COURT UPHOLDS THE KT‘S DECISION ON THE INFRINGEMENT BUT REDUCES THE FINES IMPOSED ON G4S AND BANKS

On 18 June 2012, Vilnius Regional Administrative Court (Court) upheld the Competition Council’s (Konkurencijos taryba, KT) decision of 20 December 2012, according to which, UAB G4S Lietuva (G4S) concluded agreements with AB DNB bank, AB SEB bank as well as Swedbank, AB (all together Banks) limiting the abilities of G4S competitors to operate in cash-in transit and cash handling services‘ markets and, thus, infringed Article 5 of the Law on Competition and Article 101 of the Treaty on the Functioning of the European Union.

For the infringement concerned, the KT imposed fines on G4S and the Banks amounting to more than LTL 57 millions (approx. EUR 16 m), however, having examined the complaints, the Court determined that the fines imposed on the Banks are to be reduced by 60 per cent, and the ones imposed on the G4S – by 10 per cent. The Court considered that when imposing the fines, the KT had failed to evaluate all the relevant circumstances and, therefore, the amount of the fines was groundless. The Court respectively reduced the fines up to: AB SEB bank – LTL 9,923,280 (approx. EUR 2,873,981), Swedbank, AB – LTL 5,697,440 (approx. EUR 1,650,093), AB DNB bank – LTL 3,452,080 (approx. EUR 999,791) and G4S – LTL 8,494,020 (approx. EUR 2,460,038).

Financial penalties play a key role in deterring enterprises from restricting competition. Having evaluated the Court’s judgement, the KT will consider a possibility of an appeal to the Court of Appeal for clarity on the amount of future fines, so that the imposed fines would effectively deter the market players from breaching competition law.

The Court judgement may be appealed to the Court of Appeal during a 14 day period.

Notice

(1) Cash handling services – services provided to banks that include transportation of collected cash, cash processing (counting, sorting, etc.) and storage.

(2) Cash-in transit services – services provided to banks’ clients that include cash collection from clients (mainly retailers), transportation of collected cash to a re-count centre, cash processing (counting, sorting, etc.) at the re-count centre and transfer of cash to a client’s account by using a direct connection with the bank.

Communication Division