Czech single waste collection pick triggers competition concerns

Czech single waste collection pick triggers competition concerns

The sole company authorised to collect and recover packaging waste in Czechia may have a conflict of interest in its dual role as a waste collector with powers of authorisation over competitors in breach of EU competition rules, the European Commission has warned Prague, according to a statement published today (June 11).

EKO-KOM is the only company operating in the country offering collection and recovery services for packaging waste to over 20,000 business for more than two decades.

The EU executive considers that national legislation in force since 2002, the Czech Packaging Act, has likely created “significant entry barriers” for competitors wanting to access the market, flagging that “no other company has succeeded in obtaining an authorisation” to deliver similar services.

Such barriers include authorisation requirements that are very difficult to meet, such as strict contractual and financial conditions, the Commission said, including the possibility for EKO-KOM to influence the authorisation proceedings of other applicants.

The EU executive cited “unequal opportunities” for potential for EKO-KOM's rivals and called out the Czech company for its “dual role” as both a market participant competing with any new entrant and a third party enjoying certain procedural rights in the authorisation process of new applicants.

“We are concerned that Czech measures have prevented entry of rival companies, with a consequent negative impact on prices, quality, innovation and choice,” said Commission Executive Vice-President Margrethe Vestager, in charge of competition policy.

Vestager said a letter of formal notice was sent to Czechia giving the government two months to respond to the Commission’s concerns.

The Commission's investigation followed a complaint by Czech company REMA, which attempted to enter the market for the collection and recovery of packaging waste in Czechia and failed. Five other companies have been equally unsuccessful in entering the market, according to the EU executive.

EKO-KOM has been approached for comment.