Following the completion of the hearing process, and after taking into consideration the concerned parties’ written submissions, the CPC evaluated all the evidence before it and unanimously decided at its meeting convened on 29 March 2013, that the Cyprus Grain Commission infringed Section 6(1)(a) of the Protection of Competition Law (hereinafter “the Law”).
The subject of the case was the complaint against the Cyprus Grain Commission (no. 11.17.007.60 & 11.17.007.61) filed by AGS Agrotrading Ltd to the CPC on 24 September 2007 και 3 October 2007 for an alleged infringement of Section 6 of the Law, as a result of charging prices below cost regarding the supply of barley for forage use.
The CPC, as a result of the Supreme Courts’ decisions no. 3902 (CYTA and the Commission for the Protection of Competition) and no. 1544/09, 1545/2009, 1546/2009 and 1601/2009 (ExxonMobil Cyprus Ltd etc and the Commission for the Protection of Competition), on the 31 January 2012 revoked its previous decisions, since it was decided by the Supreme Court that they have been taken by a non-legally composed administrative body and decided the ab initio examination of the complaint.
The CPC, in its meeting held on 31 January 2013, after studying the whole content of the administrative file of the case and the written and oral positions of involved parties, unanimously concluded that the acts of the Cyprus Grain Commission sold barley below average variable costs during December 2007 until May 2008 and October 2008 to December 2008, and this constitutes an abuse of dominant position held in the market, in breach of Section 6(1)(a) of the Law.
The CPC, in the light of the written comments of the Cyprus Grain Commission and having regard to the gravity and duration, as well as the nature and gravity of the infringement, and any extenuating circumstances, and in accordance with the procedures laid down in articles 24 (a) (i) and 42 (1) of the Act, unanimously decided on the amount of the administrative fine.
The Commission, when considering the amount of the fine, also noted the following:
(a) the Cyprus Grain Commission has not committed any other previously infringements of the Law.
(b) the Cyprus Grain Commission, stated to the Commission that it had no intention nor sought to hurt competitors and that all of its actions and decisions aimed at creating stable conditions in grain trading and to ensure proficiency in the market for the good of the consumer and the economy in general.
(c) the Cyprus Grain Commission proceeded to abuse its dominant position in the relevant market with the sale of barley under the average variable costs.
(d) the facts demonstrate that the Cyprus Grain Commission proceeded to sell barley below average variable costs for a period of nine (9) months, from the end of 2007 and for several months in 2008. It is noted that this specific market is characterized by large fluctuations in prices, as the sale price is largely based on international prices of barley. However, in this case, the justification put forward by the Cyprus Grain Commission that its sales prices followed international values are not tenable, because it did not took into account the prices at which the barley was bought during the period under review, as well as other expenses of the business.
(e) AGS Agrotrading Ltd, which is a competitor of the Cyprus Grain Commission, suffered throughout the period during which the Cyprus Grain Commission followed this abusive behavior.
(f) a large part of its turnover comes from the activity of barley sale. Specifically, in the year 2007 [...]% of the total turnover and in the year 2008 [...]% of the total turnover arose from that activity.
Therefore, the CPC, acting on the basis of Section 24 (a) (i) of the Law, concerning the violation of article 6(1)(a) of the Law, unanimously deemed correct and fair under the circumstances, the imposition of an administrative fine to the Cyprus Grain Commission, which amounts to € 148.450.
The full text of the decision is posted on the official website of the Committee (www.competition.gov.cy).