26. oktober 2011
On 26th October 2011, The Danish Competition Council (DCC) has adopted a commitment decision, cf. Section 16a of the Danish Competition Act, to prevent competition restrictions in the Danish market for installation of automatic sprinkler systems. The decision concerns DBI’s guideline RL001 that is used to certify companies to work on automatic sprinkler systems.
The commitments imply that a clause in RL001 that requires certified companies only to use own permanently hired personnel on sprinkler assignments is removed from RL001 and that DBI informs all relevant companies, authorities and organizations about the change to the guidelines It is the belief of the DCC that the commitments will have the same effect as if the case were to be closed by way of an injunction.
DBI’s guideline RL001 sets up different requirements that companies have to fulfill in order to be certified to work on automatic sprinkler systems. RL001 was originally drafted by a group of representatives from organizations with interests in fire protection with the aim of ensuring a certain degree of quality of sprinkler systems.
The preliminary investigation showed that the guideline is a de facto industry standard in the sense that the vast majority of contracting authorities and building owners request that companies installing sprinkler systems be certified under RL001 and, thus, in practice it is very difficult for non-certified installation companies to win sprinkler installation contracts in Denmark. Furthermore, the preliminary investigation showed that the relevant market was likely to be the Danish market for projecting, installing, servicing etc. of automatic sprinkler systems. Based on information from the involved parties, it is estimated that at least 90 per cent of the work on sprinkler systems in Denmark is conducted by companies certified under RL001.
Based on the preliminary investigation, the DCC found that the clause regarding own personnel is likely to restrict competition for, in particular, larger contracts, where there is a need to hire personnel in addition to the company’s permanently hired personnel. The clause de facto favors companies close to the construction site and large companies which makes it less attractive for foreign companies and smaller companies to get certified and operate in the Danish market and thereby the clause is likely to deter entry of such firms to the Danish market.