CROATIA Trends and Developments Contributed by: Mirna Mišetić, Mišetić & Partners
er sectors. Second, the procedural interface between competition and pluralism review has been formal - ised. Where a media transaction is notifiable under competition law, the Croatian Competition Agency must seek the opinion of the newly designated media regulator, the Agency for Media, on the pluralism and editorial independence dimensions of the transaction. The Agency for Media has 30 days to deliver its opin - ion; silence is treated as the absence of objections. Alongside the merger control track, the Act introduces a free-standing obligation on providers of media ser - vices, electronic publications and video-sharing plat - forms to notify any change of ownership to the Agency for Media within five days, irrespective of whether the change reaches competition thresholds. The Agency for Media may order corrective measures where the change is found to compromise media pluralism, and the Act backs these powers with the possibility of revoking concessions or permits, as well as admin - istrative fines, in cases of persistent non-compliance. The institutional architecture has also been updated. The former Agency for Electronic Media has been re- established as the Agency for Media, with a broader remit covering all media services, electronic publica - tions and video-sharing platforms. This consolidation is intended to mirror the substantive scope of the EU Regulation and to provide market participants with a single regulatory interlocutor on pluralism issues. Taken together, the reform brings welcome clarity but also expands the range of regulatory touchpoints to consider when structuring a transaction in the media sector. Even a deal that does not meet competition thresholds may now trigger pluralism review, and a deal that does will be assessed through a more inte - grated dual-track process. Two faces of context-sensitive analysis: hospitality on an island, and cross-border pressure in a processing industry segment One notable trend in the Croatian Competition Agen - cy’s recent practice is its growing emphasis on a careful, fact-specific assessment of how competition actually operates in the market under review, includ - ing, where relevant, the role played by cross-border trade flows and competitive pressure from suppliers
based outside Croatia. Two cases from the past year illustrate how this approach can lead the Agency in different directions depending on the structural fea - tures of the sector concerned: • a transaction in the hospitality sector on a Croatian island, where competitive pressure was structurally limited by the narrow geographic setting; and • a transaction in a processing industry segment, where the assessment took substantial cross-bor - der competitive pressure into account. When competition is locally confined : tailored remedies in a constrained market In a recent transaction concerning hospitality and tourism in an island setting, the Agency confronted a textbook scenario of geographic constraint. The rele - vant market was, by its physical nature, bounded; the number of meaningful market participants was small; and the long-term socio-economic interdependencies between the dominant operator, local suppliers, public authorities and the broader community were unusually pronounced. Rather than apply a pure market share-driven analysis, the Agency examined the wider ecosystem, of which competition formed only one element. Its assessment identified several risks specific to highly concentrated local markets in this sector: • a tendency for infrastructure investment to align primarily with the needs of the dominant operator, at the expense of broader local development and resilience; • deepening economic dependence on a single undertaking in an integrated tourism ecosystem, which can erode the bargaining power and viability of local suppliers and service providers; • a risk of standardisation that may dilute the dis- tinctive cultural identity of the destination, with potential long-term reputational and demand-side consequences; • a corresponding erosion of the ability of local authorities to enforce sustainability and spatial planning standards in the face of disproportionate private economic power; and
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