The Cassation Court supported OFAS in a judicial case with “Lenta”

On19 October 2016, the Arbitration Court of the North-West District pronounced legitimacy of the decision and determination issued by St Petersburg OFAS against “Lenta” Ltd.

In June 2015 an inspection carried out jointly with the Petersburg Prosecutor’s Office, the antimonopoly body found that suppliers of goods labeled as “groceries” entered into contracts with the retailers for providing marketing services.

The companies paid for promoting the goods on average around one third of their turnover, which ultimately affected the end costs of the products.

As a result, St Petersburg OFAS established that “Lenta” Ltd. violated Clause 2 Part 1 Article 13 of the Law “On Trade”and issued a determination to the retail chain to eliminate the violations.

The retailer disagreed with the decision and determination of the antimonopoly body and filed a lawsuit. The Court of First Instance and the Appeal Court supported the retail chain.

 The Cassation Court ruled to reverse the judgments of lower instances, therefore, supporting the position of St Petersburg OFAS.

“Hopefully, the Court ruling will be important not only for our OFAS but also for retail chains that should adjust their policy towards product suppliers”, emphasized the Head of St Petersburg OFAS, Vadim Vladimirov.

 “Lenta” Ltd. is fined 2 million RUB upon the fact of the violation.

The fine is also being appealed at Court.

Reference:

Clause 2 Part 1 Article 13 of the Law “On Trade” prohibits imposing conditions upon counteragents to require food products suppliers to pay for the right to supply goods to retail chains (in operating or opening facilities).