Bogdan Chiriţoiu, Competition Council: "Out of 44 sectors we look at, in one third we see a regression from a competitive point of view"

Out of 44 economic sectors analyzed by the Competition Council, this year, for about a third, a regression was observed from a competitive point of view, following the effects of the crisis and government interventions to combat the crisis, said yesterday Bogdan Chiriţoiu, the president of the Council Competition, during a press conference.

Bogdan Chiriţoiu said: "In past years we were very positive about how competition works in our economy. There were a number of areas of concern, but they were relatively few. This year their number has increased. We look at how sectors work. In particular, how they are structured, how many actors there are, how easy it is to enter the respective market, what are the barriers to economic activity. And we rank the economic sectors - some with difficulties, where we see problems related to competition, some where the problems are average, and some where we see that the premises under which competition takes place are good. Of the 44 sectors we look at year after year, we see a decline in one third. This shows us that, compared to other years, there is pressure, they are consequences of the economic situation. Because the economy has gone through three major crises in the last ten to fifteen years".

According to the president of the Competition Council, one of the sectors in which regressions were found is the energy sector.

"I'm not talking about violations of the law, but the number of companies present in the market, the ease for a new company to enter the market. These are some preconditions of competition. We have sectors where, traditionally, we saw problems. For example, where we have very few players, such as the area of construction materials, or areas where we have regulations, such as the area of liberal professions. We flag these every year as the most problematic sectors from a competitive point of view. This year, obviously the effect of the crisis and government interventions to combat the crisis, we see regressions in the energy sector. They came up with a regulation, and the problem for the next two years will be how we will manage to reopen the market in a way that is sustainable for both domestic and industrial consumers, but which allows competition to take place", said Bogdan Chiriţoiu.

Also, according to the president of the Competition Council, in the insurance sector regressions were found in terms of the market structure, this year. "We do not have the regulations on RCA, and the insurance issue is not resolved. We have had a number of bankruptcies in recent years, big players have exited the market and it has taken price controls until the market has absorbed the shock of these bankruptcies. But again the question arises as to how we move forward, how we enter normality in this area. These are the sectors where we see regressions from the point of view of the market structure compared to previous years", stated Bogdan Chiriţoiu.

According to the president of the Competition Council, the capping of RCA tariffs will not be removed without putting in place a set of measures that allow the market to function. "As you know, we proposed the idea of price caps to give the market time to adjust to the disappearance of a big player, Euroins, which came shortly after the disappearance of another big player in the market, City. It normally takes some time for the companies that remain in the market to expand, to take on the remaining available customers after these bankruptcies. This capping period will expire next year and by then we must have a solution. We have a bill that we proposed two years ago, which we believe will improve the functioning of the market. I hope that project or a variant of it ends up being transposed into legislation. We will not simply remove the cap without replacing it with a set of measures to enable the market to function. These bankruptcies did not appear out of thin air; the insurance legislation problems contributed, I'm not saying they caused it themselves, but they contributed to the crisis in the RCA market", said Bogdan Chiriţoiu.