The aim of competition protection is to ensure fair competition between undertakings on the market and consequently a greater variety of choice and better quality goods and services at lower prices for consumers.
Competition protection provides that undertakings compete with each other fairly and under equal conditions and that competition is not restricted or undermined in ways that are damaging to the economy or society. Competition protection in the Republic of Slovenia is regulated by the Prevention of the Restriction of Competition Act .
The rules on competition protection prohibit restrictive agreements and the abuse of an undertaking’s dominant position and also include an assessment of whether the concentrations between undertakings comply with competition rules.
Restrictive agreements are agreements between undertakings, decisions by associations of undertakings and concerted practices of undertakings that have as their object or effect the prevention, restriction or distortion of competition on the territory of the Republic of Slovenia and are prohibited and null and void in accordance with Article 6 of the Prevention of the Restriction of Competition Act.
The abuse of a dominant position on the market by one or more undertakings on the territory of the Republic of Slovenia or on a substantial part thereof is also prohibited. The undertaking or more undertakings are considered to have a dominant position when they can, to a significant degree, act independently of their competitors, clients or consumers.
The concentration between undertakings means that a change of control over an undertaking arises on a lasting basis, namely:
- upon the merger of two or more previously independent undertakings or parts of undertakings;
- where one or more natural persons already controls at least one undertaking, or where one or more undertakings, by purchasing securities or assets, by contract or by any other means, acquire direct or indirect control of the whole or parts of one or more other undertakings;
- where two or more independent undertakings create a joint venture that performs all the functions of an autonomous undertaking on a lasting basis.
The Slovenian Competition Protection Agency is responsible for overseeing the protection of competition in the Republic of Slovenia.
In the case of restrictive practices, the agency initiates a procedure ex officio if it learns of circumstances due to which there is a probability of an infringement of the prohibition of restrictive practices or the prohibition of the abuse of a dominant position or equivalent provisions of the Treaty on the Functioning of the European Union.
According to the Prevention of the Restriction of Competition Act, an infringement of these provisions is a minor offence fined up to ten per cent of the annual turnover of the undertaking in the preceding business year. The responsible person of the legal person or individual sole trader is also liable for the offence and can be fined from 5,000 to 10,000 euros.
If a restrictive practice affects several European Union Member States, the infringement procedure is implemented by the European Commission. The European Commission has the power to not only investigate but also to adopt commitment decisions and impose fines.
Restrictive agreements and abuse of a dominant position are usually to the detriment of other undertakings and consumers. The undertakings and consumers can claim compensation for the damages incurred due to illegal practices that restrict competition.
Competition protection rules also refer to concentrations between undertakings.
Combining the activities of different undertakings may allow the undertakings, for example, to develop new products more efficiently or to reduce production or distribution costs, expand their markets and thus benefit the economy. Through their increased efficiency, the market becomes more competitive and consumers benefit from higher-quality goods at fairer prices.
However, not all concentrations between undertakings comply with competition rules. Concentrations that would significantly impede effective competition on the territory of the Republic of Slovenia or on a substantial part thereof, in particular as a result of the creation or strengthening of a dominant position, are prohibited.
The agency assesses the compliance of the concentration with competition rules in a procedure initiated either on the proposal of the notifying party or ex officio when it is demonstrated that there is a possibility that a concentration governed by the provisions of the Prevention of the Restriction of Competition Act has occurred and the undertakings failed to notify the agency thereof. Following the procedure the agency can establish:
- that the concentration of which it has been notified does not fall within the scope of the provisions of the Prevention of the Restriction of Competition Act;
- that the concentration of which it has been notified complies with competition rules;
- that the concentration of which it has been notified does not comply with competition rules and the agency prohibits the concentration.
A fine of up to ten per cent of the annual turnover of an undertaking involved in a concentration together with other undertakings in a group in the preceding business year may be imposed on a undertaking when
- they fail to notify the agency of a concentration subject to the provisions of the Prevention of the Restriction of Competition Act;
- they fail to notify the agency of a concentration within the time limit referred to in the act;
- they implement rights or obligations arising from the concentration in contravention of the act;
- they fail to implement corrective measures or obligations imposed by a decision on the compliance of the concentration with the competition rules;
- they act in contravention of the decision declaring a concentration incompatible with competition rules;
- they act in contravention of an enforceable decision issued by the agency.