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01 July 2021

Croatia: Better late than never: Supreme Court upholds CCA's cartel decision after almost six years

In June 2014 the Croatian Competition Agency (CCA) rendered an infringement decision in which it found that by adopting and publishing the document "Minimum Price List of Orthodontic Services" from 1 October 2010 until 9 October 2013, the Croatian Orthodontic Society (COS) had concluded a 'prohibited agreement' within the meaning of Article 8(1) of the Competition Act. The CCA imposed a symbolic fine of HRK150,000 (approximately €20,000) on the COS. The "Minimum Price List of Orthodontic Services" was established ex lege to be null and void. The fact that the price list had not been binding for the members of the association and that they were not penalised if they did not observe it was taken into account when setting the fine but could not discharge the association from liability in this cartel case.

The COS filed an administrative claim with the High Administrative Court, which surprisingly confirmed the claim and overturned the CCA's prohibition decision. In doing so, the High Administrative Court rendered a decision in contravention of the overall concept of a cartel, as set out in the Competition Act and the Community acquis. The CCA correctly pointed out that if such a ruling and understanding of the concept of a cartel remained in force, it would constitute a precedent that would jeopardise the interests of consumers, undertakings and competition policy in general.

As there was no regular legal remedy against the judgment of the High Administrative Court, in July 2015 the CCA sent a proposal to the State Attorney's Office to submit a request to the Supreme Court for an extraordinary review of the legality of the judgment.

Finally, after reviewing the legality of the judgment, the Supreme Court found the CCA's infringement decision to be correct and confirmed that by adopting and publishing the document, the COS had concluded a prohibited agreement. The Supreme Court also repeated the very statements made by the CCA during the administrative proceeding – namely, that the law does not empower any association of undertakings to fix the prices of its members' products or services and that any fixing of minimum or fixed prices constitutes an object infringement of competition rules. In such cases, no examination of the agreement's actual or potential effects on the market is necessary.

This article was first published on International Law Office, 24.06.2021.
authors: Ana Marjančić and Srdjana Petronijević


Attorney at Law in cooperation with Schoenherr