Croatia: Amendments To The Competition Act - Update Part II

Last Updated: 5 September 2013
Article by Christoph Haid and Mislav Bradvica
This article is part of a series: Click Amendments To The Competition Act for the previous article.

1. Introduction

The Amendments to Croatia's Competition Act that entered into force at the beginning of July 2013 ("Amendments") inter alia aim at removing the procedural loopholes that had been observed over the past few years (see our legal insight of 27 August 2013 on the changes to the Croatian merger control regime). Some of these amendments significantly influence the procedural rights of undertakings.

2. Modifications of the procedural solutions

2.1. Dawn raids

The most significant amendments concern dawn raids. It is now stipulated that, in accordance with EU Regulation 1/2003, the Croatian Competition Agency ("Agency") shall provide assistance to dawn raids being conducted by the European Commission on the territory of the Republic of Croatia. The Agency can also authorise representatives of another Member State's competition authority to participate in a dawn raid on the territory of the Republic of Croatia, or it can carry out the dawn raid on the behalf of this authority.

Prior to the conduct of the dawn raid, the Agency shall request from the High Administrative Court a warrant for the conduct of the dawn raid and the sealing and temporary seizure of objects, especially if the likelihood exists that evidence could be concealed or destroyed. The Competition Act no longer contains the regulations on the securing of evidence in an extra-judiciary procedure, which formerly served the purpose of regulating the issuance of warrants. It is worth noting that the fundamental premises of extra-judiciary procedural regulations would clearly have caused practical problems, as they are incompatible with the secrecy required for the dawn raids procedure.

Another novelty relates to the content of the dawn raid warrant. Following the Amendment's entry into force, it is now prescribed that a warrant shall set out the following: (i) a list of the objects which will be inspected in the dawn raid (e.g. business premises, vehicles, other objects), (ii) the legal basis for conducting the dawn raid (iii) a list of authorised persons from the Agency and other authorised persons conducting the dawn raid and (iv) a time limit for conducting the dawn raid It is now also prescribed that the High Administrative Court must decide on whether to issue the warrant within two days from receipt of the request.

Computers, servers, and telephone devices are specifically defined as data storage devices in the Amendments. The Amendments also point out and regulate in detail the obligation of the computer owner or mere user to enable access to the computer, device or data storage device. Special regulations now also exist for the issue of the discovery during a dawn raid of objects indicating that a criminal offence prosecuted ex officio has been committed.

2.2. Judiciary control

Subsequent to the entering into force of the last version of Croatia's Competition Act in 2009, the Administrative Disputes Act was amended and a two-instance court system introduced as of 1 January 2012, implicitly entrusting judicial review of the Agency's decisions to the lower administrative courts. The Amendments have done away with this system, instead setting out explicitly the direct competence of the High Administrative Court of the Republic of Croatia for appellate proceedings against the Agency's decisions.

This solution clearly avoids proceedings and decisions at the level of the lower courts, which had to relinquish all their cases to the High Administrative Court as of 1 July 2013. This changed appeals process will certainly contribute to the concentration of cases from the field of competition law in one court, but it still remains to be seen whether the situation will also lead to or be used for the judges of the newly competent court developing a specialisation.

2.3. Private enforcement

The Amendments regulate certain elements of private enforcement actions triggered by infringements of competition law. They do so by stipulating that (i) competent courts shall take into account the final decision of the Agency or the European Commission by which an infringement has been determined, (ii) the courts may assess whether it is appropriate to halt civil proceeding if the establishment of infringement is a preliminary question and proceedings to this end are still pending before the Agency or EU Commission, (iii) the competent court shall without delay inform the Agency of any claim for damages from competition law infringements, and (iv) the limitation period for damage claims from competition law infringements shall be suspended from the day proceedings over the infringement were initiated by the Agency or the European Commission until the day the relevant proceedings have been closed.

The Amendments have also removed ambiguities on which court is competent by explicitly prescribing that the competent commercial courts are to rule on damages due to violation of the Competition Act or Articles 101 or 102 of the TFEU.

Please click here to read Part 1

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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This article is part of a series: Click Amendments To The Competition Act for the previous article.
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