Serbia: Merger Control

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This country-specific Q&A provides an overview to merger control laws and regulations that may occur in Serbia.

It will cover jurisdictional thresholds, the substantive test, process, remedies, penalties, appeals as well as the author’s view on planned future reforms of the merger control regime.

This Q&A is part of the global guide to Merger Control. For a full list of jurisdictional Q&As visit

  1. Overview

    KN: The merger control regime in Sebria is modelled after and, to a large extent, harmonized with the EU merger control regime. Nevertheless, certain local particularities exist, the main ones being as follows.

    The Law on Protection of Competition (“Official Gazette of the RS”, no. 51/09 and 95/13; the “Competition Law”) which is effective since 1 November 2009 governs the merger control regime. Furthermore, several by-laws relevant to the merger control have been adopted including: the Regulation on the contents and format of submissions of notifications, the Regulation on the criteria for determination of a relevant market, the Decision on tariffs charged for practices before the Competition Commission etc. The Law on General Administrative Procedure is umbrella legislation (i.e. lex generalis) that governs points that are not specifically dealt with under the Competition Law. Furthermore, laws such as the Law on Administrative Disputes, the Law on Electronic Media, the Company Law etc. may apply as subsidiary laws where applicable.

    The competent authority is the Competition Commission of the Republic of Sebria (the “Commission”; in Serbian: Komisija za zaštitu konkurencije Republike Srbije). Specialised department within the Commission i.e. so called the Sector for Assessment of Concentration, has been dedicated to merger control matters and it is in charge of analysing concentrations as well as for preparing draft clearance decisions. The decision-making bodies are either the President of the Commission or the five-member Council (that includes the President of the Commission).

    The filing is mandatory in Serbia whenever the merger control thresholds have been met. However, concentrations that are implemented through public takeover of joint stock companies must be notified regardless of the filing thresholds.

    The merger control thresholds are turnover-based and there are no exceptions. The Serbian merger control framework does not make any distinction between domestic and foreign transactions or transactions with or without local nexus. The Competition Commission regularly examine foreign-to-foreign transactions where the merger filing thresholds have been met, without applying the “local effects doctrine”.

    The 15-calendar day filing deadline runs from conclusion of the transactional agreement, announcement of public bid, or acquisition of control - whichever happens first.
    There is a stand-still obligation i.e. an obligation to fully suspend implementation of the concentration prior to obtaining clearance or prior to expiry of the statutory waiting period.

  2. Is mandatory notification compulsory or voluntary?

    KN: Notification is mandatory provided merger control thresholds have been met.

    Acquisition of a joint stock company established in Serbia (being implemented through public offer pursuant to the relevant laws governing the takeovers of joint stock companies) trigger mandatory merger notification irrespective of the merger control thresholds.

  3. Is there a prohibition on completion or closing prior to clearance by the relevant authority? Are there possibilities for derogation or carve out?

    KN: Yes, the implementation of a concentration is subject to a stand-still obligation i.e. closing is prohibited until the clearance is issued or statutory waiting periods have expired.

    The exceptions on prohibition on closing are not available under the Competition Law even in urgent situations save for an exception provided for a specific scenario in relation to public bids. In particular, public bids are also caught by the stand still obligation. However, exceptionally parties may continue with the realization of a public sale provided that the merger notification was filed within the prescribed deadline and that the acquirer either does not exercise its managing rights after the registration of its share, or it may exercise its rights but solely for the purpose of protecting the value of the target company and solely based on a special approval by the Competition Commission. In practice, however, the Competition Commission has been rather formalistic and has been reluctant to allow such exceptions even when the prescribed conditions seem to be met.

    Competition Law does not expressly provide for the carve-out options or hold-separate agreements, however it does not prohibit them either. The Competition Commission or the court has never given a formal opinion as to whether ‘carve out’ agreements are acceptable in practice and they have not been tested in practice before the Commission or the court. While this option is not without risks, it may be considered as an additional security in certain cases with the advice of a local competition counsel.

  4. What are the conditions of the test for control?

    KN: Control is defined as the possibility of exercising decisive influence on an undertaking. The general legal framework concerning control is closely modelled after the EU one and the European Commission’s Consolidated Jurisdictional Notice, including the rules on negative control (i.e. veto rights). Where there are no specific local rules prescribed the Competition Commission refers to the relevant EU rules and practice as persuasive authority.

  5. What are the conditions on minority interest in your jurisdiction?

    KN: Minority interests conferring control are caught by the merger control rules and there is no set % of the minority shareholding. Similarly to the EU, an acquisition of a minority shareholding may trigger the mandatory merger filing if the minority shareholder would be able to exercise decisive influence i.e certain controlling rights that fall outside the scope of ordinary rights normally afforded to a minority shareholder. In practice, there have been cases where the ability of a minority interest to veto or block strategic commercial decisions has been identified as exercising decisive influence.

    Given the lack of any specific local guidelines issued by the Commission, the Commission usually relies on the European Commission’s Consolidated Jurisdictional Notice and guidelines provided in applicable case law. The Commission is not, however, obliged to apply or follow EC guidelines and precedents therefore it is possible that it adopts wider or narrower approach in respect of minority shareholding.

  6. What are the jurisdictional thresholds (turnover, assets, market share and/or local presence)?

    KN: Merger filings are mandatory in Serbia if one of the two alternative thresholds are met:

    • if the combined annual turnover of all the parties to the concentration in the global market in the previous financial year exceeded EUR 100 million, where at least one of the parties to the concentration had an annual turnover in excess of EUR 10 million in the Republic of Serbia; or
    • the combined annual turnover of at least two parties to the concentration in the Republic of Serbia exceeded EUR 20 million in the previous financial year, where at least two of the parties to the concentration had an annual turnover in excess of EUR one million each in the Republic of Serbia.

    Intra-group turnover is not taken into account. Furthermore, a transaction which takes place pursuant to the Law on Takeover of Joint Stock Companies must be notified, even if the relevant thresholds have not been met. Although the law is not completely precise in this regard, this provision should pertain to local public companies only. Furthermore, the jurisdictional thresholds do not vary according to the industry or sector involved, however additional rules may apply to certain sectors (i.e. banking, insurance, telecommunications and media).

    Exceptionally, the Competition Commission has the authority to institute an ex officio merger control procedure if an un-notified concentration results in 40% or higher market share of the merged undertaking. The market share (40%) threshold is not a jurisdictional threshold, i.e., the parties are not obliged to file a notification with the Competition Commission if their combined market share in any relevant market exceeds 40%. However, to avoid a situation of ex post analysis, it may be advisable to notify the Competition Commission of the intended merger, if the parties’ market shares do exceed this threshold (in Serbia). Since the enactment of the Competition Law, we are not aware of any such ex officio proceedings.

    Foreign-to-foreign mergers are reviewed under Serbian competition rules if the parties fulfil the jurisdictional thresholds, which are no different for such transactions.

    The acquirer is reviewed on the group level while the target company is reviewed individually including its subsidiaries. The seller is normally not taken into account with the exception of a situation where the seller retains control in which case he is considered to be as one of the acquirers. In the case of the acquisition of joint control or joint ventures, both jointly-controlling parent companies are viewed individually as the undertakings concerned and, if joint control is acquired over an existing company, then the joint venture itself is also relevant.

    The thresholds can be met by turnover of just one party to the transaction, either the acquirer or the target. In practice, the vast number of filings related to cases where the acquiring group has met the thresholds while the target has little or no turnover or presence in Serbia. Both national and global turnover is taken into account.

    The relevant turnover thresholds refer to all revenues / assets and are not related to the relevant market.

    The jurisdictional thresholds do not vary according to the industry or sector involved.

  7. How are turnover, assets and/or market shares valued or determined for the purposes of jurisdictional thresholds?

    KN: Merger filing thresholds are solely turnover based.

    Turnover for the last financial year for which audited accounts are available is taken into account. In the Serbian legal system, a financial year runs from 1 January to 31 December. Intra-group turnover is not taken into account. The Competition Commission is reluctant to rely on management or any other form of provisional accounts in any but exceptional circumstances.

    Where a concentration takes place within the first months of the year and audited accounts are not yet available for the most recent financial year, the figures to be taken into account are those relating to the previous year.

    Aggregate turnover of the undertakings is calculated on a worldwide consolidated basis using figures from the preceding business year. The aggregate turnover of an undertaking concerned shall not include the sale of products or the provision of services between the undertakings affected by the concentration (thus, mutual transactions are not taken into account). There are special rules for the calculation of turnover of banks, other financial institutions, insurance companies and companies engaged in the reinsurance services.

    In relation to geographic allocation of turnover, the turnover is allocated according to geographic location of customer. There are no detailed rules in relation to this thus the EU rules would most probably be observed in practice.

    Special rules apply to the calculation of turnover of banks and other financial institutions – after VAT and other directly applicable taxes are deducted, their turnover is the sum of the following:

    a) Interest income;
    b) Securities income;
    c) Commissions receivables;
    d) Net profit from financial operations;
    e) Other operating income.

    Concerning insurance and other reinsurance companies, the value of gross premiums is used, which is comprised of all amounts received and receivables in respect of insurance and reinsurance contracts issued by or on behalf of the insurance companies, after deduction of taxes charged by reference to the amounts of individual premiums or the total volume of premiums.

  8. Is there a particular exchange rate required to be used for turnover thresholds and asset values?

    KN: The applicable exchange rates are the official median rates of the National Bank of Serbia. Serbian local currency is dinar (RSD). These exchange rates are updated daily and are available on the website of the NBS:

    With respect to the calculation of the turnover thresholds, the applicable exchange rate is the median exchange rate on 31st of December (or the last available) of the relevant year.

    On 30 December 2016, EUR/RSD median exchange rate was: EUR 1 = RSD 123.4723

    On 30 December 2016, EUR/RSD median exchange rate was: EUR 1 = RSD 117.1353

  9. Do merger control rules apply to joint ventures (both new joint ventures and acquisitions of joint control over an existing business?

    KN: There are no specific thresholds for joint ventures, the same jurisdictional thresholds apply to them. However, only joint ventures where “a new undertaking acting on a fully independent and long-term basis and having an access to market” is a joint venture subject to merger control. Purely cooperative joint ventures (i.e. where the joint venture is used by the parent companies to coordinate their behaviour on the market) to which merger control rules do not apply may be reviewed under the prohibition on anticompetitive agreements. Therefore, only full-function joint ventures are notifiable under the merger control rules and given the lack of local practice and guidelines the full-functionality is interpreted in line with the EU approach. The Competition Commission is not, however, obliged to apply or follow EC guidelines and precedents therefore it is possible that it adopts wider or narrower approach in respect of full functionality.

    Both changes of control over an existing joint venture and creation of a new joint venture may amount to a concentration. If a new joint venture is being formed, the turnover of parent companies is taken into account when assessing whether the merger control thresholds have been met. If controlled is being acquired or changed over an existing joint venture, in addition to joint venture parents, the joint venture itself is assessed for the purpose of merger control thresholds and in such situations double-counting of joint venture’s turnover should be avoided.

    Considering that local nexus is not required for merger control to apply in Serbia, the same goes for joint ventures. Even if the joint venture will have no actual or foreseen activities in Sebria provided the merger filing thresholds have been met by either of the joint venture partners, the filing would still be mandatory. The assessment of risk should be based on the likelihood of the Competition Commission ever finding out about the joint venture (e.g. regional transaction might be under a greater risk of enforcement than more distant transactions). However, each transaction should be assessed on a case-by-case basis by a local counsel.

  10. In relation to “foreign-to-foreign” mergers, do the jurisdictional thresholds vary?

    KN: The filing is mandatory and there are no legal exemptions to the notification obligation under the applicable legal regime in Sebria. The Serbian competition law does not make any distinction between domestic and foreign transactions or transactions with or without local nexus. The absence of local effect is not a mitigating element for a concentration to be non-notifiable in Serbia. The local competition authority regularly examines transactions where the merger filing thresholds have been met, without applying the “local effects doctrine”.

    If there are no significant horizontal overlaps or vertical links between the parties on the relevant market in Serbia, the filing would qualify for a short-form.

  11. For voluntary filing regimes (only), are there any factors not related to competition that might influence the decision as to whether or not notify?

    KN:Not applicable.

    However, the Competition Commission has the power to institute an ex officio merger control procedure if an unnotified concentration results in the merged undertakings having a market share above 40% (40% being one of the factors that could possibly lead to finding a dominant position and not a jurisdictional merger filing threshold). Therefore, in order to avoid a situation of an ex post analysis by the Competition Commission, it may be advisable to notify the transaction when parties’ joint market share exceeds 40%. To the best of our knowledge, however, there have not been instances of such ex post analysis so far in practice.

  12. Additional information: Jurisdictional Test

    KN: There are no sector-specific thresholds under Serbian merger control rules. However, under industry-specific regulations, certain additional filings have to be made with the relevant sectoral regulators e.g. banking sector, insurance, media, telecommunications etc.

    Third parties are not formally considered to be parties to a concentration according to the Competition Law.

  13. What is the substantive test applied by the relevant authority to assess whether or not to clear the merger, or to clear it subject to remedies?

    KN: The substantive test is based on assessing whether a merger would cause a significant prevention, restriction or distortion of competition, in particular as a result of the creation or strengthening of a dominant position on the market. The Competition Commission therefore applies the significant impediment of effective competition (SIEC) test.
    In applying the substantive test, the Competition Commission will take into account various factors and based on the Competition Law, it will especially consider the following:

    1. The structure of the relevant market;
    2. Actual and potential competitors;
    3. The market position of the parties to the concentration and their economic and financial power;
    4. Existence of possibility to choose a supplier and consumer,
    5. Legal and other barriers to entry on the relevant market;
    6. Level of competitiveness of parties to the concentration;
    7. Supply and demand trends of relevant goods and services,
    8. Technical and economic developments and trends; and
    9. Consumers’ interests.

    Given that there are no additional local guidelines in relation to this assessment, the Competition Commission may consult the relevant EU legislation and case law, although it is not obligated to do so.

  14. Are non-competitive factors relevant?

    KN: No. Such factor are not taken into account under Serbian merger control rules.

  15. Are there different tests that apply to particular sectors?

    KN: There are no sector-specific thresholds under Serbian merger control rules. However, under industry-specific regulations, certain additional filings have to be made with the relevant sectoral regulators e.g. banking sector, insurance, media, telecommunications etc. For instance, the Law on Electronic Media governs the protection of media pluralism specifically in relation to electronic media.

    So called “disruption of media pluralism” would exist if one party has ownership or managing rights in more than one broadcasters of electronic media in Serbia. Furthermore, the Law on Electronic Media prescribes that the Regulatory Authority for Electronic Media is obliged to review whether an acquisition represents a consolidation of ownership/control between broadcasters of electronic media causing prohibited disruptions to media pluralism.

    Should a “disruption to media pluralism” arise, the Regulatory Authority for Electronic Media will refuse to issue a broadcasting license or will nullify an existing broadcasting license if the parties do not remedy it within a given deadline.

  16. Are ancillary restraints covered by the authority’s clearance decision?

    KN: The Competition Law and relevant by-laws in Serbia do not specifically regulate ancillary restraints in mergers. However, the Competition Commission has in its practice consistently followed the approach of the European Competition Commission and, in particular, guidelines contained in the European Commission’s Notice on restrictions directly related and necessary to concentrations. In line with that, in order to qualify as ancillary, the restraint needs to be directly related to and necessary for the implementation of the concentration, as well as reasonable in geographical scope, subject matter and duration.

    Please note that Serbia still has in place an individual exemption regime and a restraint that amounts a restrictive provision (going beyond what is ancillary) would formally have to go through an administrative procedure before the Competition Commission (i.e. there is no self-assessment). However, in order to be exempt from prohibition, such a restraint would have to meet the criteria for individual exemption which are modelled after Article 101(3) criteria of the Treaty on the Functioning of the European Union. Individual exemption is time limited to a period of maximum eight years (with a possibility to apply for another exemption before the expiry of the initially granted term).

  17. What is the earliest time or stage in the transaction at which a notification can be made?

    KN: The filing is possible prior to signing of the binding transaction agreement, on the basis of a simple, non-binding document such as a letter of intent or a similar document such as memorandum of understanding which expresses serious intent of the parties to enter into a transaction.

    The only formality of such a non-binding document is that the document has to be signed by both parties. In the subsequently signed binding agreement, however, the parties should not materially deviate from the transaction structure as submitted in the merger notification based on the non-binding document that was approved by the Commission.

    The Competition Commission has thus far accepted such documents as valid acts of concentration. Also, if a filing is made based on such a document there is no 15-calendar day filing deadline, but the concentration is still subject to a stand-still obligation.

  18. For mandatory filing regimes, is there a statutory deadline for notification of the transaction?

    KN: Filing deadline is 15 calendar days from signing of an agreement, the actual acquisition of control, or making of a public invitation or an offer or closing of the public offer, whichever takes place first.

  19. What is the basic timetable for the authority’s review?

    KN: The length of review in Serbia depends on whether the case at hand raises competition concerns. If there are no competition issues in Serbia arising from the transaction, the Competition Commission may decide on summary (fast-track) proceedings (Phase I). In contrast, if the transaction raises competition concerns in Serbia, the Competition Commission may decide on in-depth proceedings (Phase II).

    For Phase I, the statutory deadline is one calendar month from filing a complete merger notification. Phase II can only be initiated after Phase I has expired. In Phase II, the Commission is obliged to issue a clearance within four calendar months as of the commencement of Phase II. If the Commission does not issue a decision either clearing (conditionally or unconditionally) or prohibiting the merger within the above cited deadlines, the transaction is considered cleared.

  20. Under what circumstances the basic timetable may be extended, reset or frozen?

    KN: If the Competition Commission finds that a notification is incomplete, incorrect or misleading, it will issue an information request seeking further information/documents or clarifications. Request for further information restart the review clock as the deadlines run from filing of a complete notification (all information and documents including translations into Serbian language have to be submitted). In practice, however, the Competition Commission usually does not abuse this power and clears the transaction within a deadline from the initial filing event with subsequent information requests, however this largely depends of a particular case handler working on the filing.

    Interventions of third parties may be taken into account in the Competition Commission’s analysis, but do not normally delay prescribed review periods.

  21. Are there any circumstances in which the review timetable can be shortened?

    KN: Shortening of the review periods is not possible under the Competition Law.

    In practice, it may be possible to obtain it informally through communication with a particular case handler working on the filing and subject to his/hers sole discretion.

  22. Which party is responsible for submitting the filing? Who is responsible for filing in cases of acquisitions of joint control and the creation of new joint ventures?

    KN: In case of acquisition of control, the responsibility to file a notification lies on the acquirer, while in case of a joint venture, notification is to be made jointly by all the participants in the joint venture.

  23. What information is required in the filing form?

    The Merger Regulation that came into force in February 2016 introduced an abbreviated from of a notification (“short-form”) in addition to the existing “long” notification. The Regulation was intended to disburden the merger control procedure especially for no-issue (Phase I) filings.
    In line with the new rules laid down under the Regulation, exact information and documents to be submitted to the Competition Commission depends on whether the concentration qualifies to be notified as a “short-form” notification or it requires a “long” notification.

    The “short-form” applies in the following cases:

    1. in cases of an acquisition of sole or joint control, if:

    • the parties to the concentration are not active on the same relevant product market and the same relevant geographic market and none of the parties to the concentration is active on the vertically connected markets at which the other party is active (i.e. there are no overlaps between the parties); or
    • in case of horizontal overlaps between the parties, the combined market share of the parties to the concentration is less than 20%; or
    • in case of vertical overlaps between the parties, the combined market share on the relevant market on which either of the parties to the concentration is present is less than 30%;

    2. in cases concerning change from joint to sole control over an undertaking.

    3. if the combined market share of all parties to a horizontal merger is below 40% and the incremental increase in post-concentration HHI is less than 150.

    Please note that the Competition Commission has a discretion to require “long” notification to be submitted even if the formal conditions for “short-form” notification have been met, when it reasonably suspects that the concentration may give rise to competition concerns in certain instances prescribed under the Regulation.

  24. Which supporting documents, if any, must be filed with the authority?

    KN: Merger notification has to be signed by the applicant or its proxy (e.g. its lawyer). Also, each page of the merger notification has to be initialed. In practice, usually the applicant’s lawyers signed the notification based on the power of attorney and there is no need for a direct involvement of the applicant.

    In terms of documents and information that are required for the notification, there is a difference between whether a filing qualifies for a “short-form” notification or a “long” notification as explained under the previous answer. The main difference, however, lies in the number of previous years for which the documents and information have to be provided (i.e. three previous years in a “long” notification and a previous year in a “short” notification). Also, the amount of information/documents required, depends on the exact structure of the transaction (e.g. whether it is an acquisition of sole or joint control).

    Effectively exists mainly with respect to the information part and the relevant year(s) for which the financial reports should be provided – both with the ‘short-form’ and with the ‘full’ merger filing the following supporting documents need to be submitted:

    • registry excerpts of the parties (and their registered subsidiaries in Serbia),
    • financial statements of the parties for the year preceding the filing,
    • the transactional agreement or other basis for concentration,
    • the group structures of the parties to concentration,
    • local and worldwide turnover figures for the year preceding the filing,
    • the largest suppliers and customers of the parties on the relevant market in Serbia for the year preceding,
    • description of the products sold on the relevant market(s) in Serbia in the previous year,
    • description of the distribution network on the relevant market(s) in Serbia,
    • the largest competitors (and estimates of their market shares) on the relevant market(s) in Serbia,
    • estimates of the parties’ market shares on the relevant market(s) in Serbia etc.

    Some documents have to be submitted in Serbia as certified copies supplied with an Apostille (e.g. PoA, the SPA) or simple copies (majority of documents). Also, all documents in foreign languages have to be translated into Serbian language by a certified court translator.
    There are no specific rules on how recent a document has to be.

    In order to avoid subsequent information requests, however, it is advisable that the documents submitted to the Competition Commission are not older than 3 months.

  25. Is there a filing fee? If so, please specify the amount in local currency.

    KN: Yes, the applicant is obliged to pay a fee for any decision issued by the Competition Commission in merger control proceedings.

    For the issuance of a clearance in summary proceedings, the fee is 0.03% of the total annual income earned by the parties to the concentration in previous year; however, this amount is capped at EUR 25,000.

    For the issuance of a merger clearance in inquiry proceedings, the fee is 0.07% of the total annual income of the parties to the concentration, but this amount is capped at EUR 50,000.
    If the Competition Commission rejects the notification on procedural grounds, the fee is EUR 500; the fee for a material rejection decision (i.e. the Commission refuses to clear the transaction), is EUR 1,200.

  26. Is there a public announcement that a notification has been filed?

    KN: The fact of filing of the notification is not made publically available in transactions which have no effect on the local market and are going through Phase I review. The Commission publishes on its website only the clearance decision (including the reasoning) after the Phase I review has finished.

    Opening of Phase II is publically announced at the Competition Commission’s website with an invitation to market participants to provide information they deem relevant or important.

  27. Does the authority seek or invite the views of third parties?

    KN: The Competition Commission may consult third parties whenever it deems it necessary or appropriate. Therefore, such contact are done at its sole discretion. Generally, however, the Competition Commission would reach out to third parties in more complex (Phase II) mergers that may significantly affect the local Serbian Market. The third parties would exceptionally be contacted in no-issue (Phase I) filings as the matter of practice.

    There are no specific rules or limitations as to who can be invited. In practice, in the document on opening of the Phase II proceedings the Competition Commission will invite all interested stakeholders to come forward with the information they deem relevant for a proposed merger. Such stakeholders normally include the largest customers and suppliers, competitors, trade associations and other state authorities.

  28. What information may be published by the authority or made available to third parties?

    KN: The fact of filing of the notification is not made publically available in Serbia. The notification itself, supporting documents any other submissions made by the parties (for example, responses to questionnaires) are not made public.

    The Commission publishes on its website only the clearance decision (including the reasoning behind the decision, but excluding the notification itself and supporting documents) after the Phase I review has finished (usually 5-7 days from delivery of the clearance decision to the parties; in certain cases and based on a reasoned request, the publication may be postponed by couple of days).

    Opening of Phase II, on the other hand, is publically announced at the Commission’s website with an invitation to market participants to provide information they deem relevant or important.

    Furthermore, the parties may mark the confidential information in the notification itself. During the Phase I review, as a standard part of procedure in Serbia, a separate Request for Protection of Confidential Information contained in the merger notification that was filed to the Serbian Competition Commission with an appropriate reasoning behind such request, is submitted soon after the filing.

    The document is a formality, in the form of a separate Request, as it just restates the information that is marked as confidential in the notification itself. The Commission will then issue a separate act (so called Conclusion of Protection of Confidential Information), by way of which it usually adopts the Request in its most part. In that way the information marked as confidential are awarded proper protection from the public.

  29. Does the authority cooperate with antitrust authorities in other jurisdictions?

    KN: Yes, the Competition Commission is active in building good relations with other antitrust authorities. Such relationships are especially pronounced with the authorities in the neighbouring countries (such as Montenegro, Macedonia etc.). International relationships take various forms that range from less formal communications, through formal meetings to entering into bilateral protocols on cooperation. The Competition Commission has entered into several agreements on bilateral cooperation with several competition authorities such as Macedonian Competition Commission, Slovenian Agency for Protection of Competition, Romanian Competition Commission etc.

  30. What kind of remedies are acceptable to the authority? How often are behavioural remedies accepted in comparison with major merger control jurisdictions, such as the EU or US?

    KN: The Competition Commission has in its previous practice used both structural and behavioural remedies as well as the combination of both. Generally, structural remedies are generally preferred over behavioural remedies. Also, it is customary for the Competition Commission to impose some sort of monitoring mechanism over implementation of remedies either through regular reporting obligations or appointment of trustees. There is no significant practice or specific guidelines when it comes to divestment measures, however the Competition Commission would usually not require an up-front buyer, but would rather lead a certain deadline to the parties to find a suitable buyer if possible.

  31. What procedure applies in the event that remedies are required in order to secure clearance?

    KN: The remedies are only possible in Phase II proceedings and are generally offered by the parties. In particular, if the Competition Commission determines that the implementation of the concentration may result in negative effects which can seriously distort competition on the relevant market(s) in Serbia, it adopts a Conclusion on the Initiation of an In-Depth (i.e. Phase II) Proceedings. The Competition Commission is obliged to render a final decision within four months as of the day of the adoption of this conclusion. Before rendering of the final decision, the Competition Commission will issue a statement of objections outlining all facts and evidence based on which the final decision will be adopted. The statement of objections gives a strong indication of the decision including the possible remedies.

    The Phase II review is usually extensive and include furnishing significant economic and legal data to the Competition Commission. It, as a rule, involves the Commission seeking information from interested parties, such as competitors and customers. If commitments were considered, the parties would firstly propose them and then negotiate with the Competition Commission in formal meetings in order to secure the most favourable outcome. Therefore, as a standard practice the negotiations are initiated with the parties proposing the commitments which are then examined, discussed and finally agreed upon in direct communication with the Competition Commission. If the negotiations fail, the Competition Commission would prohibit the merger.

  32. What are the penalties for failure to notify, late notification and breaches of a prohibition on closing?

    KN: In foreign-to-foreign merger the risk of fine is relatively low and the Competition Commission is unlikely to go after such transactions. In local mergers the risk of fines cannot be mitigated and the risk of fines is realistic.

    Implementing a concentration that was not notified or cleared can result in a fine of up to 10% of the filing parties’ total annual turnover generated in the previous fiscal year on the Serbian market. The applicant is liable for paying this fine. The Competition Law provides for a general statute of limitations of five years concerning concentrations that have been implemented without clearance or that are otherwise exposed to fines.

    If the filing party does not file a notification with the Competition Commission within the prescribed deadline (15 calendar days), the Commission may issue a procedural penalty ranging from EUR 500 to EUR 5,000 for every day of late filing provided that the maximum amount of fine cannot exceed 10% of the infringer’s turnover realized in the year preceding the year in which the Competition Commission initiated its investigation.

    The Competition Commission can cancel an already implemented concentration (de-merger), which can be effected by way of a split-off, sale of shares, cancellation of the agreement or any other action that would lead to restitution of the status prior to implementation of the concentration.

    The Competition Commission may impose both behavioural and structural measures on the merging entities in order to alleviate antitrust concerns. As far as we are aware, the Competition Commission has not implemented any de-merger to date, but has imposed both behavioural and structural measures as conditions to merger clearances.

    The Serbian Criminal Code contains a wide provision which could be used to interpret a concentration resulting in the creation or strengthening of a dominant position as the "abuse of a monopolistic or dominant position." In this case, the person responsible for intentionally implementing a prohibited concentration could be criminally prosecuted. The maximum sanction is five (5) years of imprisonment; however, this provision has never been used in practice.

  33. What are the penalties for incomplete or misleading information in the notification or in response to the authority’s questions?

    KN: If the parties provide incomplete or misleading information in the notification or in response to the authority's questions, the Commission may issue a procedural penalty ranging from EUR 500 to EUR 5,000 for each day of breach, provided that the maximum amount of fine cannot exceed 10% of the infringer’s turnover realized in the year preceding the year in which the Competition Commission initiated its investigation.

  34. Can the authority’s decision be appealed to a court? In particular, can third parties who are not involved in the transaction appeal the decision?

    KN: Competition Commission’s decisions are final in administrative proceedings and cannot be appealed. Nevertheless, the Competition Commission’s decisions can be challenged before the Administrative Court in a judicial proceeding (as an administrative dispute) procedure.

    The statutory deadline for initiating an administrative dispute before the Administrative Court is 30 calendar days from receipt of the decision by the relevant parties.

    Generally, filing of a claim before the Administrative Court does not suspend the implementation of the Competition Commission decision. However, such implementation may be postponed by the Administrative Court based on a reasoned request by the claimant. In practice, the Administrative Court usually suspends implementation until it issues the ruling.

  35. What are the recent trends in the approach of the relevant authority to enforcement, procedure and substantive assessment?

    KN: In February 2016, the new Merger Control Regulation, governing the content and the manner of submitting merger filings to the Competition Commission, entered into force. The Merger Regulation introduced a new abbreviated merger notification form (i.e. Short Form) which made the Serbian merger control regime even more aligned with the EU rules and the merger control procedure disburdened especially for Phase I filings. In accordance with that, the Competition Commission is increasingly becoming more lenient towards formalities such as translations or legalisations of documents (especially in no-issue cases) and is increasingly more focused on substantive analysis. Its industry specialisation and economic analysis of complex merger has also increased.

    Furthermore, the Competition Commission has increased its capacity and, as a result, handles cases in a fairly efficient manner even though merger control cases occupy significant amount of its time and resources. The transparency of its work has increased in the past couple of years and is to a large extent possible to predict specifics which makes the whole process of review reasonably straightforward. Finally, its fining efforts and practice has so far been focused on transaction with local nexus even though the merger control regime covers foreign-to-foreign transactions as well.

  36. Are there any future developments or planned reforms of the merger control regime in your jurisdiction?

    KN: The Competition Law is expected to be amended in the upcoming period (e.g. most probably during the course of 2018). The working groups of interested stake holders are currently being formed and the planned amendments of the law are still at a rather early stage. The expected amendments will possibly cover merger control rules as well.

    In particular, the expected changes may arguably relate to the introduction of local nexus to the merger control thresholds or extension/abolishment of the filing deadline etc. However, there have still not been any specific changes defined or draft documents produced by the Commission or other interested stake holders, therefore, the possible amendments are, although certain, still in early stages of consideration.

    Finally, greater enforcement is expected in future as the Competition Commission has continuously stressed out in various public announcements and statements the importance of compliance with the Competition Law.