According to press reports, the Croatian Government is planning to sell shares in 300 companies by the end of 2013 and in further 300 companies by the end of 2014. The income from the first round of sale is expected to reach HRK 3bn (approximately EUR 396m).

The state portfolio is divided in three categories. The first category covers companies of special state interest and the Government intends to retain a controlling shareholding (e.g. 25%+1 share). The most significant income from this group is supposed to come through the sale of Hrvatska poštanska banka (Croatian Postal Bank) and Croatia Osiguranje (largest Croatian insurance company). The Government has discussed privatization of these companies ever since taking office in 2011 and initial steps in the process have already been taken. Such privatization route is envisaged for some other major companies such as INA (national oil company), Jadrolinija (shipping), Luka Rijeka (port management) and Đuro Đaković (industrial machinery). The second category consists of companies proposed for recapitalization. Out of these companies only ACI (marinas management) received publicity up to this date.

The third category will reportedly cover companies that consistently produce losses and which should be fully privatized. The Government plans to offload all of its stakes in several hospitality/tourism companies (including hotel companies Medena, Maestral, Makarska, Korčula, Orebić) as well as in Borovo (footwear manufacturer), Tiskara Vjesnik (printing company) and Brijuni Rivijera (real estate development).

1. Background

The Western Balkans is a region on the move. Croatia became the 28th EU member country on 1 July 2013. Accession negotiations are gathering pace with Serbia, Montenegro and the Former Yugoslav Republic of Macedonia (“FYROM”). Bosnia, Albania and Kosovo are moving steadily towards candidate status. These developments will trigger significant changes in the way these economies are run. But after some decades of reconstruction on a national basis, businesses and governments will have to adapt to a European approach and competition policy will have an important part to play. This seminar, organized by law firm Babić & Partners, Zagreb, Croatia looked at the reality of competition law enforcement in the region, key trends and developments as well as practical tips based on previous transactions and matters handled by the speakers.

2. Faculty

2.1 Introduction

Alison Hook, Director, Hook International, London

2.2 Facilitator

Margaret Doyle, Columnist, Reuters Breakingviews, Thomson Reuters

2.3 Speakers

Dag Johansson, Policy Co-ordinator, International Relations, European Commission, Brussels, gave a personal view on the topic: “Pitfalls and Challenges for Emerging Competition Regimes”.

Boris Babić, Senior Partner, Babić & Partners, Zagreb, Croatia, spoke on antitrust law and enforcement issues across the Western Balkans (in Croatia, Serbia, Bosnia and FYROM especially)

Iva Basarić, Senior Associate, Babić & Partners, Zagreb, Croatia, presented a case study: “Multi-jurisdictional Merger Control Filing in the Region”.

3. Some of the topics discussed:

–  Convergence as a balancing act: must allow flexibility and be adapted to country-specific circumstances;
–  Oversimplification and misinterpretations (e.g. definition of dominance);
–  Competition authority’s, priority setting and project management;
–  Multi-jurisdictional merger control filing in the region: case study;
–  Cartels and leniency: how does it work and what industries are likely targets;
–  Relationship between EU competition law and local laws;
–  Regional convergence: is there in fact a model law in the region and how this affects the enforcement;
–  Landmark cases, enforcement record and trends.

4. Additional information

For further information, including presentations from the Seminar, please contact us at office@babic-partners.hr