Abstract
In a decision (RDG 46/2005) issued on 30 December 2005, the President of the Office of Competition and Consumer Protection (UOKiK) established an infringement of Article 8(2)(1) of the Act of 15 December 2000 on Competition and Consumer Protection by the state-owned Motor Transportation Enterprise (PPKS) in Slupsk2. According to this rule, an abuse of a dominant position may consist of a direct or indirect imposition of unfair prices, including predatory or glaringly low prices, delayed payment terms or other trading conditions. In the discussed case, the practice involved the indirect imposition of unfair travel fares by way of a ‘major fare reductions’ scheme as of November 2004 in order to eliminate a given Competitor. According to UOKiK, PPKS abused its dominating position as a commuter bus line operator with bookings based on one-off and monthly tickets. The relevant market was specified as the bus commuter route between the ‘S’ and ‘G’ municipalities.
Highlights
In a decision (RDG 46/2005) issued on 30 December 2005, the President of the Office of Competition and Consumer Protection (UOKiK) established an infringement of Article 8(2)(1) of the Act of 15 December 2000 on Competition and Consumer Protection[1] by the state-owned Motor Transportation Enterprise (PPKS) in Słupsk[2]
The decision stated that PPKS abused its dominant position on the relevant market in order to impose ‘unfair’ prices on the competitor
The fares were imposed indirectly, as a result of the following sequence of events: 1) in October 2004, the said Competitor was licensed to provide commuter services between the two municipalities ‘S’ and ‘G’; 2) the Competitor charged ‘promotional’ fares lower than those charged by PPKS; 3) PPKS introduced a new timetable with 34 new services and intended to continue reducing its fares in spite of increasing fuel prices and the financial problems it was experiencing at that time; 4) the Competitor reduced its activity on the relevant market
Summary
PPKS appealed the decision to the Court of Protection of Competition and Consumers (SOKiK). PPKS claimed that the promotional fares were intentionally introduced for the autumn-spring seasons that are inconvenient to local communities. The continuation of the promotion to cover the summer of 2005 was targeted at the great number of tourists visiting the area of PPKS’s operations. The fares were ‘within the tariff limits’, not substantially different from those charged by others. PPKS stated that its tariffs were never of a dumping nature. Notwithstanding the arguments of PPKS, SOKiK dismissed the appeal. The operator appealed SOKIK’s ruling to the Court of Appeals resulting in another dismissal. PPKS petitioned the Supreme Court for the reversal of the initial UOKiK decision but the submission was dismissed
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