On November 17 2011 the Competition Council rendered a decision in which it found that one of the incumbent telecommunications operators in Bosnia and Herzegovina – Telekomunikacije Republike Srpske ad (Telekom Srpske) – did not enter into a restrictive agreement as was alleged in a request to initiate investigative proceedings filed by competitor Crumb Group doo. Initially, Crumb also alleged that Telekom Srpske, which was designated as a telecommunications operator with significant market power by the Bosnian Regulatory Agency for Telecommunications (RAT), also abused its dominant position in the market; however, Crumb subsequently withdrew its request for investigative proceedings pertaining to the alleged abuse.

The RAT awarded Crumb a licence to provide fixed line telephone services in 2006, after which it sought to conclude an interconnection agreement with Telekom Srpske. Crumb alleged that Telekom Srpske had delayed the conclusion of the agreement by various means, eventually concluding the agreement outside the statutory deadline, while at the same time concluding such an agreement within the deadline with Aneks doo, another holder of such licence. According to Crumb, as a consequence of such actions, it was placed in an "inferior market position".

In its response to the allegations, Telekom Srpske stated that Crumb did not make clear what kind of a restrictive agreement was at hand, by which parties it was entered into and for what reasons it should be considered restrictive; and thus it was unfounded. Moreover, Telekom Srpske stated that competition law prohibits agreements with the goal or effect of coordinating two or more undertakings with the intent to discriminate third parties, and that Crumb did not prove the existence of such an agreement.

When ruling, the council found that in essence, Crumb had alleged that the interconnection agreement concluded between Telekom Srpske and Aneks constituted a restrictive agreement, as such an agreement was not also concluded with Crumb despite the fact that it had requested it to be. However, the council agreed with the arguments put forward by Telekom Srpske – that competition law prohibits agreements with the goal or effect of coordinating two or more undertakings with the intention of discriminating against third parties – while the interconnection agreement between Telekom Srpske and Aneks contained no such elements (ie, it did not restrict, distort or prevent competition on the relevant market). Thus, the council found that Telekom Srpske did not enter into a restrictive agreement.

In another opinion issued on the same day, the council found that the proposed Law on Road Transport of the canton of Tuzla contained provisions that were restrictive in terms of competition law, as they placed legal persons providing such services in a disadvantaged position compared to natural persons providing the same service. More specifically, the provisions of the proposed law which lay down the procedure for setting prices for taxi services and fines for violations of those provisions would make price competition between legal persons providing such services impossible, as fines are prescribed for legal persons but not natural persons. Moreover, the council found that the proposed law was at odds with similar laws in force in other parts of Bosnia and Herzegovina, and thus restricted competition on the whole of the Bosnian market.

For further information on this topic please contact Srdjana Petronijević at Moravcevic Vojnovic Zdravkovic in cooperation with Schoenherr by telephone (+381 11 320 26 00), fax (+381 11 320 26 10) or email ([email protected]).