This presentation by Albania was made during the break-out Session 3, “Techniques and evidence for assessing predatory pricing, margin squeeze and exploitative abuses” in the discussion “Economic analysis and evidence in abuse cases” held at the 20th meeting of the OECD Global Forum on Competition on 7 December 2021. More papers and presentations on the topic can be found out at oe.cd/eac.

1. Economic analysis in abusive
cases
Break-out 3
Albanian Experience
Ms. Mimoza Kodhelaj
Director
Albanian Competition Authority
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OECD Global Forum 7 December 2021

2. The ACA’s Mission and Competition Law
“Protection of free and effective competition in the market, to increase
public welfare.”
• Law no.9121/2003 on the Competition Protection is in compliance
with the TFEU respectively:
1. Article 101 - fighting against prohibited agreements, decisions and
coordinated behaviors;
2. Article 102 - on the abuse of the dominant position; as well as
3. Article 106 - on the rules of the mergers and acquisitions.
No State Aid, No Consumer protection
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3. Abuse of Dominant Position analysis
• In ex-ante analysis, the ACA assesses draft normative acts by the government that may impose
barriers to entry, or grant special or exclusive rights to an undertaking in the form of Public-
Private-Partnership or concession. The ACA may recommend or give obligation to the
undertakings to respect the principles and rules of competition, in order to comply with the
provisions of article 9 of the competition law regarding abuse of dominant position: - imposing,
directly or indirectly, unfair purchase or sale prices or other unfair trading conditions; - restriction
of production, markets or technical development.
• In ex-post analysis, the ACA may conduct market studies/ sector inquiry or open preliminary and
in-depth investigation and assess abuse of dominant position.
• The first step in all cases is defining the relevant market which includes both the product and the
geographic market as foreseen in the Guideline no. 76/2008 “On Market Definition” and
Guideline 2015 “Appraisal of dominant position”
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4. Methodology and Economic theory
• Industrial economics principles, Structure-Conduct-Performance Paradigm:
the market structure: monopoly (natural monopoly or undertaking holding
a concession or exclusive right/PPP); oligopoly; monopolistic competition;
the number of competitors and degree of concentration, homogeneity of
the product; barriers to entry/exit; countervailing power of buyers and
suppliers; performance in terms of productive efficiency, allocative
efficiency, and profitability;
• Literature review and best cases from OECD, ICN, or other competition
authorities when a case regards a new market that hasn’t previously been
under investigation.
• investigation procedure includes several steps to be followed like data
request, inspections, data analysis, and compiling of the report.
• preliminary investigations: 3 months, in-depth investigations: 6 months.
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5. Data request and analysis
• Requests for information: Public institutions, Market regulators in: energy,
telecommunications, banking, ports etc.; General Directory of the Customs,
Institute for National Statistics, Ministries & undertakings under
investigations.
• Data collected: sales, prices, financial statements, and contracts;
questionnaires and interviews;
• Data analysis: gathering, administering, organizing, compiling statistics and
indices, and reporting the results. Market shares, concentration HHI and
CR3 and CR4 indicators, If MSH >40% of the market, it is considered to hold
a dominant position.
• degree of expansion (network of distribution), level of vertical integration,
power of sellers and buyers, barriers to new entries, the economic power
of competitors in terms of financial indicators, and other performance and
financial indicators are calculated.
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6. Data Analysis techniques
• In margine squeeze, loyalty rebates, tying and bundling predatory
prices, and excessive prices analysis on prices and costs is done
especially.
• Benchmark analysis in countries in the region, the "as efficient
competitor: "in regulated markets, where the incumbent
undertakings are compared to other competitors in regard to cost,
prices and fees, and trade conditions.
• In refuse to deal/supply cases analysis includes mostly legal
assessment of unfair trade conditions in contracts between the
undertaking that holds the dominant position and other undertakings
in the other levels in the market.
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7. Role of economists
• in-depth long-term data analysis: the role of economists in other abuse cases as margine squeeze,
loyalty rebates, tying and bundling, predatory prices, excessive prices are essential.
• Economists are part of each team of investigators in abuse of dominant position cases.
Economists compile the RFI data format and perform all the economic analyses of the
investigation report. A huge amount of data needs to be analyzed.
• Economists represent 17 out of 46 (total number) staff in the ACA. Since 2017, the ACA has had
the position of Chief Economist (CE) in the organic structure of the Secretariat of the Authority.
The CE role is included when required in abuse cases where in-depth econometric analysis needs
to be done.
• While some abuse of dominant position cases have ended CC decision giving recommendation or
obligation to the dominant undertaking (CC decision no. 567/2018 EMS-APO refuse to deal case
or CC decision no.812/2021 LPG margine squeeze case), in cases imposing fines the CE role is very
important.
• The calculation of the fine is done using a methodology that determines elements and financial
data to be included in the amount and percentage of the fine (Refer to CC decision no. 696/2020
DCT case or CC decision no. 572/ 2018 EKMA unfair trading condition case).
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8. DCT abuse of dominant position
• In 2020 based on a complaint by one operator regarding the loading and
unloading of containers in the terminal of Durres, by imposing an unfair fee
• Market definition: (product and geographic) the loading and unloading of
containers in the terminal of Durres
• Assessment of Dominant Position: Durres Container Terminal (DCT part of
Kürüm Holding) has a concession contract which operates the container’s
terminal in the port of Durres since 2013, for 35 Years. DCT is the only
undertaking that possess and the sole administrator of all infrastructure
and facilities of this terminal, being 100% dominant, high barriers to entry,
no competition potential; low countervailing buyers power.
• Investigation period 2018-2019
• Data Gathering: down raids, RFI to Portual Authority of Durres (PAD) and
Ministry of Infrastructure and Energy (MIE)
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9. DCT abuse of dominant position
• Data analysis & results:
o Fees are approved by MIE and PAD in a mutual guideline.
o Since May 2018 DCT has applied a self-determined fee which was not
approved and was not present in the fee book from PAD: 20 feet conteiners
120 Euro/Box; - conteiners 40 feet 150 Euro/Box
o In November 2018 PAD and MIE request to DCT to change the fees to their
proposed fees: 20 feet conteiners 65 Euro/Box; - conteiners 40 feet 86
Euro/Box .
o DCT continued to apply its own fees which were 85% and 43% higher than
the proposed fees
• It resulted that fees applied by DCT were highly excessive, concluding
an violation of art. 9 of competition law “abuse of dominant position”
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10. DCT abuse of dominant position
• Compile of the report and calculate the fine using a methodology that
determines elements and financial data
• Hearing session with DCT and PAD and MIE
Competition Commission through decision no.696/2020 decided to:
• Fine DCT in the amount of 0.43% of DCT turnover of the previous financial
year, in the value 5,052,370 Lekë ~ 41,756 Euro
DCT appealed the CC decision, but the court decided in the ACA favor
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11. THANK YOU FOR YOUR ATTENTION!
Contact
mimoza.kodhelaj@caa.gov.al
www.caa.gov.al
www.linkedin.com/in/mimozak
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