OECD Product Market Regulation (PMR) Indicators: How does Slovenia compare? ___________________________________________________________________________________ Competitive product markets foster economic growth and can improve the living standards of citizens. OECD’s Product Market Regulation Indicators assess the alignment of a country’s regulatory framework with internationally accepted best practices. The Economywide Indicator measures the distortions to competition that can be induced through the involvement of the State in the economy, as well as the barriers to entry and expansion faced by domestic and foreign firms in different sectors of the economy. This indicator is complemented by a set of Sector Indicators that measures regulatory barriers to competition at the level of specific network and service sectors.
Overall PMR Indicator Index scale 0 to 6
Slovenia
1.29
OECD average
1.38
5 Most competitionfriendly countries 5 Least competitionfriendly countries
1.00 1.82 0.0
2.0
4.0
6.0
Economy-wide PMR Indicators: a breakdown by major components Index scale 0 to 6 from most to least competition-friendly regulation
6
Slovenia 5 Most competition-friendly countries
OECD average 5 Least competition-friendly countries
5 4 3 2 1 0 Public Ownership
Involvement in Business Operations
Simplification and Evaluation of Regulations
Admin. Burden on Start-ups
Barriers in Service Barriers to Trade & Network sectors and Investment
Note: All the averages include only OECD countries. Information refers to laws and regulation in force on 1 January 2018. Source: OECD 2018 PMR database.
ECONOMY-WIDE HIGHLIGHTS
Overall, regulatory barriers to competition in Slovenia are below the OECD average. The administrative burden of interacting with the government is relatively low as laws and regulation are easy to access; the administrative requirements for new firms are limited, while barriers to FDI and tariffs on imported goods are low. In contrast, state ownership is more pervasive across the economy than in many OECD countries. This is especially true in terms of ownership of dominant operators in network sectors. In addition, there is no system for ensuring a proper impact assessment of new regulations on competition.
Economy-wide PMR indicators: a breakdown by sub-components Index scale 0 to 6 from most to least competition-friendly regulation Distortions Induced by State Involvement Simplification and Evaluation of Regulations
Complexity of Regulatory Procedures
6 5 4 3 2 1 0
Interaction with Interest Groups
Involvement in Business Operations
5 Least competition-friendly countries
Assessment of Impact on Competition
6 5 4 3 2 1 0
Price controls
Governance of SOEs
Direct Control
Scope of SOEs
Gov’t Involv. in Network Sectors
Public Ownership
6 5 4 3 2 1 0
5 Most competition-friendly countries
Public procurement
OECD average
Command & control regulation
Slovenia
Barriers to Domestic and Foreign Entry
Barriers to Trade Facilitation
Barriers to Trade and Investment
Treatment of Foreign Suppliers
6 5 4 3 2 1 0
Tariff Barriers
Barriers in Service & Network sectors
5 Least competition-friendly countries
Barriers to FDI
6 5 4 3 2 1 0
5 Most competition-friendly countries
Barriers in Network sectors
Licenses and Permits
Admin. Burden on Start-ups
Admin. Requirements for Lim. Liab. Companies and Pers.Owned Enterp.
6 5 4 3 2 1 0
OECD average
Barriers in Services sectors
Slovenia
Note: All the averages include only OECD countries. Information refers to laws and regulation in force on 1 January 2018. If the blue bar does not appear on the chart for a specific indicator, it means that its value is 0. Source: OECD 2018 PMR database.
SECTOR-SPECIFIC HIGHLIGHTS Regulatory barriers to competition are above the OECD average in most network industries. This largely reflects state ownership of the dominant operators. The regulation of professional services, notably lawyers and notaries, is restrictive, both in terms of entry requirements and of conduct restrictions. In contrast, the regulatory framework for retail trade is relatively competition friendly, with the exception of retail sale of medicines.
Regulation in network and service sectors PMR Indicators for network sectors Index scale 0 to 6 from most to least competition-friendly regulation Slovenia 5 Most competition-friendly countries
6
OECD average 5 Least competition-friendly countries
5 4 3 2 1 0 Electricity
Gas
Rail
Air
Energy
Road
Water
Fixed
Transport
Mobile
E-Communications
PMR Indicators for professional services* and retail distribution Index scale 0 to 6 from most to least competition-friendly regulation Slovenia 5 Most competition-friendly countries
6
OECD average 5 Least competition-friendly countries
5 4
3 2 1
0 Lawyers
Notaries
Accountants
Architects
Professional services
Civil engineers
Real estate agents
Retail distribution
Retail sale of Medicines
Retail trade
* When comparing the indicators across countries, it should be kept in mind that the activities undertaken by specific professions may vary between countries. Note: All the averages include only OECD countries. Information refers to laws and regulation in force on 1 January 2018. If the blue bar does not appear on the chart for a specific indicator, it means that its value is 0. Source: OECD 2018 PMR database.
OVERALL ASSESSMENT
Regulatory barriers to competition in Slovenia are limited, but there is scope for improving product market regulation in some sectors and domains.
Strengths
Challenges
The administrative requirements necessary to open a limited liability company or a personally owned enterprise are among the lowest in the OECD, and most of them can be fulfilled through an online onestop shop.
An online searchable database and a general policy to use plain language in the drafting of regulations simplifies access to laws and regulations. In addition, there are explicit programs to reduce compliance costs and the administrative burden imposed by the national government on enterprises, including via the introduction of e-government.
State ownership is pervasive across the economy, in particular when it comes to government holding shares in the dominant operators in network industries, such as in the rail and ecommunications sectors. In addition, the sale of shares in these firms often requires legislative action.
There is room for reducing barriers to entry and constraints on conduct in the market for professional services. Notaries, in particular, face extremely rigid constrains on their conduct, as they are prohibited from advertising their services, they cannot cooperate with any other profession and they are only allowed to operate in personally owned enterprises with no limited liability.
The market for long distance coach services is not open to competition and licensing requirements are high in the market for freight transport by road.
In the retail sector, owners are free to decide on shop-opening hours, and administrative barriers to entry are low. However, online sales are subject to a few regulatory constraints that can limit competition. For example, some goods cannot be sold on the web and, in some sectors, sellers need a brick and mortar shop and/or a special authorisation to be allowed to operate online.
Further information
“What are the 2018 OECD PMR indicators?” PowerPoint presentation on OECD PMR website
Vitale, C., et al. (2020), " The 2018 Edition of the OECD PMR Indicators and Database – Methodological Improvements and Policy Insights", OECD Economics Department Working Papers
Please visit our website : http://oe.cd/pmr Contact us at: PMR2018@oecd.org