COURT DISMISSED THE COMPLAINT OF THE INSURANCE COMPANIES CONCERNING THE RESOLUTION OF THE COMPETITION COUNCIL

Vilnius Regional Administrative Court by its ruling of 12 September dismissed as unfounded AB Lietuvos draudimas and UAB DK PZU Lietuva complaint whereby the companies requested the Court to repeal the Resolution of the Competition Council of the Republic of Lithuania passed in their respect. Having examined the arguments provided by the applicants the Court acknowledged the validity and legality of the Competition Council’s Resolution of 23 December 2010 whereby it was recognised that AB Lietuvos draudimas and UAB DK PZU Lietuva having concluded the competition restricting insurance pool agreement concerning the compulsory insurance for the civil liability of building designer and contractor had infringed the requirements of Article 5 of the Law on Competition and Article 101 of the Treaty on the Functioning of the European Union.

It should be recalled that the Competition Council during its investigation covering the period from 2002 to 2009 examined insurance services related to construction activities provided by the insurance companies concerned, i.e., the compulsory insurance for the building designer’s and contractor’s civil liability. The information collected in the course of the investigation and the circumstances established led to the conclusion that by entering into insurance pool agreement, the companies AB Lietuvos draudimas and UAB DK PZU Lietuva (former UAB DK Lindra) had infringed the requirements of competition law applicable to cooperation agreements of the kind between competitors in the insurance sector. By the said agreement the companies had agreed on the uniform insurance calculation and risk assessment procedures, as well as on the minimum premium amount and the commission to external intermediaries. For the established infringement AB Lietuvos draudimas and UAB DK PZU Lietuva were fined accordingly LTL 400 300 and LTL 130 800.

The Resolution of the Competition Council was appealed as the insurance companies had objected to the conclusion of the Resolution concerning the effect of the companies’ agreement on competition.