93 decisions on violation of law by municipalities and municipal companies were issued by the President of UOKiK in 2012. In most cases the undertakings voluntarily committed themselves to cease unlawful practices. Some of last decisions regard the municipality of Dopiewo and three municipal establishments – in Pionki, Wieliczka and Ropczyce

49 decisions regarding the abuse of a dominant position, 44 - the violation of collective consumer interests – that is the result of UOKiK’s activities towards municipalities and municipal companies in 2012. It is positive that in most cases the entities voluntarily commit themselves to change unlawful practices. In 2012 as many as 67 enjoyed such opportunity, which allowed for faster conclusion of conducted proceedings and elimination of prohibited practices, onerous to local communities.

One of the last decisions regards the Dopiewo Municipality (Wielkopolskie Voivodeship). It forced entities, applying for consent to construct sewage and water system connection, to give donations for the purpose of municipal water and sewage infrastructure. However, under the law, recipients are bound to pay only for making the connection and the unit to place the main water meter and measuring device. Collecting other charges is prohibited. For abusing its market position the Dopiewo municipality was punished with a fine exceeding PLN 5 thousand (PLN 5,015). It is worth mentioning that it ceased to apply the prohibited practice in December 2011.

Unlawful practices were also applied by Przedsiębiorstwo Wodno – Kanalizacyjno – Ciepłownicze in Pionki (Mazowieckie Voivodeship). It excluded its own liability for interruption of water supply or sewage collection, inter alia, because of repair and maintenance works, water pollution or breaks in power supply. However, those circumstances might have resulted from the company’s actions or omissions, in which case the company is bound to remedy a damage - then excluding the company’s liability in each and every situation is contrary to law.

Moreover, the Office questioned the way the charge for consumed water was calculated in case of loss or damage of a water meter due to recipient’s fault – at the maximum possible level. However, according to law provisions, in such situations an undertaking should demand paying the amount for the actually consumed water. If it is impossible to measure the consumption correctly, the amount of consumed water should be established on the basis of average consumption during last three months of the water meter’s efficient working, or on the basis of average consumption during a similar period of the previous year. Any other ways of calculating the consumption are unlawful.

Przedsiębiorstwo Wodno – Kanalizacyjno - Ciepłownicze in Pionki was imposed a fine amounting to approx. PLN 5 thousand (PLN 4,937).

Furthermore, the decisions of UOKiK concern the practices restricting consumer rights applied by municipalities or municipal establishments – e.g. a decision against Zakład Gospodarki Komunalnej in Wieliczka (Małopolskie Voivodeship), where the Office questioned, inter alia, increasing the fees for connection of water and sewage devices (according to  the tariff  for  collective  water  supply and collective removal  of sewage) to 23 % VAT rate. Under the law, VAT should equal to 8 %.

Clauses violating consumer rights were also applied by Przedsiębiorstwo Usług Komunalnych in Ropczyce (Małopolskie Voivodeship). The undertaking granted himself the right to terminate the agreement in case of failing to perform or its improper execution by the recipient. Such opportunity, however, is not provided by the law – according to applicable laws there are only four bases to terminate the agreement: making an unlawful connection, failure to pay for two full settlement periods following the date of delivery of a call for payment, illegal water consumption, and in case the quality of removed sewage does not meet legal requirements or damage or omission of a measuring device has been found.

Both Zakład Gospodarki Komunalnej in Wieliczka and Przedsiębiorstwo Usług Komunalnych in Ropczyce commited themselves, during the conducted proceedings, to change the unlawful activities. Therefore, the President of the Office ordered to execute those obligations and restrained from imposing financial penalties.

Decisions regarding the municipal establishments in Pionki, Wieliczka and Ropczyce are final, whereas the municipality of Dopiewo appealed to the Court of Competition and Consumer Protection. 

A detailed analysis of water supply and sewage removal sector, including a thorough description of law breaches may be found in UOKiK’s report Kierunki rozwoju ochrony konkurencji i konsumentów w sektorze wodociągowo-kanalizacyjnym (Directions of development of competition and consumer protection in water supply and sewage removal sector). Those interested in the issue should also refer to the publication Konkurencja na rynkach lokalnych wraz z wybranym orzecznictwem Prezesa UOKiK (Competition on local markets with the selected case-law of the President of UOKIK), which may be ordered free of charge via fax: +48 22 826 11 86, or e-mail: [SCODE]cHVibGlrYWNqZUB1b2tpay5nb3YucGw=[ECODE].

Additional information for the media:
Małgorzata Cieloch, Spokesperson for UOKiK
Department of International Relations and Communication
Pl. Powstańców Warszawy 1, 00-950 Warszawa
Tel.: +48 22 827 28 92, 55 60 314
Fax: +48  22 826 11 86
E-mail: [SCODE]bWFsZ29yemF0YS5jaWVsb2NoQHVva2lrLmdvdi5wbA==[ECODE]