AZTN: Faggiano fined for failing to report concentration

The Competition Protection Agency (AZTN) has approved the concentration of the entrepreneur Andre d.o.o. and Novi list d.d. which occurred when Andre acquired 80.3 percent of the shares in Novi list, but due to the failure to report the concentration within the legal deadline, it has initiated proceedings for the imposition of a penal-administrative measure against the entrepreneur Andre, it was announced today by the Agency.

Andre and Novi list operated in the same relevant markets prior to the implementation of the concentration, specifically in the market for general information daily newspapers and the advertising market in general information daily newspapers, where Novi list operated directly, and Andre indirectly, through ownership stakes in Glasu Istre Novine.

By acquiring shares in Novi list, Andre, owned by Alberto Faggiano, holds between 10 and 15 percent market shares in these markets, the statement notes.

The Agency has determined that the implementation of the concentration did not lead to negative effects on market competition considering the number and market power of competitors operating in these markets.

Namely, more than 70 percent of the market share in sold circulation and more than 60 percent in the advertising market in general information daily newspapers pertains to the newspapers 24 sata, Jutarnji list, and Večernji list, the Agency states.

Therefore, they note, by increasing the market share of the entrepreneur Andre, this concentration could contribute to strengthening competition among publishers in the relevant markets.

However, despite assessing the concentration as permissible, the Agency announces that it will initiate proceedings against the entrepreneur Andre to determine the conditions for imposing an administrative-penal measure due to the failure to submit a notification of the intention to implement the concentration for assessment within the legal deadline.

The obligation to report for Andre arose on November 25, 2011, when the purchase of shares in Novi list was executed through the Central Depository of the Central Clearing and Depository Company (SKDD), and the Agency has learned that the concentration notification arrived only after the Agency requested the entrepreneur in September last year to clarify what form of concentration it was.

The Agency notes that this is a minor violation of the Competition Protection Act for which an administrative-penal measure can be imposed up to one percent of the total revenue achieved in the markets where the participants in the concentration operate.

This oversight was also one of the reasons why the Agency publicly reminded entrepreneurs in the media sector at the end of last year of their obligations to report concentrations.

Namely, it is a general rule for all entrepreneurs, in all markets, that only those concentrations whose participants, according to the criterion of achieved revenue, exceed the legally established threshold of economic size, are subject to the obligation to report and control of concentration by the AZTN. However, the Media Act and the Electronic Media Act impose an obligation on entrepreneurs in the media sector to submit a concentration notification in the media publishing market regardless of whether the conditions of total revenue are met. In that case, media publishers submit a notification to the Agency, which then assesses the concentration solely in accordance with the regulations on the protection of market competition, the Agency reminds.