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LITHUANIAN COMPETITION AUTHORITY IS OBLIGED TO ASSIGN INDIVIDUAL SANCTIONS IN OBSTRUCTION CASE

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The Supreme Administrative Court of Lithuania (Court) announced that the Lithuanian competition authority should recalculate the fines for the companies Būsto aplinka and Mano Būsto priežiūra which obstructed the inspection conducted by the authority’s officials.

The panel of judges agreed with the assessment of Konkurencijos taryba and the court of first instance that the undertakings in question infringed the Law on Competition by obstructing dawn raids and preventing the officials from obtaining documents necessary for the investigation – the officials asked for access to the company’s e-mail server, however, it was denied, in the meantime, information was deleted without the possibility of recovering files.

The Court acknowledged that the competition authority had rightly and legitimately established that Būsto aplinka and Mano Būsto priežiūra constituted a single economic entity (one economic unit), therefore, the sanction in present case must be assigned not only to the company Būsto aplinka, but also to Mano Būsto priežiūra. However, the court noted that national legal norms (norms of the Law on Competition) of that time did not establish joint and several liability, therefore, the Court left unchanged the decision of Vilnius Regional Administrative Court which stated that Konkurencijos taryba must review its decision and assign individual fines. However, since 1 November 2020 amendments to the Law on Competition entered into force envisaging joint and several liability for companies forming one economic unit, as well as succession so that undertakings could not escape fines through corporate re-structuring.

In February 2020, the court of first instance decided to partially uphold the complaints of Būsto aplinka and Mano Būsto priežiūra and oblige the competition authority to review the decision and assign individual fines. This decision was appealed to the court of final instance by Konkurencijos taryba and the undertakings.

The Law on Competition provides that undertakings must not prevent officials from carrying out the inspections, reviewing documents, obtaining copies and extracts thereof and other information necessary for carrying out an investigation. Obstruction of an investigation may result in a fine of up to 1 per cent of the gross annual income.