New competition tools: the way to more efficient competition law enforcement

Ladies and gentlemen,

let me start with a provocative question: "Can a competition authority in the 21st century be a mere 'rule-keeper' or should it become the architect of the market environment?" Our experience in recent years shows that the traditional model of repressive enforcement is no longer sufficient on its own. We also need to be creators of the conditions for healthy competition, not just resolvers of breaches.

The activities of the Competition Authority should therefore not be limited to investigating cases or imposing heavy fines, but should also focus on removing administrative barriers to competition, building a single market in the EU, etc. It is our responsibility to be more proactive in drafting legislation and regulations to ensure that the legal framework responds to the dynamically changing economic reality.

We are witnessing a rapid evolution of ways of distorting competition. We are seeing more effective collusion by undertakings, an increase in so-called tacit collusion and more sophisticated strategies to close markets to competition by dominant players. The Competition Authority must be ready and able to respond flexibly to these challenges. If it remains passive and does not introduce new instruments, it will sooner or later remain toothless in the face of such practices.

That is why, as part of our legislative initiative, we have put forward proposals that should give us more effective tools to combat these practices. However, this proposal is unlikely to be adopted in its current form, but we will continue to push for its adoption and will present it in 2026. We are counting on the possibility that it will not be identical. We want to use this opportunity to discuss possible improvements to the proposed instruments, because it is very important for us to come up with truly effective instruments that will be able to withstand the 'current world'. We also intend to consider other legislative changes in the area of procedural issues that would help to make competition law enforcement more effective. In this context, we are of course planning to hold a workshop focusing on the key institutes of this proposal and their impact on the market.

Let's take a closer look at the steps that should make our operations more efficient.

1.      Intervening in the legislative process, strengthening cooperation

Particularly recently, we have encountered draft laws creating unnecessary administrative or other barriers that hinder the development of competition. Often, they disproportionately increase the cost of market entry and reduce competitiveness not only at national level, but also within the European Union as a whole. At other times, they are even proposals that may distort or facilitate competition. We therefore want to be much more proactive ex ante and publicly draw attention to such risks, appeal to the government, legislators and intervene to ensure that laws are adopted with the least possible negative impact on competition. Competition should remain as open as possible to all those wishing to enter the market.

In addition to the laws themselves, we will also focus on the control of decrees, regulations, technical standards and other sub-legislation that may hinder the entry of new undertakings into the market or otherwise negatively affect the competitive environment. We want to actively advocate that all new and existing legislation should be as least distortive to competition as possible and that it should be proportionate and necessary to safeguard the public interest. We also plan to strengthen cooperation with relevant ministries, regulators and other public authorities in this area and hopes to actively engage with the business community.

2.      Amendment to the Czech Competition Act

The aim of the draft legislative amendments to the Competition Act was primarily to increase the effectiveness of the Office in detecting and punishing anti-competitive conduct and in promoting the development of competition. In particular, it involved the introduction of a new competition tool, the call-in model and the punishment of individuals for cartel agreements.

Call-in model

In proposing the call-in model of merger review, we have based our approach on the practice of recent years, when the Office has been repeatedly approached by market participants with concerns about mergers of competitors that, although not meeting the turnover criteria, could significantly distort competition. The proposed model should allow us to intervene in such situations. Although the original proposal contained several criteria, after a number of internal discussions, we concluded that in order to make this issue as effective and relevant as possible for a healthy competitive environment, it would be useful to modify the proposal so that we could intervene at any time when competition concerns exist.

Measures of a general nature

We also proposed a new instrument in the form of a measure of a general nature. This would allow us to respond to situations where there are persistent distortions of competition in certain markets that cannot be effectively addressed by existing means, i.e. neither by sanctioning cartels nor by intervening against abuse of dominance or merger control.

On the basis of the results of the sector inquiry, we could issue a measure of a general nature for up to 3 years, which would, for example, make all mergers in a particular market subject to authorisation or define a relevant market where there is a persistent significant distortion of competition. In addition, we could impose remedies on undertakings, in the form of behavioural and structural commitments, in order to restore effective competition.

Punishment of natural persons

In addition to the structural instruments, the proposal also included the possibility of sanctioning individuals involved in anticompetitive agreements. So far, only legal persons can be sanctioned. Agreements are often organised or executed by specific individuals, managers, owners or employees. In cases of so-called secret target agreements, i.e. the most serious anti-competitive behaviour, we would like to be able to impose a substantial fine or a ban on these individuals. We believe that this will not only increase individual accountability, but also encourage the use of leniency applications, including by individuals.

3.      Conclusion

Ladies and gentlemen,

The proposal for new competition law instruments shoud not be a revolution, but a thoughtful strengthening of our institutional framework. The aim is to protect competition more effectively for the benefit of consumers, fair market conditions and innovation. With the speed with which the new economic reality is evolving, I am convinced that competition authorities urgently need to introduce new, more effective tools to be able to intervene when competition concerns are raised.

Thank you for your attention and I look forward to further discussion.