In July 2012 the Competition Agency opened formal antitrust proceedings against the Auto Club in order to investigate whether it had distorted competition in the breakdown services and roadside assistance market by entering into anti-competitive agreements with its contractors.
In line with its powers set out under the law , the club carries out certain public functions, including the provision of technical assistance to road drivers. However, the law does not prevent other existing or new undertakings from operating in the market.
On May 25 2011 the club's board adopted an internal ordinance on the provision of technical assistance services to road drivers, which defines:
- the technical assistance system as the club's public function;
- the way in which service are operated;
- conditions to be fulfilled by all stakeholders, plus their rights and obligations;
- underlying work principles; and
- the charging structure for services rendered.
In the agency's view, Article 7 of the ordinance, which is binding on all of the club's contractors, raises competition concerns. According to the disputed provision, all contracting parties which enter into an agreement with regard to technical assistance to road drivers are prohibited from cooperating with other domestic or foreign entities and may not conclude agreements with other parties without the club's prior approval; a list of such parties is determined by the club's board.
In light of these facts, the agency's investigation will focus on whether such agreements have anti-competitive effects.
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