Abuse-of-dominance provisions of central and eastern european competition laws:

have fears of over-enforcement been borne out?

Abstract

Fifteen years ago, when economic reformers were writing and enacting competition laws in the transition economies of
Central and Eastern Europe, some critics warned that such laws, or too stringent enforcement of such laws, carried the
danger of discouraging competitive behaviour and the development of markets. An examination of the enforcement
experience with the abuse-of-dominance provisions of the laws of eleven countries over two separate time periods
suggests that the feared evils have not materialized. Two patterns stand out in this enforcement experience: first, the
number of findings of abuse of dominance has been very small in countries other than Poland , and second, a large and
growing proportion of these findings of abuse have been in sectors that would in developed market economies be
subject to economic regulation. As the socialist governments of Central and Eastern European (CEE) countries were falling to the “velvet revolutions” of 1989, reformers and scholars in these countries faced a daunting task. Existing constitutional provisions and laws were either inappropriate for democratic, market economies or, if appropriate, had been more honoured in the breach than in the observance. Ministers and ministries in nominal control of particular facets of economy and society had in fact operated under detailed instructions from the communist party. New sets of market-friendly laws had to be written and enacted, new ministries and agencies created, new ministry and agency staffs trained in the science and art of encouraging and protecting, rather than suppressing, market forces.