The President of the Office of Competition and Consumer Protection instituted antitrust proceedings to determine whether Cyfrowy Polsat has abused its market position by selling the rights to public screening of sport broadcasts

Practices consisting in abusing a dominant position belong to the most dangerous infringements of competition law. More specifically, they involve imposing excessively high or unjustifiably low prices, discriminating trading partners and imposing onerous contract terms. Dishonest business practices may be particularly evident at the time of economic crisis, when dominant players may be more likely to abuse their strong position at the expense of smaller enterprises. In 2008, UOKiK carried out over 150 proceedings concerning abuses of dominance - 80 of them resulted in issuing antitrust decisions.

Proceedings regarding Cyfrowy Polsat were launched following an analysis of information found on the company’s website as well as complaints filed to UOKiK. Imposing additional obligations imposed on businesses purchasing the rights to screen the coverage of Euro 2008 football games raised UOKiK’s concerns - Cyfrowy Polsat was the only entity in Poland selling the rights to show all the matches. Businesses running e.g. cinemas, pubs or hotels were permitted to show the games on condition that they bought the rights to their public screening as well as a decoder from Cyfrowy Polsat.

In the course of the antitrust proceedings, UOKiK is going to check whether Cyfrowy Polsat abused its dominant position by making the sale of rights to public screening of Euro 2008 coverage subject to purchasing a decoder and technical support.

According to the Polish Act on competition and consumer protection, antitrust proceedings concerning competition-restricting practices must be completed no later than within 5 months of the day of their institution. If an abuse of dominance is found, the President of UOKiK may impose a maximum financial penalty of 10% of the involved enterprise’s revenue gained in the preceding year.

The problem of dominant enterprises imposing unlawful contract terms concerns the whole European Union. Currently, the European Commission is carrying out proceedings against Microsoft, which is accused, for the second time already, of applying a practice which is forbidden by competition law and which consists in tying, this time, the Internet Explorer browser with Windows operating system. The French competition authority is, in turn, investigating a complaint against Orange, which belongs to the France Telecom capital group. Competitors accused Orange of imposing onerous contract terms regarding the access to some audiovisual services.

The irregularities emerging in the markets of new technologies pose a challenge for competition authorities, which have to monitor and adapt to the occurring changes on constant basis. These issues among others are discussed at the International Competition Law Forum organised by UOKiK in Warsaw in 15-16 April. The two-day meeting, held under the patronage of Neelie Kroes, European Commissioner for Competition, is an excellent opportunity to discuss the most current topics of competition law, including issues of new technologies, the procedures of imposing penalties, mergers in the retail market as well as issues regarding competition law in the construction sector. Among the invited guests we are going to host Philip Lowe, Director General for Competition at the European Commission and the heads of competition protection authorities from the EU member states and Canada.

Additional information:
Małgorzata Cieloch, Spokesperson for UOKiK
Pl. Powstańców Warszawy 1, 00-950 Warsaw, Poland
Tel. (+48 22) 827 28 92, 55 60 106, 55 60 430
faks (+48 22) 826 11 86
E-mail: mcieloch@uokik.gov.pl