Legal background > Introduction to the procedures of the GVH > Competition supervision proceedings

Competition supervision proceedings

Competition supervision proceedings commenced ex officio

The GVH commences competition supervision proceedings ex officio against suspected infringements of provisions of the Hungarian and Community competition law which fall within the competence of the GVH, such as unfair manipulation of consumer choice, abuse of a dominant position and agreements restricting competition.

Infringements can be observed by the GVH itself, but by the submission of a complaint or an informal complaint any person may draw the attention of the GVH to them. The submission of a complaint or an informal complaint does not result automatically in the commencement of a competition supervision proceeding. The GVH initiates a proceeding, if the practice, behaviour or situation observed may infringe the provisions laid down in the Competition Act (or in both the Competition Act and the EC competition law), the GVH is competent to proceed and an intervention of the authority is needed to safeguard the public interest.

In cartel cases ex officio proceedings may be preceded by the submission of a leniency application.

The GVH makes its decision in 90 days in the case of unfair manipulation of consumer choice, which period can be extended one time by 60 days where justified. The time limit for the settlement of restrictive agreement and abuse of dominance cases is 180 days. This deadline can be extended two times by a maximum of 180 days each.

By the decision on the substance of the case adopted in proceedings initiated against unfair manipulation of consumer choice, abuse of a dominant position or restrictive agreements, the Competition Council may

  • establish the infringement of the law,

  • order a situation violating the law to be eliminated,

  • prohibit the continuation of the conduct which violates the provisions of the law,

  • impose obligations on the undertaking, the commitment of an infringement by which it has established,

  • order a corrective announcement to be published in respect of a previous information which is likely to deceive in case of unfair manipulation of consumer choice,

  • impose fines, or

  • establish that the conduct under review is not unlawful.

By means of commitment injunctions issued during the proceedings and terminating at the same time the proceedings, the intended effect may be achieved without any serious intervention: where the undertaking which is party to the proceeding undertakes commitments to ensure compliance of its practices with the legal provisions and where effective safeguarding of the public interest can be ensured in this manner, the Competition Council make those commitments binding on the party, without concluding in the injunction whether or not there has been or still is an infringement of the law. This solution is also advantageous for the undertakings.

Supervision proceedings commenced on application

The GVH also conducts authorisation proceedings commenced on application, but in the case of a failure of undertakings to submit an application it may initiate a proceeding ex officio as well.

Applications must be submitted to the GVH:

  • for the authorisation of concentrations,

  • for the extension of the one-year period of temporary acquisition of control or assets, and

  • based on a separate legal norm, for the prior authorisation of certain price increases.

The authorisation of a merger or a temporary acquisition must be applied for by the submission of an appropriately completed form with the parallel payment of a procedural fee.

Proposed mergers are assessed, depending on their complexity, in simplified of full procedures. The GVH makes its decision in a simplified procedure, if the merger does evidently not create or strengthen a dominant position, which would impede the formation or development or continuation of effective competition on the relevant market(s), so that the granting of an authorisation may clearly not be refused. The deadline for finishing a simplified procedure is 45 days, that can be extended one time by 20 days, where justified. When the Competition Council has the opinion, that because of the complexity of the case the assessment of the effects of the merger would need a more extensive scrutiny, the length of the period open for the settlement is 120 days, that may be extended one time by a maximum of 60 days, where justified. In other cases, where an application is required, the time limit of the proceeding is up to 120 days, which may be extended by 60 days. Proceedings instituted for failures to submit an application for authorisation must be settled in up to 180 days.

By its decision the Competition Council may grant the application (i. e. authorise the proposed merger, integration, acquisition, the extension of the duration of a temporary acquisition or the performance of a price increase), or it may refuse to grant authorisation. In order to reduce the detrimental effects of a concentration, the Competition Council may attach pre- or post-conditions and obligations to its authorisation decisions (e. g. the divestiture of a part of an undertaking may be demanded or the performance of a conduct may be prescribed). It may also order the "undoing" of concentrations for the authorisation of which no application has been submitted and which could not have been authorised attaching, if need be, obligations to its decision in order to restore effective competition.

Investigatory powers

During the competition supervision proceeding, the GVH have the possibility to use the following investigative measures: request for information, hearing of witnesses, access to documents, on-site inspection without a prior notification, based on a judicial authorisation, at the headquarter of the undertaking or even in private rooms and cars of the staff, seizure, sealing or the making of forensic images about the computer database.

Post-investigation

After finishing the competition supervision proceeding, the Authority controls the observance of the Competition Council's decision (for example compliance with the prescribed commitment) in the framework of a post-investigation.