A Rabat petrol station that had announced a reduction of its prices but then reverted to the old ones after pressure by its supplier has been found guilty of breaking the law by the Office for Fair Competition.
The station and its supplier were both found to have illegally agreed a Resale Price Maintenance (RPM) agreement.
The case, in January 2015, involved San Lucian Oil Company Limited, a member of Falzon Group Holdings and M&N Camilleri Petrol Station.
The petrol station had announced it would be lowering its prices, but the Authority found that it had then been warned by the oil company that the profit margin promised to it would be withdrawn.
Subsequently M&N Camilleri Petrol Station gave in to this pressure, by reverting to the maximum retail price of €1.35 per litre of diesel.
The Office said Falzon Group and M&N Camilleri Petrol Station had infringed the Competition Act by entering into an RPM agreement, which has as its object the prevention of restriction or distortion of competition.
No penalty was imposed. The Office said:
"The Director General has no intention of imposing any administrative fines on M&N Camilleri Petrol Station, since the Office considers that [it] was benefiting
consumers by selling diesel at a lower price than the maximum retail price.
Ultimately the initiative introduced by [the petrol station] did not only increase price competition between retailers, but also increased consumer welfare. In view of this, even though the Office considers that [the petrol station] was party to an agreement which falls under Article 5, the Office does not want to deter any future initiatives from other retailers in a similar situation as that encountered by [the petrol station], which initiatives would have the ultimate goal of benefiting consumers."
The investigation was started following the publication of an article on Times of Malta on January 27, 2015.