The Commission for Protection of Competition initiated ex-officio proceedings on a request by the Supreme Administrative Prosecutor's Office for possible violations under Art. 15 and Art. 21 of the LPC when setting the prices of mass motor fuels
By Decision No. 268/16.04.2020 The Commission for Protection of Competition initiated proceedings for the investigation of potential infringements of art. 15 and art. 21 of the LPC and/or art. 101 and art. 102 of theTreaty on the functioning of the European Union when setting the prices of mass motor fuels in the whole chain: production/import - storage - wholesale - retail, both at the horizontal and vertical level, by “LUKOIL Neftochim” JSC, “Lukoil Bulgaria” Ltd, “Saksa Oil” Ltd, “Insa Oil” Ltd, “Rompetrol Bulgaria” JSC, “Eco Bulgaria” JSC, “Shell Bulgaria” JSC, “OMV Bulgaria” Ltd, “Nis Petrol” Ltd, “Petrol” JSC and “Tradenet Varna” Ltd.
The reason for initiating the proceedings was a signal from the Supreme Administrative Prosecutor's Office about the discrepancy between the significant decrease in the global price of crude oil (by 47.4% according to the Customs Agency) in March as opposing to the respective decrease in retail prices of motor fuels in the country ( by about 11%) for the same period.
Attached to the signal are instantaneous analyses of the fuel market in the country, conducted by the National Customs Agency for the period from 06.03.2020 to 26-27.03.2020 and from 30.03. to 05.04.2020 for the dynamics of average sales prices of petrol and diesel at the sites of the following gas supply chains: Lukoil, Petrol, Shell, Eco, OMV, Cruise, Rompetrol, VM Petrolium and Gazprom. Information on average prices of fuel released for consumption from tax warehouses is also provided.
According to the Customs Agency’s analysis, the decreasein the global price of the raw material started around 06.03.2020 and is related to the spread of COVID-19 and the measures and restrictions that countries around the world have taken to prevent it. Fuel prices at the gas stations responded to the change in the stock price of crude oil one week later (around 12/03/2020). On the basis of the overall average data presented, the Commission compared on a weekly basis (weeks 1 to 4 in March) the average final prices of petrol and diesel released for consumption from tax warehouses with the average retail prices at gas stations by type of fuel.
It is clear from the comparison that the decrease in the average retail prices of petrol and diesel follows the decrease in the average prices of fuels when released from tax warehouses.Despite that, there are public concerns that the retail prices are not commensurate with the significant drop in the crude oil prices globally and are a result of anticompetitive practices in the relevant markets.
Given the socio-economic importance of fuels, due to their direct impact on the entire Bulgarian economy and their direct impact on the prices of goods and services offered on the Bulgarian market, the Commission constantly monitors publicly available facts and circumstances relevant to the enforcement of the LPC. The Commission's ongoing commitment is to monitor the development of the competitive environment and emerging market conditions, including a series of press releases and mass media appearances in the last month on the decline in fuel consumption and the decrease in oil prices and how it affects the retail price of motor fuels in the country.