On 22 July 2020 the Sofia Region Administrative Court annulled the Bulgarian Commission for Protection of Competition’s decision from 2019 prohibiting the acquisition of Czech utility CEZ’ assets in Bulgaria by the financial and insurance group Eurohold Bulgaria.
The court found that the Commission had committed severe procedural violations depriving the parties from their right to be heard. The competition authority issued its negative decision only 14 days after opening an in-depth investigation phase although the Competition Protection Acts provides a 30-day period to all interested parties to submit their opinions and information.
The Commission failed to notify the parties about its preliminary conclusions on the concentration’s effect on the competition and to allow them to propose remedies. Nevertheless, the notifying party proposed at its own initiatives remedies which were rejected by the Commission without sufficient consideration. According to the court, the competition rules give priority to protecting the validity of transactions that lead to a concentration. This is why the competition authorities should proactively work with the merging parties to find appropriate remedies that can address the competition concerns.
As a result, the court returned the case to the Commission for a new in-depth examination. The decision can be appealed before the Supreme Administrative Court.
The court’s ruling comes as a breath of fresh air after a series of controversial decisions of the Commission. In 2018 the CPC stopped the attempt of Inercom, a local solar energy producer, to purchase the Bulgarian assets of CEZ. Both the Inercom and the Eurohold decisions raised numerous concerns related both to procedural aspects and the requisite legal standard for establishing impairment of competition in merger control.