VILNIUS REGIONAL ADMINISTRATIVE COURT: PANEVĖŽYS CITY MUNICIPALITY GRANTED PRIVILEGES TO MUNICIPAL COMPANY

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On 29 August Vilnius Regional Administrative Court (hereinafter – Court) rejected the appeal by Panevėžys City Municipality (hereinafter – Municipality) against the Competition Council‘s decision of 16 July 2016 whereby the Municipality restricted competition and consumer rights in the municipal waste management sector.

In 2014 the Council opened the investigation into the Municipality‘s actions after receiving a complaint from UAB Švaros komanda. The Council found that the Municipality authorized AB Panevėžio specialus autotransportas to provide municipal waste management services (hereinafter – Services) in Panevėžys City without a competitive procedure and thus breached Article 4 of the Law on Competition. The Court upheld the Council‘s decision – the Municipality granted privileges to one undertaking and discriminated against other undertakings willing to provide the Services.

The Court‘s decision proves that municipalities must protect the freedom of fair competition and organize competitive procedures in order to ensure equal conditions for all service providers. Having a company in the municipal waste management sector does not allow a  municipality to neglect the principles of fair competition.

                    –Jūratė Šovienė, Deputy Chairperson of the Competition Council

In 2015 the Council completed a market study into the household waste management sector. The study revealed that one third of Lithuanian municipalities organize competitive procedures, which results in lower prices for consumers. Unfortunately, the remaining two thirds of municipalities ignore the principles of fair competition, including Panevėžys City Municipality.