EDIZIONE HOLDING/AUTOSTRADE-CONCESSIONI E COSTRUZIONI AUTOSTRADE
PRESS RELEASE
PRESS RELEASE
THE COMPETITION AUTHORITY HAS IMPOSED FINES ON
EDIZIONE HOLDING S.P.A. FOR NONCOMPLIANCE
At its meeting on 10 November 2004, the Competition Authority ordered the Edizione Holding S.p.A. company, pursuant to section 19 (1) of the Competition Act, to pay an administrative fine of EUR6.79 million for failure to comply with the conditions imposed on 2 March 2000 and 13 September 2001, which had to be met in order to be authorised to acquire control of the Autostrade company. When calculating the fine of 1.2% of the benchmark turnover, the Authority took into account the conduct of the company, which had partly removed and partly reduced the consequences of the breach.
In its measure of 2 March 2000, having ascertained that the acquisition of the controlling interest in Autostrade by Edizione Holding, which already controlled Autogrill, would have strengthened the latter's dominant position on the motorway catering facilities market, the Authority subjected authorisation to proceed with the acquisition to the company's full compliance with a number of measures designed to remedy the anti-competitive effects that the operation was likely to produce. The Authority, among other things, prohibited Autostrade S.p.A. and the other motorway service franchisees it controlled from directly providing the catering services itself, but to commission the supply of the services to third parties, using the procedures provided by Article 8 of the agreements concluded with ANAS.
In the measure of 13 September 2001, which was issued at the outcome of an appeal filed by Edizione Holding S.p.A., the Authority reiterated that if the subfranchisees did not intend to manage the catering services themselves, they were to award them to a third party using transparent and nondiscriminatory tendering procedures. Edizione Holding had undertaken to ensure that the subfranchisee would be contractually required to ensure that this was done.
From an examination of the information subsequently brought to its attention, the Authority found that Edizione Holding had failed to comply with the requirements set forth in the aforementioned measures, and on 7 April 2004 resolved to commence an investigation. For the Authority was of the opinion that the so-called "integrated areas" did not guarantee equal access by all the prospective subfranchisees, because of the requirement that the catering companies were to find an oil partner in order to be able to tender for the services.
The Authority also considered that the invitation to tender was discriminatory where it permitted the holder of a right of preemption to put in a bid with other bidders as a member of an ATI (temporary joint-venture), and to exercise that right of preemption on the collective behalf of all the other members of the ATI. According to the Authority, this made it possible for the party with a right of preemption to select the catering company without holding a further tender, as it should have done according to the measures issued by the Authority.
The noncompliance investigation confirmed that the infringement complained of in the commencement proceedings had in fact been committed: the rules governing the procedure for granting the catering franchises in the 2003/2004 invitations to tender were able to give Autogrill a privileged position, particularly with regard to the participation in the tender by the party holding the preemption right, bidding jointly with other parties, as well as the rules requiring tenderers to have an oil partner before they were eligible to compete for the award of the catering service.
The fact that the preemption right-holder was permitted to put in the tender as a member of an ATI jointly with other parties which could have tendered on their own account meant that the parties without preemption rights would enjoy the same benefits as the preemption right-holder. It was Autogrill that benefited from this arrangement, as the party in a dominant position, vertically integrated with Autostrade. The procedure with preemption right-holding ATIs gave Autogrill privileged access to about 30% of the income from the catering services being put out to tender.
In the course of the investigations, Edizione Holding had implemented a series of actions previously submitted to the Authority, including, among other things, the renewal - through Autostrade per l'Italia (ASPI) to the extent that this was not prohibited by the conditions imposed by the courts - of the procedures relating to the award of catering services through the previously identified 18 invitations to tender, awarded to preemption right-holding ATIs, on the understanding that, unlike the previous procedure, the new procedures would not permit preemption right-holders to tender in association, or in a temporary joint venture, with other companies. In the meantime, Autogrill had revoked the mandate for the preemption right-holding ATIs.
The Authority viewed the conduct by Edizione Holding in a positive light considering that the new procedures, which did not entail additional costs to the tenderers, would be run according to different rules from those used earlier, such that the competitive benefits that Autogrill had previously enjoyed no longer existed.
The Authority therefore ruled that the conduct by Edizione Holding had mitigated the seriousness of the breach, because it was designed to eliminate the consequences of the breach in relation to the preemption right-holding ATIs, weaken the effects with regard to the integrated tenders and introduce elements to make the tenders more broadly competitive, albeit burdened by preemption rights.
In the light of all these considerations, the authority imposed a fine of EUR6.79 million.
Rome, 12 November 2004