Preliminary ruling of the Court of Justice of the European Union in the ongoing proceedings between KIA Auto AS, TKM Grupp AS and the Latvian Competition Council

According to previous company announcement of TKM Grupp (15 September 2022), on 14 September 2022 the Administrative Regional Court of the Republic of Latvia decided to stay the proceedings between KIA Auto AS, TKM Grupp AS and the Latvian Competition Council that have been ongoing since 2014. The focus of the proceedings is alleged conflict of competition law of the warranty conditions of KIA Auto AS that were valid in the period of 2004-2009 and the legality of the penalty in the amount of 135 thousand euros (see company announcement dated 22 December 2021 for further details of the proceedings) that was referred with a request to the Court of Justice of the European Union for a preliminary ruling regarding the interpretation of Article 101(1) of the Treaty on the Functioning of the European Union.

Today the Court of Justice of the European Union delivered its ruling in case No. C‑606/23 by giving its answers to the questions referred to it by the Administrative Regional Court of the Republic of Latvia. The Court of Justice of the European Union noted that it is sufficient for the competition authority to demonstrate potential anti-competitive effects, provided that they are sufficiently appreciable.

Now the proceedings shall resume in the Administrative Regional Court in Latvia where the court will have to evaluate if the decision of the Latvian Competition Council dated 19 August 2014 demonstrated sufficiently appreciable effects on competition (company announcement 21 August 2014). The date of the hearing has not yet been set, but it is foreseeable that the hearing will take place, and the judgment of the Administrative Regional Court shall be announced during 2025. The judgment of the Administrative Regional Court can be appealed to the Supreme Court of the Republic of Latvia on points of law, including the application of the guidance issued by the CJEU in its preliminary ruling.

Raul Puusepp
Chairman of the Board
Phone: +372 731 5000
info@tkmgrupp.ee