The Competition Authority has fined EDP and Sonae a total of €38.3 million, accusing the companies of agreeing an illegal ‘non-aggression pact’ in a 2012 partnership for an electricity promotion campaign.
Four companies were involved: EDP, EDP Comercial, Sonae and Modelo Continente Hypermarkets.
In order to determine the fines under the anti-competition laws, the Competition Authority looked at the turnover of the companies and the guidelines for the calculation of fines.
EDP and Sonae entered into a non-aggression pact when they agree not to enter each other's markets, especially Sonae, which undertook not to exploit the deregulation of the electricity market in Portugal and start up as a supplier.
EDP Comercial is the company that will have to cough up the most with a fine of €25.8 million.
EDP (Energias de Portugal) was fined €2.9 million, while Sonae and Modelo Continente Hypermarkets will have to pay €2.8 and €6.8 million, respectively.
The companies involved already have reacted to the fines with both EDP and Sonae saying they are “surprised by the decision.”
"The Competition Authority’s decision and the grounds for it are being analysed by the EDP group, which will not fail to avail itself of the legal means at its disposal in order to safeguard its rights. It will be stressed at the outset that the decision will be appealed at the Competition Tribunal due to the huge injustice it represents, coupled with the grave errors that underlie it," EDP said in a statement to the market on Friday evening.
The energy supplier, led by multi-millionaire António Mexia, said he did not understand the reason why five years later the Competition Authority decided that the pact between EDP and Sonae was not legal when at the time it did not show any concern.
"At the beginning of the implementation of this discount campaign, EDP notified the Competition Authority of the agreement and the authority did not make any comments or express concern regarding competition concerns or doubts - on that occasion or over the years that followed," claimed Mexia.
Sonae says the decision of the Competition Authority is not valid as the two companies are not competitors. Its management is certain that the courts will find in favour of Sonae and dismiss the fine.
According to Luís Reis, the head of Sonae, the decision is not viable. Missing the point deliberately, he commented that EDP and Sonae do not operate in the same markets, "neither EDP has, had or will have supermarkets, nor does Sonae aim to sell energy."
Luís Reis also rejected the idea that the agreement made between EDP and Sonae in 2012 served to disadvantage consumers, stating that the joint marketing scheme allowed consumers to benefit by more than €6 million.
