RIGA - The competition council has announced that state egg producers had illegally maintained a price-fixing agreement for nearly a year and that it was leveling hefty fines on 11 companies allegedly involved.
The council, which began its investigation in 2003, said that 11 egg producers had agreed to raise the price of eggs starting July 2002 and that the agreement effectively lasted until April 2003.
The council claimed in its report that Balticovo, which controls about 50 percent of the market, had decided to increase the price of 10 eggs by 0.01 lat (0.014 euro) and convinced the country's other egg producers - members of the Latvian Association of Egg Producers - to do the same.
The competition watchdog said that fines would be imposed on all 11 companies, with Balticovo paying the most - 26,700 lats. Each fine was determined on the basis of each company's position on the market, or approximately 1.5 percent of each country's revenues for the previous financial year.
In all, 44,096 lats' worth of fines were handed down.
Balticovo director general Arnis Veinbergs told the Baltic New Service that the company would appeal the council's decision but first had to study the whole document. Daugavpils Putni's board member Iraida Tenisa said the board was considering its course of action. "We do not admit any price-fixing agreement. I am surprised that a fine was slapped on us," she said.
Association director Valdis Grimze told the Telegraph daily that a cartel agreement on the egg market was theoretically impossible given the number of producers and the great number of differences between them.
He said that if there was any dishonest competition on the market, it was coming from Lithuania and other foreign producers who have started dumping their eggs on the Latvian market.
