Council of AMO factually upheld AMO´s first-instance decision on a cartel in public tender concerning food industry

On 18 September 2024 the Council of the Antimonopoly Office of the Slovak Republic (AMO) imposed a fine of more than 261 thousand euros on undertakings RM Gastro - JAZ s. r. o. (Nové Mesto nad Váhom), PekaStroj s.r.o. (Nitra) and Albertina Packaging, spol. s r.o. (Bratislava) and also prohibited two of them from participating in a public procurement (PP) for concluding a cartel agreement.

By its decision, the Council of AMO factually upheld the conclusions of AMO´s first-instance body that the undertakings had not proceeded independently during preparing bids to a public tender for supplying technologies increasing production efficiency in the bakery industry, but in such a way that the competition had been won by a pre-agreed participant.¹ 

The Council of AMO confirmed the fine in the amount of EUR 114 000 imposed on the undertaking RM Gastro – JAZ by the first-instance decision and the ban on participation in PP for three years.

The Council of AMO reduced the amount of fine imposed by the first-instance decision on the undertaking PekaStroj to EUR 75 800, because it acknowledged his cooperation with AMO and successful settlement as mitigating circumstances. At the same time, it confirmed the imposition of a one-year ban on participation in PP.

The Council of AMO increased the fine on the undertaking Albertina Packaging, as AMO had incorrectly applied the provisions on mitigating circumstances. It set the fine in the amount of EUR 71 800, after taking into account the undertaking´s participation in leniency programme and settlement with AMO, too. As a successful leniency applicant, the undertaking avoided the imposition of a ban on participation in PP.

The Council of AMO points out that the purpose of public tenders and also PPs is for their announcer to obtain a wide range of goods or services in the best possible price-quality ratio. However, cartel agreements between suppliers defeat that purpose by removing competitive pressure and allowing suppliers to submit bids not corresponding to market conditions. Therefore, such agreements are prohibited.

According to the Council of AMO, AMO´s first-instance decision is factually correct, AMO sufficiently established and correctly assessed the facts, as well as sufficiently justified the decision. However, the Council of AMO changed the part of the first-instance decision concerning sanctions.

The Council of AMO´s decision came into force on 26 September 2024.

Leniency programme

The leniency programme is an important tool in detecting prohibited agreements. It concerns only cartel agreements, that is to say, agreements between competitors.

Its principle is simple: AMO will not impose a fine, which it would normally impose for participation in cartel, on an undertaking who is the first to submit evidence of the existence of cartel on his own initiative, or information and evidence relevant to the inspection. If an undertaking provides the significant evidence of existence of cartel, AMO may reduce the fine by up to 5️0 %. 

At the same time, in cases the leniency programme is used, AMO will automatically not impose on the undertaking a ban from participating in PP. Indeed, detecting and proving cartel agreement is of greater benefit than punishing each its participant.

Details on the leniency programme (PDF, 5 MB) can be found on AMO´s website (in Slovak).

Settlement

The institute of settlement refers to cases, where an undertaking does not have any new evidence of agreement to which he was a party, but at least admits his participation in the infringement of the Act and takes responsibility for it. If an undertaking settles, AMO will impose a ban on participation in PP for one year and reduce the fine by up to 50 % (vertical agreements) or by 30 % (cartels and abuse of dominant position).