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EEC Council: Union law will introduce this year additional tools for "soft regulation" of transboundary markets

EEC Council: Union law will introduce this year additional tools for "soft regulation" of transboundary markets

4/3/2020

The EEC Council has approved the annual report of the Eurasian Economic Commission on the state of competition in transboundary markets and measures taken in the Union to prevent violations of the general competition rules. It will be published on the website of the Eurasian Economic Union after its approval by the Supreme Eurasian Economic Council on May 19 this year.

The report for 2019 noted that the Union "is consistently working to remove barriers to the movement of goods, more and more markets are becoming common and open to entrepreneurs". In this regard, the Commission’s activities on developing and protecting competition in transboundary markets within the territory of two or more EAEU Member States are an important element of protecting their rights.

The document highlights the priority areas of the EEC’s activities in this sphere. One of them is related to monitoring compliance with general competition rules in transboundary markets. Last year, the Commission considered 17 applications suggesting possible violation of general competition rules. The most common of them were abuse of dominant position and unfair competition. The Commission's Antitrust Unit also conducted nine investigations and reviewed eight cases for such violations.

However, there are cases where investigations and causing proceedings can be avoided. It was not until fairly recently that the "soft regulation" mechanism was introduced into the Union law, but in the past year, the Commission has elaborated seven Proposals on eliminating violations of competition rules in various EAEU markets. According to Serik Zhumangarin, EEC Minister in charge of Competition and Antitrust Regulation: "this enables shifting the emphasis from punishment to preventive measures that ensure creating competitive environment in the Union's transboundary markets".

Constant monitoring of prices for certain goods subject to anti-dumping duties when imported is another focus area. It helps to protect the interests of consumers and producers as well as ensure equal competitive conditions for all market players.

Increasing the transparency of the EEC’s work in this area, which is greatly facilitated by the introduction of information technologies, is another important focus area. In November last year, the Commission’s Board adopted rules ensuring the exchange of documents and information between the EEC and the Union countries’ authorized bodies on competition and antitrust regulation in electronic format.

This decision was preceded by a step-by-step joint work of the Commission and the Member States. As a result, a general process of automated data exchange has been formed for monitoring compliance with competition rules in transboundary markets and internal competition legislation. It helps to control issues related to introducing state price regulation. The information system testing in order to work out all interaction elements is scheduled for this year.

The Commission, jointly with the Union States, continues improving the EAEU legislation. In particular, it has prepared additional tools for "soft regulation" - warnings and cautions.

Warnings will be issued to legal entities and individuals as well as non-profit organizations, at the stage of considering an application (materials) on violation of general competition rules in transboundary markets, if their actions have any signs of violation of general competition rules.

The Commission will forward cautions when it detects a public statement made by an economic entity’s official or an individual about its planned behavior in a transboundary market (intent), if such behavior (intent) can lead to violating general competition rules, and with this there are no grounds for conducting an investigation.

Planned changes in legislation were approved by the Supreme Eurasian Economic Council in October 2019 and are currently being ratified in the Union countries. ​