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THE COURT PRONOUNCED ITS FINAL RULING IN THE DISPUTE BETWEEN THE COMPETITION COUNCIL AND AB „MAŽEIKIŲ NAFTA“

08 11 2004

As of today, the Competition Council of the Republic of Lithuania received the ruling of 21 October of the Supreme Administrative Court of Lithuania which is final and not subject to appeal. By the said ruling of the Supreme Administrative Court of Lithuania recognised that the fine in the amount of LTL 100.000 upon AB “Mažeikių nafta” for the infringement of the provisions of Article 5 of the Law on Competition was imposed lawfully, and rejected the appeal of AB “Mažeikių nafta” concerning the imposition of the fine.

The proceedings with AB “Mažeikių nafta” concerning the Resolution of the Competition Council of 18 May 2001 that had lasted for several years finally came to an end. The Resolution ruled AB “Mažeikių nafta” and five companies trading in fuel - “Lukoil Baltija”, “Lietuva Statoil”, “Uotas”, “Pakrijas” and “Vaizga” as having infringed the provisions of Article 5 of the Law on Competition (prohibited agreements) and were subject to pecuniary penalties. A pecuniary penalty in the amount of LTL 100.000 was imposed upon AB “Mažeikių nafta”.

A year ago, - on 10 July 2000 the Resolution of the Competition Council also had imposed a fine of LTL 100.000 upon AB “Mažeikių nafta” for the proven abuse of the dominant position constituting an infringement of Article 9 of the Law on Competition. AB “Mažeikių nafta” subsequently appealed the ruling to court. After the litigation proceedings which lasted for three years the Supreme Administrative Court of Lithuania ruled in its Judgement of 11 July 2003 that the Resolution passed by the Competition Council was lawful and reasoned.

AB “Mažeikių nafta” appealed to the Vilnius County Administrative Court and contested the Resolution of the Competition Council of 18 May 2001, on the grounds that the company had been punished for the second time by the Competition Council for the same infringement. The Court annulled the decision of Competition Council. In the view of legal peripetia the litigation proceedings turned protracted and was eventually completed in early 2004, when the Supreme Administrative Court of Lithuania closed the case by upholding the decision favourable to AB “Mažeikių nafta”. However, the case was renewed after the Competition Council presented its arguments claiming that the during the previous proceedings the relevant provisions of the Law on Competition had been incorrectly interpreted. The latter ruling of 21 October 2004 of the Supreme Administrative Court of Lithuania recognised that the Resolution of the Competition Council regarding the imposition of the fine upon AB “Mažeikių nafta” for the infringement of Article 5 of the Law on Competition was lawful.

Jūratė Šovienė, Head of the Legal Division of the Competition Council , says that the complex investigations being conducted by the Competition Council and the subsequent litigations regarding the resolutions passed by the competition authority which are most often ruled in favour of the authority contributes considerably to the development of competition culture.

Competition Council Spokesperson