Press Release
C. 28-13 th
El Salvador, October 29 , 2013.
CS will investigate the market of liquid petroleum gas for industrial consumption The Competition Superintendence (CS) will preliminarily investigate the wholesale market of liquid petroleum gas (LPG), due to findings collected in the preliminary investigation of the market of the LPG for household use and other information obtained by this institution, which point out to the existence of a possible horizontal agreement. “We will preliminarily investigate the market of liquid petroleum gas for industrial use to gather elements of the possible existence or not of anticompetitive practices that could be affecting the market, and, ergo, the consumers”, asserted Francisco Diaz Rodriguez, Competition Superintendent.
The Competition Superintendence will begin a preliminary investigation to gather information in order to determine the existence of elements that the economic agents participating in the wholesale distribution and commercialization of LPG could have materialized a horizontal agreement. In May 2011, the CS initiated a preliminary investigation in the market of LPG for household use due to the possible existence of anticompetitive practices related to horizontal agreement and abuse of dominance [Provisions 25 letter a) and 30 letter c) of the Salvadoran Competition Law (CL)]. Nevertheless when the investigation ended, the Superintendence did not gather enough findings to presume the commitment of said practices, but it allowed the competition authority to preliminarily analyze the behavior of the market of the LPG for industrial consumption. Pursuant to the 2011 investigation, the Competition Superintendence noticed high concentration in the wholesale market, as well as a surprising stability in the participation shares of each of this market´s operators.
Simultaneously to these findings, the CS became aware of certain problems related to the supply of GLP at industrial level which could be connected to the possible commitment of a horizontal agreement. Consequently, the Competition Superintendence will begin a preliminary investigation allowing it to have a basis for the findings gathered or collect new ones and, thus, if necessary, initiate a sanctioning procedure. Provision 41 of the CL states: “The Superintendent may carry out, before starting a sanctioning procedure, prior actions through the officials of the Superintendence with the power to investigate, inquire and inspect any anticompetitive practice, with the purpose of preliminarily determining the concurrence of potential violations to the Law…” If as a result of this prior investigation enough evidence of the existence of an anticompetitive practice is collected, the Competition Superintendence will ex-officio begin an administrative sanctioning procedure. At the end of said procedure, if the existence of a horizontal agreement is proven, the CS will, amongst other actions, order the anticompetitive practice to be ceased and impose a fine, as sanctions.