The Swedish Competition Authority has ended its investigation of a Gothenburg municipality owned mobile payment solution for parking services, once again failing to achieve any meaningful results against anti-competitive activities by public entities. The SCA has also ended its investigations of Trustly and Svenska Spel for abusing dominant positions. In other news, the European Commission presents a roadmap towards an innovative internal energy market, a SCA survey finds lack of monitoring a major problem in public procurement, and an IFN paper finds that local corruption has a strong deterring effect on potential entrepreneurs.
The Swedish Competition Authority ends investigation of Göteborgs Stads Parkering AB. The difficulties for the SCA to achieve meaningful results against anti-competitive activities by public entities are again highlighted, as the SCA has dropped the remaining parts of the case. The Gothenburg municipality owned company provides its own mobile payment solution for parking services which is exclusively used on municipality owned parking lots in Gothenburg and has been under investigation by the SCA since mid-2018. In September 2019, the SCA concluded that municipalities can opt to provide services themselves without public procurement and dropped parts of the investigation. But neighboring Mölndal municipality also exclusively used the service provided by Gothenburg municipality. However, the SCA has now concluded that the negative effects on competition in Mölndal aren’t serious enough to warrant a continued investigation. http://www.konkurrensverket.se/nyheter/utredning-om-mobila-betallosningar-for-parkering-avslutad/
The SCA ends investigation of Trustly. Trustly, a Swedish company expanding globally, provides instant online banking payments and has a dominant position on the market for instant payments from businesses to consumers in Sweden. Competitor Zimpler reported Trustly to the SCA for signing exclusive contracts with online gambling companies, restricting market access for competitors. The SCA has now decided to not further investigate the case, reasoning that online gambling companies are just part of the total market so any harm suffered is limited, and the SCA projects that once Swish, a service jointly owned by 6 banks, starts to provide business-to-consumer payments that will greatly overhaul the market in Sweden. http://www.konkurrensverket.se/beslut/19-0650.pdf
The SCA ends investigation of Svenska Spel. Since January 1 2019, there is a regulated competitive market for online gambling in Sweden, while the market for lotteries is restricted to only the state and licensed not-for-profit-organizations. The Swedish Trade Association for Online Gambling reported the state-owned company Svenska Spel to the SCA in 2019, arguing that the company abused its dominant position on the restricted market for lotteries to gain unfair advantages on the competitive market for online gambling, for example through its branding and marketing and by linking to its gambling business from its lottery business. The SCA has now decided to not further investigate the case due to priority reasons, but that position doesn’t mean it’s found the conduct to be legal. http://www.konkurrensverket.se/globalassets/aktuellt/19-0128.pdf
European Commission presents roadmap towards an innovative internal energy market. The most significant benefit of the digital transformation of the energy sector will be the provision of flexibility services at the electricity distribution networks level (rather than transmission level). A report therefore provides a roadmap and states recommended actions to be completed during 2020-2030, largely consisting of implementing regulations for interaction between (often state-owned) transmission system operators and (often private) distribution system operators to create a competitive market for provision of flexibility services. https://ec.europa.eu/energy/studies/assessment-and-roadmap-digital-transformation-energy-sector-towards-innovative-internal_en
SCA survey finds lack of monitoring a major problem in public procurement. A general survey about corruption conducted among public procurement officers in Sweden found that a major concern is corruption throughout the contract period, as the contracting authorities typically lack the organization to actually monitor contracts after awarding them. 69% of the respondents also stated that they needed more knowledge on how to detect possible bid-rigging cartels, and many respondents also stated that they lacked knowledge on how to react to abnormally low tenders. http://www.konkurrensverket.se/globalassets/publikationer/rapporter/rapport_2020-1.pdf
IFN paper finds that local corruption has a strong deterring effect on potential entrepreneurs. A quantitative study of what effects the local corruption index had on individual’s decision on whether to start a firm in any of Sweden’s 290 municipalities during 2012 found that local government corruption deters start-ups in a potential entrepreneur’s home municipality. Second, the study found that few entrepreneurs relocate their start-ups from their home municipalities to elsewhere, and those who do are in fact mostly ‘non-productive’ start-ups migrating from relatively low-corrupt to relatively high-corrupt municipalities. https://www.ifn.se/publikationer/working_papers/2020/1323
