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DISPUTE OVER COMPETITION LAW INFRINGEMENT ON BIOFUEL MARKET RETURNED TO SUPREME ADMINISTRATIVE COURT OF LITHUANIA

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The Supreme Administrative Court of Lithuania agreed to renew court proceedings concerning an anti-competitive agreement on the biofuel market as requested by the Lithuanian competition authority Konkurencijos taryba.

By its decision of 13 June 2018 the Court repealed the resolution of 2 December 2015 adopted by Konkurencijos taryba. The authority found that Vilniaus energija and Bionovus (its owner being First Opportunity, company registered in Estonia) made a long-term exclusive biofuel purchasing agreement, according to which Vilniaus energija committed to purchase biofuel from its sole supplier Bionovus. Since both firms exercise major market power, in the opinion of Konkurencijos taryba, the anti-competitive agreement had negative effects on competition and consumers. Infringement of the Law on Competition of the Republic of Lithuania resulted in EUR 19,004,000 fine for Vilniaus energija and EUR 3,529,000 fine for First Opportunity.

Last time the Court sent the case back to Konkurencijos taryba for additional investigation.

According to the authority, when examining the dispute the Court improperly applied and explained legal norms related to the relevant market definition*. Therefore, Konkurencijos taryba requested the Court to renew court proceedings.

Having noted that renewal might be sought in exceptional cases, the Court decided to satisfy the request of the authority.

In October 2016 Vilnius Regional Administrative Court upheld the decision of Konkurencijos taryba on almost 2,5-year-long anti-competitive agreement between Vilniaus energija and Bionovus.

 

*Market definition is a means to identify and determine whether there are actual competitors which are capable of constraining the behaviour of the firms in question and to assess the degree of real competition on the market.