#05 May 2019

In focus – Competition

Unlike other reforms in Ukraine, competition policy really has provided substantial improvements over the last few years. A lot has been done to amend antimonopoly legislation. The EU – Ukraine Association Agreement acted as the anchor for the harmonization process, which is the most ambitious one compared to other states of the wider EU Neighborhood. Ukraine is still often criticized for its weak institutional capacity, and in many cases this is so.

Expert Opinion

Regulation of Concerted Practices. Recent Developments

Oleksandr Fefelov

1. Implementation of the EU acquis

The existence and permanent development of economic competition represent the essential condition of any effective national economy. In this regard, serious challenges that are put before national and international antimonopoly agencies to ensure protection of rules of fair competition.

In Re

To Buy or to File? Antitrust Implications of Public Bids in Ukraine vs. the European Union

Olga Ivlyeva

When an acquisition is done via a public bid, antimonopoly-related issues often arise. In particular, the acquisition of a certain number of shares may require a merger clearance from a competent competition authority. At the same time, from a business perspective, receiving clearance prior to the acquisition often does not make sense or may even ruin the deal.

Ukrainian Prospects for Competition Damages Claims

Nazar Chuchak

If a company infringes competition law it must reckon with a range of possible sanctions, both under public and private law. Public enforcement is well known, as the competition authority launches an investigation against a suspected party. If an infringement is found, the authority will typically order termination of anticompetitive behavior and will, most importantly, impose a fine.

Unfair Competition. AMCU Keeps an Eye on Pharma

Yevgen BLOK, Denys MEDVEDIEV

Pharmaceutical markets have traditionally been on the radar of the Antimonopoly Committee of Ukraine (AMCU). In recent years the AMCU has completed a few high-profile investigations on alleged concerted actions against such pharmaceutical companies as Alcon, Servier, Sanofi-Aventis, Roche, Bayer. Both business and legal experts scrutinized and widely discussed the relevant decisions of the AMCU and courts.

News

Deals

CMS advised Scatec Solar

Sayenko Kharenko advised VR Capital on acquisition of 50% stake in 11 solar park projects

AEQUO — legal counsel to TMM

EY Ukraine advised Horizon Capital

Cases

EU has fined Fitch Rating Agency record sum

Goldman Sachs fined by UK regulator

State Property Fund lost appeal ruling to Ukrtelecom

Court imposed arrest on assets of Privat group of companies

Vinnitsagaz and Volyngaz failed to appeal against fines imposed by regulator

Draft

New Draft Law On Defined Contribution Pension System

Harmonization of legislation in state market supervision and consumer rights protection

Law digest

Foreign companies now allowed to open accounts in Ukrainian banks

NBU introduced control over non-bank financial institutions

Deregulation in construction industry

List of compensation for employers hiring persons with disabilities extended

New figures join sanction lists against Russia

Code on Bankruptcy Procedures signed into law

Biznews

Trade Policy

Ukraine lost to Russia in WTO dispute over transit

European Union won dispute with US in the WTO on benefits for Boeing

M&A

Ukrainian company Ajax Systems attracted USD 10 million worth of investment

Chevron to acquire competitor for USD 33 billion

Banking & Finance

Banks received multimillion loan from NBU

S&P confirmed credit ratings of Ukraine

Automobile Industry

Fiat to create association with Tesla due to fear of multi-billion dollar fines

Competition

UIA to undergo inspection over new rules for carriage of luggage

E-auctions

KPMG launched online auction platform in Ukraine

 

Cover Story

Feel the Progress

Competition law is probably one of the most successful areas on the country’s reform path. Since Ukraine is committed to providing changes according to its obligations under the Association Agreement signed with the EU, progress keeps coming with the harmonization of domestic legislation with European provisions and rules.

Market sources have recognized the main achievement, that of institutional shift in the approach of the competition regulator introducing best practices. We asked Mykyta Nota, counsel and head of competition & state aid practice at Kinstellar, to explain expectations in different economic sectors, changes in enforcement practices, and what internal reforms are anticipated inside the Antimonopoly Committee of Ukraine itself.

 

Argument

Selective Distribution

Iryna KRAVTSOVA

Selective distribution is one of the distribution channels that remains under the careful gaze of competition authorities across the world. This type of strategic distribution is aimed at customers that want a more personalized shopping experience and have special brand preferences when buying a specific product. Selective distribution has economic and marketing advantages as it concentrates on an exact market that leads to better customer satisfaction and better communication and coordination. Thus, by choosing the distributor, the manufacturer can have better control in terms of how a product is handled by the distributor. This has a direct bearing on improving the quality of provided services while selling products, and keeps up a brand image that corresponds to the manufacturer’s marketing brand strategy.

Hot Issue

First Insights into New Currency Control Regulation in Ukraine

Oleksandr RUDENKO, Yuliia PIDLISNA

On 7 February 2019, the Law of Ukraine On Currency and Currency Operation alongside with new regulations of the National Bank of Ukraine (NBU) came into force. They were expected to significantly liberalize foreign currency circulation within the territory of Ukraine and attract more investment into Ukraine and accelerate further economic growth. At the time of adoption, new currency control regulations received positive assessment from both business and expert communities. However, over the period of practical implementation of such changes some issues are still to be properly addressed.

Crux

Legal Digest

The Ukrainian Parliament, Cabinet of Ministers and National Bank of Ukraine have approved some important legislative acts that could have a great impact on business development, while others are still to be considered. The UJBL editorial team asked the views of experts on the proposed division of the State Fiscal Service of Ukraine, draft laws On Amendments to Certain Legislative Acts of Ukraine on Improvement of the Regulation of the Authorization System in the Field of Economic Activity aimed at Reducing Administrative Pressure on Business Entities, On Withdrawal of Ukraine from the Treaty of Concerted Antimonopoly Policy of Countries of the Commonwealth of Independent States and the Resolution On Introduction of Amendments to the List of Central State Executive Bodies Authorized for the Enactment of Building by the Cabinet of Ministers of Ukraine, as well as resolutions adopted by the NBU and other acts.

 

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