Message by the CPC on the application of antitrust rules in the state of emergency situation concerning COVID-19

The Commission for Protection of Competition supports the joint position of the European Commission and the national competition authorities within the European Competition Network and extends the following clarifications to the market participants regarding the application of antitrust rules during the arising social and economic crisis inflicted by the spread of the epidemic of COVID-19 over the territory of Europe.

The Commission for Protection of Competition is showing readiness to offer timely informal guidance on specific initiatives that the market participants intend to undertake in order to guarantee the legality of these initiatives in the conditions of crisis caused by the spread of COVID-19 and to achieve maximum legal certainty and foreseeability of the enforcement measures.

The Commission emphasizes that, despite the exceptional situation, market participants are obliged not to prevent, restrict or distort competition by their actions, and when indications of this are found the Commission will not hesitate to exercise its powers.

In this context, it is extremely important to ensure that essential public health products (such as masks, sanitizers and other products necessary to protect the health and life of citizens in the context of the State of Emergency) remain available on the market at competitive prices and their supply will not be impeded. On this note, the Commission will closely monitor the processes and intervene in any attempt for market cartelization or abuse of dominant position with the aim of gaining profits from the current situation. The CPC will also place particular emphasis on the pharmaceutical, food and commerce markets.

It is of central importance to ensure that this category of products that are vital to the physical survival of society in the face of an economic crisis, such as essential commodities, will be available and that the distributors of such goods will be able to provide continuity of supply in the store network. In this regard, in order to avoid such shortages and to make them accessible to the widest possible range of users, the Commission is ready to adopt a more lenient approach to temporary and proportionate coordinated measures taken by market participants, pursuing only the stated goals and necessary to achieve them. In case of doubt about the compatibility of such measures with European or national competition law, companies may contact the CPC for guidance and clarification.

The Commission emphasises that the antitrust regime in force provides a means for manufacturers to counter the resale of their products at excessively high prices, by setting maximum resale prices, as long as all the requirements of the law and guarantees that these prices do not amount to fixed resale prices are met.

While such practices may produce procompetitive effects in times of social and economic crisis and thus appear objectively justified, the Commission will continue to closely monitor and assess any market intervention by one market participant in the economic behaviour of another.

The CPC recognizes the significant social and economic consequences of the spread of COVID-19 in the European Union. At the same time, it finds that the various instruments of antitrust law have mechanisms in place to address the risks to the competitive environment while at the same time allow for the protection of higher values for society during crisis.

The CPC urges suppliers, traders and distributors from every sector of the economy to adopt responsible and legitimate business conduct at every level of the supply chain, including in  e-commerce.

The Commission also invites the general public to assist in the detection of anticompetitive practices, by reporting suspicious retail price increases of products of significant public interest in the current situation or the lack of such products in the stores or pharmacies or other commercial practices in the retail markets, which could have a negative impact on competition or consumers.

A report can be filed to this e-mail address cpcadmin@cpc.bg