Constitutional Court rejects complaint by small fuel distributors

NEWS 21.03.202317:09

The Constitutional Court has rejected a motion by the Association of Small Fuel Distributors to launch the procedure to check the constitutionality of government decrees which in 2021 and 2022 capped retail prices of oil products.

In the period from October 2021 to October 2022 the government adopted 19 decrees capping fuel prices.

The association argued before the Constitutional Court that by unilaterally capping the prices of certain oil products the government had exerted influence on the functioning of the internal market and undermined the guarantee of entrepreneurial and market freedoms, as well as “put excessive burden on small distributors resulting in a drop in their earnings to a level insufficient for sustainable business.”

They also said, among other things, that price caps did not refer to petrol stations on highways and that the government’s decree setting the maximum retail prices of oil products of 7 March 2022 was in force for as long as 92 days, contrary to the legal regulation about the maximum duration of such decrees of 90 days.

The government countered that the decrees capping only the prices of base petrol and diesel in 2021 and 2022 had relieved a financial burden of more than €580 million (4.4 billion kuna) on consumers.

The related budget revenue lost in the same period amounted to slightly less than €320 million (2.4 billion kuna) while the revenue loss for distributors was slightly more than €270 million (2 billion kuna).

The Constitutional Court ruled that the government’s decisions setting the maximum retail prices of oil products in the said period were necessary for value protection in those extraordinary circumstances, as regulated by the Oil and Oil Products Market Act, and that it considered as proportionate and acceptable in terms of constitutional law the way the government exercised its powers in line with the said law for the adoption of the decrees.