On May 18, 2020,[1] the TAR Lazio rejected the applications for annulment of the ICA decision of February 13, 2019, brought by Airgreen S.r.l., Star Work Sky S.a.s., Elitellina S.r.l., Elifriulia S.r.l., Babcock Mission Critical Services Italia Sau, Heliwest S.r.l., Eliossola S.r.l. and the Italian Helicopter Association. By the said decision, the applicants were fined in a total amount of approx. €67,000,000 for anticompetitive conduct infringing Article 101 TFEU with regard to the award of contracts for forest fire-fighting activities.[2]

The TAR Lazio, however, upheld the application filed by Air Corporate S.r.l. and annulled the Decision in its regard.[3]

The ICA decision

The ICA established the existence and operation of two separate cartels. First, Airgreen, Elifriulia, Eliossola, Elitellina, Heliwest and Star Work Sky were found liable of market-sharing conduct in the context of tenders for helicopter forest fire-fighting services, by rigging bids in the tenders organized between 2005 and 2018 at the regional level by the Dipartimento della Protezione Civile (Civil Protection Department), i.e. the national body in Italy that deals with the prediction, prevention and management of emergency events in Italy. The cartel members agreed not to offer significant rebates (which in many cases were lower than 1%). As a result, contracting authorities ended up paying higher prices for the relevant services.

Secondly, Airgreen, Babcock Mission Critical Services Italia S.p.A. (jointly with its parent company Babcock Mission Critical Services International S.A.), Elifriulia, Eliossola, Elitellina, Heliwest, Star Work Sky and Air Corporate entered into a price-fixing agreement within the Italian Helicopter Association, of which they were all members. The said companies agreed on a price list for aerial work services and passenger transport, divided by type of helicopter. In particular, the price list aimed to influence contracting authorities with regard to the setting of prices for helicopter services in their invitations to tender, as well as to provide indications to commercial customers. The ICA found that the cartel operated since 2001 through until August 2017.

The TAR Lazio judgments

The TAR Lazio upheld most of the ICA’s assessment. It took the view that the ICA correctly defined the relevant product market as national in geographic scope. With respect to the first agreement, even though the tenders were organized at the regional level, the ICA showed that companies participated in tenders even far away from their place of establishment. With respect to the second cartel, the TAR Lazio concluded that the price-fixing agreement applied uniformly to several services offered throughout the whole country.

The TAR Lazio, moreover, took the view that the ICA provided sufficient evidence of the wrongful conduct, in particular, e-mail communications between the cartel members. In addition, the ICA analyzed their bidding behavior in several tenders and found a “chessboard pattern”, for which the applicants failed to provide persuasive explanations other than their plan to distort competition.

The TAR Lazio clarified that the price-fixing cartel did not overlap with the bid rigging one. Not only were the parties different, but also the two agreements pursued different goals. Moreover, the price-fixing cartel was found to have anticompetitive effects even on tenders for helicopter rescue services, with regard to which the ICA did not find any bid rigging conduct. The TAR Lazio upheld the ICA’s demonstration that the price fixing scheme achieved its objective in both the Sardinia and Liguria Regions. Indeed, the contracting authorities of both Regions referred to the tariffs set by the Italian Helicopter Association as benchmarks to determine the budget for their procurement procedures concerning fire-fighting and helicopter rescue services.

As a consequence, the TAR Lazio upheld the ICA decision and ordered the applicants to pay costs.

As to the annulment of the decision with respect to Air Corporate, a company active mainly in the market for the provision of helicopter transport services to private clients, the TAR Lazio held that the ICA failed to indicate the harm to competition caused by the applicant’s conduct. In its assessment the ICA focused on the harm to competition on the markets for the provision of fire-fighting services. Although it also referred in passing to “passenger transport services”, the ICA decision failed to explain whether the price-fixing agreement (the only anticompetitive conduct of which Air Corporate was accused) concerned also the provision of transport services to private clients, or whether the market for transport of private clients was to be considered distinct from the market for “passenger transport services” in which the other cartelists operated.

[1]              TAR Lazio Judgments Nos. 5261, 5263, 5265, 5266, 5264, 5267, 5272 and 5274/20.

[2]              ICA Decision No. 27563, Case I806 – Affidamento appalti per attività antincendio boschivo.

[3]              TAR Lazio Judgment No. 5275 of May 18, 2020.