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Priority for 2016: Equal Competition as both Private and Public Responsibility



According to the analysis of the results of last year’s work and to market topicalities in Latvia and worldwide, the Competition Council (CC) of Latvia has set its priorities for 2016. Among other significant priorities the CC has named taking actions against market distortions by public bodies, ruthless fines to law breakers, active prevention, and in-depth market researches.

The Chairperson of the CC, Ms Skaidrīte Ābrama, invites businesses, public authorities and local governments to an active cooperation – to inform about law infringements, ask for advice, as well as to express constructive criticism.

Ms Ābrama stresses: “This year, we hope that the competition authority will be able fight economic injustices and self-serving schemes by means of amended Competition Law. Currently, adoption of amendments to the Law has been postponed at the Saeima (Parliament) once more, therefore, lengthening the consultation process for already the fourth year and preventing the CC from operating according to today’s economic reality and the good practice of the EU.”

In 2016, the CC will take actions against infringers that have caused significant damage to the market and consumers, while in case of less severe infringements the competition authority plans to use alternative solutions that proved to be effective already in 2015. For example, in 2015, 11 issued warnings to in total 29 undertakings have replaced just as many possibly initiated cartel investigations, while in three cases the CC through the mediation successfully averted abuse of dominant position.

The most common competition law infringement in 2015 was bid-rigging in public procurements. Moreover, last year after ongoing seminars for organizers of procurements, from public bodies the CC has received twice as much applications on alleged infringements than in 2014. Furthermore, in 2016, the CC will continue active prevention, educating purchasers to recognize signs of competition infringements and explaining undertakings their competition rights in order to protect the budget of Latvia and European Union from corporate fraud schemes.

Within market inquiries, the CC will analyse the playing field, market trends, and barriers for starting a business within the key sectors for Latvian consumers and economy. Such sectors for 2016 are: retail after entering into the force of the new regulation, public procurements, pharmaceutical, financial and transport services market, as well as solid-waste management.

Each year increasingly the CC receives complaints on actions of public bodies, especially some local municipalities, which create unjustified privileges to their owned capital companies and ignore principle of the competitive neutrality. Currently, the Competition Law does not entitle the CC to avert such competition distortions, therefore in 2016 the competition authority intends to actively educate public bodies on the influence of their decisions and the need to ensure the equality within all sectors.

In 2015, the CC launched six different guidelines clarifying the application principles of laws or regulations. After several discussions with undertakings and NGOs, the CC is going to continue the good practice, preparing guidelines on a number of topical issues for undertakings in order to implement legal actions and to cooperate with the CC more effectively. Among these aspects of the application of the Leniency Program, conclusion of settlements and questions regarding confidentiality can be named.

After adoption of amendments to the Competition Law in Saeima, the CC has intended to cooperate actively with NGOs, developing series of draft legislations on imposing fines, merger procedures etc.

To demonstrate the results of the CC, the competition authority has followed the good practice of other countries and developed methodology to quantitatively assess the public benefit of implementing the competition policy on regular basis. The CC will publicly introduce the calculation results reflecting the return of budget financial resources into the operation of the competition authority.

 

For media inquiries:

Inita Kabanova

Head of Communication Division

The Competition Council of Latvia

E-mail: inita.kabanova@kp.gov.lv

Ph: +371 67365210; Mob: +371 20219048