Supreme Court confirms that oil companies violated the Competition Act by colluding with each other over extended periods of time
With the rulings of the Supreme Court of Iceland today, the Supreme Court has confirmed the ruling of the District Court of Reykjavík from January 19th 2015 in the case of cartels between oil companies.
The District Court of Reykjavík found that the Icelandic oil companies Skeljungur, Olís and Ker (formerly Olíufélagið) are guilty of reprimandable collusion concerning price-fixing and other infractions. The actions in question had been “significantly harmful for Icelandic society” and the oil companies infractions had been “planned in detail and upper management of said companies participated in it in bad faith”. The Icelandic Competition Authority (ICA) was acquitted of the oil companies' charges to waive the 2005 decision of the Competition Appeals Committee.
The beginning of the case can be traced back to the ICA´s decision from October 28th 2004 that found that the undertakings had committed serious infringements to the Competition Act. The ICA decided to substantially fine each of the companies. The oil companies submitted the decision for appellate review and the verdict of the Appeals Committee confirmed the ICA's decision and found that the appropriate fine was 1.5 billion ISK.
With the decision of the Appeals Committee in January 2005 the proceedings of competition authorities ended. Later in the year 2005 the oil companies decided to appeal their case to the District Court of Reykjvík and the court proceedings ended with a ruling in March 2012. Therefore, the judicial procedure took a very long time in the District Court, mainly because of the collection of data in the form of creating estimates which the companies found necessary. In the end the Supreme Court dismissed the oil companies' case because of severe defects in their pleadings. The companies then started new proceedings which concluded with today's ruling.
The collusive activity took place continuously from 1993 to the end of year 2001 and the decision of the ICA addresses 500 collusive acts. The infringements can be divided into three main categories:
- Price fixing on fossil fuels
- Collusion in tender bidding on public tenders and price requests of their customers
- Various acts of dividing up the market for oil and gas products in Iceland
For further reference, see this press release from 2004