On 18 January 2010, the French Competition Authority (the 'Authority') issued a decision fining the three main port handling companies of the Reunion Island for agreeing on the prices of their services.
This anticompetitive agreement was in force for a particularly long period of time, i.e. from 1987 to 2002, and has been continuously implemented by the three port handling companies.
The Authority recognized that such a long-term price fixing agreement between competitors on an oligopolistic market with limited competition is usually qualified as very harmful but it imposed only symbolic fines (between € 20,000 and € 25,000).
The Authority took into consideration two mitigating circumstances.
Firstly, the legal framework applicable to port handling prices was uncertain at the time when the anticompetitive agreement was in force. Prices in the French port handling market were supposed to be liberalised after the adoption of the Ordinance of 1 December 1986 but a 1988 decree set an exception to the port handling sector in the Reunion Island, without however indicating how the prices in that sector should be determined. Furthermore, the French administration maintained an ambiguous attitude, as it did know about the companies' practice.
Secondly, the Authority took into account the small size of the market in question.
The method followed by the Authority to set the financial penalty in this case slightly differs from the method set in its draft guidelines for setting antitrust fines published on 17 January 2011 (see Community Week, issue 505). This confirms the need for the Authority to establish clear guidelines when it comes to calculating fines.
To view Community Week, Issue 505; 21st January 2011 in full, Click here.
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