Eight wholesalers fined

Serbia: Leniency leads to the discovery of a bid rigging cartel in office supplies

The Serbian Competition Commission (the “Commission“) recently fined eight wholesalers of office supplies a total of around EUR 510,000 for in public procurement and other tenders. The Commission established that the companies coordinated the terms of their offers following a leniency application by an unidentified whistleblower. The company in question was relieved from any sanctions. The Serbian Commission devotes special attention to potential bid- arrangements, considering them one of the priority topics at the moment.

A leniency policy gives the participants of a prohibited agreement an opportunity to secure immunity from fines by self-reporting and handing over the evidence on the existence of such an agreement, provided it was important to discovering or proving the cartel, that the authority did not already have the relevant information and that the company in question was not the instigator of the cartel. Leniency was an option under Serbian competition rules for several years now, but initial missteps in its application by the Commission, coupled with lack of awareness and general reluctance of undertakings contributed to its underdevelopment.

However, the Commission has dedicated significant efforts within the past year to promote leniency, with the case in question perceived as an incentive for other companies to step forth and uncover the notoriously elusive cartel behaviour. After all, while the whistleblower can walk away from sanctions and freely operate on the market, its’ competitors are simultaneously forced to expand their resources on dealing with substantial fines and burdensome proceedings.