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LASZLO GYERKOCompetition Councillor, Member of the BoardRomanian Competition Council

Sofia Competition ForumNovember 12th, 2012

Bringing benefits of competition to Bringing benefits of competition to low-income groupslow-income groups-priorities for NCAs--priorities for NCAs-

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Competition and poverty reductionCompetition and poverty reduction

Direct relationship

Lower prices for basic necessities

Lower costs for businesses

Incentives for innovation and investment

Developing and transition economies –

more vulnerable to anticompetitive

practices

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Areas of interventionAreas of intervention

Advocacy initiativesAdvocacy initiativesCompetition policy – priority area for reformPromote wider understanding in all levels of governmentRemove regulations that create barriers to entry and prevent benefits from reaching targets

Effective enforcement actionsEffective enforcement actionsFocus on unnecessary distortions (cartels, abuse of dominance)

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Advocacy toolsAdvocacy tools

Need of appropriate operational tools

RIA – competition filterAttending Gvt preparatory meetingScreening draft normative actsConcluding cooperation protocols with Gvt authoritiesSetting up common working groups (e.g. Bid Rigging Module)

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Setting priorities – key sectors with Setting priorities – key sectors with outstanding impact on overall populationoutstanding impact on overall population

2004 – 13 key sectors (energy, telecomm, postal services, food retail etc)

List reviewed regularly Market studies and sector inquiries Results and recommendations –

enforcement actions and specific advocacy initiatives

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Advocacy actions - Retail banking Advocacy actions - Retail banking

Harmonization with EU Directive on consumer credit (2010) – extension of scope in ROProposal of RCC -elimination/reduction of the early reimbursement fee to all types of consumer loansImpact analysis (2011):increased client mobility, lower switching costshigher competition on the retail banking market

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Advocacy actions - Retail banking Advocacy actions - Retail banking

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Advocacy actions – public Advocacy actions – public procurementprocurement

Organizational changes – dedicated unit for PP

Cooperation protocols Implementation of international best

practices – OECD Guidelines on Bid Rigging, introduction of CIBDs

Enforcement actions – 3x no. of investigations on bid rigging in 2011 and 2012

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Liberal professionsLiberal professions

Enforcement actions – taxi services, dental technicians, bailiffs, accountants

Issues for intervention (ex-ante - advocacy or ex-post - enforcement)

Setting min/max fees and tariffs Barriers to entry Consultations in professional associations –

facilitator of cartels

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Sector inquiry – milk marketSector inquiry – milk market Asymmetry in bargaining power between

supply and demand Role of contracts Price transparency Impact of EU agricultural policy Codes of best practices

Recommendations: Amendments of the legislative framework Market mechanisms Correction of asymmetries (i.e. framework

contracts)

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ConclusionsConclusions

Benefits may only be generated by:

Setting priorities Effective enforcement Supporting policies Advocating for Gvt support Raising awareness

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Thank you for your attention!Thank you for your attention!