In its recently published annual report for 2023 (“Report”), the Czech Office for the Protection of Competition (“Office”) highlighted its significant enforcement actions, legislative proposals and unveiled new strategic initiatives for the upcoming year.

Record Amount of Enforcement Actions 

In 2023, the Office completed a record number of administrative proceedings on prohibited agreements, issuing a total of 16 decisions, the highest figure in two decades. These cases included both horizontal cartel agreements and vertical agreements, with the total fines imposed amounting to CZK 268 mil. (approx. EUR 11 mil.). 

Notably, most of the sanctions were imposed by first instance decisions and were not appealed by the sanctioned enterprises. The Office comments that this is due to the frequent use of the “settlement procedure”, allowing for fine reductions of 10 – 20 % if the sanctioned enterprise accepts the factual and legal assessment of the case.

Sectoral Investigations and Awareness Initiatives

Under pressure due to significant rises in food prices, the Office conducted sectoral investigations of five food markets. These however did not conclude that the price rise was caused by systemic failures of competition through prohibited agreements or the existence of a dominant position. In this context, the Office’s recent proposals for legislative changes aim to expand the scope of its investigative powers. 

In response to amendments to the Act on Significant Market Power, particularly affecting farmers and food producers, the Office also focused on educational and awareness-raising activities. Through workshops and training sessions, it informed stakeholders about their new obligations. The Office also initiated numerous further sectoral investigations which continue into 2024.

More Powers for the Office?

The Office’s stated main priority for 2024 is to submit to the Government a set of possible legislative amendments which would strengthen the competences of the Office. See our recent analysis of the Office’s preliminary proposals. 

The Office also plans to initiate a discussion on merger control legislation and increasing its efficiency. Its ambitions are to summarise its findings by the end of 2024 and to start working on potential legislative proposals in 2024.

With respect to enforcement, the Office aims to stay just as active. It plans to focus its supervisory efforts on large cases and entities with significant market impact, including cartel agreements and abuse of dominance. It also plans to intensify collaboration with criminal authorities and regulatory agencies to strive for effective enforcement.

Further Agenda for 2024

Looking ahead, the Office also commits to collaborate with universities and government authorities to develop e-learning courses targeting public administrations, particularly focusing on combatting bid rigging. Internationally, the Office will engage in competition authority events and participate in international projects to enhance its expertise and exchange best practices.

Finally, in addressing significant market power concerns, the Office aims to complete ongoing sectoral investigations in the food market and initiate administrative proceedings as necessary. Market mapping and identification of entities with significant market power, especially smaller entities requiring legal education, will be prioritised. Additionally, increased scrutiny will be directed towards large retail chains to ensure compliance with competition regulation.

The Report shows that the Office retains a high level of ambition – competitors can expect a hawkish approach to enforcement, as well as an active approach to influencing legislation. It will be interesting to see how the Office’s plans play out in 2024.

The Report can be found here (in Czech only).

If you need more information or further guidance in this area, please contact Vojtěch Chloupek, Martin Taimr and Matej Šinkovic.

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