Guidelines under scrutiny horizontal mergers and the interplay between law and practice in Macedonia

• Author: Nora Memeti
• Position: Kuwait International Law School
• Pages: 256-274

Vol. 2 No. 1

January, 2018

European Journal of Economics, Law and Social Sciences

IIPCCL Publishing, Graz-Austria

ISSN 2519-1284

Acces online at www.iipccl.org

256

Guidelines under scrutiny horizontal mergers and the interplay between law

and practice in Macedonia

Nora Memeti

Kuwait International Law School

Abstract

TheadoptionofthenewGuidelinesonAssessmentofHorizontalMergersGHM inis

asignicantdevelopmentin theeldof competitionlawofMac edoniaandassuch requires

alegal analysis ofits relevance andapplication The distinctivefeature of the GHMis that

they reduce the number of undertakings from the relevantmarket or remove at least one

independent seller with a consequent increase in market concentration These guidelines

servetodemonstratethattheassessmentofmergers needstogobeyondthedenitionofthe

relevantmarketandthecalculationofmarketsharesHoweverbeingsolawbytheirnature

theGHMsprovidewide discretiontothe Commissionfor Protectionof CompetitionCPC

indetermining howmergers willbe assessedin practiceWiththis inmind thisresearch is

structuredin threeparts therstpart providesfor short overview of the functions, powers

and duties of the CPC in light of GHMsThe second part discusses the decisions of CPC

regarding horizontal mergers in  in correlation with GHM and the third part focuses

mainlyontheapplicationofGHMandthedierencesbetweentheEuropeanUnionEUand

Macedonian GHMsIn light of these developments the application of competition law in

Macedoniaisfacingsignicantchallengesandalsoshowsincoherencebetweenthelegislation

adopted and its application in practice.

Keywords: competition lawguidelines horizontal mergers European union Macedonia

market shares, market concentrations.

Introduction

The EU Annual Progress Reports Progress Report  and  do not note a

remarkableprogressintheareaofCompetitionLawofMacedoniaHoweverthereis

improvementintheadoptionofsolawintheformofsecondarylegislationincluding

amongothersnoticesandguidelineswithinmergersProgressReportChapter

pgInpracticeneverthelesstheirapplicationisdiminutiveandthisisobserved

by the decisions issued by the CPC. Infacttheguidelines weremerely mentioned

inonlyfourdecisionsoutofmore thandecisionsandonlyinonedecisionthey

wereinadequatelyapplied Twoofthese decisionswere basedon articles and

of theLawfor Protectionof Competition LPCand three ofthem arebased on

articlesandofthesamelawoutofwhichfourareacquisitionsandoneisaJoint

 The abbreviationGHMwill interchangeablyapplyto thetermGuidelines andattimes willreferto the

EuropeanUnionEUGHMastheEUGHMortheMacedonianGHMasMKGHM

 ThevecasesareCPCDecupnoAcquisitionbetweenTevaPharmaceuticalandAlergenplcCPCDec

upnoAcquisitionbetweenADImplekandNiskaMlekaraCPC DecupnoJointVenturesbetween

Nestle and PaiPartner SAS CPC Dec upno Acquisition between Cajna National and Agrochemical

Corporationand SyngentaAG andthe lastone CPCDec upno An acquisitionbetween Orbikoand

EveretInternationalAllareshownillustrativelyinthetablenumber

European Journal of Economics, Law and Social Sciences

IIPCCL Publishing, Graz-Austria

Vol. 2 No. 1

January, 2018

ISSN 2519-1284

Acces online at www.iipccl.org

257

VentureTwodecisionsTevaPharmaceuticalandADImplekaremorerelevantand

willbeaddressedinmore detailinthispaperFortheremaining threeanoverview

isprovidedintable seebelow Intherstdecisionexceptforprocedural lawthe

relevantsubstantivelawswillbe examinedandexplainedwhich areappliedtoall

decisions in general terms The second decision is considered substantial for this

researchbecauseitistheonlyonewheretheguidelines applyThiswillbeusedas

anopportunityto analyzethe applicationofGHMsinthesedecisionsKolaskyW

J DickAR Theirapplication reachesthe HHI factorwithout taking into

theconsideration whether the created eects are coordinativeor noncoordinative

GrudaSBushatiBDibraAThispaperendswithageneralcomparison

betweentheEuropeanandthe nationalGHMandconcluding remarksthatprovide

forrecommendationsandsuggestionsontheroleofCPCandtheGHMs

The Commission for protection of competition (CPC)

TheCPCis the highest and the only besides the Government andtheAssembly

authorityresponsibleforprotectionofCompetitioninMacedoniaBasedontheLaw

onProtectionofCompetitionLPCthisinstitutionisaccountabletotheMacedonian

Parliament and formally is an operationally independent authority Article  of

LPCCPCmayapprovemergerswithor withoutconditionsorevenprohibitthem

In terms of implementation based on its ocial websitehpwwwkzkgovmk

engthe CPC has functioned relatively wellduring  with a total of

decisionsadoptedoncartelsandabusesofdominantpositionwithnesamounting

toEURmillion IntheEuropean Commissionsannualreportfortheweak

administrativecapacity of CPC is underlined jointly with the insucientbudget

ThelatestEUProgressReportofnotesthattheex antecontrolCosnitaLanglais

A  TropeanoJ P  Kocmut M  JurM   of mergers and some

otherissues relatedtootherpillarsThisreportpointsoutthat thereis noprogress

in the eld of competition law in general Comparing national legislation with

EUCompetition rules andtheirenforcement the reportstates that there isa huge

dierencebetween thetwo while therst is relativelyadvanced onone hand the

secondneedssignicantimprovementEUProgressReportpg

The application of competition rules has the purpose to establish a market where

allundertakingsareequaland perform under equal conditions and their position on

themarket shouldbemeasured accordingtothe qualityof the goodsand services

they oer Moa M  The legislative framework of Mergers in Republic

of Macedonia RM is broadly and mainly aligned with Articles  restrictive

agreementsRoussevaE and Article abuseof dominantposition Kalén

AoftheTFEUandwiththecorrespondingprovisions oftheStabilizationand

AssociationAgreement SAA andcertainly the ECMR Mergersin Macedonia are

regulated under the third pillar within Law for protection of Competition LPC

in Macedonia Guidelines to the LPC The EC Merger Regulation is the basis for

 WithregardtotheadministrativecapacitytheAnnualReportsoftheEuropeanUnionpointoutthathuman

resourcesoftheCPCseemsucientbutthelevelofexpertiseshould beimprovedThetranslationoftheweb

siterelatedto thelawsand decisionsfrom MacedonianlanguageintoAlbanian andEnglishneeds tobe well

timedandeectivelyapplied