Earlier this month, Bulgaria’s Competition Protection Commission (CPC) unveiled its strategic priorities for 2024, identifying sectors and activities that warrant increased regulatory scrutiny. These priorities will guide the CPC’s operational functions, which include market monitoring, signal verification, the initiation of administrative proceedings, market investigations, and ongoing enforcement actions.
The CPC has identified eight priority sectors, although the list is said not to be exhaustive. The first is the pharmaceutical sector in light of recent legislative changes aimed at reducing the shortage of medical products in the country and ensuring transparency in their path to patients.
The CPC is committed to ensuring equitable participation of all stakeholders in this sector and monitoring the market for any agreements that may restrict access or limit parallel trade. Balancing the need for continued access to medicines in Bulgaria with facilitating cross-border exports within the EU single market is a key objective for the CPC.
A key priority for the CPC in 2024 will be the digital economy and e-commerce, given the increasing importance of digital services and e-platforms as a source of connectivity between businesses and consumers and for opening up new business opportunities. The CPC will monitor online platform operators to ensure fair competition and actively participate in their reform process, especially considering that many deadlines for compliance with the Digital Markets Act (DMA) and the Digital Services Act (DSA) are due in 2024.
The energy sector is undergoing a transition to greener practices and will receive financial incentives to support this shift. The CPC will carefully scrutinize applications for public funding in the renewable energy sector to guard against potential anti-competitive behavior.
Other priority sectors include fuel and food production and trade – due to the constant concern about rising prices in these sectors – and financial services – in light of the rapid market penetration of fintech companies.
Given the need for green technologies and the EU’s emphasis on green production, the CPC will exercise increased vigilance in the area of sustainability. This includes monitoring compliance with competition rules in relation to green practices and sustainability agreements, i.e., agreements between competitors that pursue sustainability objectives such as climate change, environment, health, human rights, living wage, and animal welfare.
The CPC’s assessments will be in line with the European Commission’s Horizontal Guidelines, which includes a new chapter on sustainability agreements.
The CPC will also aim to promote sustainable development in the Bulgarian economy. In the agricultural sector, the CPC will focus on encouraging farmers to proactively adopt higher standards of sustainability in their operations. In addition, the CPC will ensure that cooperation between farmers remains compatible with competition policy, thereby promoting a balance between sustainability goals and fair competition within the agricultural industry.
However, the global trend to prioritize sustainable practices and healthier lifestyles may have another, less positive aspect. Competition authorities have begun to identify false “green” or “healthy” claims that can mislead consumers about the true content and effects of a particular product or service.
Many authorities have started to monitor specific sectors or websites to combat illegal green claims (so-called “greenwashing”). This has not yet been identified as a priority for the CPC this year, but it is almost certainly already on its radar.
In terms of priority activities for 2024, the CPC will prioritize investigations into allegations of unfair trading practices by retail chains and large food and agricultural buyers against smaller producers and suppliers. Combating bid-rigging, cartels, and prohibited price-fixing and market-sharing agreements will remain a priority for the CPC in 2024.
By Nevena Radlova, Partner, and Dayana Zasheva, Trainee, CMS
This article was originally published in Issue 11.2 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.