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AFCA conducting market inquiry into Austrian fuel market

The Austrian Federal Competition Authority (AFCA) has launched a market inquiry into the Austrian fuel market. The AFCA is responsible for conducting competition sector inquiries in Austria. It may launch a sector inquiry where circumstances lead the Authority to suspect that competition in a specific sector of the economy is restricted or distorted. It launches this inquiry after having received numerous complaints from market participants.

The sector inquiry will analyse the price and margin development at filling stations in Austria and assess developments from a competition point of view. Its focus will be on the current competition situation in filling stations and upstream markets, systematically analysing the developments in crude oil prices, fuel prices, refineries’ costs and production quantities, as well as the price level and pricing cycles at filling stations. On the basis of this data, the AFCA can then examine in what way costs are passed on and margins develop, thereby identifying potential competition issues. As well as the changed competition between filling stations, changes in relation to competition between refineries are also relevant in this context. Additionally, the AFCA will also assess both the current and the original situations. The Authority’s last sector inquiry back in 2011 had already looked into market structures and business relationships, i.e. the purchase patterns and interconnections between filling stations and refineries, but these might have changed in the meantime. The inquiry will also consider the developments in some selected neighbouring countries, if necessary, and compare them with those in Austria. Across borders, competition pressure and price changes are expected to shift, for example because of the price caps in place in Hungary and Slovenia. The AFCA will therefore look into the prices and competition in upstream markets, specifically the crude oil market and the market for processing crude oil by refineries.

Investigative tools available for AFCA market inquiries

The sector inquiry will primarily be based on data and interviews with market participants.

In accordance with § 11a para. 1 of the Austrian Competition Act (WettbG), the AFCA is authorised, among other things, to request that information be submitted within a reasonable period of time, which is to be set individually. Undertakings are obliged to provide the requested information pursuant to § 11a para. 2 in conjunction with para. 1 nos. 1 and 3 of the WettbG. The AFCA must – under the conditions stipulated in Article 11a para. 5 WettbG – impose fines on undertakings that intentionally or negligently provide incorrect or misleading information; such fines may amount to up to 0.5% of those undertakings’ total turnover in the preceding business year.

The provision of any information requested pursuant to § 11a para. 3 WettbG may, if necessary, also be ordered by means of an administrative decision in accordance with the General Administrative Procedure Act (AVG). If, contrary to such a decision, undertakings intentionally or negligently fail to provide information, provide incorrect, misleading or incomplete information or fail to provide information in time, the AFCA must impose fines against those undertakings amounting to up to 1% of their total turnover in the preceding business year.

Aim of the inquiry

This market inquiry is being launched in response to the recent significant price rises at filling stations. Its aim is to find out whether, leaving other current developments aside, the current prices are also due to a lack of or restricted competition.

Further steps possible

A market inquiry may be launched following general developments on the market and aims to identify structural factors distorting competition. In the event of specific suspicions of anti-competitive behaviour, other investigative tools may be used or legal proceedings initiated. Reports of incidents on the market may be made either by submitting an official complaint or anonymously via our whistleblowing system. If legal proceedings are initiated, the Federal Cartel Prosecutor may become a party to those proceedings and support the AFCA. The Federal Cartel Prosecutor is not entitled to investigate independently.

Speedy conclusion

The results of the inquiry will be published in a final report. We intend to bring the market inquiry to a speedy conclusion, and therefore hope that market participants will cooperate fully. The Federal Ministry for Digital and Economic Affairs (BMDW) has agreed to make the necessary funds available.

Contact: wettbewerb[at]bwb.gv.at