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The case of OTP is closed by the acceptance of commitments - consumers will be reimbursed almost 20 million HUF by the financial institution

The Gazdasági Versenyhivatal (GVH, Hungarian Competition Authority) accepted the commitments of OTP Bank Nyrt., which include an obligation to pay compensation to its consumers and the elaboration of a communication campaign for educational purposes. The GVH did not establish an infringement in the case and therefore did not impose a fine.

The GVH investigated whether the undertaking – from 1 January 2012 to 18 December 2013 – provided appropriate information about the possibilities of interest-free reimbursement related to the use of its credit cards, paying particular attention to interest calculation applicable until 20 June 2016, on the basis of which in the case of reimbursements made after the grace period interest must be paid even after purchases made in the next accounting period.

Although the undertaking did not agree with the position of the GVH, it submitted a complex commitment consisting of several elements. After a detailed examination of the content of the commitment statement, the GVH considered that the protection of the public interest could be effectively ensured by the acceptance of the commitments.

The GVH imposed the following obligations on the undertaking on the basis of the submitted commitments:

  • the undertaking shall reimburse approximately 11 thousand concerned consumers a total amount of more than 19 million HUF – charged due to the practice of the interest calculation –  furthermore, the repayment shall not place any expense or any other obligation or engagement on consumers, and the undertaking must inform consumers of the reason and circumstances of the reimbursement;

  • the undertaking shall launch a campaign for educational purposes lasting a minimum of four weeks and primarily consisting of television and online appearances (mini programme on television, online advertising, YouTube videos and website), aimed at improving the financial culture, consumer awareness and responsible decision making, as well as drawing the attention of different consumer groups to the main information regarding credit cards (e.g. accounting period, grace period, as well as the repayment opportunities);

  • in the above-mentioned information channels the undertaking shall promote an educational website that is available for a minimum of two years aimed at different consumer target groups (students, young people, elder persons) on the topic of credit card use, and enabling access to bank neutral information.

The GVH considered, as a circumstance in favour of the acceptance of the OTP’s commitments, the following:

  • the undertaking had already submitted its statement of commitment in the course of the investigation phase of the competition supervision proceeding, thereby enabling a significant amount of time and resources to be saved;

  • the commitments of OTP were also comprised of compensational and educational elements;

  • the GVH had not established any relevant infringement of OTP regarding the 5 years preceding the decision of the GVH that might be relevant for the competition supervision proceeding;

  • the commitments meet the requirements of monitoring.

When deciding on a commitment statement the primary purpose of the GVH is to ensure the effective protection of the public interest. Through the acceptance of commitments it is possible to more effectively ensure that the undertaking in question brings its practice into line with the applicable legal provisions; and at the same time the decision provides guidance to other market participants. When making its decision, the GVH assesses the circumstances for and against accepting the commitments, taking into account the specificities of the relevant market.

Case number: Vj/16/2017.

Budapest, 5 March 2018

Gazdasági Versenyhivatal

Information for the press
Andrea BASA, Spokesperson
H-1054 Budapest, Alkotmány u. 5.
Tel.: (+36-1) 472-8902
Fax: (+36-1) 472-8898
Mobile: +3630 618-6618
Email: basa.andrea@gvh.hu
sajto@gvh.hu
http://www.gvh.hu

Further information:
GVH Customer Service

Tel: (+36-1) 472-8851
Email:
http://www.gvh.hu



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The Hungarian Competition Authority screened GTCs of online dating services

The Hungarian Competition Authority (GVH) screened the General Terms and Conditions (GTC) of seven popular online dating services in the framework of a global collaboration project between February 7-8, 2018  

In the framework of Sweep Day initiated and coordinated by ICPEN, the International Consumer Protection and Enforcement Network, an umbrella organization of 58 countries’ consumer protection authorities, the participant members investigated the target sectors according to harmonized criteria. The members browsed and searched the Internet in order to unveil misleading or deceptive practices of the web based services.

Through the widescope sweep entitled „Contract terms in digital economy” the GVH screened the General Terms and Conditions of online dating services available on PC, Android- and iOS tools, basically investigating whether the content of GTCs allow the consumer to make informed transactional decisions.

Highlighting the outstanding popularity and widescale use of online dating sites, the GVH warns that the practices of online dating services’ consumer information must meet criteria of fair information providing. It is essential that all basic conditions and circumstances, such as the exact content of services, the service fees, the cases that prompt a change in service fees, the methods of entering and terminating a service contract must be communicated in a clear, transparent and accurate manner to the consumer.

Accordingly, the online dating services shall provide that

  • the cancellation of services is not made technically more complicated than the simple, few-click subscription process;

  • GTCs must be available in Hungarian language;
  • the wording of informative and legal documents such as GTCs is not lengthy and unstructured, without any guiding highlights of essential conditions and interrupted with cross-references - to enhance clarity, comprehensibility and transparency of information;

  • no significant circumstances and conditions necessary for service use are hidden, unavailable or covertly published.

The users of online dating services can make more informed decisions and enjoy the services without unpleasant surprise if

  • they review the integrity and reliability of the selected service website (i.e. users should check if relevant data about the service provides appear on the website: is it an existing company or not; users should also check out user opinions, blogs, feedback about the online dating site – to make sure that the selected dating site lists existing profiles and users are satisfied with the services provided;

  • they devote time to read service conditions in the GTC that can be relevant for their own use, e.g. conditions on membership and related fees;

  • they contact the service provider’s customer service regarding questions on the GTC;

  • they changed their minds following registration and decided to cancel the services within the 14 days deadline;

  • they pay attention whether the contract is temporary or for indefinite duration, and whether a temporary contract is automatically renewed;

  • they check possibilities for contract cancellation prior to registration – it is practical to set up a phone or notepad reminder about the date of cancellation of renewal, to prevent unwanted service renewals;

  • they generate a separate email address for the use of dating sites;
  • hey store correspondence that is related to the cancellation of contract with the Service Provider, or save correspondence by means of print screens

The ICPEN Sweep provides greater insight for the GVH into practices typical in the online dating sector – if needed, such insight can ground the initiation of future competition surveillance procedures.

The ICPEN website provides detailed information on the Sweep Day – a comprehensive analysis of participating members’ reports will be published in the first half of 2018.

Budapest, 14 February 2018

Hungarian Competition Authority

Information for the press:
Andrea BASA
Spokesperson
Alkotmány u. 5., H-1054 Budapest,
Tel: (+36-1) 472-8902
Mobile: +36 30 6186618
Email:
press@gvh.hu
http://www.gvh.hu

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

 

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The key to successful and more efficient competition law enforcement is the close collaboration of the V4+ countries’ Competition Authorities

The Authorities of the Visegrad Group countries, and also of Austria and Slovenia, often face similar questions in the course of their enforcement activities; whether it relates to the efficiency of their cartel detection activities and the legal toolkits at their disposal, or merger control and ensuring the right of due process. The close collaboration of the regional competition authorities may result in solutions being found to the above-mentioned questions. The representatives of the V4+ countries’ Competition Authorities – on the initiative of the Hungarian Competition Authority (GVH) – met for the second time at a competition conference held in Budapest during the Hungarian presidency of the Visegrad Group.

The representatives of the 6 countries (Austria, Czechia, Poland, Hungary, Slovak Republic, and Slovenia) attending the 2nd Visegrad 4+ Competition Conference attempted to respond to common and current questions pertinent to the region. The conference was organised along the following themes: legislation and enforcement questions, cases in the retail trade, and the practice of the compliance programmes.

Miklós Juhász, President of the GVH, explicitly welcomed the benefits of the regional cooperation, emphasising: “We can learn a lot from each other, if we follow the developments of the V4+ countries’ competition law, which the Authorities encounter in their everyday work.”. Mr. Juhász stated that the existence and work of the Competition Authorities are unquestionable, due to the significant benefits they bring to society. The GVH quantifies the benefits of its activities every two years. The last assessment revealed that the budgetary spending on the GVH pays off, since in the period of 2011-16, consumers saved a sum that is more than six times the total budget of the GVH due to the work of the authority. He added that the GVH has taken a number of steps in order to promote the compliance of SMEs in the last 4 years, since the date of the last V4 conference.

Maintaining and increasing competitiveness is of crucial importance in Central Europe. Competition authorities have an important role in safeguarding competitiveness by blocking unfair market practices – Levente Magyar, Deputy Minister of Foreign Affairs and Trade, pointed out in his opening speech. He emphasised that the 25 years of Visegrad cooperation has brought concrete results in the region, also in the field of competition law enforcement.

Paul Csiszar, Director, Directorate-General Competition of the European Commission, began his introduction by stating: “Effective competition law enforcement by our NCAs based on sound and fair policy considerations is essential for building strong social market economies in our region.  Such enforcement enhances economic growth, creates a level playing field for businesses including SMEs, and it leads to better prices, quality and choice to consumers.” He further added: “Today’s conference clearly contributes – by sharing the representatives’ experiences – to successful and more efficient competition law enforcement.

The members of the session on developments in the legislation and the competition law enforcement in the V4+ countries, which was moderated by András Tóth, Vice-President of the GVH, Chair of the Competition Council of the GVH, agreed that a number of similarities exist in the field of competition law in the V4 countries and Austria and Slovenia, which may lay the foundation for enhanced cooperation between the countries. Noted examples were the efforts taken to promote compliance with the rules relating to concentrations, and the introduction and operation of informant programmes aimed at facilitating the detection of cartels.

The session on the questions of compliance summarised the common characteristics of compliance programmes acceptable by the competition authorities in general, primarily from the perspective of the undertakings. Zoltán Hegymegi-Barakonyi, Lawyer, President of the Hungarian Competition Association, who moderated the conversation, stressed that the GVH was the first competition authority in the region to make it possible for undertakings under investigation to obtain a fine reduction if they had an internal compliance programme. According to the notice published in January 2018, the GVH may reduce a fine by 10% if an undertaking has an internal compliance programme.

The presentations of the 2nd V4+ Competition Conference will be available on Tuesday (6 February) on the website of the GVH.

Budapest, 05 February 2018

Hungarian Competition Authority

 

Information for the press:
Andrea BASA
Spokesperson
Alkotmány u. 5., H-1054 Budapest,
Tel: (+36-1) 472-8902
Mobile: +36 30 6186618
Email:
press@gvh.hu

http://www.gvh.hu

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

 

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The GVH held unannounced inspections at the premises of Telekom and Telenor

The Gazdasági Versenyhivatal (GVH – Hungarian the Competition Authority) initiated a proceeding to investigate the cooperation of Magyar Telekom Nyrt. (Telekom) and Telenor Magyarország Zrt. (Telenor) which affects their networks and frequencies that are necessary for them to provide broad-band services. In the framework of this proceeding the GVH held unannounced onsite inspections at the premises of the two undertakings.

According to the suspicion of the GVH, Telekom and Telenor are suspected of coordinating their behaviours in respect of tenders published by the Nemzeti Média és Hírközlési Hatóság (National Media and Communications Authority) in 2014, in order to obtain rights to use frequencies that are necessary to provide broad-band services. It is presumed that the agreement may have been aimed at sharing the relevant market in advance and at coordinating the bids of the undertakings with the purpose of fulfilling the tender’s conditions. These practices may have violated provisions of the Hungarian Competition Act and the Treaty on the Functioning of the European Union, which prohibit agreements restricting competition.

The case initiation is motivated by the protection of the public interest, taking into account the role of undertakings in the market, the nature of the service provided by them, the significant number of subscribers potentially affected by the conduct and the gravity of the alleged infringement.

The GVH is legally empowered to hold unannounced onsite inspections based on the provisions contained in the Hungarian Competition Act. These provisions require the GVH to obtain prior judicial approval before holding the inspections.

The initiation of the competition supervision proceeding does not mean that the undertakings in question have actually committed an infringement. The proceeding seeks to clarify the facts and to prove that the presumed infringement has been committed. According to the Act these proceedings must be closed within 6 months, however, this time limit can be extended two times by a further 6 months, depending on the complexity of the case.

Case number: Vj/1/2018.

Budapest, 25 January 2018.

Hungarian Competition Authority

 

Information for the press:
Andrea BASA
Spokesperson
Alkotmány u. 5., H-1054 Budapest,
Tel: (+36-1) 472-8902
Mobile: +36 30 6186618
Email:
press@gvh.hu
http://www.gvh.hu

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

 

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According to the GVH’s new Notices on Fines significant advantages can be gained from cooperating with the authority

The Gazdasági Versenyhivatal (GVH - Hungarian Competition Authority) incentivises undertakings to remedy the harm caused to consumers as a result of competition law infringements and to operate compliance programmes by reducing the fines imposed upon them.

Undertakings infringing competition and consumer protection rules falling within the competence of the GVH may face significant fines, which may even amount to 10% of their net turnover in the previous year. The principles and methods of setting fines are laid down in the GVH’s Notices on Fines. In the new Notices on Fines issued in December 2017 the GVH has further broadened the range of circumstances that may result in fines being significantly reduced and even eliminated entirely for undertakings cooperating in competition supervision procedures.

In the framework of the above-mentioned - in addition to the benefits that can be derived from the leniency programme and settlement procedure, which were introduced a number of years ago in cartel and dominant position cases - those undertakings which take action to remedy (either partially or entirely) the negative effects stemming from their infringements, in particular as regards to the compensation of consumers, can expect substantial reductions in the amounts of the fines imposed on them. In such situations, the amount spent to entirely compensate consumers can be deducted from the amount of the fine that would have otherwise been imposed. The amount spent to partially compensate consumers can result in the reduction of the fine, as was the case recently with Vodafone when the undertaking was able to have its fine reduced by almost half, to 200 million HUF, - among other things- by offering to compensate consumers.

The GVH also incentivises undertakings to introduce compliance programmes by offering fine reductions for them. In the course of consumer protection cases it is possible for a fine to be completely eliminated if an undertaking has sought a legal opinion before launching its advertising campaign. In the course of cases concerning cartels and abuses of dominant position the GVH may grant a 7-10% fine reduction to any undertaking that terminates its participation in an infringement as a result of a compliance programme, or to any undertaking that has agreed to provide evidence to the GVH in any possible subsequent proceeding. Depending on the particular case in question, the GVH also encourages undertakings to take compliance programmes in its proceedings by granting a fine reduction of between 5-20%. The GVH remunerates the admission of infringements and the provision of evidence by reducing fines, to a degree of even 20-30% in consumer protection cases.

When preparing the new notices the GVH relied extensively on the opinion of the domestic and international professional audience.

Budapest, 9 January 2018

Hungarian Competition Authority

 

Information for the press:
Andrea BASA
Spokesperson
Alkotmány u. 5., H-1054 Budapest,
Tel: (+36-1) 472-8902
Mobile: +36 30 6186618
Email:
press@gvh.hu
http://www.gvh.hu

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

 

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