LITHUANIAN COMPETITION AUTHORITY TERMINATES INVESTIGATION INTO REAL ESTATE ADS PRICES

The Lithuanian competition authority Konkurencijos taryba has terminated the investigation into the actions of Diginet LTU, the owner of classified real estate ads websites, without finding that the company abused its dominant market position by way of charging unfair prices to customers.

The investigation was launched in 2018 following a complaint from Ober-Haus, suspecting that Diginet LTU might have applied unfair pricing of classified real estate ads on the websites aruodas.lt, skelbiu.lt and ntzemelapis.lt thus infringing the Law on Competition, which prohibits the abuse of a dominant position.

Seeking to assess the fairness of prices, which Diginet LTU applied to business and private customers for the posting of real estate ads, Konkurencijos taryba carried out a detailed pricing analysis: the authority compared the prices charged by Diginet LTU with the prices applied by the owner of a competing real estate ads website in Lithuania, as well as with analogous websites in selected foreign countries (Latvia, Estonia, Poland, Hungary, Slovakia, Czech Republic). In addition, the authority analysed a number of website attendance indicators and applied several different benchmarks and analytical methods to ensure that the results are as reliable as possible.

Such an analysis was necessary because merely a given level of prices and the fact that they are set by an undertaking which potentially holds a dominant position does not in itself indicate that the prices are unfair and that the undertaking which applies them infringes the Law on Competition. During the investigation Konkurencijos taryba relied on the case law of Lithuanian courts and the Court of Justice of the European Union, both stating that in order to assess whether the price is unfair, the difference between the costs incurred and the price charged is assessed and it is then analysed whether the price is unfair in itself or when compared to competing products.

The results obtained during the investigation did not lead to the conclusion that the prices applied by Diginet LTU to business customers (real estate brokers) and private customers (consumers) were unfair, therefore, the investigation into suspected abuse of dominance was terminated.

The decision of Konkurencijos taryba can be appealed to Vilnius Regional Administrative Court.