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The Hungarian Competition Authority (GVH) has revoked its decision clearing DIGI’s takeover of Invitel; however, the concentration can still be executed with conditions attached

The GVH established that the above-mentioned undertakings had provided false information with the possible intention of misleading officials and therefore imposed a HUF 90m (EUR 0.27m) fine on the undertakings. Consequently, the GVH has revoked its decision clearing DIGI’s takeover of Invitel and it has reopened the case. The new procedure aims to assess the relevant markets that have been affected by the misleading information.

The Gazdasági Versenyhivatal (GVH) conditionally cleared DIGI Távközlési és Szolgáltató Kft.’s (DIGI) takeover of Invitel Távközlési Zrt. (Invitel) in May 2018. One of the commitments undertaken by DIGI concerned the cable television provided by its i-TV subsidiary (i-TV Digitális Távközlési Zrt.). i-TV provides a cable television service by renting other network owners’ infrastructures. According to the decision, in those towns where i-TV provides a cable television service, and in relation to which it would acquire Invitel’s cable television service as a result of the takeover, i-TV will not renew its rental contracts with the local cable network owners. With this commitment the GVH wanted to ensure that consumers would not only be able to use the cable service provided by the DIGI Group, but would also have the opportunity to choose between independent competitors.

However, the GVH subsequently became aware that the decision clearing the concentration based on misleading information that was provided by the parties. The GVH has received market indications that suggest that the commitments do not cover all of the towns where i-TV and Invitel are both present. Consequently, the GVH initiated competition supervision proceedings to investigate the matter on 29 August. The investigation found that DIGI had failed to indicate in the merger review procedure that the planned remedies did not cover all of the areas where both undertakings are present. The original decision only covered 23 overlapping areas, when in fact it was established that there are actually 89 places where overlaps occur. Therefore, the GVH revoked its decision and imposed a HUF 90m (EUR 0.27m) fine.

With the revoking of the decision, the commitments, such as the termination (non-renewal) of the rental contracts, also ceased. The GVH will now reopen the case and adopt a new decision. However, given that parts of the concentration that have already been implemented would be deemed illegal in light of the withdrawal of the approval, the GVH accepted DIGI’s request and allowed the tie-up with Invitel to continue – with the supervision of a trustee – until a new decision is adopted (for instance: the transfer and development of its networks and services, or Invitel’s integration into DIGI).

Case number: Vj/31/2018.

Budapest, 14 November 2018

Hungarian Competition Authority

 

Information for the press:
http://www.gvh.hu

Further information:
GVH Customer Service
Tel: (+36-1) 472-8851
E-mail:
http://www.gvh.hu

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More efficient concentration procedures, concentrating on digital services - the GVH’s activity in 2017 in a nutshell -

The Economic Committee of the Hungarian Parliament has approved the annual report of the Hungarian Competition Authority (GVH) on its activities in the year 2017 and on its experience with the application of the Competition Act.

The GVH paid special attention to the detection of unfair commercial practices related to the data-based economy and continued to primarily protect consumers who are particularly vulnerable when compared to the average consumer. Regarding commercial practices related to the digital economy, the GVH delivered three decisions of a guiding nature in 2017; furthermore, it published a guidance document that provides assistance for those who create social media content and publish posts on social media.

The rules relating to the control of concentrations significantly changed in the past year. The previous procedure, which was initiated via the submission of an application, has been replaced by a notification system. The thresholds have changed and the administration fee and handling time of transactions not requiring the initiation of a competition supervision procedure have been reduced. The main objective of the new system is to make the procedure related to concentrations which do not result in a substantive reduction of competition more cost-effective and shorter. The renewed regulation has already enabled the examination of thirty-three, non-complicated concentrations, each of which was handled within 5 days on average.

In 2017 the GVH continued to carry out comprehensive investigations on certain markets. It published its market analysis on the functioning of the motor vehicle distribution and repair markets and the related insurance market. The GVH recommended reducing the costs related to the entry into service of vehicles; furthermore, the reintroduction of campaign period on the third-party insurance market. A sectoral inquiry was launched on the market of accepting bank cards as the GVH noticed that smaller retailers that accept or wish to accept bankcards are faced with less favourable fees payable to payment service providers (primarily higher merchant fees) than larger traders.

The GVH also expanded its customer-friendly services. It enabled online access to files during the Competition Council (decision making body of the GVH) phase via its application called Virtual Data Room. As a result of this application requests for access to the file, copying and the disclosure of documents are simpler, faster, and more cost-effective.

The full report and its brief summary are available on the GVH’s website.

Budapest, 15 October 2018

Hungarian Competition Authority

 

Information for the press:
sajto@gvh.hu
http://www.gvh.hu

Further information:
GVH Customer Service
Tel: (+36-1) 472-8851
E-mail:
http://www.gvh.hu

Printable version in PDF

Competition supervision proceeding initiated in relation to the TV show “Ékszer”

The Hungarian Competition Authority (Gazdasági Versenyhivatal, hereinafter GVH) has initiated an investigation in relation to the TV show “Ékszer”, which is broadcast by several TV channels. It is alleged that the sales methods employed on the show amount to an infringement of the prohibition of unfair business-to-consumer commercial practices.

The GVH received several complaints regarding the show. After assessing the complaints, the GVH decided to initiate a competition supervision proceeding against the producer of the show, Emporia Style Kft. Within the framework of the proceeding the GVH will examine whether:

  • the undertaking has actually, on any occasion, sold the advertised pieces of jewellery at their stated, full original prices or whether the stipulated discounted prices have always in fact been applied, thereby resulting in false advertising;

  • the products actually possess the stipulated characteristics (e.g. “the blessing of the Pope”);

  • consumers calling into the live show can in fact influence what happens on the show- i.e. if the prices and the stocks of the products are actually influenced by the participation of consumers, or if consumers are in reality only watching a previously scripted and recorded show; and

  • consumers were forced to make immediate decisions, thereby depriving them of the opportunity to make well-established decisions, as a result of statements claiming that the advertised products would only be available for a limited period of time and that the stocks of the products at the discounted prices were continuously decreasing.

  • The initiation of the competition supervision proceeding does not mean that the undertaking in question has in fact committed the alleged infringement. The aim of the proceeding is to clarify the facts and to demonstrate the alleged infringement. The time frame for the proceeding is three months, which in justified cases may be extended twice by two months each time.

Case number: Vj/33/2018.

Budapest, 05 October 2018

Hungarian Competition Authority

Information for the press:


http://www.gvh.hu

Further information:
GVH Customer Service
Tel: (+36-1) 472-8851
E-mail:
http://www.gvh.hu

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Results and new directions in consumer protection – the digital strategy of the GVH has been published

The Hungarian Competition Authority (Gazdasági Versenyhivatal, hereinafter GVH) has elaborated a digital consumer protection strategy in order to react more effectively to current challenges on the markets. At the same time, the GVH has summarised the results and latest directions concerning the application of the Act on the Prohibition of Unfair Commercial Practices against Consumers which entered into force ten years ago.

A decade has passed since the Act on the Prohibition of Unfair Commercial Practices against Consumers entered into force on 1 September 2008. The GVH carries out its consumer protection duties alongside the MNB and consumer protection authorities. Over the past 10 years the GVH has continuously provided content to the existing consumer protection frameworks through its decisions in a number of specific cases, thereby facilitating the ability of consumers to make decisions without distortion.

The following key figures represent the GVH’s remarkable consumer protection activity over the past ten years:

  • the GVH delivered a decision in 401 cases through the application of the jubilarian UCP Act
  • imposed a fine of more than 5 billion HUF (cca 15 million EUR)
  • accepted commitments in 34 cases which enabled the undertakings to correct their infringements themselves
  • ordered the implementation of compliance programmes in 16 cases to ensure that the undertakings operate in accordance with the law
  • required undertakings to set up consumer awareness-raising educational campaigns in 12 cases
  • issued warnings against SMEs in 5 cases
  • initiated litigation to enforce civil claims of consumers in 2 cases
  • issued 275 press releases
  • carried out communication campaigns on 4 occasions in order to strengthen the awareness of consumers
  • took part in 6 international sweep projects

The investigations of the GVH regarding consumer protection covered several market sectors and products. At the beginning of the decade, the operation of consumer groups targeting individuals excluded from the services of credit institutions (BAR listed, pensioners) gave rise to significant work for the GVH. In the second half of the 2010s the timeshare resale market required particular attention. Misleading statements related to the therapeutic and health effects of certain products are a recurring subject of the GVH’s investigations, as well as the unlawful advertising practices of the information and communication and telecommunication sectors.

However, in recent years the GVH's attention has increasingly focused on unfair commercial practices related to the digital and databased economy. The GVH has published a Guidance Document in connection with advertising via influencers who are playing an active role on social media. Furthermore, the GVH has investigated the information published by certain online service providers regarding the processing of personal data in order to consumers purchase their products in light of these information. In the course of its consumer protection investigations the GVH is also increasingly monitoring the content that is appearing on online marketplaces and communication channels.

In order to handle new types of infringements against consumers in a more efficient and timely manner, the GVH found it necessary to elaborate a digital consumer protection strategy, which has just been published today.

The dynamics of digital markets, the special features of the demand and supply side, and in particular the unique characteristics of the consumers’ decisions, which differ from other markets, necessitate the application of new tools and the establishment of priorities for the future. With this new approach, the GVH seeks to ensure that its steps, practices, interventions and messages are in line with the rapid development of business models and commercial practices created by the digital economy.

The medium-term digital consumer protection strategy is available on the GVH’s website.

Budapest, 27 September 2018

Hungarian Competition Authority


Information for the press:
sajto@gvh.hu
http://www.gvh.hu

Further information:
GVH Customer Service
Tel: (+36-1) 472-8851
E-mail:
http://www.gvh.hu

Printable version in PDF
Substantial reduction of fine thanks to cooperation of the parties

The Hungarian Competition Authority (Gazdasági Versenyhivatal, hereinafter GVH) found that GE Hungary Kft. and Silver Wood – IT Kft. had committed a competition law infringement in the course of purchasing the radiology IT products of Szent János Hospital and Észak-budai Egyesített Hospitals, as the concerned undertakings had entered into an agreement which determined the winning bidder of the tender process in May 2015, with the undertakings coordinating their prices accordingly. However, during the proceeding both undertakings cooperated with the GVH, and therefore a total fine reduction of more than ten million HUF (cca 31 thousand EUR) was granted.

The significant total fine reduction of more than ten million HUF was partly a result of the fact that GE Hungary Kft. had submitted a leniency application in which it acknowledged that it had committed a competition law infringement, also attaching evidence supporting the establishment of an infringement. On the other hand, Silver Wood – IT Kft. acknowledged the statement of facts established by the GVH and forfeited its right of appeal in the framework of a settlement procedure; consequently, the GVH reduced the fine imposed on Silver Wood – IT Kft. by 30%. A further reduction of 5% was granted because the undertaking elaborated a post-compliance programme and undertook to verify the implementation of it in a detailed manner.

Taking into account the cooperative behaviour of the undertakings and the relevant provisions of the applicable leniency policy, the GVH did not impose a fine on GE Hungary Kft., while in the case of Silver Wood – IT Kft., in accordance with the above, the GVH reduced the fine imposed on it by more than a third to 2,600,000 HUF (cca 8 thousand EUR). Consequently,the GVH granted a total fine reduction of more than ten million HUF having regard to the cooperation of the undertakings.

Case number: Vj/19/2017

Budapest, 3 September 2018

Hungarian Competition Authority


Information for the press:
sajto@gvh.hu
http://www.gvh.hu

Further information:
GVH Customer Service
Tel: (+36-1) 472-8851
E-mail:
http://www.gvh.hu

Printable version in PDF

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The notification of a concentration can now also be filed electronically

Pursuant to Article 43/J (1) of the Hungarian Competition Act, the form for the notification of a concentration published on the website of the Hungarian Competition Authority (“Gazdasági Versenyhivatal” hereinafter: GV) may be submitted electronically.

A notification of a concentration can be filed electronically on the customised platform (Személyreszabott Ügyintézési Felület, SZÜF) of the governmental website using the electronic iForm application filing programme. In case of electronic submission the notification form shall be attached to the iForm application form.

The iForm programme can be accessed on SZÜF: HERE (available only in Hungarian)

The GVH emphasises that the size of the enclosed files in the iForm programme cannot exceed 20MB. If the attachment exceeds 20MB the notification of a concentration can only be filed in person or via postal services.

Further assistance concerning the electronic filing system can be downloaded in PDF format: HERE

Please note that this document is available on our webpage for information purposes only and the notification of a concentration can be submitted only in Hungarian (see here).


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