AVIATION FUEL
PRESS RELEASE
PRESS RELEASE
THE AUTHORITY HAS BEGUN AN INVESTIGATION INTO THE AVIATION FUEL SECTOR
At its meeting on 9 December 2004, the Competition Authority resolved, pursuant to section 14 of the Competition Act, to commence investigations into the petroleum companies Eni S.p.A., Esso Italiana S.r.l., Kuwait Petroleum Italia S.p.A., Shell Italia S.p.A., Tamoil Petroli S.p.A and Total Italia S.p.A., and the Disma S.r.l., Seram S.r.l., Hub S.r.l. and Rifornimenti Aeroporti Italiani S.r.l. companies, which are jointly controlled by the petroleum companies, which store jet fuel and refuel the aircraft at Rome Fiumicino, Milan Linate and Milan Malpensa airports. The purpose of the investigation is to ascertain whether the jet fuel companies have concluded an agreement to share the airline jet fuel supply market, in violation of art. 81 of the EC treaty.
The investigation began in response to a number of reports submitted to the Authority alleging that, in the performance of their operations, the jet fuel storage and refuelling companies were also engaged in direct aircraft fuel marketing activities, such as exchanging fuels and exchanging information between the parent companies relating to the supply of jet fuel to the airlines. Since these companies are joint ventures set up by the petroleum companies themselves, their jet fuel commercial marketing operations appear likely to enable their parent companies to control the jet fuel supplies by each company in each airport, and hence the market shares of each company. The lack of jet fuel marketing competition would have serious repercussions in terms of the competitiveness of the national airlines which, on this particular market, are the main customers of the petroleum companies.
Even though this conduct may only be practised in the domestic airports, it is potentially likely to interfere with intra-Community trade, and would violate article 81(1) of the EC Treaty prohibiting any agreements between enterprises likely to distort competition between the member states and whose object is to prevent, limit or distort competition. It should be recalled, in this connection, that the agreements are alleged to have been concluded between six Italian petroleum companies which are vertically integrated upstream in the refining sector, where they have a huge share of jet fuel sales at the Rome Fiumicino, Milan Malpensa and Milan Linate airports, which account for over 65% of the domestic demand for jet fuel, and on the Italian market taken as a whole.
The investigation will be concluded by 31 March 2006.
Rome, 17 December 2004