competition | In Principle

Poland’s Office of Competition and Consumer Protection often accuses businesses of using misleading advertising content, violating consumers’ collective interests. This can attract a fines of up to 10% of the company’s annual turnover. One reason for fines can be improper wording or appearance of disclaimers.

On 9 May 2024, the Office of Competition and Consumer Protection (UOKiK) published updated guidance on notifications to the regulator and conducting proceedings under the Control of Certain Foreign Investments Act. The amended provisions of the act, which significantly expanded the scope of its application, entered into force almost four years ago, in July 2020. At that time, the regulator was granted additional powers to protect Polish companies deemed vital for public order, security or health (as we discussed in the article “Control of certain investments: new protective provisions”). The regulator published its first guidance on the new rules in 2022.

The Office of Competition and Consumer Protection has published new guidelines on the methodology for calculating fines for anticompetitive practices. The main objective is to bring the regulator’s practice into line with the recent amendments to the Competition and Consumer Protection Act, e.g. regarding fines for parent companies and consideration of the adequacy of the fine. But there are other changes as well, and some of them raise concerns.

The Office of Competition and Consumer Protection (UOKiK) definitely stands out from other public administrative bodies in the number of interventions it carries out and the decisions it issues, as well as its impact on the behaviour of market participants. The regulator’s activity constantly attracts media and public interest. This makes it particularly worthwhile for businesses to be aware of the regulator’s agenda for this year.

Since 2017, Poland’s competition authority has initiated dozens of proceedings for practices unfairly exploiting contractual advantage. As a result, nearly 20 decisions have already been issued, and many notices have been issued to companies. The fines alone have amounted to some PLN 1.1 billion (although appeals against some decisions are pending). To date, the largest fine for unfair exploitation of contractual advantage is over PLN 723 million (assessed against Jerónimo Martins Polska SA in 2020). What practices is the regulator seeking to identify and punish?

In recent years, new EU legislation has appeared addressing the influence of third countries on proper functioning of the internal market, including a mechanism for examination and control by the Commission of subsidies granted by third countries for planned economic activity in the EU of publicly or privately owned undertakings. The new rules also involve control of concentrations within the EU.

Under the statutory powers vested in the president of the Office of Competition and Consumer Protection (UOKiK), the regulator deals with issues including competition protection, contractual advantage, control of concentrations and investments, payment gridlock, and consumer protection. The activity plan for 2023 developed by UOKiK shows the areas considered key for this year.

In the face of the climate crisis, the interest in sustainability issues is growing. This increasingly brings the issue of greenwashing to the fore. “Greenwashing” refers to creation of a false impression among the public regarding the supposedly green practices applied by a business or the environmental benefits of its goods and services. Typically greenwashing is used to raise the attractiveness of goods or services in the eyes of prospective buyers, and thus to increase sales and attract customers. But sometimes the spread of misleading ecological messages is simply due to ignorance.

It has been a month since the president of the Office of Competition and Consumer Protection published the Recommendations on social media advertising labelling. Now the regulator is back with a collection of FAQs from users concerning the recommendations.
It has been a month since the president of the Office of Competition and Consumer Protection published the Recommendations on social media advertising labelling. Now the regulator is back with a collection of FAQs from users concerning the recommendations.

Significant changes are coming for medical device advertising. The rules will be much stricter than before, but still more lenient than drug advertising regulations. For the first time, the new Medical Devices Act regulates influencer advertising. It is already clear that sponsored content will be deemed to be advertising and thus must meet specific requirements under the Medical Devices Act. Companies have until the end of the year to sort out their relationships with influencers.

Since 1 June 2022, a new Vertical Block Exemption Regulation from the European Commission has been in force, setting out the rules for application of EU competition principles to cooperation between suppliers and buyers, in particular distribution. Some forms of vertical collaboration that were previously allowed are now banned. Others have been brought under the protection of the block exemption, meaning that they are now allowed. Some changes can be considered revolutionary.

Protecting consumers from unfair practices in financial services, telecommunications, and consumer sales. Early detection of bid ridding. Combatting payment gridlock. Implementation of EU directives and regulations. These are some of the plans for 2022 of the Polish competition authority.