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Serbian Competition Commission Closes the Bid-Rigging Investigation with Sanctions

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By its decision dated 29 December 2023, the Serbian Competition Commission determined that the companies KTG Solucije and Eco Sense from the town of Subotica (in Serbia) entered into a restrictive agreement by colluding in public procurement procedures (i.e., bid rigging).

The Commission opened this investigation in May 2023 based on a complaint and following the misdemeanour procedure initiated against the companies by the Office for Public Procurement for a breach of the Public Procurement Law. During the court hearing, it was alleged that one of the accused companies had been withdrawing from public procurement processes with the aim of inducing the purchaser in public procurement to enter into an agreement with the second-ranked bidder (the other accused party) but at higher prices.

During the Competition Commission’s investigation, the dawn raids were conducted at the companies’ premises which revealed the direct email communication between the companies regarding the withdrawal from public procurement processes. Simultaneously, the Commission analysed Internet Protocol addresses and determined that the parties used the same Internet Protocol address, at the same time, to access the Public Procurement Portal and submit bid documentation.

The Commission demonstrated leniency in its fining policy in this case, considering the very low annual turnovers of the parties (i.e., below EUR 1 million in 2022) and the fact that the parties cooperated with the Commission during the process. It is noteworthy that the party that admitted the infringement first and identified an additional bid rigging not covered by the initial Commission’s analysis received a fine of approximately 50% less than the other party.

This case highlights the Competition Commission’s readiness to cooperate with other state authorities and its eagerness to use all available technical tools to identify potential competition infringements. Additionally, it is important to note that the Commission has shown appreciation for the parties’ cooperation in the form of a much lower fine for the cooperating party.

The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.

By Bojana Miljanovic Hussey, Partner, Karanovic & Partners

Serbia Knowledge Partner

SOG in cooperation with Kinstellar is a full-service business law firm in Serbia that provides foreign and domestic clients with premium-quality legal advice and assistance across a wide range of key areas of corporate law. The firm was founded in 2015 by a group of seasoned, internationally-trained lawyers. SOG has developed a distinctively dynamic culture, bringing together top talent, fostering entrepreneurship, and maintaining exceptional relationships with its clients.

SOG has achieved consistent growth in the volume of its business, accompanied by an exponential increase in the number of hired associate lawyers and the firm’s network of business contacts. SOG has a robust client base of multinationals, investment and private equity firms, and financial institutions. Clients praise SOG for being commercially minded, very responsive and knowledgeable.

Establishing permanent cooperation with Kinstellar is part of realising SOG's long-term development strategy to be the leading provider of legal services in the Western Balkans market.

Firm's website: https://www.kinstellar.com/

 

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