Competition, Financial Services, Latvia, Legislation, Markets and Companies, Transport

Jakrins said that the company today received the Competition Council’s decision and is surprised about it, as well as the size of the fine. The company plans to turn to court over this decision.

He said that the Riga City Council has set the tariff for public transport fees, and the tariff is lower that the prime cost of the ride. In 2012 the tariff was LVL 0.5 (EUR 0.7), and this year it is EUR 1.15. Jakrins said that the local government pays for public transportation services of the majority of passengers, while passenger pay the same price when using minibuses. The law on public transport provides that the tariff should be the same within one city, therefore it is not possible to compete with a lower price.

"We believe that public transport is a sector that stands above the competition law as it is regulated by the law on passenger transportation," said Jakrins.

Rigas Mikroautobusu Satiksme (RMS), that ensures minibus passenger transportation services for Rigas Satiksme has to follow the same regulations, said Rigas Satiksme representative Elina Epalte-Drulle.

"The Competition Council has ungroundedly fined Rigas Satiksme about the agreement that has been reached on the minimum tariff. We cannot be fined for following the law," she said.

As reported, the Latvian Competition Council has slapped a EUR 2.1 miln fine on Rigas Satiksme municipal public transport company for a procurement on premium transportation services in 2012, the company’s spokesman Viktors Zakis told LETA.

He said that Rigas Satiksme has received the decision of the Competition Council. The fine has been imposed for illegal agreement in relation to this procurement, according to the competition watchdog.

The Competition Council said that on February 27 a decision was made to impose a fine on Rigas Satiksme and Rigas Mikroautobusu Satiksme (RMS) for restricting competition and illegal agreement on tariffs. "The agreement between Rigas Satiksme and RMS on tariffs excluded mutual price competition, protected the companies from competition pressure and restricted opportunities of passengers to receive competitive services," the Competition Council said.

The Competition Council decided to fine Rigas Satiksme with EUR 2,163,046.63 and RMS with EUR 87,948.40 for distorting competition At the same time, a ban on such an agreement has been imposed and RMS has set its tariffs based on objective calculation of prime costs per passenger ride.

The Competition Council will hold a press conference on Monday, March 13, to explain its decision.

RMS representative Maija Lazdina said that the company has not yet received the Competition Council’s decision, therefore it cannot comment on it.

As reported, in 2013 Rigas Satiksme and RMS signed an agreement on passenger transportation services for EUR 36.5 million. The agreement is in force until May 2018.