The Office of Competition and Consumer Protection (UOKiK) operates on the basis of the Competition and Consumer Protection Act. The Act authorises the President of UOKiK to conduct anti-monopolist procedures in case of anti-competitive practices such as abuse of a dominant position in the market, and prohibited agreements (cartels). These can lead to orders banning the actions in question or imposing financial penalties.
- According to the Competition and Consumer Protection Act, the President of UOKiK can issue decisions that prohibit the abuse of a dominant position and the conclusion of agreements that restrict competition.
The ban on agreements that restrict competition applies to agreements that aim to eliminate, restrict or disturb competition in the markets that are relevant to the businesses in question.
The President of UOKiK examines whether competition has been disrupted as a result of an agreement restricting competition.
According to the Competition and Consumer Protection Act, it is prohibited to enter into agreements that aim at or result in restricting competition.
In particular, the following agreements are prohibited:
- fixing, directly or indirectly, purchase or sale prices or other trading conditions;
- limiting or controlling production, sales, technical progress or investment;
- sharing markets or sources of supply;
- applying onerous or dissimilar conditions to similar contracts with third parties, thereby creating diverse conditions of competition for them;
- making the conclusion of a contract dependent upon the acceptance or provision of another service by the other party, where this other service has no material connection or connection in commercial usage with the subject of the contract;
- limiting access to, or eliminating from the market, enterprises that are not parties to such agreements;
- collusion between bidders or between these bidders and the tender organizer in respect of conditions for the submission of bids, in particular as regards the scope of work or the price.
Abuse of dominant position
While it is not prohibited to hold a dominant position, an abuse of this position that causes damage to other market participants is prohibited. In accordance with the provisions of the Competition Act, it is irrelevant whether an entrepreneur’s acts are intentional or unintentional.
An entity that, to a significant extent, can act independently from its competitors, business partners and consumers, holds a dominant position. Because of its market power, this entity can effectively influence the market, and hence restrict competition. Such actions would not be possible in a market characterised by effective competition, because they would bring about an effective reaction from competitors and consumers.
The Antitrust Act introduced the principle of presumption which makes it possible to determine the market position of a business. According to the Act, an entity whose market share exceeds 40% holds a dominant position. The term "presumption" means here that exceeding 40% does not automatically mean that an entity has a dominant position. Each time, all factors related to the operation of a business in the market are analysed.
The most common abuse of a dominant position:
- fixing prices, involving direct or indirect imposition of unfair pricing or contract conditions (for instance, unfairly low prices or long payment terms);
- limiting or controlling the level of production or supply of products in an artificial way, with harm to business partners and consumers;
- discrimination, meaning applying onerous or dissimilar conditions to contracts with business partners, thereby creating different conditions of competition;
- tie-in contracts that make the conclusion of a contract dependant on the acceptance or provision of another service by the other parties;
- hampering the development of competition by counteracting the formation of conditions that are necessary for competition to emerge or develop;
- imposing onerous contract conditions that bring the businesses unjustified benefits;
- dividing a market according to territorial, product or subject criteria.
These examples are part of an open list, as the ban on the abuse of a dominant position can also apply to practices that are not defined in the Antitrust Act.
In addition, the Act regulates the rules for the concentration of enterprises.
Other types of unfair competition
The Unfair Competition Act is another legal act that regulates competition. An act of unfair competition is defined as any act that contravenes law or decent practice if it threatens or infringes the interests of another enterprise or of the customer.
Acts of unfair competition include in particular: misleading description of the enterprise, false or fraudulent marking of the geographic origin of goods or services, misleading labelling of goods and services, breaches of business confidentiality, insisting on termination or failure to perform a contract, imitation of products, accusations or dishonest recommendations, hindering access to the market, bribing public servants, dishonest or prohibited advertising, organising pyramid sales systems and consortium systems.
In addition, the Act sets out the rules for civil responsibility in the cases of acts of unfair competition.
- The rules of monitoring and granting state aid stem directly from EU legislation. Polish regulations on state aid govern national procedures for aid allocation and notification to the European Commission.
Drafts of programmes on the granting of state aid require an opinion from the President of UOKiK. The President must decide whether a given project complies with the principles of the common market and suggests changes if necessary.
The President of UOKiK must be informed immediately about the commencement of an aid procedure. The President then informs the European Commission. The Commission can check whether state aid granted complies with appropriate regulations.
The basic objective of the Office of Competition and Consumer Protection as regards implementation of government policies on consumer protection is to intervene in cases where public interest is affected. This involves the instigation of administrative proceedings when collective consumer interests are violated.
The President of UOKiK issues decisions that prohibit practices that infringe upon the rights of weaker market participants and imposes financial penalties of up to 10% of the revenue earned in the year preceding the year in which a decision is issued.
The right to control templates of contracts with consumers is an important instrument available to the President of UOKiK.
Following these controls, many requests are sent to the Competition and Consumer Protection Court to prohibit the use of specific contractual clauses. These clauses, which are then added to the Register of prohibited clauses, cannot be used in contracts with consumers.
National antitrust authorities
The President of UOKiK is a central authority of state administration. The President reports directly to the Prime Minister. The President is selected from candidates in an open competition procedure and appointed by the Prime Minister.
The President of UOKiK is responsible for antitrust policy and consumer protection policy.
Strict provisions govern company mergers
Control of concentrations
Only the concentrations that have impact on the Polish market are subject to control by the President of UOKiK, who should be informed of an intention to enter into an agreement for a concentration.
The President of UOKiK approves a concentration if it does not restrict competition significantly; otherwise, the concentration may not be approved.
When a concentration takes place without the approval of the President of UOKiK, the President may take steps to restore the state of effective competition. For example, the President can order the division of an undertaking and the resale of a part of its shares, as well as impose a financial penalty of 10% of the last year's revenue on entities involved in the concentration.
In cases other than agreements that restrict competition or the abuse of a dominant position, enterprises that believe that competitors are infringing their interests may pursue their claims through a civil law court under the Unfair Competition Act.
Information on the implementation of the anti-corruption system can be found in the Quality section of the catalogue of services that the Polish Chamber of Commerce provides to businesses on its website.
UOKiK provides information on the interpretation of legal regulations.