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25 05 2020

The Lithuanian competition authority Konkurencijos taryba responded to information on social media and warned travel agencies that their actions may be viewed as anti-competitive when some of them requested travel organizers to include in contracts provisions prohibiting travel agencies from applying discounts for consumers at the expense of their commission fee.

In its letter addressed to travel agencies the competition authority noted that a supplier (travel organiser) shall not set the retail price or prohibit distributors (travel agencies) from applying discounts, and should make individual decisions regarding their pricing behaviour or application of discounts.

Travel agencies have been encouraged to evaluate whether their activities comply with the principles of competition law, as well as to make individual decisions relating to their behaviour in the market and refrain from any actions which could infringe the Law on Competition.

The Law on Competition prohibits agreements which have the purpose of restricting competition or which restrict or may restrict competition, including agreements to directly or indirectly set (fix) prices of certain goods and services or other conditions of purchase or sale. Agreements by which competitors coordinate the prices, price components or discounts of goods or services almost in all cases are considered anti-competitive and infringe the Law on Competition.

Infringement of the Law on Competition by an undertaking may result in a fine of up to 10 per cent of the gross annual income in the preceding business year. Besides, the director of an undertaking who has been involved in an anti-competitive agreement may be banned from executive positions for a period of three to five years. Additionally, a fine of up to EUR 14,500 may be imposed.

Last updated: 25 05 2020