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The Constitutional Court Annuls the Provision Limiting the Market

The Constitutional Court has annulled Article 62, paragraph 4 of the Animal Protection Act concerning the care and management of abandoned animals. Initially, I was intrigued as to why the Constitutional Court is even discussing such a law, and then I became interested in the subject of the decision itself.

It concerns the freedom of market competition guaranteed by the Constitution. The request for a review of constitutionality was submitted by the company AS-EKO from Šibenik, which has an animal shelter in the Šibenik-Knin County but does not have one in the Split-Dalmatia County, which is why it cannot obtain a contract for the care and management of abandoned animals in the latter due to Article 62, paragraph 4.

Thus, the contested Article 62 states that the collection of abandoned or lost animals is organized and financed by local government units (LGUs) and that they must establish at least one shelter with at least 50 accommodation places for animals in their area. Then, paragraph 4 states that LGUs can enter into a contract for the collection and management of abandoned animals with a company, but only if it has organized accommodation in the area of that LGU.

Equal Rights Only for Locals

AS-EKO believes that companies without such a shelter in the area of the LGU cannot enter into a contract because it would be contrary to the contested Article 62, paragraph 4, which discriminates against potentially better and higher-quality service providers. It cites the example that a natural or legal person based in the Šibenik-Knin County cannot succeed in a tender announced in the Split-Dalmatia County because there is no shelter there, even though it provides a closer, faster, higher-quality, and financially more favorable animal care service. In this way, local entrepreneurs are favored because the price and quality of service are not important, and entrepreneurial rights and freedoms, or equal legal status in the market guaranteed by Article 49, paragraphs 1 and 2 of the Constitution, are jeopardized. Namely, the contested article guarantees only equal legal status in the area of a specific LGU, while equality of entrepreneurs should be guaranteed throughout the entire country. Additionally, in practice, animals receive poorer care, and LGUs suffer financial damage because they cannot choose a more financially favorable offer.

In the Ministry of Agriculture’s response to these claims, it states that the mentioned provision does not prevent LGUs from entering into contracts with any service provider, which does not necessarily have to be from their area. It further states that the service of collecting and managing abandoned and lost animals is also subject to the Public Procurement Act, and all principles of public procurement, especially the principles of equal treatment and prohibition of discrimination, apply to this service since they arise from the Treaty on the Functioning of the EU and are therefore legally superior to the provisions of the Animal Protection Act. Article 62, paragraph 1 prescribes the obligation of organizing and financing the collection of abandoned or lost animals by local government units, and paragraph 2 stipulates the obligation of having at least one shelter in the area of the regional self-government unit.

There Are More Solutions

The Constitutional Court has, however, ruled in favor of the company AS-EKO, considering that legal or natural persons without an animal shelter in the area of a certain LGU cannot enter into a contract with that local government unit. This means that the legislator has imposed a territorial restriction in the areas of LGUs, which contradicts the claims of the Ministry of Agriculture, and therefore Article 62, paragraph 4 is unconstitutional.

I would dare to propose a solution to the problem: the obligation that a company caring for animals in the area of a certain LGU must also have a shelter there should be abolished. Let there remain a minimum of 50 places for animals from each LGU, and where those places will be is not that important. For example, if a company has one hundred places in one area, it can also accept animals from another area. Or LGUs should be allowed to sign such contracts simultaneously with multiple companies. Solutions certainly exist.

POST SCRIPTUM

The legislator has provided who can establish a shelter (Article 61). One possibility is that it can be a natural or legal person (paragraph 1), but if the shelter is not established by the mentioned organizations, paragraph 2 prescribes that one or more local government units or the City of Zagreb must establish the shelter. Additionally, paragraph 3 assigns this obligation to the regional self-government unit if the local government unit fails to fulfill the imposed obligation in its area. Thus, our proposal goes in favor of LGUs because in a possible situation where no one responds to the tender (according to the annulled Article 62, paragraph 4), by abolishing that article, companies from other LGUs can relieve them of the obligation to organize accommodation for animals themselves. So why not make their job easier?!

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