Sustainability and Competition Global Practice Guide |
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Ukraine |
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(Europe)
Firm
Asters
Contributors
Igor Svechkar |
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| Are ESG measures/sustainability agreements included in your jurisdictional competition regime? | ESG measures and sustainability agreements are not specifically included in the Ukrainian competition regime. |
| If ESG measures/sustainability agreements are not included in your jurisdictional competition regime, do you foresee any new regulations coming into place in 2022? | To our knowledge, no such new regulations are expected in 2022. |
| Has your Authority issued any guidance on the role, if any, of ESG in the competition law analysis applied to mergers or other conduct? | The Antimonopoly Committee of Ukraine ("AMC") has not issued any specific guidance on the role of ESG in the competition law analysis applied to mergers or other conduct. |
| Has your jurisdiction issued guidance regarding competitor collaborations or participating in industry working groups, and if so, do they specifically address ESG? | Back in 2006, the AMC issued Regulation No. 511-r which provides guidance on how to establish business associations in line with the Ukrainian competition law. These rules are not specifically focused on ESG. However, Regulation No. 511 suggests that members of associations may be allowed to coordinate their behavior (except for the hardcore alike coordination) in relation to matters that pursue sustainability objectives, in particular in relation to: "[d]issemination of scientific achievements, technical knowledge, best practices on effective technologies, implementation of cost-reducing measures, environmentally friendly technologies". |
| Can parties seek specific guidance from authorities on proposed ESG initiatives? | There is no regime allowing parties to seek specific guidance from the AMC on proposed ESG initiatives. However, parties can seek a preliminary opinion of the AMC within the general legal framework for mergers and concerted practices (agreements) among undertakings. |
| How, if at all, does your jurisdiction quantify or calculate the ESG effects? | In Ukraine, there are no rules on measuring the ESG effects as part of the general competition regime. |
| What does your legal authority currently permit even if your agency is not yet active on this topic? | The parties can seek clearance of the AMC within the general legal framework for mergers and concerted practices among undertakings. In particular, the AMC can clear sustainability agreements if they do not:
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| Are there precedents that involved ESG/sustainability matters in your country? If so please provide a short description. | Recently, there have been a few decisions of the AMC where it granted clearance to undertakings for concerted practices (agreements) that pursued sustainability objectives. Namely, in 2021, the AMC cleared concerted practices among the biggest international producers of pesticides, such as Adama, Arysta, BASF, Bayer, FMC, Nufarm, Summit Agro Ukraine and Syngenta together controlling more than 60% of the relevant market in Ukraine. Despite the parties’ significant combined market share, the AMC granted clearance after an in-depth phase II review because the practices were aimed to establish the first Ukrainian (EU alike) container management system for the collection and disposal of empty pesticide containers. Interestingly, the AMC's reasoning in this decision was somewhat similar to the one proposed by the EU Commission regarding sustainability agreements in its draft revised Horizontal Guidelines. Namely, the AMC concluded that the practices can be cleared as they (among others) were voluntary, based on non-discriminative qualifying criteria, did not foreclose from the relevant market undertakings who did not wish to participate, and included a condition not to exchange commercially sensitive information. The same year, the AMC cleared other concerted practices that related to the memorandum signed by the National Bank of Ukraine and two international payment systems – Visa and Mastercard. The memorandum envisaged the gradual reduction of interchange fees of both payment systems, while the contemplated reductions will be concurrent and within the same limit by both Visa and Mastercard. The AMC clearance decision named several justifications, including the development of a cashless economy. |
| Is there specific antitrust regulation in your jurisdiction to be aware of which might give rise to private or class action ESG litigation? | To our knowledge, there is no specific antitrust regulation that might give rise to private or class action ESG litigation. However, there is a general framework for seeking antitrust damages in place – those who suffered such damages can seek compensation in twice the amount of the actual damage sustained. |
Sustainability and Competition Global Practice Guide
ESG measures and sustainability agreements are not specifically included in the Ukrainian competition regime.
To our knowledge, no such new regulations are expected in 2022.
The Antimonopoly Committee of Ukraine ("AMC") has not issued any specific guidance on the role of ESG in the competition law analysis applied to mergers or other conduct.
Back in 2006, the AMC issued Regulation No. 511-r which provides guidance on how to establish business associations in line with the Ukrainian competition law.
These rules are not specifically focused on ESG. However, Regulation No. 511 suggests that members of associations may be allowed to coordinate their behavior (except for the hardcore alike coordination) in relation to matters that pursue sustainability objectives, in particular in relation to:
"[d]issemination of scientific achievements, technical knowledge, best practices on effective technologies, implementation of cost-reducing measures, environmentally friendly technologies".
There is no regime allowing parties to seek specific guidance from the AMC on proposed ESG initiatives. However, parties can seek a preliminary opinion of the AMC within the general legal framework for mergers and concerted practices (agreements) among undertakings.
In Ukraine, there are no rules on measuring the ESG effects as part of the general competition regime.
The parties can seek clearance of the AMC within the general legal framework for mergers and concerted practices among undertakings.
In particular, the AMC can clear sustainability agreements if they do not:
- lead to monopolization (creating or strengthening the party's monopoly/dominant position) or substantial restriction of competition on the Ukrainian market or a significant part of it (substantive test for mergers);
- contain hardcore restrictions, but at the same time give rise to efficiency gains (e.g., promotion of technical and technological development, improvement of the production and distribution processes, development and application of uniform standards, and so on.) (substantive test for concerted practices).
Recently, there have been a few decisions of the AMC where it granted clearance to undertakings for concerted practices (agreements) that pursued sustainability objectives.
Namely, in 2021, the AMC cleared concerted practices among the biggest international producers of pesticides, such as Adama, Arysta, BASF, Bayer, FMC, Nufarm, Summit Agro Ukraine and Syngenta together controlling more than 60% of the relevant market in Ukraine.
Despite the parties’ significant combined market share, the AMC granted clearance after an in-depth phase II review because the practices were aimed to establish the first Ukrainian (EU alike) container management system for the collection and disposal of empty pesticide containers. Interestingly, the AMC's reasoning in this decision was somewhat similar to the one proposed by the EU Commission regarding sustainability agreements in its draft revised Horizontal Guidelines. Namely, the AMC concluded that the practices can be cleared as they (among others) were voluntary, based on non-discriminative qualifying criteria, did not foreclose from the relevant market undertakings who did not wish to participate, and included a condition not to exchange commercially sensitive information.
The same year, the AMC cleared other concerted practices that related to the memorandum signed by the National Bank of Ukraine and two international payment systems – Visa and Mastercard. The memorandum envisaged the gradual reduction of interchange fees of both payment systems, while the contemplated reductions will be concurrent and within the same limit by both Visa and Mastercard. The AMC clearance decision named several justifications, including the development of a cashless economy.
To our knowledge, there is no specific antitrust regulation that might give rise to private or class action ESG litigation.
However, there is a general framework for seeking antitrust damages in place – those who suffered such damages can seek compensation in twice the amount of the actual damage sustained.