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The Competition Authority rejects the agreement of the Directorate of Transport and Taxes for the increase in the price of the patent, considers it contrary to the law and warns that it will monitor the market for 1 year
Written by Dario VELAJ 25 Mars 2023
The Competition Commission decided yesterday the ban on the doubling of the price of obtaining vehicle licenses, which was signed as an agreement on February 13 between the General Directorate of Road Transport, the General Directorate of Taxes, the National Association of Driving Schools and the Association of Driving Schools "Street security". At yesterday's meeting, the Competition Commission reasoned that such an agreement violates the competition between driving schools. Consequently, the commission in question will observe the driving school market for 1 year to finally decide whether the agreement to increase the price of car licenses will be implemented or not.
Reasoning: The act-agreement violated points 1 and 2 of article 4 of law 9121/2003
The Competition Authority relied on Law 9121/2003 "FOR THE PROTECTION OF COMPETITION" to block the implementation of the agreement to increase the price of car licenses to 85 thousand ALL. According to this body, taking for reference article 4 point 1, letter a) for "Prohibited Agreements" which says: "All agreements are prohibited, which have as their object or as a consequence the obstruction, limitation or distortion of competition in the market, especially agreements that determine, directly or indirectly, purchase or sale prices, or any other trading conditions”; and article 4, point 2, which states that "Agreements that are prohibited, according to point 1 of this article and that are not excluded according to articles 5, 6 and 7, are invalid", this agreement will distort competition in the market. "It was established that the act-agreement no. 2729 prot., dated 13.02.2023, concluded between interest groups representative of Driving Schools, DPSHTRR and DPT, is an agreement prohibited in itself by object, in the sense of article 4, point 1, letter a), of law no. 9121/2003, as upon entry into force it will lead to the same practices in prices/payment fees for preparing and obtaining the driving license category, evidence or certificate, hindering, limiting and distorting competition in the market. As such, this act-agreement, in the sense of Article 4, Point 2, of Law no. 9121/2003, is prohibited", explains the Competition Authority since upon entry into force it will lead to the same practices in prices/payment fees for preparing and obtaining the driving license category, evidence or certificate, hindering, limiting and distorting competition in the market. As such, this act-agreement, in the sense of Article 4, Point 2, of Law no. 9121/2003, is prohibited", explains the Competition Authority since upon entry into force it will lead to the same practices in prices/payment fees for preparing and obtaining the driving license category, evidence or certificate, hindering, limiting and distorting competition in the market. As such, this act-agreement, in the sense of Article 4, Point 2, of Law no. 9121/2003, is prohibited", explains the Competition Authority
The first decision: The implementation of the act-agreement for increasing the price of the license is prohibited
Considering that this act-agreement between DPSHTRR, DPT and two associations of driving schools violated Article 4 of Law 9121/2003. "Competition Commission, with decision no. 970, dated 24.03.2023 decided that act-agreement no. 2729 prot., dated 13.02.2023, signed between the parties: the General Directorate of Road Transport Services, the "National Driving School" Association, the "Road Safety" Driving School Association and the General Directorate of Taxes, is considered an agreement act contrary to Article 4 of Law 9121.2003, 'On the protection of competition'", it is written in the first point of the decision.
The second decision: Driving schools will be monitored for 1 year for issuing licenses
Secondly, the Competition Authority will observe for a period of 1 year the procedures of driving schools for the preparation of drivers to be equipped with a driving license (license), based on the category of this driving license, testimony and certificate. "Monitoring the market of the preparation service and equipment with driving license, according to the category of driving license, certificate or certificate, for a period of 1 (one) year", is written in the second point of the decision of the Competition Authority.
Third decision: Fines of 2-10% of annual turnover for driving schools that violate the decision
In the end, the Competition Commission (Authority) warned all driving school associations that if they do not implement the decision taken on the suspension of the act-agreement on the increase in the price of patents, they will be fined in the amount of 2-10% of the annual financial turnover of the year predecessor. This is specified in article 74, point 1, letter c) for "Measure of fines for serious violations", which states: "The commission imposes fines in the amount of 2-10% of the total turnover of the previous financial year, for each participating enterprise that does not fulfill the conditions and obligations in support of a decision taken, according to articles 45, 50 point 2, 56, 57 and 60 point 2 of this law". "The non-implementation of this decision constitutes a serious violation of competition in the sense of article 74, point 1, letter c), of law no. 9121/2003",
How was the patent price changed? The drivers would pay a total of 100,000 ALL
The agreement to raise the price of the car license was announced to the media in February. Despite the fact that DPSHTRR did not give details about the costs of the procedures, it was reported by the media that the value for the training of the license is 85 thousand Lek (50 thousand Lek theoretical phase and 35 thousand practice phase). A learning session in practice at the driving school will cost a minimum of 500 ALL, while a practical session will cost 935 ALL. The current cost is 25-35 thousand ALL for the license. However, 85,000 lek is not the final figure that car drivers have to pay. If they would apply to get the license after March 10, the value would reach 100 thousand ALL. In addition to the cost of preparation for obtaining a driving license, drivers must also pay 30,000 lek for medical visits for eyes and ears.