Estonian Competition Authority

Press release: In the dispute over the price of oil shale the court ruled in favor of the Competition Authority

With its decision of October 31, Tallinn Administrative Court dismissed the claim of Viru Keemia Grupp AS and VKG Oil AS (hereinafter VKG) against termination of the supervision proceedings by the Competition Authority on 19 October 2015. The Competition Authority found that the price of oil shale for 2013-2015 offered by Eesti Energia group to VKG was in compliance with the Competition Act. The court ruled that the conclusions of the Competition Authority regarding termination of the proceedings were legitimate.

Oil shale is mainly used for production of electricity and shale oil. Eesti Energia and VKG are the two largest oil shale users in Estonia. Eesti Energia group has been entitled to extract approximately 75% of the oil shale, which is why it is the largest mining company in Estonia by far.

VKG is entitled to extract oil shale in a smaller volume, and under certain conditions it may lack it. In this situation, VKG has historically bought the missing quantity of oil shale from the Eesti Energia group.

VKG found, however, that the price of oil shale offered by the Eesti Energia group was discriminatory. The Competition Authority found that the prices offered were reasonably connected with high energy prices on international markets during the period under review and that sale of oil shale by Eesti Energia was not damaging to competition.