Logging cartel discovered, fined €70,000

The Competition Council of Latvia has fined 11 logging companies that had rigged their offers to a tender by State LLC Latvijas valsts meži (Latvian forests). The companies have been fined for a total of €70,003.

The council has found out that, of the companies that participated in the tender for cutting damaged trees, preparing lumber and transporting it to roads, a total of 11 companies had coordinated their offers, creating four 'cartelized' company groups. The total sum for the tender was about €30 mln. 

The companies that tried to rig the tender were as follows: SIA “Amils” coordinated its offer with SIA “Oga G”; SIA “RT Kadiķi” with SIA “AN Priede”; SIA “Eko burkāns” with SIA “Davos”, SIA “Riveros” with SIA “Consultation Office”;  SIA “Roluks” with SIA “LK Forest” un IK “LUUX”. (SIA is Latvian company type roughly corresponding to English LLC.)

"If companies forgo true competition, preferring an imitation, the ordering company is kept in the dark about the real market situation, and doesn't receive the benefits of competition between companies. When exchanging information about taking part in the tender, true competition is impossible," announced the council.

"Activities such as these are considered to be a cartel agreement, which is a very severe violation of competition law," noted the Competition Council.

Some companies were fined less as they cooperated during the inquiry into the tender, and so they won't be stripped of the right to participate in state tenders.

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