-Renault (70 dealers), TiriacAuto (70 dealers) and Porsche Romania (65 dealers). The experts consider that for Romania a network of 100 dealers is optimum. Source: StiriAuto.ro, 25 November 2005. Read more...   

 

    The Office for the Protection of Competition of the Czech Republic stopped a legal proceeding with companies Komerční banka (KB), Československá obchodní banka (ČSOB) and Česká spořitelna (ČS), the three largest finance houses in the Czech Republic. Following complaints from citizens and the consumer association SOS regarding mostly to increase of fees for banking services, the Office launched the legal proceeding on 12th May 2005. The Office has proved in its investigation, that there were frequent contacts among the parties to the proceeding. However, the Office hasn’t found the parties have entered into prohibited agreement or concerted practices in connection with the level of fees for current account services. Finally, an abuse of collective dominance was not proved pursuant to criteria of European Court of Justice. Source: The Office for the Protection of Competition of the Czech Republic, 25 November 2005.

Read more...   

 

    The Competition Council of Lithuania examined the applications filed by two undertakings for the authorization to implement concentration, and passed decisions in respect of the issues considered. Following the provisions of the Law on Competition the authority decided to authorize BALTIC SME FUND C.V. to implement concentration by acquiring a 34 percent shareholding in UAB Voira. The Council established that the intended concentration will not cause any major changes in the degree of concentration in the relevant markets, neither it will create or strengthen the dominant position or result in a significant restriction of competition in the relevant markets. The second decision was passed to allow the Luxembourg-registered investment company AMBER TRUST II S.C.A. to implement the concentration transaction by acquiring up to 100 percent of shares in AB Kauno pieno centras. The Competition Council assessed the intended concentration as conglomerate do not affect the relevant markets, in particular the wholesale market of ice-cream wherein AB Kauno pieno centras operates.

Source: The Competition Council of the Republic of Lithuania, 24 November 2005. Read more...    

 

    Antimonopoly Office Launches Administrative Proceedings against Slovnaft. The Antimonopoly Office of Slovak republic launched the administrative proceedings against Slovnaft, crude oil refiner on the issue of a potential violation of the law on the protection of economic competition. The office launched the proceedings on its own initiative. AMO will examine the company’s petrol and diesel pricing policy within the proceedings.

Source: The Antimonopoly Office of Slovak republic, 23 November 2005. Read more...   

 

    The Romanian Competition Council investigates the state aids given to the Romned Company Srl within  the free area ConstantaThe investigation started from the Council itself and analyses the compatibility of the state aid given to the company which were above the limit of 65% allowed by the Reglementation regarding the regional state aid.

Source: The Romanian Competition Council, 23 November 2005. Read more...    

 

    The Romanian Competition Council investigates the state aids for 20 companies from the disadvantaged areas. The investigation started from the Council itself as a continuation of the monitoring activities on the economic agents which activates within the disadvantaged areas. The checks were done on September and October, this year, on a number of 1679 economic agents and at 20 of them were observed disfunctionalities in the intensity of the state aid. These 20 beneficiaries are carrying on their activities in the counties of Alba (disadvantaged area of Cugir), Bistrita (disadvantaged area of Rodna), Hunedoara (disadvantaged areas of Brad, Valea Jiului and Hunedoara), Prahova (disadvantaged area of Filipesti) and Salaj (disadvantaged area of Ip).

Source: The Romanian Competition Council, 22 November 2005. Read more...    

 

    The European Commission accuses the energy giants of their anticompetitive practices. According to a study presented by the European Commissioner for Energy Andris Piebalgs and the European Commissioner for Competition Neelie Kroes, the European natural gas and electricity markets suffer serious disfunctions despite of the deregulation rules of 2004. The energy prices are very different to from one member state to another, and the companies occupy dominant position with the support of the national governments. Source: Evenimentul Zilei, 17 November 2005. Read more...   

 

    Short-term export-credit insurance – new proposals of the Services of the Competition Directorate-General for a Communication of the Commission to Member States amending the Communication pursuant to Article 93(1) [now Article 87(1)] of the EC Treaty applying Articles 92 and 93 [now Articles 87 and 88] of the Treaty to short-term export-credit insurance. This document is not final and does not necessarily represent the view of the Commission itself.  

Source: The European Commission, Press Release, 17 November 2005. Read more...   

 

    The  Latvian Competition Council examined the notification submitted by Mittal Steel Company N.V. on concentration by acquiring a shareholding of 93.02 percent in Krivorizhstal iron ore extraction and processing company. The decision of the authority was to permit the concentration in accordance with the submitted notification. The Competition Council assessed the notified concentration as horizontal, having resolved, however, that the degree of concentration in the relevant market for coal steel products will change quite insignificantly, therefore the dominant position will be neither created or strengthened, neither will the transaction have a consequence of a significant lessening of competition in the markets concerned. Source:  The Competition Council of Latvia, 17 November 2005. Read more...   

 

    On the internet providers market the competition is almost an illusion as the Internet wire services are under the monopoly of two firms which have 99% of this market. The two big providers are UPC Romania/Astral and RCS &RDS. The lack of competition has negative consequences on the quality of the services.  Source: Averea, 16 November 2005. Read more...   

 

    UE asks Spain to analyze the fusion of Gas Natural with Endesa. The value of this transaction is of 22 billions Euro. Gas Natural announced since September that it has submitted an offer for Endessa. The transaction has been approved by the Spanish energy regulating authority. The fusion should be analyzed by the authorities of Madrid not by those of Brussels said the European Commissioner for Competition, Mrs. Neelie Kroes. Source: Averea, 15 November 2005. Read more...   

 

    The economic concentration of the UniCredito Italiano has been authorized by the Romanian Competition Council. UniCredito Italiano took the control over the Bayerische Hypo und Vereinsbank AG (HVG Group). The competition authority analyzed the compatibility of this action and considered that through this acquisition the UniCredit Group does not create a dominant position on the market  and does not affect the competition environment.

Source: The Romanian Competition Council, 9 November 2005. Read more...   

 

    The Romanian Competition Council conditioned the state aid for S.C. UZINA MECANICA MARSA S.A. The Ministry of Economy and Commerce gave this state aid which value rises to 6,65 millions RON. The condition of the Council to approve the aid was that the S.C. UZINA MECANICA MARSA S.A. implement the assumed reorganization program and to reduce the production capacity till 2010. The firm does not produce military equipments anymore but produce and sell car bodies, equipped containers, trailers, metallic structures, etc. Source: The Romanian Competition Council, 7 November 2005. Read more...   

 

    Antimonopoly Office of Slovak Republick issued a ruling stating that the Slovak Ministry of Culture has restricted competition in providing news services.  AMO sees as a problem that the ministry in the budget of the state-run TASR news agency for 2005 did not specify in advance the usage of finances from the state budget in an objective and transparent way. The Office fined the Ministry of Culture SKK 200,000. This is the bottom level of a fine, which AMO can impose for restriction of competition.

Source: The Antimonopoly Office of Slovak republic, 7 November 2005. Read more...   

 

    The Romanian textile industry is in continuing decline. The President of the Employers Federation of Light Industry, Mrs. Maria Grapini accuses the government that it has not implemented the measures to support this industry sector. The main problems of the producers are: the unpredictability of the taxation policy, the fluctuation of the exchange rate leu/Euro, tax evasion and especially the cheap products coming from China. These are a menace for the internal market but especially for the exportation. 

Source: HotNews.ro, 7 November 2005. Read more...   

 

    Romania is going to become a strong competitor on automobile market as a follow up of the selling of the Craiova car factory.  Nissan, in alliance with Renault, General Motors and Ford are the mail potential buyers. This is a opportunity for the Romanian producers to impose on the cheap car area but with minimum standards.  The Lonan project opened this market and Renault has simply created a niche where it has no other competitor. The only problem appears in the case of exportation, the demand exists but for a small quantity and the European market seems not to be prepared yet for  Renault’s experiment.   

Source: Evenimentul Zilei, 5 November 2005. Read more...   

 

    Romtelecom privatization. 9 investment banks are interested in the privatization process of Romtelecom and have deposed tenders for the phone operator. These banks are organized in syndicates as follows: CA~IB, Goldman Sachs, ABN-AMRO and Rotschild;  Citibank, EFG Eurobank and Ergasias S.A.; CSBF and IEBA Trust; Deutsche Bank, BRD Securities and Alpha Finance; HSBC, BCR Securities and Dresdener Kleinwort Wasserstein;  JP Morgan, RAEF, Intercapital Invest and Linklaters; Merrill Lynch and BT Securities; Morgan Stanley and Raiffeisen Bank, and finally UBS, ING Securities and CET. The privatization will be done by a Public Initial Tender.

Source: Amos News, 3 November 2005. Read more...   

 

    The societies ELGEKA CYPRUS LTD. and ILLIAN SERVICES LTD. has to pay a fine because they failed to notify their economic concentration that affected the Romanian market. The penalty imposed by the Competition Council was of 3.000 RON. According to the Competition Law, art. 15 any operation of economic concentration must be announced to the council although this in not an anticompetitive practice.

Source: The Romanian Competition Council, 3 November 2005. Read more...   

 

    The Competition Council had monitored the state aids given to the economic agents within the free areas. The Council unrolled this activity between August-September 2005 through its local offices from the five free areas: Galati, Braila, Giurgiu, Curtici – Arad and Constanta. The Ministry of Public Finances has the role to establish the dimension of the regional state aid and it transmitted to the Competition Council the list of the economic agents as well as the amount of the aid. The conclusion is that the large majority of the economic agents has received a state aid under the maxim admitted level. As a follow up, the Competition Council asked the Ministry of Public Finances to take the measures in order to oust the incompatibility.

Source: The Romanian Competition Council, 3 November 2005. Read more...   

 

    The application of competition rules to liner shipping. The Competition Directorate General of the European Commission is leading a review of Regulation 4056/86 which lays down the rules for the application of Article 81 and 82 EC and contains a block exemption for liner conferences. This is a consultative paper requested by DG Competition, which has already determined that the block  exemption should be reviewed and in the event it does not fulfill the conditions of Article 81(3) of the Treaty that it should be repealed.

Source: The European Commission, Press Release, 26 October 2005. Read more...   

 

    The Commission on Protection of Competition from Bulgaria examines the existing regulating regime of the activity of the notaries. The CPC constitutes procedures for examination of the existing regulating regime of the activity of the notaries, which serves as a continuation of the Commission’s policy for a retrial of the regulating frame of the unregulated professions in Bulgaria and identifying of those, which may restrict the competition.

Source: The Commission on Protection of Competition from Bulgaria. Read more...   

 

    The Commission on Protection of Competition from Bulgaria allowed the concentration between UniCredit and HVB. The concentration was made through the acquisition of independent control of “Bayerische Hypo-Und Vereinsbank” by “UniCredito Italiano S.p.A”, as it does not lead to establishment or consolidating of dominant position, which might prevent the effective competition on the corresponding market. The Commission allowed preliminary implementation of the decision.

Source: The Commission on Protection of Competition from Bulgaria. Read more...   

 

    State-aid in Romania will not be completely forbidden after the accession to the European Union but then as now, they must be used only in special cases and for certain domains that need restructuring or has a growing potential. Until now, the legislative harmonization has been generally accomplished and there are obvious advancements in its implementation process too. The problems to solve came from the negative effects of the reshaping of the Romania economy and the public supplies must take into consideration the competition rules and must be applied in a non-discriminatory manner, to all the economic players. Source: Euroinvest, No. 20, September 2005.

 

    The insurrance company Wiener Staedtische took over the majoritary stock of the Omniasig. After a perion of acquisitions of firms that activate on the same market, the Austrian group must decide on the best manner of leadership and should choose between fusion and multibrand system.

Source: Ziarul Financiar, September 19, 2005. Read more...   

 

    The European Commission accuse the companies Olympic Airlines and its forerunner Olympic Airways to receive 663 million dollars illegal state aid from the greek authorities.

Source: Ziarul Financiar, September 19, 2005. Read more...   

 

    The ecological auto market is in continuing expansion as seen at  Frankfurt Auto Room Show, the automobiles builders has exhibited hybrid vehicles that combine the classical motorisation based on oil with a new based on electricity. Source: Ziarul Financiar, September 19, 2005. Read more...   

 

    The President of OMV Group, the main Petrom stakeholder, Wolfgang Ruttenstorfer defended on the press conference held on 14 September 2005, the company’s policy of prices on the Romanian Market. But still, the Romanian market is one of the poorest markets in Europe and the fuel price is even higher than Greece and Malta and very close to the prices fron Germany, Freance, Sweden and the Great Britain.

Source: Ziarul Financiar, 15 septembrie 2005. Read more...   

 

    The aluminium producer Alro Slatina bought Alum Tulcea, aluminium oxid producer, by a price of 7 million Euro. The transaction took place ar Electronic Stock Exchanke RASDAQ ant in the future it is prepared the fusion. Source: Ziarul Financiar, 15 septembrie 2005. Read more...   

 

    The cement market has been relaunched. The damages caused by this summer flods relaunched the cement market by increasing the demand for industry products. This was a business of 300 million/year that registered a decline of the demand after the first semester of the year.

Source: Ziarul Financiar, 15 septembrie 2005. Read more...   

 

    Mittal Steel bought 78% of the stock exchanges sold by Broadhurst Fund that was the major owner of the Galati Harbour/Romportmet. The transaction costed 47 million Dollars and now Mittal Steel is the main stock holder owning 89% of Romportmet stock exchanges. The Mittal representatives say that this business will bring a better control of the raw material transportation. Mittal Steel has 30 day to give a notification, so the Competition Council to consent with the transaction.

Source: RevistaPresei.ro, 8 septembrie 2005. Read more...   

 

    Sidex under investigation. The Competition Council investigates the state aids received by Mittal Steel for the Sidex Galati. The investigation started as a consequence of the press articles according to which Sidex profited to much more many from the Romanian state than the maximum allowed during the negotiations with the European Union. According to a note of the Competition Council, Sidex benefited of new facilities to the payment of state debts and the social insurrances. More, the Council proposes that the also the facilities to the payment of utilities and local taxes to be considered as state aids. In accordance with the European laws, if a firm benefits of tax payment facilities given discretionary by the state it is possible that the firm should be obliged to give back the money on grounds of illegal state aids benefits.   

Source: Evenimentul Zilei, 8 septembrie 2005. Read more...   

 

    The Competition Council has elaborated the Textbook on state aid law in Romania. The Textbook was accomplished together with the German experts within the framework of the PHARE Twinning Project. This is the first decument of this kind to be elaborated and published in Romania. The Textbook offers an overview on the notion of state aid through the angle of the rules regarding this issue that apply in Romania, rules that transpose completely the european acquis in this domain, and also in the view of the upcoming accesion of our contry to the European Union. This paper presents all the issues regarding the state aid and adresses both the state authorities that give such support measures, and the companies in such way that all those who are concerned to have  an overview on the state aid domain. The main purpose of this work is to prepare on the domain both the state aid providers (ministries, national agencies, state enterprises, etc.) and the state aid beneficiaries (private firms, state firms) to understand and to put into practice the peculiar law concerning state aids, and to make them conscious of the risks to which they expose in case of wrong application of these laws. On processing this Texbook it was taken into consideration the legislation on the domain published till 15 June 2005.

Source: Press Office of the Competition Council, 6 September 2005.

 

    The European Commissioner for Competition, Neelie Kroes made clear in her speech “Competition must drive European Competitiveness in a global economy”, held on the 3rd of September 2005 in Cennobia, Italy, that the competitiveness in a main topic on the Commission’s agenda and the protectionism is a wrong answer to the new economic challenges of globalization. In order to be wealthier, the European Union must focus on global – communitarian – national competition if is wants to get the best from the peoples, use in the best way its resources, have high quality products and services at low prices. Smart public policies are the flexible ones, which target the needs of the market and focus innovation and research. The European Social Model has a future only through this reform that requires a joint effort of all political levels. Source: EU Commission/Competition/Press Releases/September 3, 2005.

 

    Commission opened in-depth investigation into E.ON’s acquisition of MOL.  As a result of the German energy company E.ON planned acquisition of MOL, oil and gas supplier in Hungary, the European Commission has opened an investigation under the UE Merger Regulation. The initial investigation has discovered that, due to the horizontal and vertical overlaps of the two companies, the transaction could create competition concerns in Hungary and the European Economic Area. The Commission will take a final decision until November 17, 2005.

Source: EU Commission/Competition/Press Releases, July 8, 2005. Read more...   

 

    Commission had requested Sweden, Austria and the Czech Republic to fully implement Directive on financial transparency: the reminder took the form of a letter of formal notice reminding Austria and Denmark to implement correctly the Directive (2002/52/EC) but the Commission sent  four formal requests to the Czech Republic to implement the original Directive 80/723/EC and the three amending Directives (85/413/EC, 93/84/EC and 2002/52/EC). These are the reasoned opinions, the second stage of the infringement procedure. If Austria and the Czech Republic do not take the necessary measures to comply with the reasoned opinion within two months of receipt, the Commission may refer them to the European Court of Justice. Source: EU Commission/Competition/Press Releases, July 7, 2005.

 

    Commission has concluded that no aid has been involved in restructuring of Polish steel company Huta Czestochowa, one of Poland’s main steel producers, and cleared the way for the sale of the company as a part of the restructuring. The Commission investigated because the restructuring required a significant debt write-off, from inter alia public creditors and it concluded that the write-off was compliant with the European Sigle Market competition rules, didn’t involve state aid but still 4 million Euro of restructuring aid previously given to the company was illegal and must be recovered.

Source: EU Commission/Competition/Press Releases, July 6, 2005. Read more...   

 

    EBRD supports Gaz de France in Romania: Gaz de France International, a subsidiary of French gas giant acquired a 51 per cent stake in the Romanian gas distribution company Distrigaz Sud and the EBRD and International Finance Corporation (IFC) acquired each a 5.1 per cent beneficial stake in the company to support its activities and to help improve, among other things, the gas distribution networks in the country. The deal supports the first private participation in Romania’s gas distribution sector, and by the EBRD 31  million Euro credit will help liberalise one of the largest gas markets in central and eastern Europe.

Source: EBRD/PressRelease - June 28, 2005. Read more...   

 

   2004 Annual Report on Competition Policy has been adopted by the European Commission. It presents an overview of the most important legislative and policy initiatives and decisions in the field of EU competition policy. Among the most important accomplishments:  in the field of EC Treaty rules on restrictive business practices and abuse of monopoly power on 1st May a new set of implementing rules entered to force, the Commission adopted three decisions prohibiting abuse of dominance, including the Microsoft decision which imposed a substantial fine of 497 million Euro and 6 decisions against cartels with fines totalling €390 million, 158 new cartel and monopoly cases were opened and 391 were closed.

Source: EU Commission/Competition/Press Releases, June 21, 2005. Read more...   

 

    Roman and Aro under the examination of the Competition Council. As a result of the notification lack The Competition Council investigated the conditions in which state aids were granted to the two companies and will re-examine the context in which the aid has been obtain, even if it has had the previous consent of the competition authorities. Roman Brasov and Aro Campulung are included among the companies that might receive state aid for restructuring. Source Cotidianul, June 15, 2005

 

   The European Commission has opened sector inquiry into gas and electricity: as a response to the complains of the consumer’s limited choices, the price rises and of the new entrants on the Single European Market. The well functioning gas and electricity markets are crucial for the competitiveness of the European industry and for the consumer to enjoy lower costs and to be free to choose the supplier. Enforcement action could follow, either by the Commission or by national competition authorities and a report will be published at the end of 2005.

Source: EU Commission/Competition/Press Releases, June 13, 2005. Read more...         

 

   EU plans new rules on state aid: the main purpose of the reform is to ensure that the national governments will spend more money in the areas that can generate economic growth, jobs and social cohesion: research and innovation, protection of the environment and the less developed regions   and will give up financing industries with no future. As the promoter of the reform, the Commissioner Neelie Kroes stated that the new rules also want to make the state aid regulations more transparent and less bureaucratic. Source: International Herald Tribune, June 8, 2005.

 

    Lafarge, Holcim and Carpatcement fined by the Competition Council: after four years of investigations the three big cement producers had received a 28 million Euro fine as they were accused of a secret arrangement on the price of the products. As a result of the investments made and under normal market conditions, the companies should decrease their prices but that thing didn’t happened and this can be explained by their agreement. Lafarge received the biggest fine, 377,2 billion Lei, followed by Carpatcement with 313,2 billion Lei and Holcim which had to pay 290 billion Lei. Source: Capital, June 2, 2005.

 

   The Competition Council is investigating some state aids: this is about S.C. LAMINORUL S.A. Braila (Order no. 1/05.01.2005) and S.C. TEROM Iasi (Order no. 21/45.02.2005). In both cases, the investigation started from the Competition Council itself, and it is about state aids granted according to the two different situations: for the former one, it refers to financial state aid for the economic recovery, and for the latter one the Competition Council doubts that the state aid granted is in accordance with the legislation in the matter.

Source: Romanian Competition Council. Read more...  

 

   Strategy for informing the entrepreneurs about the EU integration: Mr. Eugen Ovidiu Chirovici, the President of the Agency for Small and Medium Enterprises stated that all the entrepreneurs who were not prepared for the European integration would face bankruptcy. This happened also to the Hungarian business environment, even if it was better prepared than the Romanian one, where one third of the Hungarian firms went bankrupt shortly after the integration. The Tariceanu Government decided to adopt a strategy for two years, starting as soon as possible, on the preparation of the Romanian business environment for the EU integration. From the legislative perspective, the priority for Romania is to apply the acquis, than to continue the fight against corruption and to offer a “friendly and predictable” legislation for foreign investors. The campaign organized by the Agency for Small and Medium Enterprises will be called “The Caravan” and will be represented by its officials who will go around the country in order to create info points together with the town halls, prefectures and employer confederations.

Source: Adevarul, February 21, 2005

 

Romtelecom at the stock exchange: the Pre-Accession Programme for 2004 stipulates that the operations of selling a percentage of Romtelecom at the stock exchange will start this year and will be over by the end of next year. The Government also intends for this year to launch the Cosmorom mobile phone company and also sell all its shares from Postelecom, which is planned for 2006. The other objectives of this kind planned also for this year are the complete privatization of the National Society of Radio Communications and the analyzing of the process of selling the National Company of Romanian Post.

Source: Adevarul, February 21, 2005

 

The Romanian Government intends to sell 10% of BCR at the stock exchange: the Government owns 36,88% of the BCR shares, of which it intends to sell 10% at the Bucharest stock exchange, after which it has already sold last year a package of 25% plus two actions to the European Bank of Reconstruction and Development and the International Finance Corporation, for $222 million. The other shareholders are the BCR employees, owing a package of 8%, SIF Oltenia 6,11%, SIF Banat-Crisana 6%, SIF Transilvania 6%, SIF Moldova 6% si SIF Muntenia 6%. (S. Etves). The Government also intends to sell 10% of its Petrom shares, for which it has already the approval of OMV. Source: Gardianul, February 21, 2005.

 

   Mr. Adrian Nastase criticizes the renegotiation of Bechtel and E.A.D.S. contracts: former Premier, Mr. Adrian Nastase, considers that the new Government has problems in allocating the budget funds for the E.A.D.S. contract. He stated during his short visit to Cluj that it is not the Government’s business to analyse the financial aspects of such contracts, but it is the competence of the Court of Auditors to do that. Further on, he said that the new Government would risk a credibility problem by renegotiating the contract with the world’s largest construction firm. 

Mr. Ioan Rus, the former Minister of Home Affairs, supports Mr. Nastase, by stating that he was the one that adviced Mr. Nastase to sign the contract with the Franco-German firm E.A.D.S. at that time, in order to avoid any kind of corruption suspicions. Source: Cotidianul, February 20, 2005

 

   The Romanian price for pork meat set according to European rules: the firms affiliated to the Romanian Meat Association will acquire pork meat from the members of the Romanian Employers Confederation of Pork Meat at the European prices, according to a protocol signed between the two of them on 18 February 2005 in the presence of the officials from the Ministry of Agriculture. The final price will be established in accordance with the European one in the matter plus 20% import taxes, which is equivalent to a minimum of around 70.000 lei, depending on the quality on the meat.

Source: Adevarul, February 20, 2005

 

   The EU competition on financial services under investigation: the Competition Commissioner Mr. Neelie Kroes announced that investigations on barriers to competition would be launched at EU level, starting with financial services and energy. This is the new EU policy, which Mr. Kroes stated in a speech on 17 February 2005 at the Global Forum on Competition organised by the Organisation for Economic Co-operation and Development (OECD). These investigations are common at the national level, and now they will be undertaken also by the Commission, in order for the competition law to be better applied and thus encourage the European market on financial services. The new EU policy in this matter also opens the possibility for those “damaged by anti-competitive practices to take action through the courts, currently very problematic in the EU but successfully used in the US.” Source: EUROACTIV-EU News, Policy Positions and EU Actors Online, February 18, 2005  Read more...  

 

   Steel companies approved the new strategy: this is about the strategy imposed by the European Union concerning the granting of state aids to steel companies. More, at the request of the European Commission, all the companies that received illegally granted state aids after September 2004 and until the accession date will have to return them after 2007, if the Commission so requests. Mr. Mihai Berinde, the President of the Competition Council, explained that in order for a state aid to be legally granted, it has to be previously approved by the Competition Council, according to the rules from the acquis in the matter.

Source: Adevarul, February 16, 2005

 

   The Government decided to renegotiate the E.A.D.S contract: the Premier Calin Popescu Tariceanu signed on 15 February 2005 the decision to open the contract with E.A.D.S Deutschland GmbH for implementing the security integrated system for the state frontiers. The decision was taken at the proposal of the Minister of Public Administration and Home Affairs, Mr. Vasile Blaga, in order for the Government to have access to the contract file, and thus make it public and renegotiate it. The Government’s reason for this decision is to avoid a possible overlap with the PHARE programmes for securing the frontiers and also to negotiate a fair price for the contract. Source: Adevarul, February 16, 2005

 

   The European Court of Human Rights against McDonald’s: this is about the longest court case in the English legal history, against two English activists, Helen Steel and David Morris, who wrote a pamphlet in 1984 against McDonald’s, in which they accused it of starving the Third World by cutting down rainforests and selling unhealthy food. The 1997 English ruling deprived them of their freedom of expression, including the denial of state legal aid as defendants: "The denial of legal aid to the applicants had deprived them of the opportunity to present their case effectively before the court and contributed to an unacceptable inequality of arms with McDonald's", the Court said. As a consequence, the Strasbourg Court ordered Britain to pay them a total of €35.000 ($45,400) and also a fair retrial. Britain has three months to appeal the decision. Source: CNN Money, February 15, 2005. Read more...  

 

   Rompetrol expands in Albania: the Rompetrol Company has recently established

"Rompetrol Albania'', which will trade in retail and wholesale and operates a storehouse of 14.000 mt in Durres - Porto Romano. The storehouse supplies 10 gas stations administered by Rompetrol, and almost 40 private gas stations and 10 small wholesale operators. The investment plan adopted for 2005 has a total expenditure of €3 million and stipulates the building of other two stations in Tirana e Durres. Given the high quality of Rompetrol’s oil on a market with low quality oil, the business seems to become a very inspired one. Source: Foreign Investors Council, February 13, 2005.

 

   BitDefender on the global market: Softwin, the Romanian company that produces the BitDefender anti virus solutions, have reasons to believe that in the fallowing period its sales will exceed 2 percent of the total global market, thus significantly improving its position. Softwin owns other branches in Germany, Spain and the USA and intends to open a new one in Asia this year.

Source: Foreign Investors Council, February 13, 2005.

 

   MICROSOFT surrenders fighting the EU sanctions: after having received last year the highest fine ever issued by the EU in a competition case – €497 – now it seems that Microsoft is working constructively with the Commission in order to solve its problem. The matter for which the giant company was accused is the abuse of market dominant position/monopoly related to its in-built music player and video, for which Microsoft has now to reveal the information about the software codes in order to let his competitors build them, too. Source: EUobserver, January 25, 2005.

 

   Other four possible trust agreements: besides the raise of oil prices by several oil stations at the same time at the beginning of 2005, the Competition Council is investigating other four possible agreements, from which some have already been fined: a possible agreement of the great banks to impose the same commission for automatic teller machine (ATM) belonging to other banks; some real estate agencies from Braila have already been sanctioned for setting the same commission for their transactions; the ticket restaurant sector got the highest fine (47 billion lei), as eight agencies set the same minimum level of commission to their clients; the best three cement producers (Carpatcement, Holcim and Lafarge) are investigated for having agreed to set the same selling prices for internal use and as well as for exports. Source: Cotidianul, January 22-23, 2005, p 11.

 

   Romania will have protected brands before accession (2007): this is valid for the names of some wine categories and alcoholic beverages, for which the Ministry of Agriculture is negotiating with the EU. These negotiations refer to the recognition and protection of original names and the details about the region of origin for the beverages. Source: Cotidianul, January 22-23, 2005, pg 2.

 

   The EU Commission opens formal investigation on Polish car maker FSO: this investigation is meant to verify the compatibility of state aid granted for the restructuring of Fabryka Samochodow Osobowych S.A. (FSO ex DAEWOO) with the EC Treaty in the matter and the 1999 Community Guidelines on rescue and restructuring aid. The Commission wants to see if any of the relevant measures could represent a threat that would distort competition. Source: EU Commission, January 19, 2005. Read more...  

 

   The EU requested that Romania should cut subsidies to steel industry: on the one hand, this is a result of the EU legislation in the matter of state aid as a means of distorting competition, and on the other hand this is a matter of EU’ aim to become the world’s leader in the matter. In this context, the Romanian steel sector has to improve its standards as to be able to reach the European ones in due time. Thus, during the period 2005-2008 the EU will monitor our steel industry, which is also one of the 11 safeguard clauses for Romania’s joining the EU in 2007. The Government has already approved the reorganization of our steelworks: ISPAT Sidex Galati, Siderurgica Hunedoara, COS Targoviste, ISCT Campia Turzii, CS Resita, Donasid Calarasi si Otelu Rosu, comprising a cut of 52,000 steel jobs by 2008.

Source: Adevarul, January 18, 2005.

 

  The Competition Council set its priorities for 2005: harsher sanctions for the violation of the State Aid Law, expert teams to analyse if each kind of state aid is granted in accordance with the community acquis and finalize the monitoring for the state aid in the less favoured areas.

Source: Ziarul Financiar, January 14, 2005.

 

   SNP Petrom, Lukoil Downstream, Rompetrol, OMV Mineraleoel, Agip, Mol Romania Petroleum Products, Shell Romania increased prices per oil litre at the gas stations with 500 – 800 lei at the beginning of the year 2005. The Competition Council requested to be clearly informed about the Companies’ decision as it could suspect these companies of trust arrangements.

Source: Adevarul, January 13, 2005; Romanian Competition Council. Read more...  

 

   Bechtel, Vinci and EADS contracts: the Romanian Prime Minister Mr. Calin Popescu Tariceanu announced that the new Government will analyze the legal and financial aspects of the Bechtel, Vinci and EADS contracts, which have already been negotiated by the ex Government. The reason for this decision lays in the “deep irritation” at the European level regarding these contracts (and mainly the principle of open and fair competition in auctions). Source: Adevarul, January 13, 2005.

 

   The great EU achievement- Airbus A380-matter of dispute with the US: the largest passenger plane ever (500 passengers), a double-decker with bars, shops, gyms and beauty saloon seen as a “European success” is subject of intensive talks between the EU and the US over state subsidies to aircraft industry, which is contrary to WTO’s agreements in the realm. But the US also is accused to have done the same thing with its Boeing, Airbus’s main competitor, which is developing a rival 7E7 Dreamliner, a smaller 250-passenger plane that will be unveiled at the end of 2006. Source: EUROACTIV - EU News, Policy Positions and EU Actors Online, January 11, 2005. Read more...  

 

 

FIGHT AGAINST UNFAIR COMPETITION

 

    3G war begins in 2006. Next year it will be known which will be the other two companies to offer 3G phone services along with Orange and Connex. The General Inspectorate for Communications and Information Technology hope that during the auction to grant both licenses.

Source: Cotidianul, 21 November 2005. Read more...  

 

    Presentation of the Preliminary Findings of the Energy Sector Inquiry. The initial findings of the Commission’s inquiry presented in this Issues Paper have confirmed many of the criticisms made about EU gas and electricity markets. The findings will be reported more in detail in the preliminary report at the beginning of 2006.The initial findings also confirm the analysis put forward in the Commission’s Report on Progress in Creating the Internal Gas and Electricity Market and emphasise the requirements for action. After a wide public consultation on the preliminary findings, scheduled for February and March of 2006, the Commission will discuss and propose necessary structural, regulatory and competition law-based remedies. Source: The European Commission, Press Release, 15 November 2005. Read more...  

 

    From 2007 the budget of the Romanian Competition Council will be reduced to half. This is a consequence of the fact that the state aid control will be done from the Brussels. The Competition Council will have to handle the competition chapter, especially the consumption goods, industrial goods and services. Source: Averea, 04 November 2005.  Read more...  

 

    Figures on antitrust cases dealt with by ECN authorities

Source: The European Commission, Press Release. Read more...  

 

   The franchise market in Romania had been developing during the last years, the number of the firms to use this method increased each year but there are also unknown aspects for the Romanian firms. The lawyer Mihaela Ion, from the Hahui and the Associates Law Firm (www.hahui.ro) mentioned the advantages of the proceeding: a great degree of certainty due to the use of a well known mark, it involvers low costs, the exclusivity of a product, permanent instruction and technical assistance from the francizor. But on the other hand there are disadvantages to take into consideration: the lack of freedom of movement, many obligations among which to respect the prices, the image (mark, presentation, etc.) but above all the risk to come against anti-trust  regulations. To avoid this, the Competition Council must be asked for an exemption that should be given when the advantages of the franchise favor the consumer and not the franchise beneficiary. Source: Saptamana Financiara, 8 August, 2005. Read more...  

 

    The Final Conference of the Twinning Project "Further development of competition authorities' capacity to implement the competition and State aid acquis communautaire to EU standards of application" has been held on July al the International Centre of Conference of the CCIRB. On this occasion spoke, among others: Mr. Mihai Berinde, President of the Romanian Competition Council, Mr. Jonathan Scheele, Head of the Delegation of the European Commission in Romania, Mr. Wilfried Gruber, German Ambassador and Enrico Pavone, Charge d’Affaires, Italian Embassy. Source: Chamber of Commerce of Romania and Bucharest, July 15, 2005. Read more...  

 

   Unsuccessful Commission’s attempt in proposing the software patent law: this was the second time when the European Parliament rejected the Commission’s bill on the software patent legislation, asking the Commission to withdraw it, even if the computer-implemented inventions directive would allow software to be patented in order to “protect inventions that use software to achieve their effect”. The Parliament justifies its decision by the fact that the software is already protected by the copyright legislation and more, it would allow the big companies like Microsoft to monopolise the market in the detriment of small and medium companies in their innovative industries in technical components or medicines. In fact, the big companies supported the proposal, on the grounds that the patents would protect the billions spent in research. Source: EU Observer, February 18, 2005.

 

   CONNEX changes its logo: after eight years of pointing on the “X” as a distinctive element for the name of CONNEX, the mobile company decided to change its logo by unifying the two “N”. Together with this change, a new message came too, that swift from “You make the future” and “The future sounds good” addressed more to the consumer, to “CONNEX for the future”, which strengthens more the importance of the Company. This change of logo and message is a normal one in the management of a brand, and more, it is associated with a campaign of rising $7 million in three years for supporting some projects in the field of education, environment and culture. Source: Capital, January 27, 2005.

 

   The end of MULTIFIBRE AGREEMENTS with third countries: starting from this year, the EU MULTIFIBRE Agreement with 3rd countries is no longer valid. It means that the European market, as well as the US one, will no longer establish quotas for China textile imports. This is a real threat for the economies in the matter, as the Chinese labour and equipment costs are much lower than the EU ones and the quality seems to be relatively high. Romania will suffer too, as it produces for the West European famous brands, in the “lohn regime”, which means that we provide only the labour force, whose cost will non longer be kept so low given Romania’s future accession to the EU. The salary in China is about €70 per month, while in Romania around €100. Source: Banii nostri, January 18, 2005

 

   European firms fail to protect their innovations, as they do not take any measures through patents and trademarks. This is the conclusion of one of the Innobarometer for 2004 survey.

Source: EUROACTIV - EU News, Policy Positions and EU Actors online, January 16, 2005. Read more...

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