Regulation of Unfair Competition Processes in the Banking Services Market (on the Example of the Lviv Regional Department of JSC “Oschadbank“)
Students Name: Sharovska Nadiia Olehivna
Qualification Level: magister
Speciality: Management of Economic Competition Sphere
Institute: Institute of Public Administration, Governance and Professional Development
Mode of Study: full
Academic Year: 2020-2021 н.р.
Language of Defence: ukrainian
Abstract: Sharovska N.O., Skoryk H.I. (supervisor). Regulation of Unfair Competition Processes in the Banking Services Market (on the Example of the Lviv Regional Department of JSC “Oschadbank”). Master’s thesis. - Lviv Polytechnic National University, Lviv, 2020. Extended abstract. Economic competition is an important factor in the development of the economy, its individual areas, industries, regions, etc., but only if it is carried out in compliance with the law, ethics, fair rules and customs. However, in the conditions of the modern market, along with fair trade, there is also unfair competition. The Ukrainian state provides protection against unfair competition in business [1]. The formation of the theory and practice of protection against unfair competition took place in the second half of the nineteenth century. In particular, the Paris Convention for the Protection of Industrial Property of March 20, 1883, signed by member states, in Art. 10 bis, to which Ukraine joined on December 25, 1991, stipulates that unfair competition is any competitive action that is contrary to fair rules and customs in industry or other areas [2]. The object of the study are the processes of unfair competition in the market of banking services on the example of the PJSC "State Savings Bank of Ukraine". The subject of the research is theoretical-methodological and applied principles of state regulation of unfair competition processes in the market of banking services. The purpose of the master’s qualification work is to substantiate the methodological and applied principles of regulating the processes of unfair competition in the market of banking services of Ukraine on the example of JSC "Savings Bank". Oschadbank JSC is one of the leaders in the banking services market: in 2019, according to retail deposits, its market share was 23%; by the volume of lending to IASB AIC - 11% of the market (third place in the market); its corporate loan portfolio amounted to UAH 52.4 billion. The activity of Oschadbank JSC since 2017 is profitable. The main factors of this are: increase in the number of active users of web and mobile banking, the number of transactions that are carried out monthly in the Savings 24/7 system; positive dynamics of the client loan portfolio, which amounted to UAH 3 billion, including lending to micro, small and medium-sized businesses, increase in time deposits, which amount to almost UAH 6 billion. [3]. Manifestations of unfair competition in the market of banking services were detected by banks - competitors, partners, bank customers and even the criminal world. State regulation of unfair competition is a direction of state economic policy aimed at preventing, preventing and restricting the manifestations of unfair competition in economic activities in order to promote the development of fair competition in commodity markets. Regulation of unfair competition involves the use of legal, administrative and economic methods of influence [4]. Economic relations related to protection against unfair competition in our country are regulated by the Constitution of Ukraine, Laws of Ukraine "On Protection against Unfair Competition", "On Protection of Economic Competition", "On the Antimonopoly Committee of Ukraine", "Paris Convention for the Protection of Industrial Competition" property of March 20, 1883 ", international treaties of Ukraine, the consent to the binding nature of which was given by the Verkhovna Rada of Ukraine, other acts of legislation issued on the basis of laws or resolutions of the Verkhovna Rada of Ukraine. According to the current legislation of Ukraine, the methods of protection against unfair competition are grouped into three groups: judicial protection; administrative protection; self-defense. According to the results of the study of the manifestations of unfair competition in the market of banking services, the main reasons for its application were identified: corruption and shadowing in the market; conflict of interests of market participants; low professional level of employees and inefficient system of work motivation; use of obsolete equipment and neglect of economic security issues; criminalization of certain spheres of economic life; not all market participants care about their reputation, as they do not consider their functioning in the market in the long run and after committing unfair competition, mostly leave the market; quite often individual consumers do not have the opportunity to obtain complete and reliable information about the market, price and quality of services provided, and they can not understand the existing information and determine how complete and reliable it is, relying on statements and proposals of unfair competitors, accept knowingly unfavorable for yourself a solution [5]. Factors in the effectiveness of protection of commercial banks from unfair competition are: the effectiveness of the legal framework and the effectiveness of legislation on protection against unfair competition; competitive environment in the banking services market; the degree of awareness of market participants about the rights to protection against unfair competition; the desire of commercial banks to make extra profits; reliability of business relations with private and corporate clients and partners; efficiency of personnel and management policy and motivation of employees. According to them, the following measures of state regulation of unfair competition in the market of banking services are proposed: - clarification of requirements for advertising in the market of banking services, informing consumers about financial services and conditions of their provision; - strengthening of control by the NBU and the AMCU over compliance with the norm on the completeness and accuracy of information on banking services provided in a single, unified format; - inclusion in employment agreements of clauses defining liability for actions that are unfair competition, as well as provisions prohibiting the use of production, financial, commercial information by employees who resigned from a new job or in the activities of their own, created after dismissal, the company; - advocacy of fair competition in the market of banking services, including through social networks, promoting awareness of consumers about their protection from unfair competition. Key words: competition, unfair competition, fair rules and good customs, protection against unfair competition, state regulation of unfair competition. References. 1. The Constitution of Ukraine. Information of the Verkhovna Rada of Ukraine (VVR), 1996, № 30, Art. 141. Edited by 01.01.2020. –URL: https://zakon. rada.gov.ua/laws/ show/ 254% D0% BA/96-%D0%B2%D1%80#Text 2. Paris Convention for the Protection of Industrial Property (as amended by the Stockholm Act of 1967 р.). –URL:https://zakon.rada.gov.ua/laws/show/995_ 123#Text 3. The State Bank ended the new record with a profit of 35.2 billion on March 2, 2020 – URL: https://minfin.com.ua/ua /2020/03/02/ 41343585/ 4. O.V. Garan (2018) Modern Understanding of State Regulation of Competition in Ukraine. November, 2018. - Odesa National University Herald Jurisprudence 23(2(33)):45-55 DOI: 10.18524/2304-1587.2018.2(33).146767 – URL: file:///C:/ Documents%20and%20Settings/Admin/% D0%9C%D0%BE% D0%B820%D0%B4%D0%BE%D0%BA%D1%83%D0%BC%D0%B5% D0% BD%D1% 82%D1%8B/ Downloads/146767-325839-1-PB.pdf. 5. Mikhalchishin N.L. (2011) Availability of methods of protection against unfair competition of business entities. Management and entrepreneurship in Ukraine: stages of formation and problems of development. Bulletin of the National University "Lviv Polytechnic" - Lviv Polytechnic Publishing House, № 720 (2011) – URL:http://vlp.com.ua/node/882