The Romanian Competition Council is mirroring the EU trend of investigating alleged abuses of economic dependence (a case of unfair competition infringement)

Jun 27, 2024 | News

A Romanian registered supplier of medical oxygen in Romania was raided by the Romanian authority within its first investigation of an alleged abuse of economic dependence.

The apparently dependent undertaking is the Bucharest Emergency Clinical Hospital, reliant on the investigated company for liquid medical oxygen. The investigation, initiated ex officio, drew initial evidence from public sources.

Romanian relevant legislation

Under Romanian unfair competition legislation, a superior bargaining position is the market-based situation of a company that could induce significant imbalances due to factors such as the specific structure of the production or distribution chain, vulnerability to external factors, perishability, or seasonality, and the specific commercial relationship between the company holding such position and other companies operating in different markets.

This specific relationship is to be examined by the Romanian competition authority based on the following cumulative conditions:

  • The existence of an unbalanced power dynamic due to factors such as market share or brand recognition.
  • The importance of this commercial relationship for the other (dependent) company’s business, as a result of factors such as the significant share of its sales or purchases in the other undertaking’s business, the critical role of its products or services to the other (dependent) company’s business, or the existence of significant investments by the other undertaking in order to sustain the commercial relationship established.
  • The absence of an equivalent alternative solution for the other (dependent) company.

The relevant unfair competition law specifically mentions several abuses, including refusal to supply or deal, or discriminatory practices. However, the list is not exhaustive.

The company holding such superior bargaining position (defined as subjective should not hold a dominant market position, as defined by the Romanian competition act which presumes a dominant position starting from 40% market share.  In the latter case, the Romanian competition act will apply.

Also, such prohibition is not applicable if the Romanian rules regarding the food retail and unfair trading practices (UTPs) in business-to-business relationships in the agricultural and food supply chain (Romanian law no. 321/2009 and Romanian law no. 81/2022) apply.

This infringement is subject to fines ranging from approx. EUR 10,000 to EUR 100,000, combined with interim measures to suspend alleged practices.

The Romanian prohibition on economic dependence abuse, introduced in June 2022 amid sectoral shifts during the Covid-19 pandemic, aims to regulate situations where negotiation gaps and exploitative practices arise.

Similar provisions in other EU countries

Similar provisions exist in EU countries such as Belgium, Italy, Germany, France, and Bulgaria.

Belgium initiated its inaugural ex officio investigation in the agricultural sector in late 2023, while Italy started investigation and imposed interim measures in April 2023 against Meta for alleged abuses against SIAE, the primary Italian artists’ rights collective.

For further information, please refer to the following links:

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