ACTIVITY OF THE ITALIAN GOVERNMENT PRINTING OFFICE AND MINT (Advisory opinion)
PRESS RELEASE
The Italian Competition Authority submitted to the Speakers of the Senate and the Chamber of Deputies, the Prime Minister, the Minister of the Treasury an advisory opinion on distortions on competition deriving from Law no. 559/66, concerning the activity of the Italian Government Printing Office and Mint (hereafter "the Institute").
Such a law, inter alia, provides for the Institute to produce and supply common and security papers, prints, publications and stationery for the Public Administration. Orders are placed by the Government General Superintendent. Law no. 559/66 also establishes that fees to be paid to the Institute be determined by taking into account the price lists set by a Commission (also including the President of the Institute), which is not required to use clear-cut criteria.
On the basis of comparisons between homogeneous product classes, it emerged that prices charged by the Institute for its supplies to the Public Administration were appreciably higher than market prices. In addition, prices charged to private companies were lower than those charged to the Public Administration. The law also provides for a mechanism of quarterly prepayment to the Institute, which ensures an unjustified privilege to this operator, whereas payment to the other suppliers of the Public Administration are made after delivery.
The privileged position enjoyed by the Institute and reflected by higher prices and facilitated payment terms originates from the exclusive regime and is likely to have anticompetitive effects also in the markets where the Institute works in competition with other operators. Indeed, by taking advantage of guaranteed demand, the Institute enjoys an unjustified competitive better position in such markets. In fact it is less tied to legal restraints than the other suppliers and is able to bear possible losses deriving from its activity, unlike competitors.
Lastly, Law no. 559/66 provides that the Institute can contract third parties for the supply if and when its productive capacity is inadequate to satisfy demand of the Public Administration. In this way the Institute is able to affect directly competitors' activity and market strategies.
The privileged position enjoyed by the Institute creates distortions on competition, which are not justified by public interest, on consideration of the types of products supplied. Neither is justified the filtering role played by the Institute in contracting third suppliers, holding that it is able to select alternative providers.
The Authority advocated an in-depth reform of Law no. 559/66 and, in particular, the removal of the exclusive regime and the role of the Institute in selecting third suppliers.