The Italian Competition Authorities opens an enquiry into bidding practices allegedly carried out by the suppliers of the public TV broadcaster

By the decision made on 10 December 2013, pursuant to Article 2 of the Italian Competition Act n. 287/190, in the case I771 Rai/Post-produzione TV the Italian Competition Authority (ICA) has opened an investigation into an allegedly anticompetitive agreement affecting the market for the supplying of  post-production services to the complainant, RAI. Under the Italian legal system RAI, the national public broadcaster, has to select its suppliers through competitive procedures to which only qualified suppliers meeting certain requirements are invited to particiapte. By a complaint lodged with the ICA, RAI reported that the procedures it called for over the period August-September 2013 to select the suppliers of post-production services were influenced by a market-sharing agreement entered by the suppliers.
The ICA then started an investigation against 22 providers of post-production services. In the ICA view the elements collected over the preliminary investigations corroborated the allegations of RAI. First, the contracts for the post-production services tendered for the investigated period have been awarded on the basis of higher prices than those indicated in the bids for the contracts tendered beforehand, and the higher prices depended by the lower discounts offered by the bidders. Second, the price increases affected the most important contracts tendered just before the launch of the new TV seasons. Third, in many cases the winners of the 2013 procedures were the same as of the 2012 procedures.

In light of the above the ICA believed the under scrutiny firms to have put in practice a market sharing arrangement, by coordinating their conducts with regard to the competitive procedures organized by RAI. And as a result, the contracts tendered by RAI in 2013 were then awarded to the same suppliers that successfully bid for them the year before,  the only difference being in the higher prices of the 2013 winning bids. Importantly, in the ICA decisional practice the market sharing agreements having the object the coordination of bids for competitive procedures amounts to a hard core competition infringement (see for example, Rifornimenti Aeroportuali, decision n. 15604 of 14 June 2006). Though the degree of transparency of the market is quite high, it remain to be seen, however, whether  the competition concerns voiced by the ICA are grounded. Indeed, it should be taken into consideration as factors militating against the finding of a anticompetitive agreement Rai/Post-produzione TV that several firms participates in the alleged anticompetitive practice. That makes the agreement at hand quite unstable. In addition, the market is not concentrated and all the parties have small market shares.

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