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By the judgment of 17 December 2015 a five judge panel of the Supreme Administrative Court of Lithuania (hereinafter – the SACL) dismissed the appeal of a private limited company Lukoil Baltija in a case concerning acquisition of control over petrol stations without having notified the Competition Council.

By the disputed decision of 18 April 2013 the Competition Council found that the applicant had infringed the Competition Law of the Republic of Lithuania (hereinafter – the Competition Law) when it acquired control over three petrol stations without having notified the Competition Council and without having obtained merger clearance. The private limited company Lukoil Baltija was fined LTL 1 117 600 for the infringements.

The Competition Law stipulates that the intended concentration must be notified to the Competition Council and its permission must be obtained where the combined aggregate income of the economic entities concerned in the business year preceding the concentration is more than LTL 50 million and the aggregate income of each of at least two economic entities concerned in the business year preceding the concentration is more than LTL 5 million. A notification of concentration must be submitted to the Competition Council prior to the implementation of the concentration. A fine of up to 10 per cent of the gross annual income in the preceding business year is imposed on economic entities that have implemented a notifiable concentration without permission of the Competition Council.

The applicant in the case argued that he had not implemented a concentration as it is defined under the Competition Law because he took over only individual assets. He also stated that the gross anuual income of the petrol stations in the business year preceding the concentration had not exceeded the amounts foreseen in the Competition Law because the amounts of the excise duty should not be included in the gross anual income of the petrol stations.

The five judge panel noted that the petrol stations the control of which had been taken over by the applicant, were compounds of movable and immovable property, independent business units, therefore the applicant had had a duty to notify the Competition Council about the intended acquisition of their control. The Court also stated that the amounts of the excise duty did not have to be excluded from the gross annual income of the petrol stations because the entities that had controled the petrol stations prior to the disputed acquisition had not payed excise duty.

Having taken all the relevant circumstances into account the five judge panel upheld the findings of the Competition Council and the court of the first instance which had found that the applicant had the duty to notify the Competition Council and obtain clearance. The Court also found that by establishing that the applicant had committed a serious infringement and by imposing fines of LTL 983 500 and LTL 194 100 the Competition Council did not overstep its margin of discretion. Therefore the decision of the first instance court wherein the complaint of the applicant had been rejected, was left unchanged.

For more information see the website of the Supreme Administrative Court of Lithuania www.lvat.lt Case No. A-1699-822-2015. Please indicate the source when using this content.