Competition watchdog explains Riga Transport fine

Rigas Satiksme municipal transport company and Rigas Mikroautobusu Satiksme (RMS) minibus operator had entered an illegal agreement that only aimed to raise the companies’ fares but did not provide for reducing them, Competition Council chairwoman Skaidrite Abrama said at a news conference Monday.

“Although Rigas Satiksme has a subcontract agreement with RMS, they are still two independent companies,” Abrama said.

The main violation is the companies' additional agreement obliging RMS to adjust its fares to the tariffs set by Rigas Satiksme. The agreement only provides for price increases but rules out reducing them, she said.

“There is no directive allowing companies to agree on the lowest price. They can only agree on the maximum price that cannot be exceeded,” Abrama said.

Rigas Satiksme has three months to terminate the agreement. RMS has been told to set its fares independently and reasonably.

"This is an illegal agreement, and all of us have suffered for it - every single Rigan and visitor of Riga who buys tickets," said Abrama.

If Rigas Satiksme and RMS fail to end their agreement within three months, the companies will face additional fines, said Abrama.

Both RMS and Rigas Satiksme have said they'll appeal the fine. 

As reported, the Latvian Competition Council has slapped a €2.1 million fine on Rigas Satiksme municipal public transport company for a procurement on transportation services in 2012.

The Competition Council decided to fine Rigas Satiksme with €2,163,046.63 and RMS with €87,948.40 for distorting competition. 

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