SUPREME COURT UPHELD KT DECISION ON CARTEL AMONG TRAVEL AGENCIES

The Supreme Administrative Court of Lithuania (Supreme Court) upheld Lithuanian Competition Council‘s (KT) decision that 29 travel agencies used online booking system E-TURAS to concert practices when applying discounts to bookings and thus breached competition law.

The Supreme Court dropped the charges against several travel agencies since there was not enough evidence to prove that the companies were aware of discount restrictions applied in E-TURAS online booking system. In addition, the Supreme Court restored  the fines previously imposed by KT and reduced fines for some companies.

This case is the first Lithuanian competition case that had a question referred to the Court of Justice of the European Union (CJEU). Digital age brings new challenges not only to business and competition authorities, but also to courts. As a competition authority, we must react to an ever-changing business environment and technological progress. Thus, the Supreme Court’s ruling is yet another significant proof of high professional standards of the Competition Council's team. It is also our duty to further apply the highest standards of proof in each and every case. Needless to say, rulings both of the Supreme Court and CJEU are also significant to business as they help companies to better understand competition rules and challenges of the digital age.

Elonas Šatas, Deputy Chairman of the Competition Council

On 7 June 2012, KT found that travel agencies used online booking system E-TURAS to limit the size of discounts of booking travel packages online and thus breached competition law. KT imposed fines totalling ~1,5 million euros on all cartel parties, however, the companies appealed against the Council‘s decision to court. The Supreme Court suspended the case and on 17 January 2014 referred the question to CJEU asking for a preliminary ruling on companies‘ liability for the aforementioned anti-competitive agreement.

CJEU ruled that notifications about the applicable discounts or technical restrictions to apply discounts generated by the online booking system might have led to concerted practices among the companies. According to CJEU, the companies which were aware of the content of notifications but did not take any actions to prevent discount restrictions, were part of the cartel.

This ruling of the Supreme Court is final and not subject to appeal.