The Administrative Regional Court in its judgments of 17 February has rejected applications of AS “Kesko Senukai Latvia” and SIA “Tirdzniecības nams “Kurši”” on cancellation of the decision adopted by the Competition Council of Latvia (the CC) on 31 August 2017. In this decision the CC identified a prohibited agreement between manufacturers and traders of building materials on long-term determination of resale prices. According to this decision a fine of 1,145,077 euros was imposed on SIA “Tirdzniecības nams “Kurši”” and 920,618 euros on AS “Kesko Senukai Latvia”.

During the case investigation, the CC assessed an agreement concluded by SIA “Knauf” and SIA “Norgips”, as well as the largest retailers of building materials AS “Kesko Senukai Latvia”, SIA “Tirdzniecības nams “Kurši””, SIA “DEPO DIY” and SIA “Krūza”, fixing the minimum resale price level and specific price level for products distributed by SIA “Knauf” and SIA “Norgips”. The CC established in the decision adopted in 2017 that the agreement manifested itself both as vertical restrictions between SIA “Knauf” and SIA “Norgips” and retailers, and as horizontal bid-rigging agreements by retailers reaching common understanding and implemented coordinated action regarding unified operational principles and mutual control in implementation of the agreement concerning products of SIA “Knauf” and SIA “Norgips”.

“In the judgments the court carried out detailed and comprehensive analysis of evidence available in the files of court proceedings, and mutual communication of case participants, which sufficiently revealed the aim of AS “Kesko Senukai Latvia” and SIA “Tirdzniecības nams “Kurši”” to reduce competition on the market. As a result, the court completely agreed with the conclusion made by the Competition Council on detection of prohibited agreement and imposing of liability,” explains Valentīns Hitrovs, the Head of the Legal Department.

For the implemented prohibited agreement the CC decided to impose a fine of 5.8 million euros on three traders of building materials – AS “Kesko Senukai Latvia”, SIA “Tirdzniecības nams “Kurši””, as well as SIA “DEPO DIY”, the application of which on cancellation of the decision adopted by the CC is still examined by the court.

Prior to adoption of decision by the CC, administrative agreements were concluded with SIA “Knauf”, SIA “Norgips” and SIA “Krūza”, which provided for termination of legal dispute and settlement of a fine in total of 1.6 million euros.