COURT AGREES WITH KT: KAZLŲ RŪDA MUNICIPALITY DID GRANT PRIVILEGES TO UAB LITESKO

On 15 April 2013, the Supreme Administrative Court of Lithuania (SACL) upheld the 19 April 2012 Competition Council’s (Konkurencijos taryba, KT) decision finding certain actions of the Kazlų Rūda municipality (Municipality) restrictive of competition. The SACL confirmed the KT’s conclusions that the Municipality had granted privileges to UAB Litesko and, thus, created different competitive conditions, since the Municipality had extended the contract for modernisation and renovation of heating infrastructure with UAB Litesko until 2030 without any competitive selection procedure and regardless of the tender provisions stating that the longest possible extension could be until 2025.

The SACL indicated that the contract extension beyond the term established in the tender rules had created legal uncertainty for potential competitors as they could not predict their actions as well as entrance to the relevant market.

The SACL noted that the Municipality’s decisions were not subject to the application of the requirements established in the laws of the Republic of Lithuania, therefore, the Municipality could have avoided creating different conditions of competition.

Communication Division