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ANTITRUST: WHAT'S NEW?_November 14, 2017

LEGAL HOTLINE . 14 November 2017

THE ANTIMONOPOLY COMMITTEE OF UKRAINE (AMCU) FINED LIFECELL FOR UNFAIR COMPETITION

DLF SEEDS COMBINES ASSETS WITH SYNGENTA

PERMIT FOR CONCENTRATION MUST BE OBTAINED BEFOREHAND

Contacts

Max Lebedev

Partner, Head of corporate practice, Attorney at law

Oleksandr Melnyk

Attorney at law, Associate

THE ANTIMONOPOLY COMMITTEE OF UKRAINE (AMCU) FINED LIFECELL FOR UNFAIR COMPETITION

A fine of UAH 19,466,840 was imposed for disseminating misleading information among consumers by communicating false, incomplete, inaccurate information about outgoing calls billing to the uncertain number of individuals, which could influence the intentions of these people to acquire services from lifecell LLC.

Under the lifecell’s tariff conditions, “outgoing and forwarded calls are billed per-second and charged in the 1st second of every minute of the conversation; from the 2nd to the 60th second of every minute, conversations are not billed”.
At the same time, details on the tariff plan provide the following: “Calls are billed in the 1st second of every minute of the conversation in the amount of the specified cost of a minute”.

In the AMCU’s opinion, such wording gives consumers the reason to believe that the payment for communication services is made for each actual second of the conversation, because a second is indicated as the tariff unit of the time of services. Herewith, in the 1st second of the conversation, a subscriber is charged for the whole minute, regardless of the number of seconds of the conversation, which contradicts the concept of “per-second billing”.

Also, the AMCU has indicated that a subscriber is, in fact, unable to obtain full information about tariffs from the phone prior to concluding a contract with lifecell, as this requires activating a SIM card. Access to the tariff conditions on the website is difficult, since it requires consecutive downloading of at least three pages (files). Herewith, in the global practice, it is enough for subscribers to download a single file or web page to learn about detailed tariff conditions.

DLF SEEDS COMBINES ASSETS WITH SYNGENTA

The AMCU provided DLF Seeds A/S (Roskilde, Denmark) permits for concentration and concerted actions in part of acquisition of shares of Syngenta Seeds AB (Landskrona, Sweden) and assets of Syngenta Crop Protection AG (Basel, Switzerland), as well as for concerted actions in the form of implementation of provisions of the agreement on the sale and purchase of assets and shares in part of non-competition.

Thus, concerted actions or concentration conducted by non-residents outside the territory of Ukraine may also require prior permits of the AMCU, if (taking into account controlling relationship) such participants of concentration or concerted actions have businesses or assets located in Ukraine.


PERMIT FOR CONCENTRATION MUST BE OBTAINED BEFOREHAND

The AMCU fined Elver Company Limited (Belize City, Belize) UAH 102,000 for the concentration through acquisition of a share in the authorized capital of Rengy Trostyanets LLC, which ensures gaining more than 50% of votes in the company’s highest governance body, without prior obtaining the corresponding permit of the bodies of the Antimonopoly Committee of Ukraine, availability thereof is necessary.

It should be noted that the violator requested the permit from the AMCU, but after the concentration was conducted. This, in turn, did not remove the existing violation, but served as a mitigating factor in determining the amount of the fine thereafter.

Let us recall that concentration without a permit issued by of the AMCU entails a fine in the amount of up to 5% of income (proceeds) of a group of companies, connected with the violator through the controlling relationship, from the sale of products (goods, works, services) for the previous year. Given that in this case, based on the results of 2016, the violator’s income made UAH 4.5 billion, the maximum amount of fine could reach UAH 225 million.

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