Published reports of the Committee for the Protection and Development of Competition of the Ministry of National Economy of Kazakhstan (Antimonopoly Authority) allow to identify some trends in the approaches used by the Antimonopoly Authority in detecting and suppressing violations of antimonopoly law.  The statistics of investigations conducted and preventive mechanisms applied in previous year 2019 as well as in the first half of 2020 reported by the Antimonopoly Authority in respective reports indicate, in particular, the following.

Investigations vs Preventive mechanisms

In 2019 the Antimonopoly Authority conducted and completed 87 investigations against market participants and state bodies, resulting in 69 cases of violations of antimonopoly law detected.

In 2020, during the first half of the year, the Antimonopoly Authority conducted 46 investigations against market participants and state bodies. Although respective reports of the Antimonopoly Authority do not contain data on the results of those investigations, a simple comparison of the number of cases for the said periods suggests that the investigation as a mechanism for detection and suppression of violations of antimonopoly law remains to be the main in arsenal of the Antimonopoly Authority.

At the same time, there is a positive dynamic in the use of preventive mechanisms by the Antimonopoly Authority, such as:

-  warnings about the inadmissibility of actions that may lead to violation of antimonopoly law (Warnings), and

-  notifications about the presence of signs of violation of antimonopoly law in the actions (inaction) of a market participant (Notifications).

For instance, in 2019, the Antimonopoly Authority issued and served 40 Warnings and 558 Notifications. In the first half of 2020 alone, the Antimonopoly Authority already served 38 Warnings and 574 Notifications.

The abovementioned preventive mechanisms allow avoiding the initiation of an investigation and, accordingly, the imposition of an administrative fine in the event of voluntary elimination of violations.

Besides, there is a positive trend in the work of the conciliation commission, which is authorized to review a draft conclusion of the Antimonopoly Authority as a result of the investigation conducted, in case there are disagreement with its arguments. The draft conclusion is submitted for consideration at least 20 calendar days before the end of the investigation.

In particular, while in 2019, as a result of 29 meetings of the conciliation commission, it was recommended to suspend investigations in 5 cases only, in the first half of 2020, investigations in 20 cases were suspended as a result of 21 meetings of the conciliation commission.

Types of antimonopoly law violations

Similarly as in 2019, in 2020 such violation as anti-competitive agreements remains to be the "leader" in the list of detected violations of antimonopoly law. For instance, in 2019, 43 (out of 87) investigations were conducted on this type of violation, whereas in the first half of 2020 there were 22 (out of 46) investigations.  This is followed by violations such as abuse of a dominant or monopoly position as well as anti-competitive actions.

Antimonopoly compliance

Reports of the Antimonopoly Authority for the period under review indicate that the antimonopoly compliance concept aimed at preventing violations of antimonopoly law is still "unpopular" and requires development and spread.

In 2019, the Antimonopoly Authority received only 2 drafts of the external act of antimonopoly compliance, out of which only 1 was approved.  Reports for the first half of 2020 do not contain any data on drafts of the external act of antimonopoly compliance received, which may suggest that there were none submitted for review by the Antimonopoly Authority.

Akylbek Kussainov, Partner, akylbek.kussainov@zanhub.com
Ilmira Yuldasheva, Counsel, ilmira.yuldasheva@zanhub.com