DIANO/TOURIST FERRY BOAT-CARONTE SHIPPING-NAVIGAZIONE GENERALE ITALIANA
PRESS RELEASE
PRESS RELEASE
THE COMPETITION AUTHORITY HAS HANDED DOWN A FINE OF EUR2 MILLION ON THE TOURIST, CARONTE AND NAVIGAZIONE GENERALE ITALIANA COMPANIES FOR ABUSE OF A DOMINANT POSITION ON THE STRAIT OF MESSINA FERRY SERVICES MARKET
At its meeting on 27 April 2002 the Competition Authority found the three companies, Tourist Ferry Boat S.p.A., Caronte S.p.A. and Navigazione Generale Italiana S.p.A., liable for abuse of a dominant position on the vehicle and passenger ferry services market across the Strait of Messina. Considering the serious nature of the offences committed to the detriment of competition, the Competition Authority imposed total fines in excess of EUR 2 million.
The proceedings were instituted in response to a complaint by the Diano ferry services company which has been operating the new Reggio Calabria-Messina route since 1998. Previously, all the ferry services across the Strait of Messina were between Villa San Giovanni and Messina, plied for over 30 years on that crossing route by three companies, Ferrovie dello Stato, Tourist and Caronte. Following the market entry of Diano, the Tourist-Caronte group also began to operate the Reggio Calabria - Messina route, and in October 1998 through their subsidiary company, Navigazione Generale Italiana (NGI). However, they practised predatory pricing by charging artificially low fares that were insufficient to cover costs, and hence with the sole purpose of hampering the operations of the new operator, Diano.
In order to ascertain the true nature of the anti-competitive behaviour on the part of the Tourist-Caronte Group, which holds a dominant position on the ferry services market across the Strait of Messina, with a market share of around 80%, and is the only operator on both routes, the Competition Authority analysed the fares charged and the service operating costs. This analysis showed that the fares being charged by the Tourist-Caronte group on the Reggio Calabria-Messina route were not sufficient to cover their costs, and were therefore designed as part of a predatory pricing policy with the purpose of impeding competition.
The Authority imposed fines of EUR 1,146,102 on Tourist Ferry Boat, EUR 1,096,034 on Caronte, and EUR 73,616 on Navigazione Generale Italiana.
Rome, 2 May 2002