Romania - Functional Review : Romania Competition Council

Abstract

The European Union is founded on a
 competitive market economy unified by commonly agreed rules
 and practices. While Romania has joined the Union, its
 ability to prosper fully within the common market requires a
 strengthened commitment to, and ability to protect, EU
 competition principles. Romania's legal and
 organizational framework for enhancing competition is
 tenuous and the current economic and fiscal crisis puts
 recent gains at risk. In particular, Romania's
 performance in competition policy still lags behind EU
 practice and is characterized by: (i) State-owned
 enterprises and government participation still play a
 dominant role in many important markets and sectors in
 Romania, controlling at least one firm in 14 key sectors of
 the economy and exhibiting a market share above 50% in at
 least one segment of network industries. (ii) Relatively low
 enforcement of competition policy against hard-core cartels
 and abusive practices while merger review cases that do not
 significantly impose threats to competition account for the
 bulk of the workload in the competition area. (iii) Low
 staffing for competition enforcement and economic analysis
 placing the Romania Competition Council (RCC) at the bottom
 of European Union rankings with no internal target deadlines
 to track performance. (iv) Active advocacy activities mainly
 focus on raising awareness of the importance of competition
 law but efforts need to be made to refocus activity on
 tackling anticompetitive regulation, expand advocacy to key
 groups within the government and implement alternative
 advocacy tools. A comprehensive reform program therefore is
 required at the national level, as well as within the
 Romanian Competition Council (RCC) as the key agency in
 guaranteeing healthy competition. Priority actions, further
 detailed in this report, include the following: (i) improve
 the competitive environment by reducing the dominant role of
 the state in several economic sectors, (ii) provide space
 for a redoubled RCC focus on competition enforcement
 establish a new unit within RCC to target hard core
 anti-competitive behavior take immediate steps, within the
 principles of the government's unified pay system, to
 ensure a level of compensation to core RCC competition staff
 commensurate with their responsibilities in front of the
 judiciary and private sector.