On 11 June, the Competition Authority decided to impose daily fines on the Association of Businesses in the Catering Sector (SVEIT) for the association's breach of its legal obligation to provide the authority with data. The fines were imposed to compel SVEIT to comply with competition law and to provide the requested information. The Competition Authority concluded that SVEIT had failed to comply with a clear obligation to provide information, thereby breaching Article 19 of the Competition Act. SVEIT was to pay a daily fine of 1,000,000 kr. until the requested documents had been handed over to the Competition Authority.
SVEIT appealed the decision of the Competition Authority to the Competition Appeals Board, demanding that it be annulled. SVEIT argued that the Competition Authority did not have the authority to investigate alleged collusion offences and that the authority's request for data was overly broad. With ruling However, in its ruling today the appeals board upheld the decision of the Competition Authority. SVEIT shall pay a daily fine of 1,000,000 kr. if the documents have not been received by the Competition Authority by 6 October.
Background information
The background to this is that on 14 March 2025, the Competition Authority received a complaint from the Icelandic Trade Union Federation, the Efling Trade Union and the Icelandic Federation of Professional Associations regarding „of unlawful price-fixing by companies in the catering market and unlawful price-fixing within the Association of Catering Companies“. It is therefore alleged that the conclusion of a collective agreement with the union Virðing, which provides for pay terms in the catering market, has contravened competition law. The complaint argues that the union Virðing is „bogus trade union“ and also that an exemption of the second paragraph of article 2 of the Competition Act from the scope of the law due to „wages or other terms of employment of employees in accordance with collective agreements“ Does not apply.
The Competition Authority decided to launch an investigation and requested data from SVEIT, certain SVEIT member companies and Virðing. Data has been received from Virðing and the SVEIT member companies to which the data request was addressed.
SVEIT, however, repeatedly rejected the Competition Authority's request for the submission of documents. The organisation has demanded that the Competition Authority's investigation into alleged breaches of competition law be dropped. In support of this, it is stated, among other things, that the Competition Authority has „no grounds to initiate an investigation concerning the establishment of a trade union, the circumstances preceding the conclusion of a collective agreement, its content or validity, pursuant to Articles 1 and 2 of the Competition Act.“
In the Competition Authority's decision on daily fines, it was noted that the exemption in paragraph 2 of Article 2 of the Competition Act from the scope of the law regarding wages or other terms of employment of wage-earners under collective agreements is, in competition law, subject to certain conditions. If the relevant agreement does not meet these conditions and is therefore not considered a collective agreement under competition law, it may constitute an illegal concerted practice by the undertakings concerned and their associations regarding employees' wages (wage fixing).
Such infringements contravene Article 10 of the Competition Act, pursuant to Article 12 of the Act, and are generally considered serious and liable to cause damage. The competition authorities' investigation in such cases involves, amongst other things, assessing whether or not a genuine collective agreement is in place. The provisions of Article 19 of the Competition Act grant the Competition Authority extensive powers to request all necessary documents for the purposes of its investigation. This was confirmed in a ruling by the Competition Appeals Board today.
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