Council of AMO SR changed the first-instance decision of the Office in the matter of the abuse of dominant position by a company in rail freight transport

19.11.2019
On 14 November 2019 the Council of the Antimonopoly Office of the Slovak Republic (hereafter “the Council of the Office“) changed the first-instance decision of the Antimonopoly Office of the Slovak Republic, the Division of Abuse of Dominant Position and Vertical Agreements, (hereafter “the Office“) of 19 July 20191, by which it had imposed a fine in the amount of EUR 2 990 651 on the undertaking operating in the area of rail freight transport for the abuse of its dominant position during the period of years 2005 – 2010.
 
The Council of the Office confirmed the fine and its amount imposed by the Office, but it came to the conclusion about the necessity to define the length of the anticompetitive behaviour in accordance with the judgement of the Supreme Court of the SR in the matter concerned, i. e. from 3 March 2009 to 31 December 2010 so that the point 1 of the operative part of the decision corresponded with its point 2. So by the change of the period assessed, the Council of the Office removed the conflict resulting from the first-instance decision, in which the Office imposed a fine for a period other than that specified in the point 1 of the operative part of the decision. In the decision of the Council of the Office, it came to the conclusion that, with the exception of the time span of period of duration of the anticompetitive behaviour, the first-instance body correctly assessed the factual state of the matter, correctly applied the legislation and imposed a fine in a reasonable amount for the conduct committed.
 
The Council of the Office imposed a fine in the amount of EUR 2 990 651, for the dominant company Železničná spoločnosť Cargo Slovakia, a.s., (hereafter “Cargo”) restricted the sale and the lease of electric locomotives and refuelling motor locomotives to competing private carriers. Thus, the company Cargo abused its dominant position pursuant to the Article 8 of the Act on Protection of Competition and the Article 102 of the Treaty on the Functioning of the European Union. The company committed the illegal conduct between the years from 2009 to 2010.
 
During the period assessed, Cargo was a dominant player in the rail freight transport market, where several other private carriers were operating. To be able to operate in Slovak market, the companies inevitably needed motor or electric locomotives. Electric locomotives are more cost-effective, but those that were able to be operated under the conditions in the Slovak Republic were mostly available to Cargo. However, Cargo refused to sell or lease them to its competitors.

Private carriers were forced to increasingly use less efficient diesel motor locomotives. Here, private carriers encountered another problem, as the network of petrol stations needed was owned by Cargo and the refuelling was not allowed to private carriers there.
 
Both restrictions, i. e. the sale and the lease of electric locomotives, as well as the refuelling of motor locomotives were the part of a strategy aimed at pushing competitors out of the market and maintaining the dominant position, as evidenced also by direct evidence obtained by the Office. The conduct of Cargo made it difficult for private carriers to efficiently provide their services, succeed in the market and compete with Cargo.
 
The decision was issued in the proceedings, in which the Office had already decided once, but the previous decision was annulled by the Regional Court in Bratislava and the Supreme Court of the SR. Therefore, the courts’ objections were taken into account in this current decision.
 
The decision of the Council of the Office came into force on 15 November 2019.
Last update:20.11.2019