The Slovenia Times

Major regulators object to government merger plans


Ljubljana - Major Slovenian regulators have voiced opposition to plans to merge eight independent agencies into two super-agencies as part of government efforts to streamline the public administration. Some say the plan violates international rules and Slovenia's commitments under EU law, was made without any analyses and curbs their independence.

The Competition Protection Agency (AVK), one of the six agencies slated to be merged into an agency for market and consumers, said the plan ran "contrary to all democratic standards and regulations" as well as the 2018 EU directive on the strengthening of competition protection bodies.

It would "substantially reduce the independence of the agency, which is in explicit violation of the directive", the agency said on Monday.

The Agency for Communication Networks and Services (AKOS) said the merger did not ensure regulatory independence. "The proposal is incompatible with multiple EU directives, in particular in the sense of ensuring the independence of the regulatory authority, a demand of directives in all areas covered by the agency," AKOS director Tanja Muha told the press.

The Securities Market Agency (ATVP) said the proposal was unsuitable since the stock market regulator was supposed to be truly independent, not just on paper. But under the proposal, the government would appoint the management and the governing council of the new agencies, which would be "a step back".

Similarly, the Agency for Insurance Supervision (AZN), which would together with the ATVP form a new agency for financial markets, said the new legislation would not bring "more efficient supervision" of the financial market as the agency's independence would diminish.

The only legitimate purpose of merging regulators is more efficient supervision, or equally efficient but financially more viable, AZN boss Gorazd Čibej said.

He said expert views needed to be carefully weighed on before any systemic change to regulators, especially when bodies of strategic importance for financial supervision and stability are concerned.

The Civil Aviation Authority (CAA), which would be merged with the road safety and rail transport agencies, told the STA the plan violated the basic tenets of international regulations in which competent independent bodies are the foundation of aviation safety.

It said the stated goal of streamlining was untenable since the agency needed to secure a sufficient number of qualified staff and staff cuts would render it impossible to carry out the prescribed tasks. In 2014, the agency had already been the subject of EU infringement proceedings due to insufficient staffing.

What is more, aviation safety has "nothing to do with consumer protection or market regulation" and the two agencies with which it is supposed to be merged have completely different powers.

The agencies said they had neither been briefed nor consulted about the plan. They received the proposal on Thursday and were given until today to submit comments. The ATVP did not even receive the proposal, but found it on the internet.

The agencies also object to how the new management and supervisory bodies would be appointed since the government would have the final say.

The director of the Energy Agency Duška Godina said such a merger and government appointment powers would be in violation of EU law on the energy market while bringing no benefits for users.

She said that no analysis had been put forward to substantiate the merger of incompatible agencies, which could in fact lead to additional costs.

Godina stressed energy regulators had primarily been established to keep decisions independent of economic and political interests. This independence is clearly in peril, including because the regulator needs to be able "to independently decide on how much human and financial resources it needs for successful and effective work".

The Public Agency for Railway Transport (AŽP) said that it is not a regulator for railway transport and that its activities are not related to keeping track of market conditions as is the case with most other agencies that are to be merged.

AŽP, established on the basis of EU law and under direct oversight of the EU Agency for Railways, is a security, licensing, inspection and penalising body designed to secure safety in railway transport, the agency said.

It examined the proposal nonetheless, but was not able to recognise any positive effects of a merger. "The present AŽP organisational model is completely adequate in our opinion; this was also confirmed in the oversight by the EU Agency for Railways."

The Traffic Safety Energy intends to issue a response on Tuesday.

The Economy Ministry, which drafted the proposal, said the proposal was currently subject to talks among various government departments and expected the coordination would result in a "consensus for positive change".

Prime Minister Janez Janša meanwhile said on Twitter that the proposal was modelled on the Dutch system, which was considered "one of the most efficient and transparent models in the EU".


More from Politics