Polskie Przedsiębiorstwo Wydawnictw Kartograficznych and Nowa Era have concluded an illegal agreement excluding competition between them for 10 years. For the breach of antimonopoly regulations, the President of UOKiK Cezary Banasiński imposed on the two companies a joint fine of over 100 thousand zloty

On 30^th July 2003 Polskie Przedsiębiorstwo Wydawnictw Kartograficznych (PPWK) sold to the educational publishing house Nowa Era a portion of its assets. In a result, Nowa Era took over the activity of PPWK in the market of school publications - for instance, it acquired the copyright to cartographic publications used in education, trade marks and know-how developed for publishing projects related to education.

The companies also agreed, that for 10 years they would not undertake any activity that would be competitive to each other. It was agreed that only Nowa Era would be active in the market of educational publications and PPWK - in the sphere of popular cartography.

The companies mutually decided not to undertake any marketing nor promotional activities, nor to create sales systems that would be directed to buyers reserved for the other party. For breach of the non-competition clause, the enterprises agreed on a contractual penalty of 8 million zloty.

Suspecting a possibility of a breach of law, UOKiK initiated an explanatory proceeding and then, on 10 December 2003, an antimonopoly proceeding. On the basis of the materials collected, the President of the Office decided, that the provisions on the market split between PPWK and Nowa Era, were not exclusively “ornaments to the agreement” (as claimed by one party), but that they led to a real abandonment of competition between the enterprises for many years to come.

Provisions of the agreement between PPWK and Nowa Era restricted competition between the companies to an extent that was not justifiable by purchasing by Nowa Era some of the assets of PPWK. The high contractual penalty must be effective in discouraging the company from undertaking any actions breaching the principle. Such agreements are prohibited by the Polish and the EU antimonopoly regulations.

In view of the above, the President of UOKiK imposed on both companies fines of a total amount of over 100 thousand zloty. When determining the amount of the fines, they were to play both a repressive and preventive role, as well as it was taken into consideration that on 16 July 2004 the companies voluntarily signed an annex to the agreement, amending the questioned provisions and adjusting the agreement to the law in force. It was also of importance, that neither company had been punished for anticompetition practices before.

The decision may be appealed to the Court of Competition and Consumer Protection.

Additional information:
Elżbieta Anders, Spokesperson of UOKiK
International Relations and Communication Department
Office of Competition and Consumer Protection
Pl. Powstańców Warszawy 1, 00-950 Warsaw
Ph.: (+48 22) 827 28 92, 55 60 106, 55 60 314
E-mail: [SCODE]ZWFuZGVyc0B1b2tpay5nb3YucGw=[ECODE]