Competition restraints concerning waste management: The arrangement of collection of paper and cardboard by municipalities in the capital area of Iceland (Opinion)

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• Case number: 1/2014
• Date: 6/11/2014
• Company:

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• Sectors:
  • Restrictions by public authorities
• Policy Area:
  • Environmental
• Summary

  This opinion regards the implementation of municipalities, in the capital area, of so called Blue bins for paper and cardboard waste. The opinion concludes that the implementation is harmful to competition but that special provisions in the waste management Act prevent the ability of the Competition Authority to intervene with a binding decision. The conduct of the municipalities that was harmful to competition was twofold. On the one hand Reykjavík city (the capital of Iceland) did in its promotional material not make clear the possibility for residents to buy the service from private undertakings as well as the city. Therefore the promotional material was considered misleading. On the other hand households in other municipalities in the capital area cannot refuse to buy the service from their municipality and therefore free competition in the market may no longer be feasible. Those municipalities tender the collection of recyclables collected in the Blue bin but do not tender further management of the waste, e.g. sorting, recycling, use and sale of the material, etc. In the opinion the ICA recommends that the municipalities make certain adjustments and take actions to increase competition in the management of paper and cardboard waste. Also certain recommendations are made to the ministry responsible for this field.