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Competition Agency to Release a Fuel Market Research Report in the Coming Days

CBW has learned that the fuel market research report will be publicized in the near future.

The Competition Agency confirms this information and declares that the survey results will be known in about 7-10 days. At this stage the Agency refrains from answering the main question- whether  the artificially inflated  prices were revealed  and what type of sanction may be imposed. A member of the 2030 organization  Beka Kemularia says  the process took a lot of time due to the volume of material to be studied by the Agency. In his words,  the conclusion of the Competition Authority must be supported by facts, therefore, it required  months.

As for Kemularia’s expectations from the report, he notes  that if it is decided to  impose a  fine on companies, the latter is likely to appeal and processes will move to the Court. When asked what will be changed in the market after the conclusion is announced, Kemularia talks  about  the changes in  prices, because the prices will become  competitive and fair. In addition, Kemularia explains that  we should not  expect the sharp decrease in prices. Kemularia believes that such a precedent would minimize  the probability of the agreed prices and the situation in the  market will be improved in this regard.

The fuel market is the most resonant among the Competition Agency’s “cases”. The Prime Minister has made a statement on this issue and spoke about the need for more study of the fuel importing by the companies. An assumption that the Competition Agency would confirm the artificially inflated fuel prices was made by the Prime Minister Irakli Garibashvili.

In late 2014, Irakli Garibashvili ordered the Competition Policy and the Competition Regulatory Authority of Georgia to investigate fuel prices and implement control over the issue. Prime minister stated that the price of oil had dropped by a large percentage on the world market but was not adequately reflected in the price of fuel at Georgian petrol pumps.

Apart from the fuel market,  the Competition  Agency is  studying or has  already studied other cases, including an alleged monopoly  of  Tskaltubo  thermal and mineral waters (was not confirmed), abuse of dominant position on the flour market (research in progress), the alleged violation of the Georgian law on competition  by “Trans Caucasus Terminals”  and other facts.

Monitoring of  the coffee market  has been carried out  and  revealed that concentration levels on the market  are also low, which, presumably, indicates  that no problem is present in the market in terms of competition. Last December Prime Minister gave the Competition Agency 10 days to answer to the question – “why gasoline prices   in the Georgia market  are not adequate to  the world prices”. On January 5, 2015 the Competition  Agency presented the  Prime Minister  the interim report on fuel prices.