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19 December 2017
newsletter

Bosnia and Herzegovina: Competition Council – no concentration when company takes over competitor's premises

The Competition Council recently took a stand regarding whether a situation in which a food retail company takes over a competitor's business premises and continues the same business activity in those premises constitutes a concentration. The council concluded that such situations should be notified as they are not considered concentrations according to the Competition Act.

Bingo doo submitted two proposals to the council:

  • The first proposal referred to Bingo's intention to lease directly from the owner 1,200 square metres of business premises used by its competitor Konzum, to open a new supermarket and continue to use the premises for the same purpose as Konzum, but without entering into any kind of an agreement with Konzum.
  • The second proposal referred to Konzum's intention to terminate the lease agreement and leave the premises, while Bingo, as owner of the premises, would continue to use them for its core business activity and open a new supermarket.

The council stated that neither situation represented a concentration according to the Competition Act. The first proposal does not amount to a concentration since it referred only to the conclusion of a lease agreement and not to an agreement between Bingo and Konzum. Regarding the second proposal, the council reasoned that the termination of a lease agreement with Konzum and further use of the business premises as a supermarket by Bingo should not be considered a concentration, since Bingo was the owner of the premises.

This article was first published on www.internationallawoffice.com