Headquarters for Joint Investigations of the Violations of the Antimonopoly Legislation in the CIS Countries
Headquarters for Joint Investigations of the Violations of the Antimonopoly Legislation in the CIS Countries was established in 2006. In the framework of the Headquarters’ activity, the Member-Countries started to conduct on the voluntary basis joint monitoring (investigations) of anticompetitive practice of companies performing on the territories of different CIS Countries.
The sessions of the Headquarters resulted in choosing the markets, the successful functioning of which provides the infrastructure, which is the basis for the CIS Common Economic Area and the social and economic well-being of those Countries.
In the previous years, the Headquarters considered the markets of air transportation, telecommunications, and retail. Nowadays the pharmaceutical market, the oil and oil products market and the grain market are in the purview of the Headquarters.
The market of air transportation within the CIS was selected at an initial stage as an example of a transboundary market.
The decision to initiate the joint investigations of the air transportation market was made at the 25th Session of the ICAP which took place at the 6th Conference of the International Competition Network in May 2007. As a result, the experts approved methodical approaches to the selection of the airlines routes, chose certain itineraries and drafted a standard request of information. Besides, it was decided to launch simultaneous inspections of the airlines by the competition authorities of the CIS Countries, which started in June 2007. Additionally, to receive information, the ICAP Members simultaneously sent requests for information to the selected airline companies.
The Russian Antimonopoly Authority sent requests for information to thirty six airlines, including certain foreign airlines and the CIS Countries’ airlines acting in the Russian market.
As a result of the investigation, the CIS Countries prepared the Report on the State of Competition in the Air Transportation Markets in the CIS Countries (hereinafter referred as the Report).
The investigators carefully examined and analyzed the international experience in the protection of competition in the air transportation markets, particularly the experience of the European Union, the most typical cases on violations of the antimonopoly legislation in the market of air transportation and airport services and the intergovernmental agreements on air communication in the CIS Countries. As a result of the investigation, the Countries elaborated the recommendations for the competition development at the air transportation market, including the proposals to maintain a non-discriminatory access to the natural monopolies’ services and to develop competition in potentially competitive segments of this market related to the market of air transportation. The implementation of such proposals has been one of the instruments of the development of the air transportation market in the CIS Countries.
The Report was considered at the session of the Commission on Economic Issues of the CIS Economic Council on July 9, 2008, at the session of the CIS Economic Council on September 12, 2008, and on November 14, 2008 at the session of the Council of the Heads of the CIS Countries. It received a positive evaluation.
In addition, another priority market selected for investigations was the market of telecommunications.
In 2008, the antimonopoly authorities of the CIS Countries, through the Headquarters, analyzed the state of competition on the telecommunications market. Based on the analysis, the Headquarters prepared the Report proposing possible measures towards developing competition and conducting antimonopoly investigations of roaming services. The Report was presented to and approved by the Council of the Heads of the Governments of the CIS Countries.
In the first six months of 2010, the antimonopoly authorities of the Republic of Kazakhstan and the Russian Federation initiated investigations on the markets of roaming services. The investigations were completed in October 2010; on the basis of the findings the FAS Russia found that three companies abused their market dominance, while the Agency of the Republic of Kazakhstan for Competition Protection arrived to the same conclusions with regard to several Kazakh companies.
Following up the outcome of the cases initiated by the FAS Russia and the Agency of the Republic of Kazakhstan for Competition Protection, the operators agreed to reduce the rates in inter-operator agreements between themselves and with other CIS operators.
As for the cases investigated by the FAS Russia, the Russian operators reduced their rates in December 2010 by two - four times. In 2012, prices continued going down but without involvement of the antimonopoly authorities.
After the rates for communications services in roaming were reduced significantly, cellular communication operators evaluated the advantages: the overall number of out-coming and in-coming calls, and SMS-messages multiplied; the data transfer traffic and the duration of conversations and the Internet-sessions in roaming increased. The operators can now earn on the volume of services rather than excessive tariffs.
Moreover, on the regular basis Member-Countries perform exchange of information about the facts of starting investigations of violations of competition legislation. This allows to detect potential objects for monitoring by the Headquarters. This activity could result in formulation of recommendations for solving the existing problems.
It is worth noting that over the years of its existence the Headquarters has established itself as an efficient body able to detect and investigate violations of the antimonopoly legislation in the transboundary markets within the CIS. This contributes to a deeper economic integration and to the elimination of barriers of the movement of goods and services in the CIS Economic Area.