The Eurasian Economic Commission is constantly working to improve the working conditions in the EAEU, and one of the directions of this is to improve the mechanisms of antimonopoly regulation. As suggested in ECE during the Antimonopoly Forum on February 18, the Eurasian Union requires new approaches to antitrust compliance, since the existing norms are not given to unified standards. The question concerns including digital markets whose development has intensified under the influence of the pandemic and the restrictions associated with it. What measures to protect ECE's competition use now and what changes is preparing, a member of the Collegium (Minister) on Competition and Antimonopoly Regulation of the Commission Arman Shakkaliyev told, in an interview with Eurasia.Expert.
- Arman Abayevich, your block is responsible for protecting competition in the Union. What are the measures, in your opinion, the most effective in practice?
- Do I need to protect competition and how to do it? Such a question arises in discussions quite often. In my opinion, to protect and develop competition is unambiguous. For example, ensuring fair competition contributes to the development of small and medium businesses, which, in turn, leads to the emergence of new jobs. Any emergence of competitors in commodity markets forces other players of this market to introduce new technologies, look for new options to improve the efficiency of their activities. All this comes to the benefit of the state economy and ensures the growth of all economic and financial indicators in various industries.
Under these conditions, competition between market entities should be conscientious for which the "Rules of the game" were identified both at the national legislation of countries and at the supranational level in the EAEU. And as a guarantor of conscientious behavior and equilibrium in the markets we are - antitrust authorities. The EAEEC Treaty defines general principles and rules of competition, the competence of the commission and the authorized bodies of Member States are delimited. All that does not go beyond one state, control national authorities. If violations of the general rules of competition affected the markets of two or more EAEU states, that is, transboundary markets, this is the field of activities of the Commission.
If we talk about measures to protect the competition, then, of course, they should be aimed at preventing and preventing unscrupulous actions that violate the rules of competition. And the tools can be different - as punitive (in the form of penalties, for example), and preventive (this is the so-called "soft regulation"). If we talk about figures, over the past year we reviewed 28 applications on the signs of violations of the general rules of competition; spent 13 investigations; Considered 11 cases of violation of the general competition rules.
The goal is to punish, finfing business representatives before the Commission is not worth it. Penalties - the last measure, to which it is worth resorting, the restoration of competition is that the main thing.
Now the Commission is actively introduced and used "Soft regulation" mechanisms. For example, a sentence mechanism has already been implemented. As a preventive measure, it allows you to restore equal terms of competition, saves time, financial and labor resources for market participants - we offer a market entity independently and voluntarily eliminate signs of violations of competition rules, commit certain actions, including aimed at restoring competition. In addition, business entities do not fall under penalties and do not carry notable reputational risks.
In 2020, we developed, agreed and issued to 10 statements of the proposal to participants in various commodity markets on the actions aimed at eliminating competition violations on cross-border markets. It must be said that this tool is equally effective established itself both in the markets of anisotropic steel, coal, and in the markets of fermented and tea drinks.
- It is no secret that samples of individual goods implemented in the markets of Western countries, in terms of their qualitative characteristics, largely exceed the samples presented in the markets of our countries. Is this an act of unfair competition? How does the Commission intend to resist this?
- Indeed, cases where goods-surrogates are implemented on the territory of the EAEU, are recorded by the national authorities of Member States. On the agenda of the commission, there is a question to develop changes to the technical regulations of the EAEU. In particular, if the goods implemented in the territory of the EAEU member states, in its composition, qualitative characteristics or other indicators differs from the same product being implemented outside the EAU under the identical trademark, information about this should be brought to the consumer, that is, Specified on the packaging. This will protect our market from the unscrupulous competitive practices of large transnational companies for the production and implementation on the territory of the EAEU of low-quality goods.
Perhaps we will go different ways and consider the possibility of joint actions with national associations that protect the rights of consumers. In our opinion, the legal decisions of this issue can be found in the national legislation of the EAEU participating countries.
- In a pandemic of coronavirus infection, digital markets received new development. What is the case with protecting competition on them?
- I would not say that it was the global pandemic of coronavirus infection that influenced the development of digital markets. Rather, she accelerated their development. It seems to me that the development of digital markets is growing with the strengthening of the role of "figures" around the world and in different areas, and this happens quite quickly. In such conditions, the antimonopoly authorities require more actively to distort the competition in digital markets, and we pay special attention to the monitoring of the behavior of digital companies.
The Commission is preparing a project review "Competitive (antitrust) regulation on digital markets." It will analyze the international practice of applying the provisions of antimonopoly legislation to relations folding on the "digital" markets. New approaches will be reflected in the antitrust regulation of digital markets and the revision of traditional regulatory methods may have been made of recommendations. We are still at the beginning of the way, so now all these issues are discussed with the experts of state bodies of our countries.
We also reviewed some digital markets, which are more likely anti-competitive practices may be present. Among such markets are marketers, online cinemas, search engines, taxi aggregators. In March 2021, at a meeting with the heads of the antimonopoly bodies of the EAEE states, we plan to submit the results of these reviews in order to conduct further initiative investigations.
- Representatives of the Commission emphasize that their priority is not a punishment for violating the general rules of competition, but preventive control. What are preventive measures to protect competition the most effective?
- As I said, we go to more "soft regulation." We are betting to work not with the consequences, but to create a risk management system and prevent the possibility of violations of the Rules of Competition.
Today, the Commission, together with the National Bodies of the EAEU Member States, holds the large amount of work on the development and improvement of the competitive environment in the EAEU commodity markets, in particular by improving antitrust regulatory mechanisms. One of the main agreements, which was already able to agree on and include in a large package of amendments to the EAEEC Agreement (Currently, the Protocol on Amendments to the Agreement is on ratification - Ed.) Is the introduction of "soft regulation" mechanisms, namely issuing warnings about The need to terminate the actions that contain signs of violations of the general rules of competition, and making warnings on the inadmissibility of actions that can lead to a violation of the general rules of competition.
The warning is invited to issue an application for a violation of the general rules of competition (this is a certain analogue of the Institute of Proposals I talked about above). In this case, warnings will not be issued if signs of anti-competitive agreement (cartel) or establishing monopoly high or low prices are identified. It will not be issued in the event of a re-violation within 24 months.
It should be noted that when fulfilling the prevention conditions for the person who is issued, it will not be investigated and the case of a violation of the general competition rules will be carried out, accordingly, a measure of responsibility will not be applied in the form of an imposition of a fine. At the same time, if a business entity does not fulfill the warning, the Commission will resume the consideration of the application and will investigate.
The second element of "soft regulation", which is now being introduced into the contract, is a warning. It may be issued to the official person of the hossekject, as well as to individuals on the basis of a public statement about the planned behavior on the transboundary market, if such behavior can lead to a violation of the general competition rules, and there is no reason for making a definition of the beginning of the investigation. The procedure for making a warning will approve the Commission.
In addition, one of the main directions of our work is advantage of competition - measures aimed at promoting the advantages of competition and explanation of antimonopoly regulation methods. Over the past few years, the practice of systematic explanation of the general rules of competition has been formed, providing feedback with the business community of EAEA members. At the same time, various information exchange mechanisms are used: meeting with business, informing media, placement of information on the website of the Commission on the Internet, as well as on social networks, publishing printed materials and so on.
The successful form of interaction between the Commission with the business community was regular meetings of the public receiving unit for competition and antimonopoly regulation. In 2018 and 2019 We conducted visiting meetings in countries, worked "in the fields", clarified the profile problematic issues, including responsibility for violations of the general competition rules on the transboundary EAEU markets, the procedure for submitting the commission and consideration of statements of market entities on the presence of signs of violations, investigative procedures and consideration of cases. Over the years, more than 850 companies of the EAEE states took part in the field sessions of the public reception.
In connection with the restrictions entered due to the Pandemic COVID-19, at the end of December 2020, the meeting was held online: there was a broadcast on the YouTube Channel of the Commission. Business asked questions in the row of comments for broadcast, we promptly published the answers.
We believed, it's time to transform a public reception. We want to create a place where we can regularly consult with business and practicing lawyers, discuss current problems, develop general solutions in brainstorm mode.
This is a new format of "open doors", where the most pressing issues will be discussed without a bureaucracy. We want a business to form our agenda. We create a digital ecosystem, where to build the interaction of the main participants: "Platform (our digital resource) - a business consumer."
The platform works on the "open window" principle: in it by means of appealing through the website of the Commission, through the public reception or our pages in social networks will not only be able to contact the representatives of the business, but also citizens of the EAEU countries. This will help us to take into account the opinion of business and consumers in the definition of our agenda. For example, on the Competitive Block page on the website of the Commission there is a feedback form, with which there is always the opportunity to ask questions about questions and get answers. The page on Facebook is also being conducted, where it is easy to track events, news, announcements of events - "Business Navigator EAEU".
- Earlier, an idea was announced on the introduction of one of the tools of prophylactic nature - antitrust compliance. How do you assess the prospects for such innovation?
- For us, the introduction of the Institute of Antimonopoly Compliance to the EAEU Right is one of the priorities. It is important that the business not only eliminated the violation of the rules of competition, but also corrected its internal processes to prevent the revisions in the future.
We plan to develop new approaches to antitrust compliance based on a standardization system. In two of the five countries, the EAEU This institution has been successfully functions and shows positive results. It is necessary to collect and analyze the entire best global practice and on its basis, taking into account the features of the EAEU, to develop a practical guide for companies to develop, implement, functioning and evaluating the effectiveness of antimonopoly complens, standardize procedures. It is also necessary to establish the requirements for independent experts who will make conclusion about the compliance of the enterprise policy to the established requirements.
The introduction of this function will allow business owners in a timely manner to identify antitrust risks, adopt an exhaustive set of measures to prevent the occurrence of violation of antimonopoly legislation and, accordingly, to achieve its operating goals. The main emphasis here will be on the initiative of entrepreneurs who independently and, most importantly, will voluntarily decide on the need to introduce antimonopoly compliance in their activities.