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SACL has rendered a decision in the travel agencies’ case
2016-05-16
 

On 2 May 2016, the Supreme Administrative Court of Lithuania rendered a decision in an administrative case in which the applicants, i. e. Eturas UAB (the holder of exclusive rights to E-TURAS online system and the system’s administrator) and travel agencies using the system contested a decision of the Competition Council of the Republic of Lithuania to impose fines on the travel agencies for anti-competitive practices.

E-TURAS is an online system that processes and systematises information about travel services and the related services provided by tour organisers. The system has been integrated into websites of travel agencies. Clients were able to purchase tours on the travel agencies’ websites by completing a form in the E-TURAS booking system.

In the decision being contested, the Competition Council stated that the E-TURAS administrator had imposed a technical restriction on discounts applied to the tours sold through the system, as a result of which the main discount given by the travel agencies was limited to 3 %. It also stated that, prior to imposing the restriction, a system message informing the travel agencies about the limited discount had been posted in E-TURAS. The Competition Council asserted that, while using the E-TURAS system when the restriction was imposed, the travel agencies could, upon assessment of the system’s operating principles and properties, the system message published by Eturas UAB, and the information about discounts published on the travel agencies’ websites, reasonably predict that all the travel agencies using the system would apply discounts of up to 3 %. In the opinion of the Competition Council, the travel agencies revealed to each other the size of the discount they were going to apply in the future, thus indirectly expressing their common intention to behave in the relevant market in a certain way. The Competition Council treated such behaviour as concerted actions constituting a violation of the Law on Competition and the Treaty on the Functioning of the European Union.

When deciding the dispute the judicial panel has taken account of the preliminary ruling of the Court of Justice of the European Union (CJEU) rendered in this case on 21 January 2016, in which the CJEU asserts that the conclusion of the national court to the effect that the travel agencies had to know the content of the system message involved in the main proceedings was drawn merely on the basis of the fact of its sending and that such a conclusion would contradict the presumption of innocence. The CJEU also states in this ruling that the presumption of innocence would not be infringed if the national court decided that the fact of sending the system message in the main proceedings could form a basis (having regard to other objective and consistent indications) for a presumption that the travel agencies concerned knew the content of the message since the date of its sending, leaving the opportunity for the travel agencies to contest the presumption. The CJEU also points out that it is important to determine whether any of the travel agencies had withdrawn from concerted actions, for example, by systematically applying a discount higher than 3 %.

The Supreme Administrative Court of Lithuania has considered the issue of whether each travel agency with respect to which the contested decision was adopted had known about the discount restriction imposed in the E-TURAS system and whether it had objected to the restriction or not. The judicial panel has evaluated the evidence gathered by the Competition Council with respect to each applicant, and has considered whether each agency had admitted knowing about the discount restriction during the period of its application and whether there was other evidence in the case showing that the travel agency knew about the restriction in E-TURAS (e. g. evidence that the travel agency had reduced its discount after learning about the restriction). The court has also assessed whether the travel agencies that knew about the discount restriction had withdrawn from the concerted actions (e. g. by systematically giving additional discounts).

Upon evaluation of evidence gathered with respect to each applicant, the judicial panel has grouped the travel agencies punished by the decision of the Competition Council as follows: firstly, the travel agencies that knew about the imposed restriction and did not oppose it; secondly, the travel agencies that knew about and opposed the imposed restriction; and thirdly, the travel agencies with respect to which the Competition Council had failed to gather sufficient evidence for asserting that they knew about the restriction imposed in the E-TURAS system. The judicial panel of the Supreme Administrative Court of Lithuania has decided that the Competition Council had no grounds for recognising that those travel agencies which did not know about the restriction or which opposed it (the second group and the third group) had violated the provisions of the Law on Competition and the Treaty on the Functioning of the European Union, and has lifted the fines imposed on such travel agencies. The court has also stated that the travel agencies that knew about the restriction and did not oppose it had been reasonably recognised as agencies taking part in anti-competitive practices. The court has also found that Eturas UAB had arranged and introduced the restriction on the discount in E-TURAS system, therefore, the Competition Council had reasonably stated that Eturas UAB had violated the Law on Competition and the Treaty on the Functioning of the European Union.

The judicial panel has not found any mitigating circumstances, therefore, it has satisfied the appeal filed by the Competition Council in part and has changed the fines that were reduced, by the court of first instance, for some of the applicants that had engaged in anti-competitive practices.

For more information please visit the website of the Supreme Administrative Court of Lithuania at www.lvat.lt. Case No A-97-858/2016. Please provide a reference to the website when citing or otherwise disseminating this information.

 
Information updated by: LVAT
Updated on: 2016-05-16 09:38

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