The Reykjavík District Court confirms that the publishing house has breached competition law and must pay a 25 million króna fine.

The Competition Authority concluded in a decision in July 2011 that Forlagið ehf. had breached the conditions in the Competition Authority's decision. No. 8/2008. The publishing house was established in 2008 through the merger of two companies, namely JPV útgáfu ehf. and Vegamóta ehf. During the merger proceedings at the Competition Authority, the Publisher took the initiative to propose conditions that would remove the barriers to competition which the Authority had identified. A settlement was reached in the case, whereby the Publisher committed to complying with certain conditions to counteract the merger's adverse effects.

The Competition Authority considered that the Publisher had breached these conditions. The breaches consisted of the Publisher violating the ban on publishing the retail price of books and the ban on granting bookshops discounts that constituted undue discrimination by the Publisher between them. These conditions were intended, among other things, to ensure that the Publisher would not distort competition in the resale of books. The Competition Authority imposed a regulatory fine of 25 million krónur on the Publisher for these breaches.

The Publisher appealed the Competition Authority's decision to the Competition Appeals Board. In September 2011 the Appeals Board confirmed that the Publisher had committed the alleged infringements and that the imposed fine was appropriate. The Commission pointed out that it was essential for the Publisher to comply with the conditions imposed on the merger and that one could trust that commitments in such cases were more than empty words. This was especially true in this case, since the Publisher itself had taken part in drawing up the conditions. The words and actions of the Publisher suggest that the company did not take the aforementioned conditions seriously. The committee states that in cases of this nature, imposed fines must have a deterrent effect and ensure that companies comply with the conditions they have pledged to respect.

The Publisher appealed the arbitration panel's decision to the courts, and today the Reykjavík District Court delivered its judgment. It was confirmed that the Publisher had breached the relevant conditions, and the court did not agree with the Publisher's contention that the breaches were committed negligently. The court also disagreed that the imposed fine was excessive and upheld it.