Two competing taxi dispatchers, Follo Taxisentral and Ski Taxi, collaborated through a jointly-owned company, Ski Follo Taxidrift AS, on submitting bids during two competitive tendering rounds during the autumn of 2010. These competitive tendering rounds applied to the transport of patients for the Oslo University Hospital, valued respectively at up to NOK 20 million and NOK 30 million.
Ski Follo Taxidrift has been given the largest fine of NOK 2.2 million. Follo Taxisentral will have to pay a fine of NOK 400,000 and Ski Taxi a fine of NOK 250,000. All three fines are being imposed for breaches of Section 10 of the Competition Act which bans collaboration between competitors designed to limit competition.
Serious breach of the Act
– It is a serious breach of the Competition Act when competitors collaborate on important criteria such as prices, quality and capacity in connection with competitive tendering. Such illegal collusive tendering reduces the competition for a job, and the principal risks having to pay too much, says Director General for Competition Christine B Meyer.
Vigilant health enterprise
The Competition Authority learnt about this illegal collusive tendering from the Oslo University Hospital HF when the Hospital expressed its concern about the lack of competition in respect of patient transport in the Follo region.
– Vigilant principals are of invaluable help in the battle against illegal collaboration which might otherwise be very hard to detect. The tip provided by the Hospital made the Competition Authority aware of this illegal tender collaboration, says Head of Section Karin Stakkestad Laastad.
During the first round of competitive tendering, the collaboration between the taxi ranks resulted in the Oslo University Hospital only receiving one tender. The Oslo University Hospital decided to cancel the competition due to a lack of competition. When the second round of tenders was advertised the taxi ranks also submitted common bids. There were two other tenderers in this tendering round.
– Follo Taxisentral and Ski Taxi are competitors in the taxi market in Follo, and these two companies could have submitted independent bids in both tendering rounds. The basic tendering material provided by the Oslo University Hospital contained nothing to prevent these companies from submitting individual bids. When instead they decided to collaborate, they were acting in contravention of the law, says Stakkestad Laastad.
Taxi dispatcher fined previously
The Competition Authority has previously adopted a resolution in respect of a similar case. In 2009 Taxi Midt-Norge received a fine of NOK 300,000 kroner for engaging in illegal collaboration in a competitive tendering round advertised by the Central Norway Regional Health Authority.
– It is important that both taxi companies and anyone else submitting bids during competitive tendering is aware of the competition rules, emphasises the Director General.