A drastic sanction fell on Sociedad Eléctrica del Sur Oeste SA (Seal), an electrical company that operates in Arequipa. Indecopi, through the Commission for the Defense of Free Competition (CLC), sanctioned it with a fine of 1,000 UIT (tax tax units), equivalent to 4 million 400 thousand soles.
According to Resolution 052-2021 / CLC-INDECOPI, Seal was sanctioned by “abuse of dominance position, by implementing a discriminatory treatment to its clients who are within the group of ‘free users’”From the Arequipa region.
It should be noted that this decision is of the first administrative instance, so the company can appeal to the Specialized Chamber for the Defense of Competition of the Indecopi Court.
What is the penalty for
In the investigated market there are three types of electricity users: the regulated, the free and, finally, users who have a demand between 200 kW and 2500 kW, who can decide to remain as regulated or migrate to free status (they are generally small businesses and industries).
It should be noted that in the case of ‘regulated users’ the annual consumption of electrical energy is not more than 200 kW and they hire the distributor in the area; in this group are the homes. Meanwhile, ‘free users’ they consume more than 2,500 kW per year and contract the supply with any generator or distributor. In this last group are the big enterprises.
According to the resolution, Seal incurred in abuse of dominance position when implementing unequal conditions to the ‘regulated users’ who wanted to pass to the condition of ‘free’. According to the Indecopi Commission, Seal gave discriminatory treatment to those users who chose to contract with other companies.
It was precisely a competing company that filed this lawsuit. Is about Atria, a firm dedicated to the generation and supply of electricity to free users.
According to current legislation, regulated users who wish to change their status to free must notify their current supplier one year in advance, in this case Seal. Likewise, to be ‘free’ they must have adequate power measurement, protection and limitation equipment.
After an exhaustive investigation, the Commission concluded that Seal implemented a policy to exempt the one-year notice period and not require the installation of the equipment from regulated users who switched to free, all this as long as they committed to maintaining said company as a supplier.
Nevertheless, Seal did require meeting deadlines and installing equipment from those who switched to free users, but who chose to contract with Atria.
The Commission also determined that the sanctioned company did not have the right to introduce discriminatory conditions among its regulated users who were trying to switch to the free user regime.
Seal’s conduct – maintains the Commission – allowed it to increase its share in the market for the supply of free users, both in percentage of new users and of total contracted power. All this ensured – between 2016 and 2020 – to obtain significant benefits, by charging average prices 21.5% higher than the weighted price charged by the other suppliers.
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