Fourth antitrust legislative package sent to the State Duma

Government Decree 1793-р, of 11 September 2014, transmitted the legislative package titled The Development of Competitiveness and Antitrust Policy Advancement, which includes amendments to Federal Law 135-Fz, of 26 July 2006, The Protection of Competition, to the State Duma, where it was approved, on 23 October 2014, after the first reading.

The bill implements the road map on “competition support and antitrust policy advancement” approved in the Government Decree 2579-p, of 28 December 2012, and fulfills the commitments of the Chairman of the Government of the Russian Federation, Dmitry Medvedev, in response to the 26 June 2013 meeting of the members of the “Business Russia” national committee.

The amendments include:

1. exemptions from antitrust laws for cross-border businesses;
2. the inclusion of an agency agreement for “vertical agreements” that antimonopoly legislation prohibits;
3. exceptions that permit an economic entity to have a dominant position in the market for certain goods if its share does not exceed 35 percent, except when specified in the law and in the case of collective dominance;
4. corrections of certain provisions in the concept of “a group of persons”;
5. exemptions from antitrust actions not related to entrepreneurial activities, even if economic entities dominate the market or violate the rights of citizens or organizations;
6. an authorization for the Government of the Russian Federation to implement nondiscrimination rules for the access to goods of businesses not engaged in natural monopoly activities if they violate antimonopoly legislation;
7. a clarification of the concept of “the cartel” to include the actions of economic entities engaged in the procurement of goods in the commodity market;
8. an exclusion from the list of prohibited agreements that restrict competition for joint ventures that have the prior consent of the antimonopoly body;
9. an exclusion from the list of valid agreements and their pursuant actions for joint ventures that improve the economy, production, or technology or that invest directly in the Russian Federation, provided that they have the prior approval of the Federal Antimonopoly Service (FAS);
10. detailed clarifications in the procedures for signing agreements with financial organizations;
11. a ban on the creation of state and municipal companies without the preliminary agreement of the FAS;
12. exceptions to the obligation to create a list of economic entities that have market shares of more than 35 percent for products;
13. the establishment of a collegial body, within the FAS of Russia, to summarize and clarify the practical application of antimonopoly legislation and to review the decisions and orders of the territorial bodies of FAS Russia;
14. the introduction of obligations to provide information containing tax secrecy;
15. the expansion of the scope of cautions and warnings for minor violations;
16. a requirement to inform the FAS about joint ventures involving competing companies;
17. the establishment of requirements for a market analysis with sufficient scope and depth to reveal antimonopoly legislation violations;
18. an exception in the grounds for terminating an antitrust violation case when the offender corrects the violation and its consequences;
19. limitations not only on the circumstances for turnover-based administrative fines, under the Russian Code on Administrative Violations, but also on forfeitures to the national budget of income from antitrust violations;
20. the introduction of provisions for reductions in administrative responsibility for individuals assisting the investigation of antitrust violations in the Code of Administrative Offenses.

The proposed amendments had a mixed response from economic experts and lawyers. During the negotiation of the draft law about the amendments, there were many positive and negative opinions focusing on the proposed new statutes from the representatives of big business. The antitrust agency also took into consideration some of the opinions of the expert community during its preparation of the amendments. Thus, in the process of negotiating the package of amendments, those who drafted the legislation excluded the control provisions for setting tariffs, the introduction of obligations to publish trade monopoly practices, and the dissemination of antimonopoly regulation of intellectual property because of the influence of business entities.