Konkurencijsko vijeće Bosne i Hercegovine

CONCLUSIONS OF THE 51sT SESSION OF THE COUNCIL OF COMPETITION

Sarajevo, 28.09.2007. - On its 51st session, the Council of Competition has adopted a Decision declaring the concentration compatible. The concentration shall be implemented in the market of electric power production and distribution in Bosnia and Herzegovina by means of common long term investments provided by independent undertakings ČEZ a.s. Prague, Czech Republic and Mješovito Holding (Mixed Holding company) "Elektroprivreda" Republic of Srpska Trebinje – Matično preduzeće (Parent company) a.d. Trebinje (ERS) in undertaking Nove elektrane оf Republic of Srpska (New Powerplants) d.o.o. Gacko (NERS).

Namely, the undertakings ČEZ and ERS submitted to the Council of Competition a joint Notification of intended concentration based on the Agreement on implementation by means of which they intend through common investments in undertaking Nove elektrane оf Republic of Srpska to deal with production and distribution of electric power in the territory of Bosnia and Herzegovina.

The Agreement is a continuance of the first phase of common investment which was previously allowed by the Council of Competition and within which the ČEZ and ERS established a common undertaking for production and sale of electric power NERS (the input of ČEZ was 51% of the shares capital, the input of ERS was 49% of the shares capital). The Agreement foresees that RiTE Gacko, as a dependant undertaking of ERS, adjoins to undertaking NERS by bringing in its capital (in the form of things and rights) while ČEZ brings in the capital in the form of money and remains the owner of 51% of the share capital of NERS. The mentioned funds will be invested in reconstruction of the existing thermal-power plant, construction of a new thermal power plant „Gacko II“ and opening a coal deposit in opencast mine of Gacko Basin. After the second phase, NERS will continue the production of electric power by exploiting a coal from Gacko and it plans to deal with electric power trade.

Upon request of undertaking „Polimedia“ d.o.o. Sarajevo, the Council of Competition adopted a Resolution on initiation of the appraisal proceedings relating to presence of prohibited competition practices performed by the stock association BH Telecom Sarajevo. It is stated in the Request, submitted by Polimedia, that BH Telecom abuses a dominant position in the market, imposes directly or indirectly unfair purchase and sale prices, applies different conditions for the same or similar type of activity, concludes agreements with conditions requiring the second party to accept additional obligations and to show discrimination which infringes the stipulations of the Act on competition. The Council of Competition shall establish in the proceedings whether the market competition is prevented, restricted or distorted.

Also, upon requests of the undertakings, the Council of Competition adopted two separate Opinions relating to the obligation on submission of the notification of intended concentration to the Council of Competition, pursuant to the Act on Competition.

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