FOUR PRIORITY SECTORS UNDER THE COMPETITION COUNCIL'S SPOTLIGHT
The Competition Council has decided to focus its attention on the energy, health (including pharmaceuticals), retail trade and digital markets sectors in 2024.
The head of the institution, Jolanta Ivanauskienė, emphasised that when setting sectoral priorities each year, the Competition Council aims to direct its limited human and financial resources and take more active measures in those sectors of the Lithuanian economy that are significant and rapidly developing, where products and services relevant to many consumers are offered.
The energy sector has been identified as a priority due to significant ongoing changes, starting from the liberalisation of the electricity supply market in Lithuania and the spikes in fixed energy resource prices in 2022 due to the Russian-led war in Ukraine. Although a considerable part of the energy sector is regulated and supervised by the state, the Competition Council assesses the competitive effects of legislative acts and their compliance with state aid rules in this area every year. This year, considering the rapid development of electric vehicle charging station infrastructure in Lithuania, associated with the green energy course and the commitments undertaken by Lithuania as an EU member, the institution has decided to conduct monitoring and investigate whether there are any barriers to competition in this sector.
For several years, the health sector, including pharmaceuticals, remains among the priorities. In 2022, the institution identified a violation of the Law on Competition in this sector and continues with another investigation. Additionally, the Competition Council takes actions to assess the existing and proposed legal regulations in this sector, particularly those related to amendments to the Law on Pharmacy and other legislative changes.
Retail trade is identified as a sectoral priority, considering its significance for all Lithuanian consumers. Last year, the institution focused on potential vertical agreements in the online space and identified an agreement between a cosmetics manufacturer and its product distributors, preventing consumers from purchasing goods at lower prices. Currently, the Competition Council is conducting three additional investigations into potential violations. Two of them were initiated by the institution in 2023: one related to the actions of companies engaged in the sale of everyday consumer goods and the other related to the actions of companies engaged in the production and sale of beverages.
As businesses, not only in retail but across various sectors, increasingly operate in the online space, issues related to digital markets become more relevant for regulatory bodies. Last year, the Competition Council presented findings from the monitoring of the e-commerce market conducted in collaboration with Latvian counterparts. This year, the institution plans to publish guidelines for representatives of this sector, addressing, among other things, business practices that may pose a risk of restricting competition.
The establishment of sectoral priorities does not automatically imply that the Competition Council will identify infringements or take other significant decisions in these sectors in 2024. In each case, before deciding to act, the Authority will assess whether a particular investigation is consistent with the Competition Council's priority of making a significant contribution to the effective protection of competition and thereby ensuring the highest possible consumer welfare. However, the Authority expects that the increased focus on these sectors will allow it to gather data and information that will be useful for a more detailed assessment of competition conditions not only this year but also in the near future.
In the identified priority sectors, the intention is not only to monitor the situation but also to take active investigative and preventive actions. This includes examining concentrations that economic entities are not obligated to report to the Competition Council, assessing the impact of legislation and its projects on competition, investigating complaints, deciding on the initiation of infringement investigations and market studies, and conducting educational activities.
