Experts from different countries discussed independence and protection of economic regulators from unlawful influence
On 2 November 2016, a FAS delegation led by Deputy Head of FAS Anatoly Golomolzin took part in the 7th session of the Network of Economic Regulators, at the Organization for Economic Cooperation and Development (OECD) in Paris (France).
Introductory remarks were given by NER OECD President, Luigi Carbone, whose Report “Being an independent regulator” was drafted by OECD experts on the basis of the information submitted by OECD member-states and observers.
According to the Report, factors affecting regulator independence are: unlawful intervention of the state, absence of dialogue with business and other NGOs, issues of personnel organization, and budget restrictions. An intention was highlighted to continue the study based on dividing external (the law, influence of interested persons and organizations, etc.) and internal factors (organization the work of personnel, salaries, etc.) that determine regulator independence.
The next speaker was former Head of UK railways regulator, Thomas Windsor. His main conclusions included a degree of performance efficiency and trust from business and the society. Mr. Windsor said that the more business and society trust a regulator, the more difficult it is to deprive the regulator of its independence. He also pointed out that it is important for regulator to reach both legal and behavioural (secured in practice) independence.
If there are no doubts about independence from business and groups of influence, possibilities of independence from the state are far from being always obvious. Head of Department of the German Federal Agency for regulating the electric power industry, gas, telecommunications, post and railways, Annegret Groebel, mentioned that discussing unlawful influence upon regulators, it is necessary to factor in the specifics of every OECD member-state and observer. Independence from other authorities may not even conform to the Constitution.
The arrangements were reached that participants would submit their proposals on further work to NER OECD Secretariat by 18 November 2016.
Deputy Head of FAS Anatoly Golomolzin pointed out: “FAS independence as a regulator from other bodies is additionally supported by FAS competence in antimonopoly control whether the authorities observe the laws on competition protection and public procurement. Regarding economic entities: for already a quarter of a century FAS independence from economic entities has been confirmed with the practice of investigating cases against all largest monopolies in Russia. Also, under the frame of the new tariff policy we practice discussing all aspects of tariff-setting methodology at the Methodological Council on Tariff Regulation. In addition, the tariff regulator has Consumer Councils, whose involvement facilitates a balance of interests with holders of natural monopolies. All this in entirety ensures trust from the state, business and the population”.