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THE COURT UPHELD THE RESOLUTION OF THE COMPETITION COUNCIL ON THE ACTIONS OF AB LIETUVOS PAŠTAS INFRINGING THE LAW ON COMPETITION

07 04 2009

The Supreme Administrative Court of Lithuania (SACL) passed the final and unappealable Ruling thereby the Court overruled the appeal filed by the Lithuanian post company AB Lietuvos paštas.  By its Ruling the SACL acknowledged the validity of the conclusion in the Resolution of 27 September 2007 of the Competition Council to the effect that AB Lietuvos paštas had infringed the requirements of Article 9 of the Law on Competition by having abused its dominant position in the relevant market.  For the proven infringement – actions of AB Lietuvos paštas by establishing different prices for the mail delivery the Competition Council had sanctioned the company at LTL 80,000.

The litigation proceedings between AB Lietuvos paštas and the Competition Council had lasted since January 2006, when the Resolution concerning the abuse of the dominant position by AB Lietuvos paštas was first passed. The Ruling of the SACL had obligated the Competition Council to supplement the investigation carried out by an assessment of the substitutability of the mail delivery and courier services.  Having supplemented the investigation in September 2007 the Competition Council reconfirmed the findings of its previous Resolution. It was concluded that AB Lietuvos paštas was holding a dominant position in the market for reserved mail services. In this position the company has been abusing its dominant position and was seeking to oust its competitors (UAB BMK and UAB NAC) from a closely related market – that of invoice printing, binding and enveloping. The investigation conducted to assess the results of the tender announced by UAB Vilniaus energija to procure combined invoice printing-enveloping and delivery services. The prices of all three competitors for the service of invoice printing, folding and enveloping were to a large extent comparable; thus the companies could compete in terms of their prices. AB Lietuvos paštas, however, was in an advantageous position to offer more attractive mail delivery prices being aware in advance of the prices offered by competing companies, since in order to submit a competitive tender the latter had to use the mailing services and fixed the rates set up specifically by AB Lietuvos paštas.

The SACL noted that the assessment of the findings and motives provided by the Competition Council having regard to the evidence obtained, factual circumstances established and in the context of the legal acts governing mail and courier services allowed the conclusion that the Competition Council had thoroughly assessed all circumstances related to substitutability of goods (services), therefore leaving no doubt concerning the validity of the conclusion produced by the competition authority.

Competition Council Spokesperson