26 February 2015

CNMC fines petrol operators €32.4 million for horizontal anticompetitive agreements

On 25 February 2015, the Spanish Competition Authority (CNMC) announced the adoption of a decision fining five suppliers operating in the oil-related products market for an infringement of Article 1 of the Spanish Competition Act 15/2007 and Article 101 TFEU.

The CNMC found the following to have breached competition law:

  1. Different agreements between Compañía Española de Petróleos S.A. (CEPSA) and Repsol S.A. (Repsol) between 2011 and 2013, namely a non-aggression pact to protect their respective petrol stations; an agreement to share strategic information regarding the petrol stations with the name of one of the companies but exclusively supplied by the other company and finally, an agreement for the coordination of their respective petrol stations in Brea de Aragón and Illueca (in the province of Zaragoza).
  2. Two agreements between CEPSA and Disa Corporación Petrolífera S.A. (DISA), namely a non-aggression pact concerning prices, followed by an agreement to fix prices within the autonomous city of Ceuta.
  3. Several exchanges of information between Disa and Meroil S.A (Meroil) in relation to prices of petrol stations around Sant Joan Despí (in the province of Barcelona) in 2012, and in relation to their operative margins in 2013.
  4. An exchange of information in May 2013 between Galp Energia España S.A. (Galp) and Meroil regarding a supply and flagging contract.

The above conduct was considered by the CNMC to be in breach of competition law and therefore subject to a fine of up to 10% of the turnover of the preceding year.  The amount of fine imposed on each company was as follows:

Repsol: €20 million

Cepsa: €10 million

Disa: €1.3 million

Galp: €800 thousand

Meroil: €300 thousand

The parties have two months from receiving the notification of the fine in which to challenge the decision before the Audiencia Nacional, the judicial authority in charge of reviewing the legality of administrative decisions.

The current decision is to be placed within the framework of different investigations that the CNMC is undertaking in this sector against petrol operators.

The above decision was taken as a result of an investigation originally commenced by the Spanish watchdog on 29 July 2013.  However, upon finding evidence of both horizontal and vertical conduct by the parties, the CNMC split the investigation into two different infringement proceedings.  The second investigation is still pending and relates to alleged price coordination through vertical agreements among oil-related product operators and independent entrepreneurs with automotive oil-related products distribution contracts.

In addition, on 6 February 2015, the CNMC announced the adoption of two separate decisions fining Cepsa Comercial de Petróleo €2.5 million and BP Oil España €750,000 for non-compliance with the commitments imposed in an earlier 2009 decision taken by the former Comisión Nacional de Competencia (CNC) with case number S/0652/07, REPSOL/CEPSA/BP.

Repsol, which was also subject to the aforementioned 2009 decision, is also subject to a formal non-compliance investigation.  However, the proceedings were put on hold due to an appeal regarding procedural issues.  In addition, it is worth noting that Repsol recently challenged the President and two members of the CNMC’s Chamber of Competition who were dealing with the case, alleging conflict of interests and public enmity, and referring to a recent statement of the President during a conference - "…we have ensured that petrol prices are lower than a coffee at Starbucks”.  The plenary assembly of the CNMC’s Council unanimously rejected this challenge on 20 February 2015.

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