Restraints of Trade and Dominance in Ukraine: Overview
June, 2015 - Igor Svechkar, Oleksandr Voznyuk
Restraints of trade - Scope of rules: 1. Are restrictive agreements and practices regulated? If so, what are the substantive provisions and regulatory authority? Restrictive agreements and practices may qualify as anti-competitive concerted practices (that is, practices that resulted or may result in prevention, elimination or restriction of competition). There is a general prohibition of anti-competitive concerted practices, unless an exemption applies (see Question 3). Anti-competitive concerted practices are subject to administrative sanctions under the Law of Ukraine on Protection of Economic Competition 2001 (Competition Law). In addition, third parties that sustained damage as a result of such violations may claim damages (see Question 14). There is no criminal liability for these violations.
In addition to the Competition Law, the regulatory framework includes the:
- Law on the Antimonopoly Committee of Ukraine 1993 (Law on the AMC).
- AMC Methodology for Establishment of the Monopoly (Dominant) Position of the Undertakings on the Market 2002 (Monopoly Methodology).
- AMC Resolution on the Procedure for Filing Applications with the AMC for Obtaining its Approval of the Concerted Practices of the Undertakings 2002 (Concerted Practices Regulation).
- AMC Resolution on the Standard Requirements to Concerted Practices of the Undertakings for their General Exemption from the Requirement to Obtain Prior AMC Clearance 2002 (General Exemption Regulation).
- AMC Resolution on the Standard Requirements to Concerted Practices of the Undertakings concerning Specialisation of Production 2008 (Specialisation Regulation).
- AMC Resolution on the Standard Requirements to Concerted Practices of the Undertakings concerning Joint R&D and/or Development and Engineering Works 2012 (R&D Regulation).
- Regulation on the Procedure Application of Leniency 2012 (Leniency Regulation).
Concerted practices are defined as follows (Competition Law):
- Agreements in any form (including verbal arrangements and networks of agreements).
- Decisions of associations of undertakings.
- Any co-ordinated practices (actions or omissions) of the undertakings.
- Establishment of an undertaking or an association (or entry into an association) aiming at, or resulting in, the co-ordination of the competitive behaviour of the:
- undertakings that established a new undertaking or an association; or
- undertakings that established a new undertaking or an association, on the one hand, and the new undertaking, on the other.
Anti-competitive concerted practices most commonly include, among others (Competition Law):
- Fixing prices or other purchase or sale conditions.
- Limiting production, markets, technological development or investment, as well as assuming control of them.
- Dividing markets or sources of supply according to territory, type of goods, sale or purchase volumes, or classes of sellers, buyers or consumers.
- Distorting the results of trading, auctions, competitions or tenders.
- Ousting other companies from the market or limiting their market access.
- Applying different conditions to identical agreements to put a specific company at a disadvantage.
- Executing agreements that are conditional on the contracting party's acceptance of additional obligations unrelated to the subject of the agreement.
- Substantially limiting the competitiveness of other companies without justifiable reasons.
- Parallel behaviour (actions or omissions) that resulted or may result in the prevention, elimination or restriction of competition is also considered a violation, unless there are objective reasons for this behaviour.
Regulatory authority
The Antimonopoly Committee of Ukraine (AMC) is the primary authority entrusted with ensuring protection of competition. In particular, it has powers to investigate, as well as grant or refuse granting the authorisation for concerted practices. If the AMC refuses to approve the concerted practices, the Cabinet of Ministers of Ukraine (CMU) may overrule that decision (see Question 3, Individual exemption and Question 5, Relevant authority).See box, The regulatory authority.
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