The proceedings brought by the Serbian Commission for Protection of Competition against incumbent telecom operator Telekom Srbija a.d. for alleged abuse of dominance on the wholesale ADSL broadband access and the wholesale direct internet access (internet transit service) markets, was closed by a decision of the Commission dated 14 November 2014 making set of commitments offered by Telekom Srbija a.d. binding.
The probe against Telekom Srbija a.d. was initiated in October 2011. In its Statement of Objections of 16 August 2013, the Commission expressed concerns that Telekom Srbija a.d. abused its dominance on the wholesale ADSL broadband access and the wholesale direct internet access markets, allegedly by engaging in margin squeeze, price discrimination, tying and imposition of unfair contractual terms.
On 7 August 2014 Telekom Srbija a.d., represented by Živković Samaradžić, offered commitments to meet the concerns expressed by the Commission in its preliminary assessment, and in particular:
– to set its prices on the retail ADSL broadband access market in accordance with the “equally efficient operator” test;
– to apply the same direct internet access price / bandwidth volume ratio it applies to wholesale clients to its retail division;
– not to grant wholesale ADSL broadband access discounts conditioned by simultaneous wholesale direct internet access purchases, and
– to maintain an option for its wholesale direct internet access customers to enter into new, or renew old contracts for the duration of one, two, or three years, based on the user’s preference.
Proposed commitments were market-tested and the Commission found in its decision that they do remedy the competition concerns. Thus, the Commission decided to make them legally binding.
Unlike the European Commission that closes more than 75% of its antitrust probes by means of commitments, this was the first time ever that the Serbian Commission for Protection of Competition closed any abuse of dominance case in that way. What is even more important for Telekom Srbija a.d., the case was closed without a finding of infringement and without a fine levied.
Decision of the Commission, in Serbian language, is available at: http://www.kzk.org.rs/kzk/wp-content/uploads/2014/11/Zakljucak-o-prekidu-postupka-pokrenutog-protiv-Preduzeca-za-telekomunikacije-Telekom-Srbija-ad-Beograd.pdf
Živković Samardžić team representing Telekom Srbija a.d. in this case was led by Slobodan Kremenjak, Živković Samardžić Competition, Technology, Media and Telecommunications partner.