Competition Commission: Reduced fine in the SESA due to the dispute settlement process

The Competition Commission imposed a reduced fine on the Association of Elevator Installers and Maintenance after accepting the relevant Dispute Settlement proposal submitted by the Association.

In particular, the Plenary Session of the Competition Commission (EA) with no. 750/2021 its unanimous decision (“Decision”), during the simplified Dispute Settlement procedure of article 25a of Law 3959/2011 and in accordance with no. 704/2020 its decision, accepted the relevant dispute settlement proposal submitted by the “Association of Elevator Installers and Maintenance” (“SESA”).

The Decision was issued during the above simplified procedure, following a relevant expression of interest on the part of the Association for its inclusion in the procedure and a consequent final statement on the acceptance of the violation found.

The EA imposed a reduced fine on the SESA due to the dispute settlement process for the execution of the established, based on the reasoning of the Decision, violation of article 1 of Law 3959/2011, ie, amounting to 5,703.69 euros (five thousand seven hundred three euros and 69 minutes).

EA also imposed a series of corrective / behavioral measures on the Association in order to inform its members and consumers and to strengthen competition in the elevator installation and maintenance industry.

Dispute Settlement Procedure

The dispute settlement procedure concerns the cases where companies or associations of companies voluntarily and unreservedly admit their participation in a horizontal cartel, in violation of article 1 of Law 3959/2011 and / or article 101 TFEU, and facilitate, with the in this way, the procedure for establishing the infringement by the Competition Commission. In these cases a reduction of the fine by 15% is granted under certain conditions.

The purpose of the dispute settlement procedure is the simplification and acceleration of the administrative procedure for issuing decisions by the Competition Commission for violations of article 1 of Law 3959/2011 and / or article 101 TFEU, as well as the limitation of the number of appeals filed against decisions of the Commission before the Administrative Court of Appeal of Athens.

This enables the Commission to deal with more cases with its own resources and with less administrative burden, thus increasing the deterrent nature of its action and, at the same time, raising citizens’ interest in effective and timely punishment. of offenders.

Record

The investigation of the General Directorate of Competition focused on the investigation of the behavior of two associations of professionals active in the market of installation and maintenance of elevators, on the one hand of “SESA”, and on the other hand of the Association of Maintenance and Installers of Northern Greece (“SYSEVE”). This decision concerns only the practices of SESA, which submitted a Settlement Proposal, while a decision is pending for SYSEVE, which was not subject to the Dispute Settlement Procedure.

The GDA survey evaluated the following practices by the ESA:
– interventions on the pricing policy of the members of SESA, and
– interventions on the advertising activity of the members of SESA.

Related Market

The relevant product market is the market for the installation and maintenance / repair / modernization of elevators, while the relevant geographic market occupies the region of Attica, as the SESA members are active in this region.

Legal Assessment

Business Association Decision (as it appears from the Minutes of the Disciplinary Committee)

The SESA is an association of companies, which is occupied by the provisions of competition law, in this case article 1 of Law 3959/2011, as its members are companies (elevator installers-maintainers), whose commercial interests it serves, as it appears from its statutory purpose.

The SESA, like any professional organization in the form of an association or association, expresses the collective will of its members through in particular its bodies, which are provided for in its Articles of Association, namely the General Assembly, the Board of Directors and the Disciplinary Committee, which meet either at regular intervals or extraordinarily. The Minutes of the Meetings of the bodies of SESA, and especially of the Meetings of the Disciplinary Committee during the years 2011-2014, “directly” reflect the practices of SESA, which concern the financial and competitive behavior of its members.

More specifically, from the Minutes of the Meetings of the Disciplinary Committee, the will of the SESA directly restricts the competition between its members in terms of prices and advertising.

Procedure before a Disciplinary Committee – Object of a decision, which is contrary to article 1 of Law 3959/2011

During the discussion of the complaints before the Disciplinary Committee, as it appears from the Minutes of the period 2011-2014, the conservators who are accused of offering a lower price than the existing and / or distributed brochures accept the instructions and suggestions of the Members of the Disciplinary Committee. In some cases they are called upon to “reprimand”, reprimand and make it clear to them that if they insist on offering a lower maintenance price than the existing one and / or distribute flyers, then relevant letters will be sent by the SESA to all their customers. , even if it is a thousand (1,000) letters, or they will be challenged with the SESA, or their share will be posted at the SESA offices with the consequent consequence that all the members of the SESA will turn against them, or will be deleted from the SESA , or accept other vague threats that are part of this practice aimed at changing the economic policy and tactics of conservators who do not follow the requirements of the SESA on this issue of competition between lift conservators.

This action of the Disciplinary Committee is known to the other bodies of SESA and seems to receive the full approval of the other bodies of SESA and as such expresses its will, as emerges from the relevant meetings of both the General Assembly and the Board of SESA. and those reported during them to the Disciplinary Committee.

The coordination by the SESA of the conservators to the extent of not submitting a lower price than the existing one is a practice of indirect pricing according to article 1 par. 1 case. a) of Law 3959/2011, as, according to the Union and national case law, the term “prices” in these provisions can be interpreted broadly and even includes only “recommended” prices or “target prices”, without requiring the absolute match of all prices. It is recalled that price fixing, either direct or indirect, is a “blatant” restriction of competition.

Co-ordination by SESA of conservators to the extent of non-distribution of leaflets is a practice of restricting competition, as advertising is an essential element of the competition process.

Single and permanent infringement

The SESA committed a single and continuing infringement from 2011 to 2014, as its practices in question are closely interrelated, chronological and logical, and fall within the scope of a more general objective of distorting competition.

Fine / Corrective – Behavioral measures

In addition to the imposition of the above fine of € 5,703.69, EA imposed on the Association the following package of corrective-behavioral measures to inform its members and the consumer public and to strengthen competition in the sector. In addition, it imposed behavioral measures aimed at educating the members of the Association.

According to the Decision of EA, SESA must, within twenty (20) days from the notification to him of the decision of the Competition Commission:

– send an e-mail and registered mail to all its members, which will include a text stating that the amount of maintenance bids is determined freely and independently by each maintainer and that the submission of lift maintenance bids at prices lower than existing and the distribution of brochures are in accordance with competition law. These letters should explicitly refer to the decision of the Competition Commission;

– to announce at the next General Assembly of the Association and to post on its website a text with the above content;

– to publish in two (2) newspapers of pan-Hellenic scope a text with the above content. These publications will take place within one month from the notification to him of the decision of the Competition Commission and will be two (2) weeks apart.

With its Decision, the EA imposes on the SESA the keeping of the Minutes of the Meetings of the SESA bodies.

Finally, it obliges SESA to organize training Seminars in collaboration with the Competition Commission, on the rules of free competition and the obligations and rights of its members.

The behavioral measures imposed enhance professionals’ compliance with competition law and emphasize the educational role of the sanctions imposed by the Commission – in addition to the deterrent role of the latter.