Formation of a competitive environment. Price regulation
Competition policy is aimed at forming and developing a competitive environment that will ensure the efficient use of public resources, free market entry for business entities, and consumers' freedom to choose a wide range of goods of better quality at lower prices.The goal of competition policy is the formation and development of an effective competitive environment, the creation of a critical mass of competitive relations.
The implementation of the directions defined by Decree of the President of Ukraine No. 1097/2001 of 19.11.01 "On the Main Directions of Competition Policy for 2002 - 2004" has a positive effect on the formation of an effective competitive environment, reducing the share of the monopoly sector in Ukraine's economy, improving competition rules, and developing institutional support for competition.
The adoption by the Verkhovna Rada of Ukraine on January 11, 2001, of the Law of Ukraine "On Protection of Economic Competition", which entered into force on March 2, 2002, largely completed the formation of the competition legislation system.
The development of competition in the city of Lutsk takes place under conditions of growing and strengthening positive trends in the national economy. The economic processes that have taken place recently have in practice revealed the interconnection and mutual influence of the development of competitive relations and economic recovery.
The further reduction of the share of the monopoly sector in the city's economy remains important. The main ways of such a reduction are, first, the maximum possible removal of barriers to the entry of new business entities into monopolized product markets and the stimulation of the entry of new business entities into these markets; second, ensuring the development of the competitive sector of the economy at faster rates compared with monopolized sectors of the economy.
An urgent task is to strengthen the functions of control over compliance with the requirements of competition legislation and control over compliance with state price discipline, primarily in the markets for services of natural monopoly entities.
Tasks of competition policy for 2004:
- reducing administrative influence on market processes, optimizing government intervention in the financial and economic activities of business entities;
- improving competition rules and building an effective competitive environment in socially important product markets;
- creating an effective mechanism for state regulation of the activities of natural monopoly entities;
- strengthening the protection of entrepreneurs and consumers against monopoly manifestations, primarily by natural monopoly entities.
The main measures of competition policy, the implementation of which will make it possible to achieve the goals set for 2004:
- to determine the lists of paid services that can be provided directly by executive authorities;
- to gradually narrow the scope of provision by executive authorities of those services that are provided by business entities controlled by these authorities;
- to carry out further non-structural demonopolization, in particular by removing barriers to the entry of business entities into markets;
- to complete the structural demonopolization of certain regional markets that are potentially competitive, in particular, through the separation from enterprises during privatization of non-core production facilities and social infrastructure facilities;
- to intensify control over the prevention, non-admission and termination of violations of legislation on protection of economic competition;
- not to allow the monopolization of certain product markets through the most efficient possible use of the concentration control mechanism;
- continue the restructuring of natural monopolies in the housing and communal services markets;
- introduce competitive principles for the procurement by natural monopoly entities of raw materials, materials, and equipment in large volumes;
- introduce licensing of the activities of natural monopoly entities and entities operating in adjacent markets in accordance with the Law of Ukraine "On Licensing Certain Types of Economic Activity", taking into account the specifics provided for by the Law of Ukraine "On Natural Monopolies";
- continue price regulation of the activities of natural monopoly entities and certain most socially significant markets;
- gradually abolish price (tariff) regulation in those markets where the threat of monopolization no longer exists;
- introduce temporary regulation of prices and tariffs only in the event of abuse of a monopoly position or unjustified price increases.
Criteria for the effectiveness and efficiency of competition policy:
- an increase in the number of competitive markets;
- the emergence of new business entities in the markets;
- the possibility for entrepreneurs and the population to receive quality services;
- increased efficiency of the activities of business entities of natural monopolies and enterprises operating in adjacent markets.