Recent developments in Romanian competition law
February 2012 – A review of recent developments in Romanian competition law.
Criminal Offence under Competition Law No. 21 / 1996
Bogdan Chiritoiu, the president of the Competition Council has recently issued a press statement advocating for the application of criminal sanctions in cases of antitrust infringements. Article 60 of Competition Law No. 21 / 1996 qualifies as criminal offence the participation of a natural person, with a fraudulent intention and in a decisive manner to the conception, organisation or achievement of prohibited anti-competitive practices or agreements. The afore-said criminal offense shall be punished by imprisonment from six months to three years or by fine.
This public message issued by the president of the Competition Council may signal a change in the policy of the Competition Council and may prove to be a warning that the Competition Council and the public prosecutors will be looking to apply the provisions of Article 60 of Competition Law No. 21 / 1996, which so far have not been enforced.
Unfair Competition Act Draft
On 23 December 2011, the Competition Council launched a public consultation on the draft of law on unfair competition which aims to replace Law No. 11 / 1991 on unfair competition currently in force.
An important development relates to the authority of the Competition Council to investigate and sanction unfair competition acts of interest for the proper functioning of the economy or a part thereof. For this purpose, the Competition Council will have the right to use the dawn raid and the other procedures provided by the Competition Law No. 21 / 1996.
Under the current draft, the Competition Council will have the right to sanction acts of unfair competition with fines up to 3% of the total turnover achieved during the year previous to the sanctioning decision.
Amendments of the Regulation on Economic Concentrations
On 11 January 2012, the Competition Council’s Order No. 941 / 2011, amending and supplementing the Competition Council’s Order No. 385 / 2010 for the application of the Regulation regarding economic concentrations, has been published in Official Gazette No. 23. The most important amendment introduced by Order No. 941 / 2011 is related to the procedure regarding economic concentrations that are likely to generate national security risks and the referral of notifications to the Supreme Council of National Defence (the “CSAT”).
Pursuant to Order No. 941 / 2011, when an economic notification is filed with the Competition Council, the latter has the obligation to inform CSAT and, where national security risks are identified, a separate analysis of the economic concentration will be carried out in parallel by CSAT.
If CSAT identifies any risks resulting from the proposed economic concentration for the national security, the Government will issue a decision through which the operation is prohibited.
Order No. 941 / 2011 also specifies that in case a concentration is not subject to a notification to the Competition Council due to the thresholds not being met or if the operation is not a notifiable concentration, the parties have the duty to directly inform CSAT in order for the transactions to be assessed in terms of national security risks.
Oder No. 941 / 2011 raises several important practical questions that investors will have to consider in the future, such as: can the parties implement the transaction if the clearance of the Competition Council is obtained prior to that of CSAT or will the parties have to wait also for that of the CSAT? What qualifies as a national security risk and on what grounds can the parties contest a decision of CSAT? Last but not least, will every transaction of acquisition of control has to be notified to CSAT and what are the sanctions for failure to notify?
For more details and questions related to the above, please contact Iustinian Captariu, Counsel, at .