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KONKURENCIJOS TARYBA LAUNCHES INVESTIGATION INTO SUSPECTED ANTI-COMPETITIVE AGREEMENT AMONG LITHUANIAN BASKETBALL LEAGUE AND BASKETBALL CLUBS

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The Lithuanian competition authority Konkurencijos taryba has launched an investigation into a suspected anti-competitive agreement among the Lithuanian Basketball League (Lietuvos krepšinio lyga – LKL) and basketball clubs after evaluating their exchange of information on the terms of payment of basketball players‘ salaries during the meeting of 13 March 2020.

After finding out in public that the LKL and the basketball clubs discussed the terms of payment of basketball players‘ salaries and that two clubs were accused of non-compliance with the agreement on players‘ salaries, on 14 April 2020 Konkurencijos taryba approached the LBL and the clubs asking to provide information about the aforementioned meeting and decisions which had been adopted.

Competitor agreements on the size of salaries paid to employees (in this case – to basketball players) and other individual terms may restrict competition and infringe the Law on Competition, therefore, may not be justified by the COVID-19 outbreak. However, although the initiation of investigation proceedings indicates that there are reasonable grounds to suspect an anti-competitive agreement, it does not mean that such infringement exists.

Konkurencijos taryba has previously warned companies and associations that they should not discuss or exchange commercially sensitive strategic information. The authority has also expressed its position that it will favour only those business initiatives which will benefit consumers during the COVID-19 crisis, and will not tolerate companies that may seek to exploit the present situation and restrict competition.

Infringement of the Law on Competition by an undertaking may result in a fine of up to 10 per cent of the gross annual income in the preceding business year. Besides, the director of an undertaking who has been involved in an anti-competitive agreement may be banned from executive positions for a period of three to five years. Additionally, a fine of up to EUR 14,500 may be imposed.

Under the leniency programme, immunity from fines can be granted to a member of a cartel if it has not been a coercer of an anti-competitive agreement, and is first to provide all necessary information to Konkurencijos taryba prior to the authority‘s decision to open an investigation. If, during an investigation, a cartelist submits substantial evidence and other additional information concerning an infringement to Konkurencijos taryba, the company may be offered an up to 75 per cent reduction in fine.

Konkurencijos taryba also invites informants who have evidence about possible anti-competitive agreements to submit evidence to the authority and receive a financial award of up to EUR 100,000. Upon request, the identity of informants will not be disclosed to the parties of the investigation procedure, including undertakings suspected of a competition law infringement.