The Norwegian Competition Authority imposes a fine of NOK 3 million on St1 Norge AS

The Norwegian Competition Authority has today imposed a fine of NOK 3 million on St1 Norge AS for breach of disclosure requirements when it took control over a petrol station belonging to a competing chain.

In July 2018, St1 Norway signed an agreement to lease the Best Kyrksæterøra petrol station in Heim municipality in Mid-Norway. The deadline for informing the Competition Authority about the transaction expired three working days after the final agreement was concluded. St1 Norway informed the Authority of the agreement on 14 January 2019.

– The Competition Authority’s has concluded that St1 Norway has not complied with its disclosure obligations in connection with the conclusion of this agreement. The Authority was thus not able to review this concentration and found it necessary to impose a fine, says department director Hanne Dahl Amundsen.

According to the Norwegian Competition Act an undertaking may be fined if it does not comply with disclosure obligations and fails to provide the information necessary for the Authority to discharge its duties under the Competition Act.

An important tool in the fuel market
The Norwegian Competition Authority has imposed disclosure requirements on the largest motor fuel retailers obliging them to inform the Authority about transactions whereby they take control over competing petrol stations. Such disclosure requirements, which apply to transactions that are not subject to mandatory notification under the Competition Act, have been imposed on St1 since 2017. Disclosure requirements are imposed because even smaller concentrations that are exempted from mandatory notification may harm competition at a national or local level. The undertakings must, at a minimum, inform the Authority of the date of the final agreement, the parties to the agreement and the date the agreement was implemented.

– Motor fuel retailing markets in Norway are highly concentrated. Acquisitions of individual petrol stations by the large retail chains may increase market concentration in local markets. This may harm competition and lead to higher prices for consumers. The disclosure requirements are an important part of the Authority’s monitoring of the structure and the degree of concentration in the motor fuel retailing markets. If disclosure requirements are not complied with, it becomes more difficult for the Authority to monitor competition in an efficient manner in this sector, says Director General Lars Sørgard.

Reduced fine
In light of the reply to the statement of objections from St1 on 16 June 2020 and a fresh review of the facts of this particular case, the Authority has concluded that the infringement could not be regarded as serious. Consequently, the Authority has reduced the fine significantly, from NOK 15 million to 3 million.

The Authority is of the view that the fine in this case should be appreciable and have the necessary deterrent effect. The size of the fine also reflects that this particular infringement is not regarded as serious, says Hanne Dahl Amundsen.

Var dette nyttig?

Facts

Disclosure requirements for mergers and acquisitions in specific markets

  • The Authority may impose disclosure requirements on individual firms with regard to concentrations, including mergers, acquisitions and rental agreements etc. that lead to lasting structural changes in specific markets where competition is weak and/or markets concentrated.
  • Section 24 of the Competition Act is the legal basis for issuing disclosure requirements.
  • Disclosure requirements ensure that the Competition Authority is made aware of concentrations, even if the regular notification thresholds are not met. Such information will enable the Authority to assess whether it is appropriate to require notification of these transactions.
  • Disclosure requirements are useful because, in some markets, also acquisitions of smaller businesses may affect competition negatively and lead to higher prices and lower quality for consumers.
  • The Authority has imposed disclosure requirements in markets where the degree of local competition is of particular importance.
  • Currently, the following market players are required to inform the Authority about mergers and acquisitions:
    • Motor fuel retailing: Uno-X Energi AS, St1 Norge AS, Certas Energy Norway AS and Circle K Norge AS
    • Electricity generation: Statkraft AS, BKK AS, Skagerak Energi AS and Agder Energi AS
    • Waste management and recycling: Norsk Gjenvinning Norge AS
    • Grocery store chains: Norgesgruppen ASA, Coop Norge SA, Rema 1000 and Bunnpris IK Lykke AS
    • Locksmith services: AssaAbloy Norge AS
    • Newspapers: Amedia AS, Polaris Media ASA and Schibsted ASA
    • Broadband services: Telenor ASA
    • Home security systems: Verisure AS and Sector Alarm Group AS
    • Laundry services: Nor Tekstil AS
    • Garden centres: Plantasjen Norge ASA
    • Suppliers of concrete: Nordic Concrete Group AS, Heidelberg Cement Norway AS and Unicon AS
    • Accounting systems: Visma AS

The Norwegian Competition Authority may take action against concentrations that fall below regular notification thresholds if they worsen the condition of competition to the detriment of consumers. The Authority promotes effective competition to the benefit of consumers.

The Norwegian Competition Authority is continuously assessing whether there is a need to introduce disclosure requirements for additional market players and in other markets.

The disclosure requirements are important as they enable the Competition Authority to monitor competition in a number of markets and ensure that the Authority’s review of concentrations is effective. If disclosure requirements are not complied with, administrative fines of up to 1 per cent of the turnover of the undertaking concerned can be imposed.

Portrettbilde av Hanne Dahl Amundsen, avdelingsdirektør i Konkurransetilsynet.
Hanne Dahl Amundsen, department director.
Director general Lars Sørgard.