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Law of the Republic of Armenia on Protection of Economic Competition
 
 
 

L A W   O F  T H E  R E P U B L I C  O F  A R M E N I A

ON PROTECTION OF ECONOMIC COMPETITION

Adopted on 6 November 2000

Adopted on
November 6, 2000


 

C H A P T E R  1

GENERAL PROVISIONS
 

Article 1. Objective of the Law

The objective of the Law is to protect and encourage free economic competition, ensure appropriate environment for fair competition, promote development of entrepreneurship and protection of interests of consumers in the Republic of Armenia.

(Article 1 supplemented by HO-107-N of 22 February 2007)

 

Article 2. Subject matter of the Law

1. This Law shall apply to actions or conduct of economic entities, state bodies, as well as officials thereof that lead or may lead to restriction, prevention, prohibition of economic competition, or act of unfair competition, except for cases provided for by law, as well as may prejudice the interests of consumers.

2. This Law shall not apply to relations pertaining to intellectual property rights, except for cases provided for by this Law.

3. Where international treaties of the Republic of Armenia prescribe norms other than those provided for by this Law, the norms of the international treaties shall apply.

4. The State Commission for the Protection of Economic Competition of the Republic of Armenia (hereinafter referred to as "the Commission") shall perform the functions of economic competition with regard to persons regulated or supervised by the Central Bank of the Republic of Armenia, as well as with regard to persons operating in the regulated sector of public services based on the principle of co-operation with the Central Bank of the Republic of Armenia and Public Services Regulatory Commission of the Republic of Armenia (hereinafter referred to as "Regulatory Bodies"), respectively.

5. The Regulatory Bodies shall — before the adoption of secondary legal acts on the prevention of abuse of dominant position, anti-competitive agreements and concentrations — submit them to the Commission for an opinion.

6. The Commission shall inform the Regulatory Bodies on the issues of economic competition emerging in the fields provided for by this Article.

7. The Commission shall, except for the cases provided for by part 10 of this Article, refrain from making any intervention related to an issue raised with regard to economic competition, where the Regulatory Bodies reasonably inform the Commission that the given issue is reserved, based on the objectives of regulation prescribed by law, to the Regulatory Bodies and that the Regulatory Bodies perform functions prescribed by law.

The Commission may express its position under the procedure prescribed by this Article, but the final decision shall be adopted by the Regulatory Bodies.

8. The Regulatory Bodies shall, while undertaking measures and within the scopes prescribed by law, provide the Commission with the opportunity of expressing its position. The Regulatory Bodies shall mandatorily address all the issues raised and positions expressed by the Commission, by providing justifications for the acceptance or non- acceptance thereof.

The Regulatory Bodies shall mention the position of the Commission in their final opinion or decision, and in case of rejecting the position of the Commission — the justifications thereon.

In case of failure by the Commission to submit its position as prescribed by this part, the decisions or opinions of the Regulatory Bodies shall be adopted without getting the position of the Commission.

9. The procedure prescribed by parts 5, 7 and 8 of this Article shall not apply in exceptional cases, where the Central Bank of the Republic of Armenia aims to prevent the potential danger posed to financial stability and price stability or to address it, declares a financial organisation insolvent or submits an application for bankruptcy to the court, enforces alienation of the shares or stocks of a financial organisation or of a participant thereof, exercises reorganisation of a financial organisation, forced sale or liquidation.

The Regulatory Bodies shall, following the adoption of the decisions provided for by this part, inform the Commission thereon, where they do not contain information constituting a bank secret or other secret protected by law.

10. Where the Commission finds that the information provided by the Public Services Regulatory Commission of the Republic of Armenia, envisaged by part 7 of this Article, is not justified, it may apply to the Prime Minister by filing a motion for including the given issue in the agenda of the regular sitting of the Government. In the case provided for by this part, the Government shall, by adoption of an individual legal act, determine the competent body performing the functions of economic competition related to the issue raised with regard to the economic competition.

(Article 2 edited by HO-107-N of 22 February 2007, amended by HO-137-N of 12 April 2011, supplemented by HO-249-N of 23 March 2018)

 

Article 3. Legislation on the protection of economic competition

The legislation on the protection of economic competition comprises the Constitution of the Republic of Armenia, the Civil Code of the Republic of Armenia, this Law and other legal acts.

 

Article 4. Main concepts

1. Main concepts used in this Law shall be the following:

economic competition or competition — economic activity aimed at ensuring the most favourable conditions for selling or acquiring goods, as a result of which opportunities of each competitor to unilaterally influence general conditions of the goods turnover in the given commodity market are objectively limited;

goods — any object of civil law, including property, work, service (including financial) which is designated for sale;

substitute goods — goods which are comparable in terms of their intended use, application, qualitative, technical, price or other characteristics, in a way that the acquirer substitutes or is ready to substitute certain goods for others;

commodity market — the field of turnover, prescribed upon the decision of the Commission, of the given goods and the substitutes thereof within a certain area, the boundaries whereof are determined by economic or other opportunities and expediency for acquisition of the goods by the buyer in the relevant territory and the lack of such opportunities and expediency beyond the boundaries thereof. Commodity market is characterised by product type and geographical boundaries, the composition and volume of its subjects;

product type range of a commodity market — the entirety of given goods and the substitutes thereof, prescribed by the decision of the Commission;

geographical boundary of a commodity market — a certain geographic territory (including road, air, water and overland route, etc.), prescribed by the decision of the Commission, within the scope whereof the acquisition of the given goods and the substitute goods thereof is economically possible and expedient for the buyer and such possibility and expediency is not available beyond the given territory. The geographical boundary of a commodity market may cover the entire territory of the Republic of Armenia or a part thereof, or the territory of the Republic of Armenia (or a part thereof) and that of other state (or a part thereof);

subjects of a commodity market — a seller (vendor, supplier, alienator, provider, executor) and an acquirer (buyer, recipient, accepter, consumer) of the given goods and substitutes thereof;

volume of commodity market — the total volume of sale or acquisition of goods and substitutes thereof within the geographical boundary of a commodity market expressed in in-kind and/or value terms;

sale — vending, supply, alienation, provision, execution;

acquisition — purchase, receipt, acceptance;

state body — a public administration or local self-government body, an institution of the State or community, Central Bank of the Republic of Armenia;

economic entity — a license fee payer, an individual entrepreneur, a legal person, other organisation, its representative, representation or branch, a group of persons. In case of concentration provided for by this Law a natural person shall also be deemed to be an economic entity;

official of an economic entity — a person exercising the competences of the sole executive body of the economic entity, or a member of the collegial executive body, or a managing person performing organisational, instructive or administrative-economic functions;

trade facility — a property complex (land parcel, building, structure) which is used in the field of sales for delivering goods to consumers;

trade network — a cluster of two or more trade facilities functioning under common management or operating under the same trademark or other identification mark;

economic conditions (factors) — expenses, taxes, duties, mandatory payments related to acquisition, production, sales of goods (delivery of service, performance of works);

unjustified price increase — increase, by the economic entity, of the price of goods and/or substitutes thereof within a certain period of time, not preconditioned by economic conditions (factors);

unjustified price decrease — decrease, by the economic entity, of the price of goods and/or substitutes thereof within a certain period of time, not preconditioned by economic conditions (factors);

unjustified price maintenance — maintenance, by the economic entity, within a certain period of time, of the price of goods and/or substitutes thereof (including up to five percent change in that price) in a situation when the existence of certain economic conditions (factors) might have led or should have led to fixing a lower or higher price;

discriminatory conditions — conditions for entering the commodity market, as well as for production, exchange, consumption, sale or transfer of goods in any other way, which create unequal competitive conditions for the economic entity or the consumer or unequal situation as compared to another economic entity or consumer;

characteristics restricting, preventing or prohibiting competition — reduction in the number of economic entities that are not a group of persons, increase or decrease in the price of goods, which are not related to the relevant changes of the general conditions of goods turnover in the commodity market, refusal by economic entities that are not group of persons to make independent actions in the commodity market, defining general conditions of goods turnover in the commodity market as a result of anti-competitive agreements reached by economic entities or according to the binding instructions given thereto by another person, or as a result of co-ordination of actions by economic entities that are not group of persons, other circumstances which provide the economic entity with the opportunity to unilaterally influence the general conditions of the goods turnover in the commodity market, as well as defining, by state bodies and/or officials thereof, of requirements not provided for by law with regard to goods or economic entities;

co-ordination of economic activity — co-ordination of the actions of the economic entities by the natural person, the economic entity or state body or the official thereof, which is not included in the group of persons with any of those economic entities and does not carry out activity in the commodity market, where the co-ordination of actions of the economic entities is being performed;

direct supervision — the possibility of predetermining, by the legal or natural person, the decisions adopted by the legal person, which is manifested through performance of the functions of the executive body of the legal person, through acquisition of the right to establish the conditions of entrepreneurial activity of the legal person and/or through disposal of the votes of more than 50 per cent of the total number of votes granted by the stocks (shares) comprising the authorised capital (share capital) of the legal person;

indirect supervision — the possibility of predetermining, by the legal or natural person, the decisions adopted by the legal person, through a legal or a natural person which has direct supervision over the given legal person;

(paragraph repealed by HO-249-N of 23 March 2018)

delivery of an administrative (legal) act or other document (hereinafter referred to in this paragraph as “correspondence”) — sending the correspondence by registered mail to the address of the place of location, place of residence or place of activity of the addressee, or postal or other address specified by the addressee, or handing it over in person, or transmitting via other means of communication ensuring the formulation of the message, or delivering it in any other due manner. Correspondence, sent (delivered) to the address of the place or postal address specified in this paragraph, shall be deemed to be duly delivered to the addressee irrespective of the circumstance as to whom it was provided. The organisation providing postal communication service shall bear the responsibility for the damage caused to an addressee due to incorrect delivery of correspondence. In case the addressee refuses to receive the correspondence sent via the address of the place or postal address specified in this paragraph or sign the document certifying the receipt of the correspondence, or the correspondence sent by the Commission through registered mail is returned due to absence of the addressee, the correspondence shall be deemed to be duly delivered to the addressee on the third day following the day of posting by the Commission a statement on the availability of the correspondence addressed to the addressee and possibility of becoming familiar with its content at http://www.azdarar.am and/or on its official website;

asset value — balance sheet value of the asset;

unit — right to participation (share, stock, other security) in the authorised capital (share capital) of a legal person;

monitoring — observation carried out in the place of activity (including in the trade facility) of the economic entity for the purpose of detection of the price, quality, quantity, other characteristics of the goods sold or acquired by the economic entity, as well as actual actions or conduct of the economic entity.

2. The concepts defined in this Article shall be applied only within the meaning of this Law and other legal acts adopted on the basis thereof.

3. Other concepts specified in this Law shall be applied within the meaning prescribed by the Civil Code of the Republic of Armenia, other laws and other legal acts.

(Article 4 supplemented by HO-29-N of 25 December 2003, edited by HO-107-N of 22 February 2007, HO-227-N of 26 December 2008, supplemented, amended, edited by HO-137-N of 12 April 2011, HO-249-N of 23 March 2018)

 

Article 4.1. Group of persons

1. Within the meaning of this Law, a group of persons shall be a group of legal and/or natural persons who are actually interrelated or under supervision of each other, and they meet at least one of the following conditions;

(1) an organisation and a natural or legal person, where that natural or legal person has, based on participation thereof in that organisation and/or on a contract, the right to directly or indirectly dispose of (including through purchase and sale, trust management, joint activity contract, commission or other transactions) more than half of the authorised capital or unit of an organisation as prescribed by legislation;

(2) organisations, where the same natural or legal person has, based on participation thereof in those organisations and/or a contract, the right to directly or indirectly dispose of (including through purchase and sale, trust management, joint activity contract, commission or other transactions) more than half of the authorised capital or unit of organisations as prescribed by legislation;

(3) an organisation and a natural or legal person, where that natural or legal person has, based on the founding documents of the organisation or a contract or otherwise, the opportunity to predetermine the decisions (including conditions for conducting entrepreneurial activity) adopted by that organisation and/or to give binding assignments to that organisation;

(4) organisations, where the same natural or legal person has, based on the founding documents of the organisation or a contract or otherwise, the opportunity to predetermine the decisions (including conditions for conducting entrepreneurial activity) adopted by those organisations and/or to give assignments binding for those organisations;

(5) an organisation and a natural or legal person, where the sole executive body and/or more than half of the composition of the collegial executive body of that organisation has been elected or appointed, and/or more than half of the composition of the management body of that organisation has been elected upon recommendation of that natural or legal person;

(6) organisations, where the sole executive bodies and/or more than half of the composition of collegial executive bodies of those organisations have been elected or appointed, and/or more than half of the compositions of management bodies of those organisations has been elected upon recommendation of the same natural or legal person;

(7) an organisation and a natural or legal person, where that natural or legal person has been exercising the competences of the sole executive body of that organisation for at least one year;

(8) organisations, where the same natural or legal person has been exercising the competences of the sole executive bodies of organisations for at least one year;

(9) organisations, wherein more than half of members of the collegial executive body are the same natural persons;

(10) natural and/or legal persons, the trade facilities operated whereby are under common management or function under the same trademark or other identification mark;

(11) a natural person, his or her spouse, parent, child, brother, sister;

(12) natural and/or legal persons, each of which forms a group of persons with the same person on one of the grounds referred to in this part, as well as other persons, who form a group of persons with one of the given persons on one of the grounds referred to in this part;

(13) an organisation, a natural and/or legal person, who – on one of the grounds referred to in this part – form a group of persons, where those persons have, based on their participation in the organisation and/or on a contract, the right to directly or indirectly dispose of (including through purchase and sale, trust management, joint activity contract, commission or other transactions) more than half of the authorised capital or unit of that organisation as prescribed by legislation.

(Article 4.1 supplemented by HO-249-N of 23 March 2018)

 

C H A P T E R  2

ANTI-COMPETITIVE AGREEMENTS
 

Article 5. Anti -competitive agreements, prohibition thereof 

1. Within the meaning of this Law, anti-competitive agreements shall be deemed to be transactions concluded between economic entities, their agreements, directly or indirectly co-ordinated actions or conduct, decisions adopted by unions of economic entities (hereinafter referred to as “agreements”), which directly or indirectly lead or may lead to restriction, prevention or prohibition of competition, except for the cases provided for by part 7 of this Article.

2. Anti-competitive agreements shall be concluded (reached):

(1) between potentially or actually competing economic entities operating in the same commodity market (horizontal agreement);

(2) between economic entities (sellers and acquirers or potential sellers or acquirers of the goods and/or substitutes thereof that are not competitors) having certain interrelation and operating in different commodity markets (vertical agreement);

(3) (point repealed by HO-249-N of 23 March 2018)

3. Horizontal anti-competitive agreements may particularly relate to:

(1) distribution or division of the market or supply sources according to the volume of sale or acquisition or assortment of goods or groups of sellers or acquirers or territorial principle or otherwise;

(2) impediment to the market entry (restriction of the market entry) of other economic entities, or ousting them from the market;

(3) unjustified increase, decrease or maintenance of the prices of goods;

(4) agreed direct or indirect establishment, change or maintenance of sale or purchase prices, rates, discounts, surplus, privileges or other conditions of trade;

(5) restriction of or control over product, supply, technical development or modernisation, import, trade or investment;

(6) import of goods to the detriment of the interests of consumers or unjustified decrease in or termination of production or creation or maintenance of deficit in the commodity market by means of keeping, spoiling and destroying the goods;

(7) arrangement with regard to the conditions or results of state procurement or tenders or auctions or falsification (distortion) of the results thereof or unjustified increase, decrease or maintenance of the price of goods;

(8) an arrangement to organise the trade activity with any economic entity without a grounded reason;

(9) offering or applying unequal conditions for the same goods, which lead or may lead to restriction, prevention or prohibition of economic competition;

(10) force additional obligations on the party to a contract, including trade facilities, which are not justified economically or technologically and are unfavourable for the party, or where they are not related to the main subject of the contract in their nature or in terms of their fulfilment;

(10.1) compelling not to enter into contractual relations, or compelling to terminate or to suspend the contractual relations with certain sellers or acquirers;

(11) other conditions or conduct, which lead or may lead to restriction, prevention or prohibition of economic competition.

4. Vertical anti-competitive agreements may particularly relate to:

(1) restrictions of sale of goods in terms of territorial, price or other characteristics;

(2) unjustified increase, decrease or maintenance of the prices of goods;

(3) refusal to acquire (sell) goods from (to) other economic entities;

(4) offering or applying unequal conditions for the same goods, which lead or may lead to restriction, prevention or prohibition of economic competition;

(5) establishment of such a clause (clauses) in transactions which is (are) not economically or technologically justified and is (are) unfavourable for the party, or which in its (their) nature or in terms of implementation is (are) not related to the main subject of the transaction;

(5.1) compelling not to enter into contractual relations, or compelling to terminate or to suspend the contractual relations with certain sellers or acquirers;

(6) other conditions or conduct, which lead or may lead to restriction, prevention or prohibition of economic competition.

5. Anti-competitive agreements shall be deemed to be proven, where:

(1) there exists any factual data (including any written document or other written evidence, video or audio recording), or any other evidence not prohibited by law;

(2) they are evidenced by the actions or conduct of economic entities, referred to in part 3 and 4 of this Article.

6. Concluding (reaching) anti-competitive agreements shall be prohibited.

7. The following shall not be deemed to be anti-competitive agreements:

(1) vertical agreements of economic entities, where the share of each of the participants of the given agreement does not exceed 20 per cent in the relevant commodity market;

(2) agreements concluded by economic entities included in the group of persons, where one of those economic entities has directly or indirectly established supervision over the other economic entity, and where those economic entities are under direct or indirect supervision of one person, except for the agreements concluded by economic entities that perform such types of activities the simultaneous performance whereof by several economic entities included in the group of persons is proscribed by law.

8. Before concluding (reaching) an agreement, economic entities may apply to the Commission in order to receive an opinion.

(Article 5 edited by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, supplemented, amended, edited by HO-249-N of 23 March 2018)

 

Article 5.1. Grounds for and procedure of permitting anti-competitive agreements

1. Vertical anti-competitive agreements that are to be qualified as anti-competitive agreements shall be permitted upon the decision of the Commission, where they do not establish, with regard to economic entities, restrictions that are not necessary for fulfilling the objectives of those agreements and do not create a possibility for the restriction, prevention and/or prohibition of competition in the relevant commodity market, and where the economic entities prove that such agreements contribute or may contribute to:

(1) improvement of the production (sale) of goods or promotion of technical (economic) progress or increase in the competitiveness of goods produced in members states in the world commodity market;

(2) receipt, by consumers, of the relevant part of advantages (benefits) acquired as a result of actions undertaken by relevant persons.

2. The Commission shall be entitled to establish binding assignments and/or conditions along with permitting, upon its decision, the vertical anti-competitive agreements of the economic entities.

3. The Commission shall be entitled to declare the decision on permitting vertical anti-competitive agreements of the economic entities repealed, where it is confirmed by the evidence obtained later by the Commission that the decision was adopted based on inaccurate information, or where the economic entity has failed to fulfil the assignments or has failed to comply with the conditions prescribed by the decision of the Commission.

(Article 5.1 supplemented by HO-249-N of 23 March 2018)

 

Article 5.2. Co-ordination of economic activities

 It shall be prohibited to carry out co-ordination of economic activities that leads and/or may lead to:
 
(1) application or maintenance of prices (tariffs), discounts, supplements (additional payments), mark-up;
 
(2) increase, reduction in or maintenance of prices during auctions, biddings, procurements or tenders;
 
(3) division of the commodity market according to the territorial principle, volume of sale or acquisition of goods, assortment of sold goods or the composition of vendors, buyers or customers;

(4) reduction in or termination of the production of goods;
 
(5) refusal to conclude contracts with specific vendors, buyers or customers;

(6) establishment of a resale price of goods, except for the cases where the vendor establishes the maximum resale price of goods for the buyer;

(7) the obligation on the buyer not to sell the goods of an economic entity which is the competitor of the vendor. Such a prohibition shall not extend to an agreement reached with regard to the organisation, by the buyer, of sales of goods bearing the trademark or any other identification mark of the vendor or the producer;

(8) restriction, prevention or prohibition of competition by other means.

(Article 5.2 supplemented by HO-249-N of 23 March 2018)

(Chapter edited by HO-107-N of 22 February 2007)
 
 
 

C H A P T E R  3

MONOPOLISTIC OR DOMINANT POSITION
 

Article 6. Monopolistic or dominant position

1. Within the meaning of this Law, an economic entity shall be deemed to have a monopolistic position in the commodity market, where it has no competitor as a seller or acquirer.

2. An economic entity shall be deemed to have a dominant position in the commodity market, where:

(1) it has a market power in the given commodity market, in particular, does not encounter any significant competition as a seller or acquirer, and/or based on its financial standing or other qualities has the opportunity to have a decisive influence on the general conditions of the goods turnover in the given commodity market and/or oust the other economic entity from the given commodity market and/or impede the entry into the given commodity market; or

(2) as a seller or acquirer it captures at least one third of the given market in terms of sale or acquisition volumes; or

(3) each of two economic entities having the largest sale or acquisition volumes in a commodity market shall be deemed to have a dominant position in the given commodity market, where they jointly capture, as sellers or acquirers, at least one third of the given market in terms of sale or acquisition volumes; or

(4) each of the three economic entities having the largest sale or acquisition volumes in the commodity market shall be deemed to have a dominant position in the given commodity market, where they jointly capture, as sellers or acquirers, at least two thirds of the given market in terms of sale or acquisition volumes.

3. Economic entity (entities) shall be deemed to have a dominant position on one of the grounds provided for by points 2, 3 or 4 of part 2 of this Article, taking into account the peculiarities of the structure of the given commodity market with regard to the distribution of shares of economic entities operating in that market.

Economic entity (entities) may not be deemed to have a dominant position on one of the grounds provided for by points 3 or 4 of part 2 of this Article, where it (they) as sellers or acquirers does (do) not exceed one tenth of the given market by sale or acquisition volumes. Economic entity (entities) referred to in this Article may provide evidence excluding the existence of its (their) dominant position in the given commodity market.

4. The procedure and criteria for determining the monopolistic or dominant position, including the market power of an economic entity shall be prescribed by the Commission.

5. An economic entity shall be deemed to have a dominant position, where:
(1) four or more trade facilities (trade network), the annual sales turnover whereof exceeds the total sum of AMD 1.5 billion, are under general control of the given economic entity, or

(2) four or more trade facilities (trade network), the annual sales turnover whereof exceeds the total sum of AMD 1.5 billion, operate under the same trademark or other identification mark owned or used by the given economic entity.

6. (part repealed by HO-249-N of 23 March 2018)

7. The statement of information, issued by the Commission to the effect that it has no objection with regard to liquidation (removal from state record-registration) of the economic entity, shall be mandatory for the liquidation (removal from state record-registration) of an economic entity having a monopolistic or dominant position.

(Article 6 supplemented by HO-398-N of 28 June 2002, edited by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, HO-253-N of 8 December 2017, edited, amended by HO-249-N of 23 March 2018)

 

Article 7. Abuse of monopolistic or dominant position

1. Abuse of monopolistic or dominant position by economic entities (hereinafter referred to as “dominant position”) shall be prohibited.

2. Abuse of a dominant position shall be deemed to be the following:

(a) establishing or applying unjustified, discriminatory sale or acquisition prices or direct or indirect forcing of other trade conditions contradicting the legislation;

(a.1) direct or indirect forcing or application of conditions contradicting the legislation or business turnover practices of the Republic of Armenia, as a result whereof unequal competitive conditions are created or may be created;

(b) restricting trade or modernisation of production or investments of another economic entity;

(c) unjustified reduction in import of goods or production, or creation or maintenance of deficit in a commodity market to the detriment of the interests of consumers by means of keeping, spoiling and destroying the goods;

(d) establishing or applying discriminatory conditions (including prices) with regard to other economic entities or consumers under otherwise equal conditions;

(e) forcing economically and/or technologically unjustified conditions – non-profitable for them or not related to the subject matter of the contract – to a party to the contract or a person willing to conclude a contract, including trade facilities;

(f) compelling economic entities to re-organise, undergo liquidation or disrupt economic ties;

(g) the action or conduct aimed at the impediment to the market entry (restriction of market entry) of other economic entities, or ousting them from the market, as a result whereof another economic entity did not enter the market or was ousted from the market or incurred additional expenses in order not to be ousted from the market, or as a result whereof another economic entity might have failed to enter the market or might have been ousted from the market or incurred additional expenses in order not to be ousted from the market;

(h) offering or applying conditions that create or may create unequal competitive conditions in case similar conditions have not been offered to other economic entities operating in the given commodity market;

(i) establishing, changing or maintaining discounts of sale or acquisition prices or privileges, where they are aimed at the restriction, prevention of prohibition of competition;

(j) unjustified increase, decrease or maintenance of the price of goods;

(k) establishing and/or applying unjustifiably high or unjustifiably low prices;

(l) refusal or avoidance of concluding a contract with the acquirer of goods or those willing to acquire goods on economically and/or technologically unjustified grounds, where there is a possibility of production and/or sale of the relevant goods;

(m) establishing or applying other conditions or conduct, which lead or may lead to restriction, prevention or prohibition of economic competition.

3. Apart from the actions (conduct) prescribed by part 2 of this Article, the following shall also be deemed to be an abuse of dominant position by a trade network:

(1) forcing of conditions on a party to the contract with regard to:

(a) prohibition of concluding a contract with another economic entity;

(b) provision of information on the contract(s) being concluded with another economic entity;

(c) collection of additional payment from or forcing another condition on an economic entity, where the supply will also be made to a new trade facility included in the given trade network;

(d) collection of additional payment from or forcing another condition related to the change in the assortment of supplied goods;

(e) compensation of damages by the economic entity for the spoilage, damage, loss or destruction of the goods supplied and deemed to be the property of the trade network, except for the case when it has happened through the fault of the economic entity;

(f) compensation by the economic entity of those expenses that are not connected with the implementation of the contract on supply of goods or further sale of goods;

(g) establishing of an obligation for the return of those goods that have not been sold for a certain period of time, except for the cases, when the requirement for the return of goods is prescribed by the legislation of the Republic of Armenia;

(h) other circumstances that contain essential elements of conditions prescribed by this point;

(2) compulsion to make supply without concluding a written contract.

(Article 7 supplemented by HO-29-N of 25 December 2003, HO-91-N of 4 May 2005, edited by HO-107-N of 22 February 2007, amended, supplemented by HO-137-N of 12 April 2011, supplemented, edited by HO-249-N of 23 March 2018)

 

Article 7.1. Unjustifiably high prices

1. The price of sale or acquisition — established by an economic entity having a dominant position — which is higher than the sum of the expenses necessary for the production and sale of those goods and the profit, as well as the price that was formed under competitive conditions in a commodity market which is comparable by composition of acquirers or sellers of goods, conditions of goods turnover, conditions of accessibility of the commodity market, state regulation, including tax regulation and customs-tariff regulation (hereinafter referred to as "comparable commodity market") shall be deemed to be an unjustifiably high price in case of existence of such a market in the territory of the Republic of Armenia or outside the territory of the Republic of Armenia, except for the cases provided for by this Law.

2. A price shall not be deemed to be unjustifiably high, where it:

(1) has been established within the limits of tariffs provided for by the legislation of the Republic of Armenia by economic entities operating in the field of provision of public services;

(2) has been established as a result of innovative activity, i.e. such an activity which leads to the creation of new non-substitute goods or new substitute goods in case of reduction in the costs of production or improvement of quality thereof.

3. While determining the unjustifiably high price prescribed by part 1 of this Article, the Commission shall take into consideration the indicators of the exchange and non-exchange prices of the given goods, established in the global markets based on the peculiarities of each activity.

(Article 7.1 supplemented by HO-249-N of 23 March 2018)

 

Article 7.2. Unjustifiably low prices

1. The price of sale or acquisition — prescribed by an economic entity having a dominant position — which is lower than the sum of the expenses necessary for the production and sale of those goods and the profit, as well as the price that was formed under competitive conditions in a comparable commodity market in the territory of the Republic of Armenia or outside the territory of the Republic of Armenia, except for the cases provided for by this Law.

2. A low price of goods shall not be deemed to be unjustifiably low, where:

(1) it has been established within the limits of tariffs provided for by the legislation of the Republic of Armenia by economic entities operating in the field of provision of public services;

(2) the establishment of the price has not led to or might not have led to the restriction of competition with regard to the reduction in the number of economic entities which form the same group of persons with sellers and acquirers of goods in the commodity market.

(Article 7.2 supplemented by HO-249-N of 23 March 2018)

(Chapter edited by HO-107-N of 22 February 2007)

 
 

C H A P T E R  4

CONCENTRATION
 
 

Article 8. Concept of concentration of economic entities

1. The following shall be deemed to be concentration of economic entities:

(1) amalgamation of economic entities registered in the Republic of Armenia;

(2) merger of economic entities registered in the Republic of Armenia;

(3) acquisition by an economic entity of the assets of another economic entity registered in the Republic of Armenia, where their value per se or together with the value of assets already owned by the acquirer constitutes 20% or more of the assets of such economic entity;

(4) acquisition by an economic entity of the unit of another economic entity registered in the Republic of Armenia, where it per se or together with the value of the unit already owned by the acquirer constitutes 20% or more of the authorised capital (share capital) of such economic entity;

(5) any transaction, action, reorganisation or conduct of economic entities, due to which the economic entity will directly or indirectly influence the rendering of decisions by another economic entity or the competitiveness thereof, or may directly or indirectly influence the rendering of decisions by another person or competitiveness thereof.

2. Economic entities reorganised through amalgamation shall be deemed to be participants of the amalgamation.

3. Economic entities that are being merged shall be deemed to be participants of the merger.

4. In case of acquisition of assets, the economic entities selling and acquiring the assets shall be the participants of the concentration.

5. In case of acquisition of a unit, the economic entity acquiring the unit and the economic entity from the authorised capital (share capital) whereof a unit is acquired shall be participants of the concentration.

6. In case of point 5 of part 1 of this Article, economic entities that are participants of legal relationship shall be deemed to be participants of the concentration.

7. Within the meaning of this Law, concentration shall be formed:

(1) in the same commodity market (horizontal concentration);

(2) in various commodity markets having certain interrelation (vertical concentration);

(3) in various commodity markets (mixed concentration).

8. The reorganisations, actions or transactions of economic entities — referred to in part 1 of this Article — that take place, pursuant to Article 4.1 of this Law, between economic entities forming a group of persons shall not be deemed to be a concentration.

(Article 8 edited by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, supplemented, amended, edited by HO-249-N of 23 March 2018)

 

Article 9. Declaration of concentration

1. Concentration of the economic entities, before being put into effect, shall be subject to declaration, where:

(1) the total value (amount) of assets or revenues of the participants of the concentration or the value (amount) of assets or revenues of at least one of the participants has exceeded, during the last financial year preceding the formation thereof, the value (amount) of assets or revenues prescribed by the decision of the Commission;

(2) at least one of the participants of the concentration has a dominant position in any commodity market.

2. The declaration of concentration shall specify the type, objective of concentration, and the following information about each of the participants:

(1) name (title), place of residence (registered office) and place of activity;

(2) annual financial statements on the activities as of the end of the financial year preceding the declaration and, in case of a requirement for mandatory performance of audit of financial statements, prescribed by law — also the audit opinion thereon. Where any of the participants of the concentration has started its activity in the given year, its financial statements and audit opinions thereon shall be submitted as of the end of the month preceding the declaration. In the cases provided for by the decision of the Commission, financial statement as of another term may be submitted by the economic entity;

(3) volumes of goods per assortment, sold during the preceding year, as well as the description of production capacities;

(4) other documents and information prescribed by the decision of the Commission on approving the procedure for declaration of concentration and the form of declaration.

3. The procedure for declaration of concentration and the form of declaration shall be prescribed by the Commission.

(Article 9 amended by HO-74-N of 23 May 2006, edited by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, supplemented by HO-249-N of 23 March 2018)

 

Article 10. State regulation of concentration

1. Concentration subject to declaration shall be permitted or prohibited upon the decision of the Commission, which may also contain conditions and obligations binding for a participant(s) of the concentration.

2. While assessing concentration subject to declaration, the Commission shall take into consideration the circumstances impeding economic competition, including leading to or strengthening dominant position or deteriorating the competitive conditions.

3. The Commission shall also permit concentration subject to declaration, where the economic entity proves that competitive conditions shall be ensured in the commodity market as a result of the given concentration.

4. It shall be prohibited to put the concentration subject to declaration into effect:

(1) before rendering of a decision by the Commission (undeclared concentration);

(2) in case a decision on prohibition of concentration is rendered by the Commission (prohibited concentration).

5. A concentration prohibited upon the decision of the Commission and put into effect shall be subject to liquidation (rescission, termination) upon the decision of the Commission as prescribed by the legislation.

(Article 10 edited by HO-107-N of 22 February 2007, amended, edited by HO-137-N of 12 April 2011, edited by HO-249-N of 23 March 2018)
(Chapter edited by HO-107-N of 22 February 2007)

 

CHAPTER 5

UNFAIR COMPETITION

 

Article 11. Unfair competition

1. Any action or conduct of economic entity contradicting this Law, other laws, legal acts or customary business practices, violating the principles of fairness, i.e. honesty, equity, verity and/or impartiality among competitors or between the competitors and consumers shall be deemed to be unfair competition.

2. Unfair competition shall be prohibited.

3. Any interested person, including consumer, who has incurred damage as a result of unfair competition, shall have the right to submit a claim to the court on termination of unfair competition. This right shall also be reserved to organisations having the competence to protect the economic interests of interested persons.

4. The cases listed in Articles 12-15, 15.1 and 16 of this Law, as well as other actions complying with the elements of part 1 of this Article shall be actions of unfair competition.

(Article 11 amended by HO-168-N of 30 September 2008, amended, supplemented by HO-249-N of 23 March 2018)

 

Article 12. Creation of confusion with regard to economic entity or the activity thereof

1. Any action or conduct of economic entity, which creates or may create confusion with regard to another economic entity, its activity or goods offered thereby, shall be deemed to be an act of unfair competition.

2. Within the meaning of this Article, the following shall be deemed to be creation of confusion:
(1) use of an unregistered trademark or service mark or industrial design confusingly similar to a registered trademark or service mark or industrial design;

(2) use of an unregistered trademark or service mark or industrial design confusingly similar to an unregistered trademark or service mark or industrial design used earlier;

(3) use of a trademark or service mark or industrial design identical to a registered trademark or service mark or industrial design without the consent of the rightholder;

(4) use of a trade name confusingly similar to a trade name or illegal use of a trade name;

(5) actions or conduct creating confusion with regard to the appearance of goods, for instance, packaging, colour or other non-functional characteristics of the goods;

(6) actions or conduct creating confusion with regard to participants of civil circulation, goods, other identification marks, for instance, business symbols, signs or letters substituting words, slogans;

(7) actions or conduct creating confusion with regard to types of introduction of goods, including advertisement, uniform, style of delivery of goods;

(8) use of names of distinguished persons, popular figures in the field of literature, art or sport, names, other information, images of other popular persons, full or partial reproduction, copy or otherwise usage of works, titles, texts or images thereof without a relevant consent (permission).

(Article 12 edited by HO-137-N of 12 April 2011, amended by HO-249-N of 23 March 2018)

 

Article 13. Discrediting the economic entity or the activity thereof

1. Any false or unjustified statement which discredits or may discredit an economic entity, its activity or goods offered thereby, shall be deemed to be an act of unfair competition.

2. Within the meaning of this Article, discrediting may arise in the course of implementation of measures contributing to the promotion or dissemination of goods, and in particular with regard to the following as regards goods:

  • production process;
  • their suitability for a certain purpose;
  • quality, quantity or other characteristics;
  • offer and delivery conditions;
  • price or calculation method thereof.

(Article 13 amended by HO-249-N of 23 March 2018)

 

Article 14. Misleading of the general public

1. Any action or conduct that misleads or may mislead the general public as regards an economic entity, its activity or goods offered thereby shall be deemed to be an act of unfair competition.

2. Within the meaning of this Article, misleading may arise in the course of implementation of measures contributing to the promotion or dissemination of goods, and occur particularly with regard to geographic origin of goods, as well as the peculiarities listed in part 2 of Article 13 of this Law. Any unjustified exaggeration of the quality of goods, failure to provide relevant information on the quality, quantity or other characteristics, which may lead to a false impression (misinformation), forgery with regard to the personality of an advertiser, shall be deemed to be misleading. Absence of production or expiry date of goods, name (title) or address of the economic entity manufacturing or importing the given goods or notes in Armenian about other information or conditions provided for by the legislation, or existence of notes contradicting the legislation, or indication of deficient, false or incomplete data (information) in the advertisement (during advertising), or absence of such data (information) that prevents the consumer from having a complete understanding about the sold or advertised goods, or an advertisement contradicting law shall also be deemed to be misleading of the general public.

3. The Commission shall make a decision with regard to the issue of occurrence of misleading of the general public.

(Article 14 amended by HO-107-N of 22 February 2007, supplemented by HO-137-N of 12 April 2011, amended, supplemented by HO-249-N of 23 March 2018)

 

Article 15. Harm caused to reputation and goodwill of economic entity

1. Any action or conduct which, irrespective of creating confusion, harms or may harm the reputation or goodwill (intangible asset) of an economic entity shall be deemed to be an act of unfair competition.

2. Within the meaning of this Article, harm caused to the reputation or goodwill of an economic entity may generally result from impairment of reputation or goodwill with regard to the objects listed in part 2 of Article 12 of this Law.
Impairment of reputation or goodwill shall be deemed to be the diminution of distinguishing features or advertising significances (meaning) listed in part 2 of Article 12 of this Law, particularly by using a sign, similar or identical to the registered or well-known trademark of certain goods on completely different goods.

(Article 15 amended by HO-107-N of 22 February 2007, HO-249-N of 23 March 2018)

 

Article 15.1. Making inappropriate comparisons

Making of inappropriate, inaccurate, improper comparison by an economic entity between the goods produced or sold thereby and goods produced or sold by other economic entities shall be deemed to be an act of unfair competition.

(Article 15.1 supplemented by HO-249-N of 23 March 2018)

 

Article 16. Unfair competition with regard to undisclosed information

1. Within the meaning of this Article, technical, organisational or commercial information, including production secrets (know-how), shall be deemed to be undisclosed, where:

(a) they, as a whole or by accurate inter-arrangement and integrity of their parts, are completely unknown or not easily accessible to persons usually dealing with such information;

(b) they have certain actual or possible commercial value by virtue of being unknown to third persons, but legitimate grounds for their free accessibility are lacking;

(c) reasonable measures to retain the confidentially of information under existing circumstances have been undertaken by natural or legal person disposing of it, such measures might have been expressed in the form of concluding a relevant contract and/or ensuring its conditions, undertaking other preventive measures, maintaining them on identification information-carriers in the form of documents, computer files, video and audio tapes, items embodying such information, etc.
The subject matter of undisclosed information may be production methods, chemical formulas, designs, test samples, methods of sale of goods and distribution, contract forms, business plans, details of contract prices, professional activity fields (profiles) of consumers, advertising strategy, lists of suppliers or clients, computer software, databases, etc.
Materials and information collected through administrative observations enclosed in reports shall not be deemed to be undisclosed information.

2. Any action or conduct which leads to acquisition, use or disclosure of undisclosed information without the consent of the lawful owner thereof or which contradicts customary business practices shall be deemed to be an act of unfair competition.

3. The rights referred to in part 3 of Article 11 of this Law shall arise irrespective of any formalities (registration, receiving of a certificate, etc.) performed with respect to undisclosed information and shall be effective as long as conditions provided for by part 1 of this Article persist.

4. Within the meaning of this Article, the methods of acquisition, use or disclosure of undisclosed information contradicting customary business practices shall be the following:

(a) industrial, commercial espionage or enforcement thereof;

(b) breach, rescission of a contract related to undisclosed information or enforcement thereof;

(c) breach of confidentiality or enforcement thereof;

(d) acquisition of undisclosed information by a third person who was aware or could have been aware that such acquisition would be considered to be performance of the actions referred to in the above-mentioned points.

5. Use of undisclosed information shall be deemed to be its usage in entrepreneurial activity, as well as the introduction into economic circulation of goods received or processed due to its use.

6. Publication of undisclosed information, as well as its transfer to any other person who, by keeping it in secret, may gain tangible or other benefit, shall be deemed to be disclosure thereof.

7. Any action or conduct shall be deemed to be an act of unfair competition, where it constitutes or is followed by:

(a) unfair commercial use of pharmaceutical or agricultural chemical products received by means of using new chemical mixture, composition or compound, which were submitted to the authorised body for approval and were originated as a result of unfair commercial use of data of tests involving considerable efforts or of other undisclosed data;

(b) disclosure of data referred to in point “a” of this part, except for the cases when it is necessary for the protection of public interests or when guarantees of data protection against their unfair commercial use are already in place.
Within the meaning of this part, the sale of data to other persons, their usage in order to produce identical or similar products, etc. shall be deemed to be unfair commercial use of data.

8. Where the person illegally using undisclosed information has acquired it from a person having the right to disseminate (publicise) it, whereof the user was unaware or was not obliged to be aware of (bona fide acquirer), the lawful owner of undisclosed information shall have the right to claim compensation, from the bona fide acquirer, for the damage caused thereto as a consequence of using undisclosed information starting from the moment when the bona fide acquirer has become aware that the use of such information is illegal.

9. Taking into consideration the expenses incurred by a bona fide acquirer in connection with the use of undisclosed information, the court may permit its further use until compensation of incurred expenses.

10. A person who has independently and lawfully acquired information constituting content of undisclosed information shall have the right to use them irrespective of the rights of the owner of the relevant undisclosed data, and shall not bear any responsibility for its use before the owner.

11. Person legally disposing of undisclosed information may, based on a relevant contract, wholly or partially provide the data constituting its content to another person.

12. The person disposing of undisclosed information shall, based on a relevant contract, be obliged to undertake appropriate measures to keep its confidentiality, and as such, on equal terms with the lawful owner of undisclosed information, shall have the right to protect it from illegal use by third persons. Unless otherwise provided for by the contract, the person disposing of undisclosed information shall incur an obligation of keeping the confidentiality thereof also after the termination of the license agreement, in case the information continues to be considered undisclosed.

(Article 16 edited by HO-398-N of 28 June 2002, HO-86-N of 26 May 2004, amended by HO-107-N of 22 February 2007, HO-249-N of 23 March 2018)

 

 

CHAPTER 51
STATE ASSISTANCE AND EXPERT EXAMINATION OF LEGAL ACTS AND SIGNED CONTRACTS, ANTI-COMPETITIVE ACTIONS OF STATE BODIES AND OFFICIALS THEREOF
(title edited by HO-168-N of 30 September 2008,
supplemented by HO-137-N of 12 April 2011)

 

Article 161. State support and prohibition thereof

1. Within the meaning of this Law, state support shall be deemed any support (including financial means, such as aid, credit, loan, property, privileges or other conditions) provided by a state body or its official to a specific economic entity or a certain group of economic entities.

2. State support which directly or indirectly leads or may lead to the restriction, prevention or prohibition of competition in a commodity market, or prejudices or may prejudice the interests of consumers shall be prohibited, except for cases when the indicated support is provided for by law.

3. This Article shall not cover the state support aimed at protection of the environment, solution of problems of social nature, compensation for damages caused due to natural disasters or other exceptional cases, fulfilment of obligations provided for by law or an international treaty.

4. The body (organisation) initiating the provision of state support, or the economic entity applying for it, shall be entitled to apply to the Commission for an opinion prior to the provision of state support or applying for it respectively.

5. An economic entity having received prohibited state support shall be obliged to return it within the time period prescribed by the Commission.

(Article 161 supplemented by HO-107-N of 22 February 2007, amended by HO-137-N of 12 April 2011)

 

Article 162. Expert examination of legal acts and signed contracts

The Commission shall conduct expert examination of legal acts adopted and contracts signed by state bodies with regard to their compliance with the legislation on the protection of economic competition. The expert examination shall be conducted by the Commission on its initiative or upon the application of each natural or legal person or the body adopting the legal act or signing a contract. For the purpose of receiving a positive opinion, such bodies may apply to the Commission with the request to conduct expert examination prior to the adoption of the legal act or signing of the contract.
The Commission shall submit the opinion on the results of the expert examination of the legal act or the contract within ten days following the day of receipt of the application. Where the state body disagrees with the expert opinion of the Commission on a legal act, whereas, according to the opinion of the Commission, the legal act is likely to have a negative effect on the economic competition in a commodity market, the body initiating the adoption of the legal act shall be obliged also to submit the substantiation of its position to the body adopting the respective legal act.

(Article 162 supplemented by HO-168-N of 30 September 2008, amended, supplemented by HO-137-N of 12 April 2011)

 

Article 163. Prohibition of anti-competitive actions or conduct of state bodies and officials thereof

1. Actions or conduct of a state body or its official or legal acts restricting, preventing or prohibiting economic competition shall be prohibited.

2. An action or conduct of a state body or its official restricting, preventing or prohibiting economic competition shall be:

(1) establishing and/or applying discriminatory conditions with respect to an economic entity (economic entities);

(2) prohibiting or restricting entrepreneurial activities, except for cases provided for by law;

(3) issuing directives, assignments, instructions, advice or orders to economic entities related to the implementation of their entrepreneurial activities (regarding goods, transactions concluded or other issues), except for cases provided for by law;

(4) providing for an obligation for consumers restricting their right to free choice of goods;

(5) anti-competitive agreements with other state bodies or economic entities or officials thereof, including transactions, agreements, actions or conduct coordinated directly or indirectly, which lead or might lead, directly or indirectly, to the restriction, prevention or prohibition of competition.

3. Actions or conduct, provided for by part 1 of this Article, by a state body or its official within the scope of powers thereof, pursuing legitimate purposes, shall not be deemed as anti-competitive, except for the case when another method for the achievement of that purpose, not prohibited by law and restricting the economic competition less, exists.

(Article 163 supplemented by HO-137-N of 12 April 2011, HO-249-N of 23 March 2018)

 

 

CHAPTER 6
THE STATE BODY FOR PROTECTION OF ECONOMIC COMPETITION

Article 17. The state body for the protection of economic competition of the Republic of Armenia

1. Protection of economic competition shall be performed by the Commission.

2. The Commission shall be an autonomous body.

3. The Commission shall have a seal, stamp, form and other means of individualisation. The seal of the Commission shall bear the image of the Coat of Arms of the Republic of Armenia and the words "State Commission for the Protection of Economic Competition of the Republic of Armenia". The Commission shall be located in the city of Yerevan.

4. The Commission may, within the scope of its competence, on behalf of the Republic of Armenia, acquire and exercise property and personal non-property rights, bear responsibilities, act as a plaintiff or defendant in courts, as well as possess, use and dispose of that property in compliance with the objectives of its activities and the designation of the property attached.

5. The Commission shall be established as prescribed by this Law, operate based on the Constitution of the Republic of Armenia, this Law, other legal acts and its statute, and shall be independent within the scope of its competence.

(Article 17 amended by HO-107-N of 22 February 2007, edited by HO-249-N of 23 March 2018)

 

Article 18. Tasks and functions of the Commission

1. The tasks of the Commission shall be:

(a) protection and encouragement of economic competition for the purpose of development of entrepreneurship and protection of the interests of consumers;

(b) ensuring of an environment necessary for fair and free competition;

(c) prevention, restriction of and warning on anti-competitive practices;

(d) supervision over the protection of economic competition.

2. For the fulfilment of its tasks, the Commission shall perform the following main functions:

  • exercise supervision over the compliance with the legislation on the protection of economic competition;
  • consider cases of violation of the legislation on the protection of economic competition and adopt decisions;
  • (paragraph repealed by HO-137-N of 12 April 2011)
  • apply to court with regard to cases of violation of the legislation on the protection of economic competition;
  • participate in elaboration of legal acts regulating the development of economic competition and the state policy in this field and in their submission as prescribed;
  • participate in the conclusion of interstate agreements on the issues of its competence;
  • cooperate with state bodies and non-governmental organisations of the Republic of Armenia and of foreign states, as well as with international organisations, sign with them memoranda on the issues of its competence, other agreements on cooperation, involve specialists, experts, where necessary, from the indicated bodies and organisations in the activities conducted by the Commission upon the written consent of the heads of those bodies and organisations;
  • develop and implement measures preventing violations of the legislation on the protection of economic competition;
  • summarise the practice of application of the legislation on the protection of economic competition and elaborate proposals on its improvement;
  • ensure the publicity of its activities;
  • implement measures aimed at raising public awareness on the issues relating to economic competition, including the provisions of this Law;
  • perform other actions falling within its competence.

(Article 18 supplemented, amended by HO-107-N of 22 February 2007, amended, supplemented, edited by HO-137-N of 12 April 2011, amended by HO-249-N of 23 March 2018)

 

Article 19. Powers of the Commission

1. The Commission shall be entitled to:
(a) adopt decisions on:

  • possible or actual violations of this Law;
  • studies of commodity markets;
  • initiating administrative proceedings, conducting inspection, study;
  • boundaries of commodity markets, existence of a dominant position of economic entities on that market, as well as on implementation of measures conditioned thereby;
  • disaggregation (division, separation, alienation of units or assets) of economic entities abusing the dominant position twice or more within a year;
  • termination of violations of this Law made by economic entities, state bodies and their officials, or elimination of the consequences thereof, restoration of the original state, amendment or rescinding of contracts contradicting this Law, singing contracts with other economic entities;
  • issuing opinions on contradiction of acts, other documents (decisions, protocols on the organised tenders, etc.) adopted by state bodies or their officials to the legislation on the protection of economic competition, agreements being concluded, state supports as well as concentrations;
  • suspension, dissolution (rescission, termination) of concentration or state support, anti-competitive actions or conduct of state bodies, economic entities or officials thereof, declaring legal acts unlawful and repealed;
  • subjecting economic entities and officials thereof, officials of state bodies to liability for the violation of this Law;
  • issuing warnings on possible violations of this Law to economic entities, state bodies or officials thereof;
  • approving consultative guides, other documents on the application of the provisions of this Law by the Commission, other state bodies and officials thereof, as well as by economic entities;

(b) exercise supervision over the execution of (compliance with) the decision of the Commission;

(c) conduct inspection, study (including test purchase) and/or monitoring for the purpose of supervision over revealing the reliability of information submitted by an economic entity, actual activities of the economic entity, or over the execution of the decision of the Commission;

(d) apply to the court with regard to violations of this Law, including with a request to declare the legal acts adopted by state bodies or their officials, the contracts concluded by economic entities in violation of this Law fully or partially invalid, as well as to amend or rescind those contracts;

(e) apply to the Government of the Republic of Armenia with a motion to terminate actions or conduct of state bodies or officials thereof contradicting this Law;

(f) issue a warning with an assignment to eliminate and/or further exclude violations, impose penalties with an assignment to eliminate and/or further exclude violations and to pay the fine, prescribing a time period for the execution of the assignment;

(g) adopt appropriate procedures related to anti-competitive agreements, dominant position, determination of an unjustified high price and an unjustified low price, concentrations, unfair competition, state support, monitoring, disposal of goods acquired by test purchases, as well as determination of the commodity market;

(h) give clarifications on issues related to the application of the legislation on the protection of economic competition;

(i) exercise other competences provided for by legislation.

11. The decision of the Commission on disaggregation, provided for by point "a" of part 1 of this Article, shall be subject to execution by economic entities no later than within 6 months.

12. Where an economic entity fails to submit, within the prescribed time period, the documents and other information necessary for the consideration, proceedings, inspection, study and/or monitoring, or otherwise hinders the process thereof, or the documents and other information necessary for them are lacking, the Commission shall be entitled to render decisions based on the documents and other information at its disposal. Adoption of the decisions provided for by this part shall not exempt economic entities from the duty to submit documents and other information or from the liability prescribed for failure to submit them within the prescribed time period or for hindering the exercise of the powers prescribed by this part.

13. In case of consideration of the issue on the boundaries of electronic communication commodity markets and existence of a dominant position of economic entities on these markets, the Commission shall consult with the Public Services Regulatory Commission of the Republic of Armenia.

2. The Commission shall be independent of other state bodies in performing the tasks and functions prescribed by this Law.

(Article 19 edited by HO-398-N of 28 June 2002, amended, supplemented by HO-91-N of 4 May 2005, edited by HO-107-N of 22 February 2007, amended, supplemented, edited by HO-137-N of 12 April 2011, amended, supplemented by HO-249-N of 23 March 2018)

 

Article 19.1. Reviewing decisions based on the newly emerged circumstances, as well as clarification of decisions, correction of misspellings, miscalculations and misprints

1. Decisions of the Commission may be reviewed based on the newly emerged circumstances, on the initiative of the Commission or based on the application of the participants of the proceedings having preceded the adoption of the decision.

2. Newly emerged circumstances shall be a basis for reviewing the decision where those circumstances were not known and could not have been known to the Commission or the participants of the proceedings, or those circumstances were known to the participants of the proceedings, but were not submitted to the Commission for reasons beyond their control, and those circumstances have an essential significance for the settlement of the case.

3. An application for reviewing the decision of the Commission based on the newly emerged circumstances may be submitted within three months, starting from the moment when the person submitting the application got to know or might know about the emergence of those circumstances.

4. The Commission may restore the missed time period for submitting an application, prescribed by part 3 of this Article, upon the motion of the person submitting the application, where that motion has been filed within six months starting from the moment when the applicant got to know or might know about the emergence of new circumstances, and when the Commission declared the circumstances indicated in that motion as valid.

5. An application submitted for reviewing a decision based on the newly emerged circumstances, besides the general requisites, shall also contain:

(1) the number of the decision to be reviewed, year, month and day of rendering thereof;

(2) the request of the applicant with indication of the newly emerged circumstances;

(3) substantiations with regard to the essential significance that the newly emerged circumstances have for the case.

All the pieces of evidence at the disposal of the applicant, which may have an essential significance in the settlement of the issue, shall be attached to the application.
The issue that the newly emerged circumstances have an essential significance for the settlement of the case shall be settled by the Commission.

6. The Commission shall return the application where the requirements for the form and content of the application have not been observed or the time period prescribed by part 3 of this Article has been missed and a motion on restoring the missed time period has not been submitted, or the Commission has rejected that motion.

7. The Commission shall, on its own initiative or upon the application of persons participating in the proceedings, be entitled to clarify its decisions, correct the misspellings, miscalculations and misprints existing therein without changing the content of the decision.

(Article 19 supplemented by HO-249-N of 23 March 2018)

 

Article 20. Procedure for formation of the Commission and requirements for the members thereof
(title edited by HO-249-N of 23 March 2018)

1. The Commission shall be composed of seven members: a chairperson and six members. The positions of members of the Commission shall be considered civil positions.

2. The Chairperson and other members of the Commission shall be appointed by the National Assembly, upon the proposal of the Prime Minister, as prescribed by the Constitutional Law of the Republic of Armenia "Rules of Procedure of the National Assembly", by the majority of the total number of votes of Deputies, for a term of office of five years, except for cases provided for by this Law. In case a vacant position of a member of the Commission emerges, the Chairperson of the Commission and, in case of his or her absence or impossibility to perform the official duties thereof, the person provided for by part 2 of Article 23 of this Law, shall apply to the Prime Minister, presenting the requirements prescribed by this Article for the candidate for the given position. The same person may not be appointed as a member of the Commission established as prescribed by this Law more than two consecutive times, for the full term of office of five years.

3. Every person that is a citizen only of the Republic of Armenia, having completed higher education, having at least five years of work experience (of which at least three vested with functions of co-ordination of subdivisions or in the position of the head of a subdivision) and with knowledge of Armenian may be appointed as a member of the Commission. At least one of the members of the Commission must have higher legal, and at least one — higher economic education.

4. A member of the Commission shall hold office until attaining the age of 65.

5. Members of the Commission may not engage in entrepreneurial activities, hold a position not conditioned by their status in state or local self-government bodies, any position in commercial organisations, or perform other paid work, except for scientific, creative or pedagogical activities. A member of the Commission shall show political restraint in his or her public speeches.

6. In case of early discontinuation or termination of powers of a member of the Commission, a new member of the Commission shall be appointed for the unexpired term of office through the procedure for appointing a member of the Commission, prescribed by this Article. Where the remaining term of office is less than one year, the term of office of the new member of the Commission shall be prescribed five years plus the remaining time period.

7. Where one of the members of the Commission is appointed as the Chairperson of the Commission, he or she shall hold office until the expiry of his or her term of office as a member of the Commission. Where the remaining term of office is less than one year, the term of office of the Chairperson of the Commission shall be prescribed five years plus the remaining time period.

8. Member of the Commission may not be appointed the person who:

(1) does not comply with the requirements prescribed by part 3 of this Article;

(2) has been declared as having no or limited legal capacity by a civil judgment of the court having entered into legal force;

(3) has been convicted for an intentionally committed crime by a criminal judgment of the court having entered into legal force;

(4) has been deprived of the right to hold a certain position as prescribed by law;

(5) has a disease hindering his or her appointment as a judge, provided for by the list prescribed by the Government of the Republic of Armenia.

(Article 20 edited by HO-249-N of 23 March 2018)

 

Article 21. Discontinuation and termination of powers of members of the Commission
(title edited by HO-249-N of 23 March 2018)

1. The term of powers of a member of the Commission shall expire on the same day of the fifth year following the day of his or her appointment, except for cases provided for by this Law.

2. Powers of a member of the Commission shall discontinue, where:

(1) he or she has attained the maximum age of holding the office;

(2) he or she has lost the citizenship of the Republic of Armenia or has acquired the citizenship of another state;

(3) he or she, informing the Prime Minister in advance, officially submits a written application on his or her resignation to the Chairperson of the National Assembly;

(4) he or she has been declared as having no active legal capacity, having limited active legal capacity, missing or dead based on a civil judgment of the court having entered into legal force;

(5) a criminal judgment of conviction, having entered into legal force, has been rendered against him or her;

(6) he or she has died;

(7) he or she has been deprived of the right to hold a certain position as prescribed by law.

3. Powers of a member of the Commission may be terminated, where:

(1) he or she has acquired a disease, during his or her term of office, that hinders the exercising of powers of a member of the Commission;

(2) he or she has been absent from at least half of the sittings of the Commission due to long-term disability or other valid reason during one year;

(3) he or she has not attended the sittings of the Commission more than twice during one year without a valid reason;

(4) he or she has violated the incompatibility requirements of a member of the Commission;

(5) he or she failed to perform or improperly performed his or her official duties;

(6) it was revealed during the term of office that, at the moment of appointment, he or she did not comply with the requirements for a member of the Commission.

4. The Chairperson of the Commission and, in case of his or her absence or impossibility to perform his or her official duties— the person provided for by part 2 of Article 23 of this Law, shall inform in writing the Chairperson of the National Assembly on the grounds provided for by this Article.

(Article 21 amended by HO-107-N of 22 February 2007, edited by HO-249-N of 23 March 2018)

 

Article 22. Staff of the Commission

1. The Commission shall organise its activities through its Staff, the statute whereof shall be approved by the Commission.

2. The structure of the Staff, the functions of structural subdivisions, the number of employees and other internal regulatory issues regarding the organisation of the activities of the Staff shall be regulated by decisions of the Commission. The number of employees of the Staff shall be agreed with the Prime Minister.

3. Remuneration of the Staff of the Commission shall be conducted in compliance with the Law of the Republic of Armenia "On remuneration for persons holding state positions and state service positions".

(Article 22 edited by HO-107-N of 22 February 2007, HO-185-N of 12 December 2013, HO-249-N of 23 March 2018)

 

Article 23. Chairperson of the Commission

1. The Chairperson of the Commission shall:

(a) represent, within the scope of his or her competence, the Commission in the Republic of Armenia, other states and international organisations;

(b) manage and co-ordinate the normal activities of the Commission, give assignments, for this purpose, to the members of the Commission and employees appointed by him or her, perform distribution of working duties among the members of the Commission;

(c) (point repealed by HO-257-N of 23 March 2018);

(d) convene and preside over the sittings of the Commission, approve the agenda of the sitting;

(e) organise the execution of decisions adopted by the Commission;

(f) sign the decisions and the minutes of sittings of the Commission;

(g) approve the staff list of the Staff of the Commission, act as the representative of the employer for the members of the Commission and employees appointed by him or her, hire and dismiss employees of the staff of the Commission within the scope of his or her competences, act on behalf of the Commission in the court, issue letters of authorisation to act on behalf of the Commission, adopt orders, including orders on conducting an inspection, a study (including test purchase) or monitoring, exercise other powers vested in him or her by this Law, other legal acts and the Statute of the Commission.

2. In case of absence of the Chairperson of the Commission or impossibility to perform his or her official duties, he or she shall be substituted by one of the members of the Commission upon his or her assignment, and in cases of absence of the latter or in case of impossibility to perform his or her official duties or give such assignment, by the member of the Commission having served in that position for a longer period.

(Article 23 edited, supplemented by HO-107-N of 22 February 2007, supplemented by HO-137-N of 12 April 2011, edited by HO-249-N of 23 March 2018, amended by HO-257-N of 23 March 2018)

 

Article 24. Conflict of interests

1. A member of the Commission having personal interest in an issue being considered at the sitting of the Commission shall be obliged to inform the other members about the fact and nature of his or her interest prior to the consideration, which must be recorded in the minutes of the session. After such informing, the mentioned member:
(a) shall be obliged to renounce his or her participation in the sitting on the given issue;
(b) must not be record-registered for the purpose of ensuring the quorum of that sitting.
2. A person the issue whereof is being considered may recuse a member of the Commission where the latter has a personal interest in the issue being considered.

 

Article 25. Declaration of incomes of members of the Commission

Members of the Commission shall submit their declarations of incomes as prescribed by law.

(Article 25 edited by HO-91-N of 4 May 2005)

 

Article 26. Statute of the Commission

1. The statute of the Commission shall prescribe the rules of operation of the Commission.

2. The statute of the Commission shall be approved by the Commission.

(Article 26 edited by HO-107-N of 22 February 2007)

 

Article 27. The annual programme and report

1. Each year the Commission shall, by 1 October, publicise its annual programme for the next year in the National Assembly, which contains summary information on the analysis of the situation of the economic competition and revelation of existing fundamental issues, measures for the protection of economic competition and the schedule of their implementation, as well as on other necessary provisions prescribed by the Commission for the performance of the tasks and functions prescribed by this Law.

2. The Commission shall, each year, by 1 May, publicise the report on the activities of the preceding year, which contains summary information on the activities of the Commission, analysis of commodity markets, implemented measures aimed at the protection and supervision of economic competition, process of implementation of proposals aimed at the improvement of the competitive situation, financial report of its activities and other measures.

3. The annual programme and the report on the activities of the preceding year of the Commission shall be approved upon a decision of the Commission.

(Article 27 edited by HO-436-N of 23 October 2002, supplemented by HO-137-N of 12 April 2011, edited by HO-249-N of 23 March 2018)

 

Article 28. Duties of state bodies, economic entities to provide information to the Commission

(title edited by HO-137-N of 12 April 2011)

1. Based on a letter of the Chairperson of the Commission or a decision of the Commission or a requirement prescribed by legislation, state bodies, as well as officials thereof shall be obliged to submit, within the time period prescribed, documents and other information – provided for by law– necessary for the exercise of powers of the Commission.

2. Based on a letter of the Chairperson of the Commission or a decision of the Commission or a requirement prescribed by legislation, economic entities shall be obliged to submit, within the time period prescribed, documents and other information – provided for by law – necessary for the exercise of powers of the Commission.

3. Where necessary documents and other information are requested by a letter of the Chairperson of the Commission or a decision of the Commission, the Commission shall inform the economic entity on the time period for their submission, as well as on the legal consequences for the failure to submit the necessary documents and other information within the prescribed time period or for submitting inaccurate or incomplete information.

4. Economic entities having dominant position shall be obliged to submit to the Commission, through the procedure and in cases prescribed by the Commission, at quarterly intervals, monthly information regarding the balances, acquisitions, production and sales indicators of goods expressed in kind and in value terms. The information shall be submitted to the Commission by the 30th day of the month following the quarter.

(Article 28 edited by HO-29-N of 25 December 2003, supplemented by HO-91-N of 4 May 2005, edited by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, supplemented, amended by HO-249-N of 23 March 2018)

 

Article 28.1. Conducting monitoring, impermissibility of hindering the exercise of the rights and fulfilment of duties vested in the Commission

1. The name of the body conducting monitoring, full name (names) or title (titles) of the economic entity (entities), the position, name, surname of the person (persons) conducting monitoring, purpose of monitoring, time period and legal grounds for monitoring shall be indicated in the order on conducting monitoring. The copy of the order on conducting monitoring shall be handed over to the economic entity or the head of the economic entity (substituting person) or other competent person (hereinafter referred to as "representative of the economic entity") after conducting the monitoring. Where necessary, upon the request of the representative of the Commission and in the form prescribed by the Commission, the latter shall draw up a protocol on the results of the monitoring, which shall be signed by the representatives of the Commission and the economic entity. Photographs, documents, electronic media and/or other materials may be attached to the protocol on monitoring, whereon a relevant note shall be made in the protocol on monitoring. In case of having an objection to the results of the monitoring, the representative of the economic entity shall make a note thereon in the protocol. Where the representative of the economic entity refuses to sign the protocol or otherwise hinders the conduct of monitoring, the representative of the Commission shall make a note thereon in the protocol, wherein the name, surname and position of the representative of the economic entity having hindered the conduct of the monitoring shall also be indicated.

2. Hindering the conduct of monitoring or study (including test purchase) upon the order of the Chairperson of the Commission, or the conduct of inspection upon the decision of the Commission or upon the order of the Chairperson of the Commission shall be viewed as a hindrance to the exercise of the rights or fulfilment of duties vested in the Commission and shall entail liability prescribed by this Law.

(Article 28.1 supplemented by HO-137-N of 12 April 2011, amended, supplemented by HO-249-N of 23 March 2018)

 

Article 29. Annual expenditures of the Commission

1. The Commission shall be financed at the expense of the State Budget funds. The Chairperson of the Commission shall, based on the Law of the Republic of Armenia “On budget system”, within the time period prescribed, submit the estimate of expenditures of the Commission (budget request) to the Government of the Republic of Armenia to be included in the draft State Budget.
The budget request shall, without any changes in case of being adopted by the Government of the Republic of Armenia or with changes in case of objections thereby, be included in the draft State Budget of the Republic of Armenia, along with which the request shall also be submitted to the National Assembly of the Republic of Armenia.
The Government of the Republic of Armenia shall also submit to the National Assembly of the Republic of Armenia its substantiation regarding the changes made in the budget request.

2. The estimate of expenditures of the Commission shall ensure the opportunity for proper fulfilment of tasks and performance of functions prescribed by this Law, including ensuring the representation in international organisations, as well as payment of salaries to members of the Commission.

3. The official pay rates for members of the Commission shall be prescribed by the Law of the Republic of Armenia "On remuneration for persons holding state positions".

(Article 29 edited by HO-107-N of 22 February 2007, supplemented by HO-185-N of 12 December 2013)

 

Article 30. Procedure for organising activities

1. The Commission shall carry out its activities through sittings.

2. A sitting of the Commission shall have quorum where it is attended by at least four of the members.

3. The Commission shall examine issues in an open sitting, except for cases when it may prejudice the interests of the interested persons.

4. Sittings of the Commission shall be recorded. Brief information on the place, time, participants, agenda, speeches and voting results of the sitting shall be indicated in minutes.

5. Sittings shall be convened at certain intervals or ad hoc, upon the request of one of the members of the Commission.

6. The Commission shall render a decision as a result of consideration.

In case of consideration of procedural issues or in case of failure to render a decision on the merits (including convocation of a closed sitting, removal of an issue from consideration, postponement of consideration, inclusion of an additional issue in the agenda, giving an instruction to the Staff, etc.), the Commission shall adopt a verbal (protocol) decision through voting, whereon a note shall be made in the protocol.
At the sittings of the Commission, decisions shall be adopted by the majority of votes of members participating in the sitting. In the event of a tie, the vote of the Chairperson of the Commission or the person substituting him or her shall be decisive.
Refraining from voting or transfer of a vote to another member shall not be permitted.
Failure by notified persons to attend shall not hinder holding the consideration and adopting decisions.

7. Following the adoption of an administrative act, a copy thereof shall be handed over to the addressee within 5 days.

8. An administrative act adopted by the Commission shall enter into force from the day of handing over of its copy to the addressee, unless a later period is prescribed by that act. In case the administrative act has more than one addressee, the administrative act shall enter into force with respect to each of them with the part thereof, from the day of handing over of the copy of the given administrative act to the relevant addressee, unless a later period is prescribed by that act.
The other individual legal acts adopted by the Commission shall enter into force from the moment of their adoption, unless a later period is prescribed thereby.

9. An administrative act adopted by the Commission may be appealed against through administrative procedure within a period of 10 days following its entry into force. An administrative act adopted by the Commission may be appealed against through judicial procedure, in case of disagreeing with the results of consideration of the administrative appeal — within a period of one month from the moment of entry into force of the decision on the appeal, whereas in case of failure to lodge an administrative appeal — within a period of one month following the entry into force of the administrative act adopted by the Commission.

10. The maximum time period for the Commission to conduct administrative proceedings shall be 90 days.

11. The process of the time period for conducting administrative proceedings may be suspended in case of impossibility to hand over the correspondence provided for by this Law due to the absence of the economic entity, the official or other competent employee thereof, in case of failure to submit documents or other information to the Commission or submission of inaccurate or incomplete information or hindrance to the conduct of the proceedings or in case other circumstances making the conduct of the administrative proceedings impossible exist. Administrative proceedings shall be resumed after the elimination of the circumstances provided for by this part.

12. In case a fact of violation of this Law is not revealed during the conduct, by the Commission, of the administrative proceedings or in case circumstances making the adoption of the administrative act impossible exist, the proceedings shall be dismissed upon the decision of the Commission.

(Article 30 edited, supplemented by HO-91-N of 4 May 2005, edited by HO-107-N of 22 February 2007, supplemented by HO-168-N of 30 September 2008, edited, supplemented by HO-137-N of 12 April 2011, amended, edited by HO-249-N of 23 March 2018)

 

Article 31. Competence of the Commission to impose sanctions, as well as give a warning, and the procedure for application thereof
(title edited by HO-137-N of 12 April 2011)

1. In case of violation of this Law, the Commission shall be entitled to give a warning or impose a fine upon its decision.

2. When imposing a sanction, the Commission shall take into account the nature, duration of the given offence, the possible or actual impact of the offence on the competition situation in the market or on the interests of consumers, repetition of violations of this Law by the given economic entity, the extent of intentionality of the economic entity, the motives of the economic entity for committing the offence and the circumstances thereof, the circumstance of acceptance, by the economic entity, of the fact of committal of an offence, or cooperation with the Commission, the possible impact of the fine being imposed on the economic entity, the field and/or history of activities of the given economic entity.
When imposing a fine for an anti-competitive agreement, the Commission shall also take into account the type of anti-competitive agreement provided for by part 2 of Article 5 of this Law (horizontal, vertical, mixed).

3. Where this Law provides for other procedures and time periods for conducting administrative proceeding, adopting an administrative act, its entry into force, appealing against or compulsory enforcement thereof other than those provided for by other laws, the provisions of this Law shall have effect.
4. For the purpose of prevention of potential violations of this Law, the Commission shall be entitled to give, upon its decision, a warning regarding the actions and/or conduct of economic entities, state bodies or their officials, that may lead to restriction, prevention or prohibition of economic competition or an action of unfair competition or may prejudice the interests of consumers.

(Article 31 edited by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, supplemented by HO-249-N of 23 March 2018)

 

Article 32. Executive orders

(Article repealed by HO-107-N of 22 February 2007)

 

Article 33. Obligations of the Commission in keeping a commercial, bank or official secret

(title supplemented by HO-107-N of 22 February 2007)

1. Information comprising commercial, bank or official secret, which has been received while exercising the powers reserved by this Law, shall be kept by the Commission as prescribed by law.

2. Members and employees of the Commission shall not have the right to publicise or otherwise disseminate, as well as use for personal mercenary purposes the confidential and official information received during the performance of their official duties.

3. In case of publication of information comprising commercial, bank or official secret, the damage caused to an economic entity shall be subject to compensation at the expense of the Republican Budget funds, as prescribed by the legislation.

(Article 33 supplemented by HO-107-N of 22 February 2007)

 

Article 34. Grounds for consideration of violations of this law by the Commission

The Commission shall be entitled to adopt a decision based on applications and information of state bodies, economic entities and consumers, reports of the mass media and other documents at its disposal, which attest to a violation of this Law.

(Article 34 amended by HO-137-N of 12 April 2011)

 

Article 35. Procedure for executing the decision of the Commission

1. A decision of the Commission shall be subject to execution by economic entities, state bodies and their officials within the time period indicated in the decision.

2. The Commission shall be entitled to file a claim with the court in case of failure to execute its decision.

3. Appeal against the decision of the Commission shall not suspend its effect (execution).

(Article 35 amended, supplemented, edited by HO-107-N of 22 February 2007, amended by HO-137-N of 12 April 2011)

 

CHAPTER 7

LIABILITY FOR VIOLATION OF THIS LAW

Article 36. Amounts of fines envisaged for offences committed in the field of economic competition
(title edited by HO-137-N of 12 April 2011)

1. Economic entities, state bodies and their officials shall bear liability, as prescribed by law, for violation of this Law.

2. The amount of fine imposed for concluding an anti-competitive agreement (reaching it, participating in the agreement) shall constitute up to 10 percent of the revenue of the economic entity that is a participant of an anti-competitive agreement for the year preceding the conclusion of that agreement (reaching it, participating in it). In case of having carried out activities for a period less than 12 months during the preceding year, the amount of the fine imposed for the offence provided for by this part shall constitute up to 10 percent of the revenue of the economic entity that is a participant of an anti-competitive agreement for the period of activities preceding the conclusion of that agreement (reaching it, participating in it), but not more than that for 12 months.

2.1. The amount of fine imposed for prohibited coordination of economic activities shall constitute up to 10 percent of the revenue of the economic entity having committed an offence for the year preceding the offence. In case of having carried out activities for a period less than 12 months during the preceding year, the amount of fine imposed for the offence provided for by this part shall constitute up to 10 percent of the revenue for the period of activities preceding the offence, but not more than that for 12 months.

3. The amount of fine imposed for the abuse of the dominant position shall constitute up to 10 percent of the revenue for the year preceding the offence. In case of having carried out activities for a period less than 12 months during the preceding year, the amount of fine imposed for the offence provided for by this part shall constitute up to 10 percent of the revenue of the economic entity for the period of activities preceding the offence, but not more than that for 12 months.

4. The amount of fine imposed for giving effect to the concentration prohibited by the decision of the Commission shall constitute up to 10 percent of the revenue of the economic entity for the year preceding the offence. In case of having carried out activities for a period less than 12 months during the preceding year, the amount of fine imposed for the offence provided for by this part shall constitute up to 10 percent of the revenue of the economic entity having committed an offence for the period of activities preceding the offence, but not more than that for 12 months.

4.1. The amount of fine imposed for failure to declare concentration shall constitute up to five million drams.

5. The amount of fine imposed on an economic entity for an action of unfair competition shall constitute up to five percent of the revenue for the year preceding the given offence. In case of having carried out activities for a period less than 12 months during the preceding year, the amount of fine imposed for the offence provided for by this part shall constitute up to five percent of the revenue of the economic entity for the period of activities preceding the offence, but not more than that for 12 months.

6. The amount of fine imposed for receiving prohibited state support shall constitute up to five million drams.

7. The amount of fine imposed for the failure by an economic entity to submit, within the prescribed time period, documents or other information prescribed by a letter of the Chairperson of the Commission or by a decision of the Commission or by legislation or for submitting inaccurate or incomplete information shall constitute up to five million drams.

8. The amount of the fine imposed for hindering the exercise of the rights or fulfilment of obligations vested in the Commission, a member or an employee of the Commission by legislation shall constitute up to five million drams.

9. The amount of fine imposed for the failure by an economic entity to eliminate the violations enshrined by a decision of the Commission, to fulfil the conditions, obligations or assignments provided for by the decision within the prescribed time period shall constitute up to five million drams.

(Article 36 supplemented, edited by HO-398-N of 28 June 2002, amended by HO-29-N of 25 December 2003, edited by HO-91-N of 4 May 2005, HO-107-N of 22 February 2007, HO-137-N of 12 April 2011, edited, supplemented, amended by HO-249-N of 23 March 2018)

 

 Article 36.1. Exemption from application of a sanction

1. The Commission may adopt a decision on non-imposition of a sanction on an economic entity that is a participant of an anti-competitive agreement, where the economic entity is the first to apply, on its initiative, to the Commission before a decision on initiating administrative proceedings with regard to the given agreement is rendered or an order of the Chairperson of the Commission on conducting inspection is adopted, and voluntarily undertakes the obligation to terminate its participation in that anti-competitive agreement (except for cases when, in the opinion of the Commission, it is not necessary to reveal the anti-competitive agreement) and further exclude it, at the same time, submitting such evidence (pieces of evidence) regarding the given anti-competitive agreement, which, according to the Commission, is (are) a sufficient ground for initiating administrative proceedings and/or conducting inspection with regard to the given anti-competitive agreement.

2. An economic entity shall be fully exempted from the liability provided for concluding an anti-competitive agreement (reaching it, participating in that agreement), where it provides to the Commission the following evidence at its disposal or known to it:

(1) the titles of all the economic entities participating (having participated) in the anti-competitive agreement;

(2) detailed description of the anti-competitive agreement, including its purpose, manner of manifestation, the goods that are the subject matter of the agreement, date of entering into (reaching), duration, place of the anti-competitive agreement, and other data;

(3) names, positions, addresses of all the persons who are involved, have been involved or may be involved in the process of concluding (reaching) the anti-competitive agreement;

(4) other evidence at the disposal of the applicant regarding the anti-competitive agreement.

3. The economic entity having applied to the Commission may not be exempted from the liability prescribed by this Article where it has failed to fulfil the following conditions or one of them:

(1) the economic entity fails to terminate its participation in the anti-competitive agreement immediately after submitting an application, except for cases when, in the opinion of the Commission, it is not necessary to reveal the anti-competitive agreement;

(2) the economic entity fails to co-operate with the Commission from the moment of submitting information until the end of administrative proceedings, without reservations and on a continuous basis. That co-operation implies that:

a. the economic entity immediately submits all the necessary information and evidence with regard to the alleged anti-competitive agreement that come at its disposal or become known to it;

b. responds, within the prescribed time period, to all the enquiries of the Commission which may contribute to the recording of the facts regarding the alleged anti-competitive agreement;

c. ensures the opportunity of acting or, where possible, ex directors and employees of the economic entity, that is a participant of an anti-competitive agreement, to give explanations;

d. fails to destroy, forges and conceals information and evidence regarding an anti-competitive agreement, and

e. fails to reveal the fact and content of submission of a statement, application, information or evidence with regard to an alleged anti-competitive agreement before the entry into force of a decision, adopted by the Commission, on instituting administrative proceedings with regard to the possible fact of an anti-competitive agreement or in other cases agreed by the Commission.

4. The Commission shall leave the application submitted simultaneously by two and/or more participants of an anti-competitive agreement without consideration.

5. The procedure for submitting applications for exemption from imposition of a sanction shall be prescribed by the Commission.

(Article 36.1 supplemented by HO-249-N of 23 March 2018)

 

Article 36.2. Deduction of the amount of fine

1. An economic entity revealing its participation in an anti-competitive agreement, in case of failure to meet the requirements of Article 36.1 of this Law, may submit an application on deduction of the amount of fine.

2. To deduce the amount of fine, an economic entity must submit evidence to the Commission with regard to a possible fact of the offence provided for by Article 5 of this Law, which will have an essential significance for proving the offence.

3. The amount of fine imposed on an economic entity having informed about the anti-competitive agreement, as prescribed by this Article, the first and having submitted evidence having an essential significance for revealing that agreement shall constitute up to 50 percent of the fine prescribed by part 2 of Article 36 of this Law. The amount of fine imposed on the second economic entity having submitted evidence having an essential significance shall constitute up to 70 percent of the fine prescribed by part 2 of Article 36 of this Law. The amount of fine imposed on the third economic entity having submitted evidence having an essential significance shall constitute up to 85 percent of the fine prescribed by part 2 of Article 36 of this Law.

4. The procedure for deducting the amount of fine imposed on an economic entity shall be prescribed by the decision of the Commission.

5. Where, at the moment of submitting an application on deducting the amount of fine, an economic entity is a participant of another anti-competitive agreement and informs about that anti-competitive agreement as well, that economic entity may submit an application to the Commission on receiving a full exemption from paying the fine, as prescribed by Article 36.1 of this Law.

(Article 36.2 supplemented by HO-249-N of 23 March 2018)

 

Article 37. Failure to execute the decision of the Commission

(Article repealed by HO-137-N of 12 April 2011)

 

Article 38. Compensation of damages

Where damages have been caused to other economic entities or persons due to actions (omission) of an economic entity in violation of this Law, they shall be subject to compensation by the economic entity having committed the violation, as prescribed by the legislation.
Where damages have been caused to economic entities or other persons by a state body by unlawful decisions, actions or conduct, they shall be subject to compensation as prescribed by the legislation.

(Article 38 edited by HO-91-N of 4 May 2005, amended by HO-107-N of 22 February 2007, HO-137-N of 12 April 2011)

 

Article 39. Liability of officials of the Commission

An official of the Commission shall bear liability for the violation of this Law, as prescribed by the legislation.

 

Article 40. Liability of officials for violation of the requirements of this Law

Officials shall bear liability for the violation of the requirements of this Law, as prescribed by the administrative legislation of the Republic of Armenia.

(title amended by HO-107-N of 22 February 2007)
(Article 40 amended by HO-107-N of 22 February 2007)

 

CHAPTER 8

FINAL PROVISIONS

Article 41. Establishment of the Commission

The President of the Republic of Armenia shall appoint the Chairperson, Deputy Chairperson and members of the Commission within thirty days following the entry into force of this Law.

 

Article 42. Entry into force of the Law

This Law shall enter into force from the moment of its promulgation.

 

 

President
of the Republic of Armenia                                                                                                         R. Kocharyan

 

Yerevan
5 December 2000
HO-112

 

 

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28/11/2018
 
 
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