News

The Supreme Court of Latvia rejects a third party claim to require the CC punishment for potential merger participants

(11.10.2016.)

On 14 September, the Supreme Court of Latvia has rejected an appeal from SIA BMS-Baltijas Marketing Serviss (the BMS) and confirmed that a third party does not have subjective rights to require the Competition Council of Latvia (the CC) to propose a violation case of non-notified mergers, impose fines and an obligation to submit a merger notification.

In August 2015, the CC received a submission from the BMS stating that SIA PROCTER & GAMBLE MARKETING LATVIA LTD has terminated a contract for Duracell Battery distribution with the BMS. The applicant claims that ensuring distribution to SIA SANITEX a non-notified merger has been conducted. The BMS required the CC to initiate an infringement case as well as to impose fines and an obligation to submit a permission to merge.

The CC informed the BMS that the applicant does not have the subjective right to request to propose a violation case of non-notified mergers. The merger control regulation does not provide third parties with such rights and only the CC has rights to initiate an infringement case. The Supreme Court of Latvia agreed with the CC and noted that the rights of third parties are protected by the Competition Law (the Law) which prohibits abusive conduct by companies that have a dominant position on a particular market.

Furthermore, since June 2016, the Law was amended giving the rights to the CC to prioritize its operation and to assess whether an official case investigation other methods that also aimed to increase prevention and discontinue infringement with minor effect are the most effective. Thus, the CC is able to focus its resources primarily to detection of infringements that cause the most damage and affect the essential part of public or any economic sector.

Mr Māris Spička, the Head of the Legal Department of the CC, said: “We welcome the court's decision, conforming that the third party does not have rights to demand to start an investigation of companies that, in its opinion, have conducted a non-notified merger. The CC evaluates the details of any possible violations of the Law, but an official case investigation will be initiated by assessing the possible nature of the infringement, the impact on competition and the public interest.”

At the same time, the CC invites all legal entities and individuals to inform the CC if they have any suspicion on a possible distortion of competition. It is possible to report anonymously using an online form at the CC website or booking an appointment with an expert by phone +371 67 282 865.

For media inquiries

Mr Toms Noviks
Head of Communication Unit of the
Competition Council of Latvia
Phone +371 67365210 
E-mail: toms.noviks@kp.gov.lv