BiH Court abolishes Competition Council decision favouring Telekom Srbija

NEWS 26.07.2021 22:57
Source: N1

The Court of Bosnia and Herzegovina has with its ruling finally recognized the illegal activities of certain members of the BiH Competition Council and its the long-standing practice of making political decisions that favour Telekom Srbija, Serbia's state telecommunications operator.

According to the ruling, the Law and previous instructions of the Court, the Competition Council of BiH is now obliged to renew the procedure for assessing the concentration in question, allowing Telemach to participate in the procedure. The Court made the decision instead of the competent body, the Competition Council. The procedure for the takeover of the operator Blicnet d.o.o. Banja Luka by the Telekom Srbija Group must be renewed. Other interested parties should also be allowed to participate, in this case Telemach, which filed the lawsuit.

Telekom Srbija, through M:tel, which it is the majority owner of, in recent years bought Elta Kabal from Doboj, Blicnet in Banja Luka, telecommunication and cable operator Telrad Net from Bijeljina, and previously Logosoft, which ensured the absolute dominance of M:tel in the area of Bosnia’s Republika Srpska (RS) entity.

Denis Zvizdic, at the time serving as Chairman of the Council of Ministers, reacted to this issue earlier, but was told that everything was in accordance with the law.

Although the Competition Council said that a monopoly represents a concentration of capital that exceeds 40 percent of the total territory of the country, it ignored the article stating that this may also apply to a certain part of the territory.

The Law on Competition says that “It is assumed that economic entity has a dominant position in the market of goods or services when it holds more than 40 (forty) % of the market share in the relevant market.”

However, article 13 of this law says:

“Prohibited are the concentrations of economic entities, which as a result have a significant distortion of the efficient market competition, in the entire market of Bosnia and Herzegovina or its significant part, especially those which create new or strengthen an existing dominant position.”

M:tel has, meanwhile, covered almost 100 percent of the telephone, cable television and internet markets in Republika Srpska. To be precise, this was done by Telekom Srbija, which owns M: tel, by disabling fair competition through the Competition Council, which ultimately also affected consumers.

Certain members of the Competition Council have already been reported for committing criminal offences regarding the non-implementation of the verdicts of the Court of BiH and for causing financial damage to the citizens of BiH with their illegal decisions. The person who headed the proceedings in the disputed cases in which the acquisitions were approved was Arijana Regoda Drazic, a member of the Competition Council appointed by the Government of Republika Srpska. This means she had a direct conflict of interest, but that did not seem to be a problem for the Competition Council.

Telekom Slovenija, which previously owned Blicnet, did not want to comment on the court’s decision, specifically the allegations regarding the renewal of the process of the sale of Blicnet, which was completed two and a half years ago.

M:tel, as well as Telekom Srbija, which, according to media reports from Serbia, allegedly paid enormous amounts for this acquisition, also did not comment on the ruling.