In a dialogue with Bogdan Chiritoiu, President of the Romanian Competition Council, and Dan Ghita, President of ROMBET
Mister President, you were saying a while ago that the ‘mission of the Competition Council is to protect, maintain and stimulate competition and a normal competitional environment, to the benefit of the consumers.’ How would you describe now the outcome of the initial mission?
Since 2009, when I was assigned to this position, have felt the impact of the economic and financial downturn. All of a sudden, the major objective was to fight with the prices in a competitional environment. I have always wanted to have a prompt institution, oriented towards results and increase of the market efficiency. Because our goal is to have more competition in Romania, which means a more active economy and, implicitly, the welfare of the consumer. It was an effort that took us two years to carry out: one year for preparing the text and adopting the EGO and another one for the parliament debate and the substantial text amendments made in the Parliament.
Upon the changing and completion of the legislation, national procedures to the community stipulations regarding competition have been adjusted, thus giving us more opportunities to reach this goal of being more flexible and have a faster economic impact.
We are pointing now to a sensitive issue for the industry, the Romanian economy and everyone involved: EGO 77/2009. What could you tell us about the connection of the Competition Council in this regards?
As an autonomous administrative authority, the Competition Council is entitled by law to intervene when the measures taken by the state can have an anti-competition impact on a market. While for an administrative act with a normative nature – for instance, a government resolution, a minister order – this Council can impose by a decision (subject to the law) the amendment or the elimination of an anti-competition stipulation, it can only formulate proposals or recommendations for an act, which the Parliament considers or not.
The Competition Council has had numerous interventions that aimed at the elimination of those stipulations with an anti-competition impact, which can bring or do bring market discriminations, by giving leverage to some companies (mainly the Romanian Lottery) to the detriment of others.
We were among the ones who welcomed the emergence of Rombet – the association of the betting organizers. Their management has aimed to give a helping hand to the industry and to revive the dialogue with the authorities. There are still many economic agents that see the state as the public enemy, a hindrance to their business. How can the Competition Council become involved in this dialogue?
In its early years, the Competition Council was an active presence in this process and concluded some protocols with certain associations in various fields where competition was strongly promoted. Right now, the competition rules are already known and people are aware of them at a large scale, hence this approach is no longer opportune.
The associations can play the role of a forum for exchanging ideas in their line of expertise, while randomly interacting with the public authorities to promote or to oppose to such regulation.
When the association has regulatory authority given by the state via a legal act, this association can inquire the Competition Council about its initiative or any relevant regulation. This aspect is rather procedural.
What is happening at the Romanian Lottery compared to your institution? After record earnings, they were heavily fined by the Competition Council. Looking from the outside, the Lottery seems an eternal problem. How do you see its development?
The main problem in terms of the competition rules is the video-lottery, a game that the present regulation classifies into the category of the lotto games, for which the Romanian Lottery holds exclusivity, and not in the slot-machine, as the Competition Council decided in its 2006 decision and in 2013. There is an investigation pending on this issue.
To give exclusivity to the Romanian Lottery, with no open and transparent auction or without charging a corresponding tax, is seen as an unfair advantage in the state.
On the other hand, our institution acts to follow up on either complaints about competition problems on the market or ex officio where there are sufficient grounds, de facto and de jure, to launch an investigation after preliminary analysis. For the Lottery, it was surprising that there were no complaints about the aspects that this investigation deals with. The contract has been held secret for a long period of time. Before the investigation, a basic analysis had been done so as to attempt to clarify the status of the video lottery related to both the market and to the current regulations.
The online environment is still a dispute in Romania. Could you tell us how did the Competition Council get involved to adjust the legislation to the online environment and the internet gambling operators?
The proposals and the recommendations of the Competition Council have considered that that access of the monitoring and reporting operators to the market not have excessive and discriminatory rules and the prices for their services should not be limited by any norms. For us, the potential replacement of the online with the land-based gambling is interesting, depending on the point of view adopted by the Competition Council.
Mister Dan Ghita, as the Rombet President, could you tell us anything about the updates on the amendment of EGO 77/2009? We know that, after its establishment, the association management has actively worked on protecting the industry interests from possible legal stipulations approved without a solid documentation…
The fact that the situation is more complex than the law makers thought proves not only the involvement of Rombet and the stimulation of the constructive dialogue but also the negative solution given by the Government at the end of July. This is something we are happy about, as it is beneficial to the industry from many points of view. First, it seems that the situation is coming clear in terms of the gambling industry: how it works, how it reports itself to its own and the European legislation, what are the strengths and weaknesses, how a real dialogue with the authorities should look like. It is only a first step on the road to bring all this to a normal status. The second step is more difficult, as it deals with changing the perception towards this industry – the amount to be spent is around 1 billion euros per year and this is for Romania only. To initiate a law for this industry, you need solid and well-documented studies and the proposals should be lied down on the table until all the stakeholders understand and agree with the possible changes.
Talking about studies, Rombet and a team of experts from Brussels are preparing a comparative legislative study in the gambling industry at the European Union level, so that we will know where is Romania placed and what are we supposed to do so that the Romanian gambling industry be similar to any on the continent.