Igor Artemiev discussed developing the antimonopoly law and policy in the Russian Federation at OECD

On 15 June 2016, the Head of FAS Igor Artemiev addressed the Competition Committeeof the Organization for Economic Cooperation and Development (OECD). His speech focused on developing the competition law and policy in the Russian Federation.

First of all, Igor Artemievinformed theparticipants of OECD Competition Committee that in 2015 FAS, following the Order of the President of the President of the Russian Federation of 21 July 2015, was assigned the tariff regulation functions from the abolished Federal Tariff Service. Thus, FAS is becoming an economic macro-regulator with a considerable number of functions that adding each other generate a synergy effect. Combining the powers of antimonopoly enforcement, control over public procurement and tariff regulation enables comprehensive evaluation of the market trends and choosing the most efficient remedies against monopolistic actions.

Igor Artemievpointed out that FAS builds up tariff regulationon the basis of pro-competitive approaches, while the main regulatory principles are optimizing expenses in the regulated sectors, orientating towards consumer interests, and ensuring infrastructure access on non-discriminatory conditions. The Head of FAS pointed out that for a regulated company to index the tariff it must devise in-house programs to reduce operational, investments and financial-and-economic costs and get rid of non-core assets. “We insist on terminating tariff regulation for the sectors in competitive conditions”, pointed out Igor Artemiev.

All measures proposed by FAS to improve the system of public procurement and procurement by large companies and result-oriented efforts to control and supervise enforcement in this field are aimed at competition development.

Igor Artemievreported on pursuingthe recommendations given by OECD Competition Committee to the Russian Federation in 2013 when OECD recognized that the antimonopoly law and competition policy in the Russian Federation meet the high OECD standards. A significant contribution to executing the recommendations was made by the “forth antimonopoly package” of amendments to Russian antimonopoly law that came into effect in January 2016. The “forth antimonopoly package” has such important novelties as abolishing the Register of persons with over 35% market share, expanding the institutions of warnings and admonitions as well as important procedural changes, particularly, FAS collegial body can now review decisions made by FAS regional bodies. Igor Artemievalsostated that to fulfill OECD recommendations, criminal liability for repeated abusing market dominance was abolished and employment of economic analysis in investigating antimonopoly cases is being continuously improved.

Igor Artemievpaid special attention to international cooperation inenhancing the law and enforcement practice. He pointed out that FAS is always open for cooperation with competition authorities across the world and for discussing the key issues in different formats, including EAEU, CIS, BRICS, ICN, OECD and UNCTAD.

Further, Igor Artemiev informed the session participants that on19 May 2016, in St Petersburg, BRICS signed a Memorandum of Understanding on cooperation in the field of competition law and policy. The Memorandum brings collaboration between the competition authorities of BRICS countries to a whole new level. In particular, it provides for creating a Working Group to study the issues of competition in socially-important sectors of BRICS economies.

“Members of the Working Group representing the antimonopoly bodies from BRICS countries intend to invite top executives of the largest transnational corporations to its meetings for a constructive dialogue, to find the ways to suppress unfair practices of doing business and develop the best practices in the interests of consumers in our countries”, said Igor Artemiev.

Outlining FAS directions and priorities in international cooperation, Igor Artemievemphasized that one of the mostimportant areas is result-oriented collaboration with foreign competition authorities in investigating cases on violating the antimonopoly law. As one of the examples, Igor Artemiev described a case against “Google” where FAS issued a determination to “Google” to eliminate the violation of the Federal Law “On Protection of Competition” in the part of abusing dominance on the market of preinstalled application stores in “Android” OS. The Arbitration Court of First Instance supported the position of Russian competition authority. In this context Igor Artemievpointed out thatmany competition authorities may be interested in cooperation in that field, in understanding the logic of the investigation and the system of evidence used by FAS to make a decision on the case.

In 2015 FAS also investigated a case against several largest world shipping container companies upon signs of concerted actions on the market of container shipping on the Southeastern Asia – St Petersburg route. As a result of the investigation, FAS found that several largest shipping container liners violated Article 11.1 of the Federal Law “On Protection of Competition” (concerted actions). Similar investigations were also carried out by the European Commission and China’s antimonopoly authority. Efficient exchange of information and effort coordination are, however, complicated in such cases due to absence of an international legal framework.

At the same time, in its enforcement practice FAS has successful examples of collaboration with foreign competition authorities. For instance, investigating and exposing a cartel on the wholesale market of supplying salmons and trout from Norway became possible through collaboration between FAS and Norway’s competition authority. Investigating an anticompetitive agreement between Russian importers of Vietnamese swai, FAS worked in active cooperation with the competition authority of Vietnam.

Finally, Igor Artemievemphasized that in the modern conditions efficient enforcement is possible only through joint efforts of competition authorities from different countries.  FAS is always open to cooperation on various issues of competition law, policy and enforcement.