Monopoly and Dominant Position in Bulgaria

The nature of monopoly and dominant position under the Protection of Competition Act (PCA) in Bulgaria.

A position of an enterprise is considered to be monopolistic if that undertaking, by virtue of the law, has been granted exclusive rights to carry out certain economic activity. A monopoly position shall be granted only by virtue of the law and any other arrangement shall be null and void.

Dominant shall be the position of an undertaking which, in view of its market share, financial resources, possibilities for market access, level of technology and economic relations with other undertakings may hinder competition on the relevant market, as it is independent of its competitors, suppliers or customers.

On the other hand, two or more undertakings may enjoy a collective dominant position, without being individually dominant. For those undertakings to be regarded as enjoying collective dominance they have to be linked in such a way as to adopt (in some respects) a common policy on the relevant market.

Prohibition of Abuse of Monopoly or Dominant Position

Article 21 of the Bulgarian Protection of Competition Act (respectively Article 102, i.e. Article 82 of the EC Treaty) prohibits undertakings enjoying monopoly or dominant (respectively collective dominant) position from conducts that may prevent, restrict or distort competition.

Forms of Abuse

The PCA points out some of the most common forms of abuse of monopoly or dominant position but the list of forms is not exhaustive:

• directly or indirectly imposing purchase or sale prices or other unfair trading conditions;
• limiting production, trade and technical development to the prejudice of consumers;
• applying to certain partners dissimilar conditions for equivalent transactions, thereby placing them at a competitive disadvantage;
• making the conclusion of contracts subject to acceptance by the other party of supplementary obligations or to the conclusion of additional contracts which, by their nature or according to common commercial usage, have no connection with the object of the main contract or with its performance;
• unjustified refusal to supply goods or to provide services to actual or potential customers in order to impede their economic activity.

Inapplicability of the prohibition for abuse of monopoly or dominant position

The prohibition of abuse pursuant to Article 21 of the PCA (respectively Article 102, i.e. Article 82 of the EC Treaty) shall be declared inapplicable in the presence of objective external circumstances which have prevented the undertaking enjoying a dominant position from adhering to its obligations. The presence of an external circumstance exerting the same influence on all participants in the market has to be proven by the undertaking, so that it can give reasons that its conduct is a form of protection against objective circumstances and not a purposeful anti-competition conduct.

The undertaking seeking to establish such inapplicability shall prove that its conduct has been motivated by the need to react to the counter conduct of its competitors and has not been aimed at restricting competition.