Successful Complaint to the European Commission against the Czech Republic and EKO-KOM Concerning Packaging Waste

KSB’s competition desk – Pavel Dejl and Martin Vráb – and environmental desk – Tomáš Sequens and Petra Mirovská – teamed up to file the complaint on behalf of REMA AOS, which is an example of KSB’s interdisciplinary overlap and successful cooperation within the firm. REMA AOS, like a number of other unsuccessful applicants, attempted to break EKO-KOM's 20-year de facto monopoly and become the next authorised packaging company to provide take-back and recovery of packaging waste on the Czech market. However, in the authorisation procedure conducted by the Ministry of the Environment, it encountered insurmountable obstacles, which were an indication that the measures taken by the Czech Republic in favour of EKO-KOM were causing very serious distortions of competition on the market and were completely preventing undertakings from emerging and efficiently competing with EKO-KOM.

In response to the complaint, the European Commission published a press release on 11 June 2024, in which it reported on the investigation and its preliminary conclusion that the conditions required for obtaining authorisation, including the financial and contractual requirements, together with EKO-KOM's ability to influence the authorisation process, created significant barriers to the entry of new competitors into the market. EU law prohibits Member States from adopting or maintaining in force measures that are contrary to EU treaties and EU competition rules, including the prohibition of abuse of dominant positions by monopoly undertakings that have been granted special or exclusive rights to operate in a particular sector.

Margrethe Vestager, the Commission's Executive Vice-President responsible for competition, said in the press release: "The Czech market for packaging waste collection and recovery has been dominated by the incumbent operator for more than two decades. We are concerned that Czech measures have prevented entry of rival companies, with a consequent negative impact on prices, quality, innovation and choice. Therefore, we have sent a letter of Formal Notice to Czechia. Ensuring effective competition is essential for achieving a sustainable and circular economy, one of the main building blocks of the European Green Deal."

We are proud to have been able to contribute to this important step towards ensuring fairer competition in the Czech Republic in the field of environmental protection.