The digital age has been a hot topic recently, do you think that competition law rules need an update with regards to the digital economy? If so, what kind changes are needed?
In my opinion, you do not have to adapt the legislation whenever a new situation arises. The current legislation is sufficient. On the contrary, an advantage of competition laws is their general definitions, which enable competition authorities to apply them in various sectors and times.
I do not find the current arguments of people calling for new competition law rules for IT and new technologies – big data – especially plausible. I think that recent legislation can be easily applied even to these rather new phenomena. A more practical way to deal with a digital economy would be better preparation by competition authorities. They should get deep knowledge of these subjects, have the necessary specialists available and should not be afraid to amend the recent case law in light of new market situations, especially new definitions of the market, but always with sufficient and qualitative argumentation.
Plans to adapt new competition rules look rather non-standard and like "bullying" of successful businesses who comply with all applicable legislation. Moreover, any new competition rules will raise problems of interpretation and legal uncertainty in the IT sector for at least for several years.
An example of a premature response to the digital economy might be the changes of notification criteria for mergers in Germany and Austria. Both countries introduced new notification criteria based on the value of the transaction. This instrument should enable competition authorities to assess transactions involving a company with smaller turnover but a large "potential" value, meaning ownership or dealing with so-called big data. The aim of the new notification criteria is to catch up with mergers in the IT area especially. However, the application of these new criteria in practice is, in my understanding, rather unconvincing. In particular, I doubt whether the competition authorities are in fact capable of anticipating the effects of IT mergers on competition conditions on the market. There were so many IT topics bubbles that burst. In my view, working with hypothetical scenarios can only lead to assessments that are divorced from reality.
Huge companies like Facebook or Google defend their acquisition of other platforms by arguing that their targets are active on different market levels. Is this in accordance with competition rules?
Such an approach by these giants is always under the scrutiny of the antimonopoly authorities in case the notification criteria are met or in case of alleged abuse of dominance.
How do you evaluate the position of smaller players on the market?
The IT sector is growing and developing unbelievably quickly. A small company today can be a big company tomorrow. Specific groups of customers prefer products and solutions that are local, innovative, brand-new or special. They hate anything global, anything "corporate". Customers might actually determine a structure of the market in the future, without any intervention by public authorities. Therefore, small players should take advantage of their current position, since a small position on the market does not have to mean no power on the market. Plus, they are always entitled to complain in case they feel abused by the conduct of bigger players.
Why did you decide to leave your position as a partner at an international law firm?
After many years in big law firms I needed a change and a new challenge. This was all the more true because I spent almost 15 years in the same office. After so many years, I also wanted to do things my way.
What are the biggest challenges of running a boutique law firm in the Czech Republic and Slovakia? Does size matter?
Size generally does not matter. Of course the law firm needs to have a certain size, for example, for assistance during dawn raids or competition compliance audits. But at the end of the day what really matters is the quality of the legal advice.
Boutique law firms are still fairly uncommon in the Czech and Slovak markets. In competition law, we are the only one. But more and more clients require highly specialised legal advice and understand that specialised law firms can provide it better.
How do you feel after five years on your own? Do you think your firm has achieved a solid place on the local market?
I feel it was the right decision. It still makes me smile. We work on very interesting cases and are ranked in the highest tiers in international and national ratings. I am especially pleased that more and more law firms which do not provide competition law advice are referring their clients to us, since they understand that today you need to have specialised advice in this area.
Martin Nedelka is a partner in both our Prague and Bratislava offices.Martin specialises in competition law, regulatory matters (especially energy) and compliance. In competition law, Martin has extensive experience of merger notifications, and has regularly represented investigated undertakings before the national competition authorities, the European Commission and the courts. He helps his clients prepare internal competition compliance programmes and offers them competition compliance training. In energy, Martin specialises in electricity and gas regulatory issues, energy network matters, renewables, and acts for clients before national regulators and the European Commission. In compliance, Martin has extensive experience of conducting compliance due diligence and providing insightful advice into the consequences of any breach of the relevant compliance regulations.
From 1996 to 1999 and again from 2001 to 2008, Martin worked in the Prague and Brussels offices of the law firm Gleiss Lutz, from 2003 as a partner. In 2001, Martin worked as an associate in the Brussels office of Cleary Gottlieb Steen & Hamilton. From 2009 to 2013, Martin was a partner with the law firm Schoenherr.
Jitka specialises in competition law, regulatory matters, public procurement law and compliance. In competition law, she provides legal advisory to clients in various industries both in their day-to-day business activities and when under investigation by the Czech Competition Authority, the Slovak Antimonopoly Office or the European Commission. She assists clients in preparing their merger notifications, and represents them before the competition authorities and courts. In addition, she helps them create and implement internal compliance programmes, including regular compliance trainings and "mock dawn raids".Jitka used to work for the Czech Competition Authority and the Directorate General for Competition of the European Commission. Since she moved to private sector, she worked at the Prague office of Gleiss Lutz and later Schoenherr, where she headed the competition unit.
NKA, a boutique law firm, is highly specialized in the following areas of Czech, Slovak, and EU law: competition law, regulatory matters, particularly energy, public procurement and compliance. NKA´s team is made up of experienced lawyers who have practised in the above areas of law for a long time. NKA´s lawyers have previously worked at leading international law firms, as well as the European Commission, The Czech Office for the Protection of Competition (Úřad pro ochranu hospodářské soutěže), Antimonopoly Office of the Slovak Republic (Protimonopolný úrad) and the Energy and Competition Office of Baden-Wuerttemberg in Germany (Energiekartellbehörde Baden-Württemberg). In competition law, the leading independent international and national legal directories (including Chambers Global, Chambers Europe, Global Competition Review, PLC Which lawyer?, Who’s Who Legal, and Lawyer of the Year) regularly rank our core team in their highest tiers. (interviewer: Jitka Linhartová).