It entered into force on 29 July 2023 amendment to Act No. 143/2001 Coll., on the protection of economic competition and about changing some laws. This amendment aims to specify the requirements for the functioning of the Office for the Protection of Economic Competition (hereinafter referred to as "ÚOHS"Or"Office") and its representatives, the protection of the identity of whistleblowers of anti-competitive behavior and the overall strengthening of the position of the antimonopoly office. In addition, the amendment is also intended to ensure that the Office always has sufficient resources, both financial and human and technical. The changes brought about by the amendment are also a response to the European directive from 2018, namely Directive (EU) 2019/1 of the European Parliament and of the Council on strengthening the position of competition authorities in member states so that they can more effectively enforce the rules, and ensuring the proper functioning of the internal market. The deadline for incorporating the directive into Czech law already expired on February 4, 2021.
ÚHOS fulfills an important function with regard to the functioning of the market. It is the central body of the state administration, whose task is to support and protect economic competition from its illegal restriction.[1] It also oversees the awarding of public contracts and concessions, monitors public support and ensures that significant market power is not abused. For the proper functioning of the Office, it is necessary for it to keep up with new (unfair) practices not only in the field of economic competition and at the same time to have the most effective investigative tools that will help it to detect actions in violation of the law.
Among the most mentioned changes brought by the amendment, we could include a new investigative tool, which will allow the ÚOHS to use police wiretaps.
Police wiretapping
The general regulation of wiretapping and recording of telecommunications traffic can be found in Section 88 and Section 88a of Act No. 141/1961 Coll., Criminal Code. It serves as a tool of law enforcement authorities, which is implemented in secret under the conditions set by law and is used to clarify criminal activity. In the light of the right to privacy guaranteed by the Constitution, this is a significant intervention, but it is acceptable if all the conditions stipulated by law are properly met. According to the commentary on the criminal code, under the term "telecommunications operation" itself[2] we can present communication carried out either by telephone, walkie-talkie, fax or electronically sent messages.
The Office for the Protection of Economic Competition is now authorized to use a recording of telecommunications traffic or a recording that was taken for the purpose of monitoring as one of the pieces of evidence when exercising supervision in the matter of the conclusion of a secret horizontal agreement or collusive actions that aim to distort competition in some way of persons and things seized in criminal proceedings for a criminal offense pursuant to § 248, paragraph 2 of the Criminal Code and handed over to the Office by a criminal enforcement authority after the conclusion of the preliminary proceedings, or for any of the criminal offenses pursuant to part two of Title VI, Part 3 of the Criminal Code (Criminal acts against to the binding rules of the market economy and the circulation of goods in contact with foreign countries) and handed over to the Office when handing over or transferring the matter according to the criminal code.[3]
As can already be seen, the Office as such will not be the one conducting the wiretapping. According to the chairman of the ÚOHS doc. JUDr. PhDr. Petra Mlsny, Ph.D. but the Office will not even ask for wiretapping. The police of the Czech Republic will be able to provide them only in situations where it is an investigation of criminal offenses against economic competition. At the same time, the ÚOHS will not have access to interceptions older than the effective date of the amendment. It will therefore be possible to use only those that are taken within the framework of criminal proceedings until July 29, 2023. Records that the Police of the Czech Republic will share with the Office for the Protection of Economic Competition will be excluded from the possibility of viewing the file.[4] This measure is intended to guarantee respect for the rights of individuals.
Police wiretapping is intended to help uncover the creation of prohibited cartels and other anti-competitive behavior. Furthermore, they can be used to determine the mutual links between competitors, the extent of influencing the market through prohibited practices or the very content of secret agreements that are created for the purpose of disrupting the market. At the same time, the law enforcement authority will decide on the submission of wiretapping by the Police of the Czech Republic to the Office, if it considers that the antimonopoly office will be more suitable for investigations in specific cases. This "cooperation" could lead to the fact that, on the basis of the objective responsibility that legal entities have in competition law, the antimonopoly authority could punish cartels that, in the past, due to the systemic impossibility of proving the subjective side of the crime, the law enforcement authorities could not punish .
Therefore, the ÚOHS will only fulfill the function of a kind of passive recipient of the recording, which must be secured through the Police of the Czech Republic anyway. In addition, he will most likely only be a passive recipient in rare cases. The entire process that the Office will lead to records of telecommunications traffic, in the form in which it was approved in the amendment, is already destined to require a judicial review in many cases. However, it will be interesting to see how the cooperation between PČR and ÚOHS will proceed and whether the use of wiretapping will really be an exceptionally used investigative tool.
Identity of whistleblowers
The amendment also aims to strengthen protection against whistleblowers of possible violations of competition rules, by concealing their identity. However, this does not create any obligation for the Office, only a possibility. At the same time, it is necessary that the whistleblower himself requests the confidentiality of his identity at the latest at the same time as submitting the information, and that his legitimate interests may be threatened or damaged by its disclosure. Furthermore, the Office should proceed in its activities in such a way as not to defeat the purpose of concealing the identity of the whistleblower.[5] Documents from which the classified identity of the whistleblower could be ascertained are excluded from viewing the file. It is questionable whether this change will lead to an increase in detected cases of anti-competitive conduct, because the ÚOHS may protect the whistleblower's identity, but according to the wording used in the law, this is not his duty, which does not give the whistleblower any guarantee that his identity will not be revealed.
Strengthening the role of whistleblowers is generally dealt with by Act No. 171/2023 Coll., on the protection of whistleblowers, which was promulgated in June 2023 in the Collection of Laws. The subject of this law is the protection of whistleblowers who have become familiar with information indicating illegal conduct in connection with the performance of work or other similar activities. You can find more information about this in our article "Whistleblowing - application of the law on the protection of whistleblowers according to Czech and Slovak law", which is available on our website.
Independence and impartiality
Act No. 273/1996 Coll., on the competence of the Office for the Protection of Economic Competition, was also amended, where a provision was added which, with regard to the purpose that the ÚOHS fulfills and the principle on which it is based, we should perhaps take for granted. It is a given that the Office must act independently and impartially in the performance of its mandate and may not accept instructions from public authorities or other persons. Furthermore, it is established that other high-level (political) positions, such as the post of senator, deputy, judge or any other position in the public administration, are incompatible with the performance of the office of Chairman of the Office. The ban on membership in political parties or political movements remains.[6]
Offer of commitment and restoration of competition
The possibility to offer the Office an undertaking that will lead to the restoration of competition on the market, provided that the Office finds that someone has violated it, has also been extended. Now authorities and other state institutions can also offer a commitment, until now only companies could do so.
záver
The amendment to the Law on the Protection of Economic Competition was expected for a long time, and the changes should have taken place regardless of the need to implement the European directive.
There is no need to doubt the need to streamline the activities of the Office for the Protection of Economic Competition and at the same time strengthen its impartiality. However, it seems that the time pressure associated with that European directive has caused that the changes in the amendment are not fully completed in our opinion and in practice will quite possibly cause more problems than would be desirable. For example, the possibility of using police wiretapping seems at first glance to be a huge breakthrough and an indisputable advantage, which will from now on be a powerful weapon of the Office in the fight against unfair practices in the competitive market. But will that really be the case? The ÚOHS itself will not even be able to request records of telecommunications traffic, even if it becomes more than clear to it that the law is being violated. But we will see whether the application of this amendment in practice will not surprise us and we will not face a turning point in the activities of the Office for the Protection of Economic Competition.
Source: epravo.cz
Mgr. Lucie Špičková, Attorney
Eva Hrdličková, Paralegal
[1] § 1 of Act No. 273/1996 Coll., on the powers of the Office for the Protection of Economic Competition
[2] Šámal P. et al., Criminal Code I. § 1 to 156, Commentary. 7th edition. Prague, CH Beck, 2013
[3] § 21ga of Act No. 143/2001 Coll., on the protection of economic competition and on the amendment of certain laws
[4] § 21c of Act No. 143/2001 Coll., on the protection of economic competition and on the amendment of certain laws
[5] § 21ba of Act No. 143/2001 Coll., on the protection of economic competition and on the amendment of certain laws
[6] § 1 of Act No. 273/1996 Coll., on the powers of the Office for the Protection of Economic Competition
