Illyrian Guard, the state-owned company that violates free competition

Author: Melsena Danglli

In early April 2019, the Government set up a new police structure, the Illyrian Guard, which would operate in the market as a trading company to provide paid services to physical and legal persons, public and private; a wholly state-owned structure operating as a private company.

While almost all other public services have been privatized, the government decided to create a public company to provide private services.

Illyrian Guard entered the market at an awry time for private security companies.

Ongoing robberies of banks and other foreign currency deposit agencies culminated with the super robbery inside the Mother Teresa Airport. The Government explained this unprecedented intervention, according to specialists in the market, due to the poor service of private companies who hired untrained and underpaid people.

Illyrian Guard would recruit human resources among those leaving the State Police ranks and consequently be better trained, and have higher standards of work and pay.

The state “violently” enters into a free market.

Its creation seems to be in the public interest, as it will provide greater security for the institutions it protects. However, does this “private police” with state capital impede free competition? Article 10 and 11 of the decision to establish the Illyrian Guard state: “All institutions and public entities that operate state-owned facilities whose maintenance and security must be provided by specialized services for this purpose, shall address the following request to this company to benefit the physical safety and security services.

If this company decides on the impossibility of providing the required service, public institutions and entities may provide this service in accordance with the relevant legislation in force ”.

Illyrian Guard has been launched into a free-market with the states support that not only covers costs and investment, but also orders entities to seek security services, first with this company. Only if it will refuse it because of the impossibility, then they can request services from other private companies.

Ledio Braho is a lawyer. He thinks that the creation and operation of this company is illegal.

“This decision is in violation of the Public Procurement Law (PPL), as it excludes from public procurement procedures all contracts for the service of physical protection and security of public entities,” said Braho, when asked about this issue.

This company does not behave like a free operator in a competitive market. It penetrates the market through obligatory orders, obtaining  services that it would need to compete for in order to win them.

“The decision distorts competition, as it arbitrarily favors Illyrian Guard, which is created with state capital. According to the Decision of the Council  of Ministers, Illyrian Guard has absolute priority in concluding contracts for the provision of physical and security services. This too contradicts Law no. 9374, which states that “except the cases forseen differently by this law, any assistance granted by state sources shall be prohibited”. added Mr. Braho.

Private companies, which have so far operated in the safety and physical security sectors, have been significantly affected by the “violent” launch of Illyrian Guard. Many have lost their agreements with state institutions, as this government decision forces institutions to seek service from Illyrian Guard. It is worth mentioning the case of QSUT, which terminated the contract with Ndreu Security and entrusted the security of the institution to Illyrian Guard. This market intervention has a significant economic impact.

Many private companies, unable to get into the bidding process, are being forced to lay off their employees. Many institutions have also been ordered to replace security companies with Illyrian Guard. This order was rejected only by banks and some diplomatic services, as well as international institutions, which continued to operate according to market rules through tendering procedures.

Does Illyrian Guard offer more security?

In addition to the legal discrepancies mentioned above, Illyrian Guard has been supplied with weapons by the State Police (which is prohibited); there is no official uniform and the police of this structure do not have a register with the Police Directorate. Illyrian Guard lacks capacity, no operating rooms, nor do they have an authorization from AKEP to use radio waves.

During the creation of the Illyrian Guard, Prime Minister Edi Rama stated: “This new structure will make a significant contribution to clearing a private police jungle that is often absorbing public needs and often fails to provide the services that can be provided by the State Police. Illyrian Guard police officers will be prepared and trained. ”

But where did the state-owned company Illyrian Guard get its employees?

Some of the private company police officers, whether fired or not, have joined the Illyrian Guard to stay employed.

We have a list of over 100 Ndreu Security police officers who are already part of the Illyrian Guard. It is the same “ill-trained” police officers who changed uniforms.

The association of private security companies has sent a letter to the European Commission, complaining that Illyrian Guard is violating and damaging the SAA (Stabilization and Association Agreement).

The EC has taken into consideration Union Security Albania’s complaint.

The union has also sent a letter to the Competition Authority, complaining of Illyrian Guard’s distortion of competition. The response sent by the Competition Authority reads: “The Competition Commission decided to recommend to Illyrian Guard SHA to comply with the competition principles and legal provisions deriving from Law no. 9121, dated 28.07.2003 “On Protection of Competition”, as amended and in particular the observance of Article 9 of this Law, but this recommendation has not produced any effect.

Union Security Albania has sued the Internal Affair Ministry and Illyrian Guard. During the first hearing, the Internal Affair Ministry lawyer defended herself saying that Illyrian Guard was born out of necessity because the private police service had problems.

Meanwhile, we learned that the Director of Illyrian Guard, Henrik Elmazi, was the former president and technical director of Alsig Group, a company that operates in the field of private security.

However, the Administrative Court of Appeal has quashed the claims of the Union Security Albania.

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