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Tuesday 12.11.2019 | Name days: Kaija, Kornēlija

Competition Council prohibits Tīrīga from signing contracts with residents

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Latvia’s Competition Council (CC) refused to allow waste management company Tīrīga to sign contracts with Riga’s residents on waste management.

CC does not provide comments on this. Explanations for this decision will be provided at a press-briefing on Tuesday, 10 September.

Riga City Council chairman Oļegs Burovs has confirmed that CC has applied a temporary order in regards to cooperation with Tīrīga.

«CC has ordered us to call off Tīrīga’s already signed waste management contracts with residents no later than 12 September. They offered us to continue cooperation with existing waste management operators. Theoretically this offer is good, but the city council’s legal experts note that this is not possible because of regulations,» the mayor explains.

Burovs plans to meet with representatives of involved city council institutions. On Tuesday, there will likely be a meeting with existing waste management operators in an attempt to reach an agreement on continuation of operations. «The question is whether the operators are prepared to mobilize and continue operations. Then we will see whose lawyers were correct – ours or CC’s,» says Burovs.

When asked if the city council intends to appeal CC’s decision in court, Burovs said yes. He did stress, however, that the municipality’s primary task is sorting all technical issues to prevent problems with waste management services. Legal aspects will be decided upon later.

In April 2019, CC admitted that Riga City Council was previously warned about risks for residents and competition should the municipality sign a 20-year contract for public and private partnership in waste management.

«Riga’s current public and private partnership scenario is a Damocles sword over Latvia’s waste management market – it basically means the end for it. It is expected that without competition services will become more expensive,» says CC chief Skaidrīte Ābrama.

Because only two contenders participated in the tender and each combines two waste management sector players, immediately after the end of the tender CC started considering the formed joint company as merge or cooperation agreement. The tender was entered by SIA CREB Rīga, which combines waste management service providers SIA Clean R and SIA Eco Baltia vide, as well as Pilsētvides serviss and Lautus, which combines SIA Pilsētvides serviss and SIA Lautus.

«It is the duty of competition supervisors, whose goal is preventing implementation of operations negative for society and competition if specific contracts fit the criterion of merge or cooperation announcement. In such cases Competition Council may decide on either permitting or prohibiting contracts,» explains CC.

According to the council, public and private partnership is generally supported. At the same time, CC invites Riga City Council to decide on the term for the signing of a competition-friendly agreement, as well as divide Riga into multiple waste management regions to contribute to development of competition and private businesses.

AS Tīrīga’s public partner is Getliņi Eeko, which provides public and private partnership project’s monitoring and creation of a landfill. SIA CREB Rīga is a private partner, which combines two environment service providers – SIA Clean R and SIA Eco Baltia vide – for participation in public and private partnership.

Currently Riga City Council has signed an agreement with four companies – SIA Clean R, SIA Eco Baltia vide, SIA Pilsētvides serviss and SIA Lautus – for provision of waste management services.

As previously reported, Getliņi EKO has signed a contract worth EUR 686.3 million with Riga City Council for public and private partnership. CREB Rīga was declared the winner. In accordance with the public private partnership process, the winner of the tender will provide waste management services in Riga for the next 20 years.

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  1. Zerry says:

    Looks somehow similar than few years ago the Rigas Bioenergija case. Making everything look like pure legal but rather soon after the deal the other part was sold to other one. And nobody dares to care when big boys are playing with public money.

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