The Competition Authority has today taken a provisional decision for a likely breach by Hreyfil of the Competition Act no. 44/2005, by prohibiting taxi drivers who drive for Hreyfil from using the services of other taxi companies.
Since Hopp began operations, Hreyfill has prevented taxi drivers who drive for Hreyfill from using Hopp's services. Furthermore, rules in Hreyfill's bylaws and station regulations also excluded its members from using other services available to them on the market.
For years, Hreyfill has been the country's largest taxi company, with the most taxi drivers and a huge financial strength over its competitors. The Competition Authority examined similar conduct by Hreyfill towards another company in 2020. The Competition Authority then issued an order to Hreyfill to cease the conduct, which was likely to breach Article 11 of the Competition Act. The investigation into this matter has revealed that Hreyfill has disregarded the aforementioned order from the Competition Authority.
The interim order directs Hreyfill to cease its conduct towards Hopp without delay, as well as making the necessary amendments to the company's rules and bylaws to prohibit or prevent taxi drivers who drive for Hreyfill from also using the services of other companies. Furthermore, Hreyfill shall issue a formal notice to the taxi drivers who use the company's services, informing them of the interim decision and that they are free to also use the services of other parties should they so choose.
The Competition Authority considers that the said conduct is not based on either objective or rational grounds. Hreyfill's conduct is likely to prevent a new competitor from entering the market to the detriment of consumers, as well as to maintain the restrictions on the majority of taxi drivers that the new law on taxi driving was intended to eliminate.
The Competition Authority considers it likely that Hreyfill's conduct constitutes an infringement of the prohibition provisions of the Competition Act and that the conditions for making an interim order are met. It is therefore particularly important that the competition authorities intervene and stop the conduct without delay.
The interim decision is valid until 31 January 2024. It is available here.
In accordance with the 3rd paragraph of Article 16 of the Competition Act no. 44/2005, the Competition Authority is authorised to make interim decisions in individual cases if it appears likely that the conduct or circumstances under consideration contravenes the provisions of the Competition Act or decisions taken on its basis. The condition is that the matter cannot be delayed. Such decisions therefore do not constitute a final determination as to whether the conduct in question is unlawful.
On 1 April 2023, new law no. 120/2022 on taxi services came into force. The objectives of the law include opening up the taxi market to increased competition in both pricing and service, and creating conditions for innovation in the sector. Various changes were made to the legislation, which had previously imposed strict conditions on taxi operation and largely restricted the work of taxi drivers.
The changes include, among other things, that there are no restrictions on the number of taxi drivers or their areas of operation, taxi drivers can work for more than one taxi company at the same time, the minimum permit utilisation fell and the maximum age also.
"*" indicates required fields
