FCCA intervenes in competition – compromising practice of municipal waste management company

Pirkanmaan Jätehuolto Oy, a cooperative waste management company owned by its stakeholder municipalities, has changed its pricing for the processing of municipal waste after an intervention by the Finnish Competition and Consumer Authority (FCCA). In the future, the processing fees for similar waste deliveries will not depend on whether the waste was delivered by municipal or private service providers.

The regulations on competitive neutrality that entered into force in September 2013 were applied to the case. The FCCA decreed that the company’s practice could have endangered competitive neutrality, in this case by impeding the ability of private service providers to compete for corporate customers on the waste management market.

In addition to municipal responsibilities, Pirkanmaan Jätehuolto also serves corporate customers, whose waste is collected by the same collection vehicles that pick up municipal waste. Before the company changed its pricing policy, it was charging a lower processing fee from the company’s own contractors than from private service providers with equivalent waste deliveries.

An investigation into the company’s pricing policy as a potential case of dominant market position abuse was initially launched as a result of a request for action. The September 2013 amendment to the Competition Act has since enabled the agency to investigate the matter on its own initiative, from the perspective of the new regulations on competitive neutrality.

Development of the waste management industry of interest to the competition authorities
In 2013–2014, the FCCA and Regional State Administrative Agencies conducted an extensive survey of market conditions in the waste management industry. The survey brought to light some potentially problematic structures and procedures, which may in the future have to be evaluated from the perspective of competitive neutrality regulations. The state of competition in the waste management market is also being examined within the scope of a joint project of the Nordic competition authorities. The final report of the project is slated for completion in the autumn of 2015.

See the FCCA’s decision of 15 December 2014 (in finnish)