Digest of the best cases of regional antimonopoly offices against the authorities
FAS Presidium determined the best cases of regional antimonopoly offices under Articles 15-21 of the Federal Law “On Protection of Competition”
The collegial body of the antimonopoly authority gave the first place to the case of Rostov OFAS against the Federal Accreditation Service for the South North Caucasus and Crimea Federal Districts (Rosaccreditation Regional Office),”Gukovstroi” Ltd. in the group of persons with an individual entrepreneur Ya. Osadchenko. The Rosaccreditation Regional Office deliberately overrated the initial (maximum) contract price at auctions and made sure that contracts were signed with the entities affiliated with the Head of the ordering party that was the key link and coordinator of anticompetitive relations.
Rostov OFAS sought a criminal sentence for the Head of the Rosaccreditation Regional Office. The staff of the antimonopoly body acted as witnesses during the criminal case investigation and judicial proceedings, outlining the position of the Commission of Rostov OFAS in more details.
The TOP-10 cases in 2016 included two cases of Moscow Regional OFAS. The second place was assigned to a case against local self-government bodies and officials of Sergievo-Posad District. The staff of Moscow regional antimonopoly office developed a special practice how to suppress actions when the authorities avoid the established procedures for allocating plots for housing construction that can now be used by all regional FAS offices. Moscow Regional OFAS proved at Court that the Head and the Council of Deputies of Zvenigorod Town District had adopted acts on the tender procedure to select a specialized organization for the right to enter into property leasing and buying-and-selling contracts, establishing the bid assessment criteria to give advantages to one of the predetermined persons.
A case of Moscow OFAS is on the 3rd place. OFAS successfully defended at Court its decision on a case restoring the right of a lessee, who had entered into a public property lease contract not based on tenders (prior to Article 17.1 of the Federal Law “On Protection of Competition” coming into force), for concluding a lease contract for a new period. In the course of the case processing in three Court instances, a detailed judicial interpretation of consolidated Parts 1, 3, 9, 10 Article 17.1 was developed that can now be used by antimonopoly bodies to protect the rights of bona fide lessees.
The TOP-10 best cases of regional FAS offices against the authorities also include cases of Perm and Murmansk OFAS (the 5th and 7th places accordingly). In the Kama area the “10th Detachment of the Federal Fire Service in the Perm region” prevented operations of around 100 organizations. In particular, only two accredited centres could connect devices of “Strelets-Monitoring” software-hardware complex of the organizations to the anti-fire control panel of the Ministry of Emergencies. Both centres had the same representative who simultaneously was a member of the Working Group formed by the “10th Detachment of the Federal Fire Service in the Perm region”. If an organization applied to other, non-accredited companies for assembling “Strelets-Monitoring” software-hardware complex, the representative of the “10th Detachment of the Federal Fire Service in the Perm region” refused to connect the facility based on an inspection acts drawn up on behalf of the accredited organizations. Along with the Perm region, similar situations were typical for the Omsk, Volgograd, Samara, Rostov and Tambov regions where Courts took the side of the units of the Ministry of Emergencies considering the appeals on decisions made by regional antimonopoly offices. In view of the negative judicial practice, Perm OFAS found that the “10th Detachment of the Federal Fire Service in the Perm region” violated Part 3 Article 15 of the Federal Law “On Protection of Competition”. After that the company voluntarily eliminated the exposed violations and the Main Department of the Ministry of Emergencies in the Perm Region made changes to the relevant documents regulating the procedure for activities of the Working Groups by Detachments.
In the Murmansk region OFAS staff established with the minimum direct evidence that Acting Head of ZATO Authority, Severomorsk, reached an oral agreement with road carriers. He was the founder of the companies in question. To give advantages to his companies in a tender for selecting a carrier through assigning them additional scores and in order to eliminate a competitor from the market, the violator included an additional criterion for evaluating the bidders: “economic indicator”. Murmansk OFAS was able to prove for the first time that this criterion was anticompetitive. The case materials describe indirect evidence of the violation in detail.
The 6th position in the TOP-10 cases against the authorities is assigned to Tver OFAS. The antimonopoly body established that the Ministries of healthcare, industry and investment technologies of the Tver region as well as a number of companies reached and implemented arrangements that led to an unreasonable growth of the initial (maximum) price and guaranteed winning with the maximum possible price offer. The outcome of the anticompetitive agreement was not only restricted competition but also inefficient spending of budgetary funds (over 30 million RUB). Tver OFAS was able to entrench the practice of proving participation in the anticompetitive agreement of not only direct tender participants but also other persons, whose conduct affected the tender conditions and outcome. This practice can be replicated and used by other FAS regional offices.
The ranking of the best cases of FAS regional offices under Articles 15-21 of the Federal Law “On Protection of Competition” in 2016 is closed by the cases investigated by Bashkortostan, Yaroslavl, and Samara regional offices. Bashkiria OFAS exposed a violation of Clause 4 Article 16 of the Federal Law “On Protection of Competition” by Sterlitamak Authority. Yaroslavl OFAS (the 6th rank) ascertained violations in the actions of Yaroslavl Mayor’s Office that had failed to perform tender procedures for exercising research work aimed at optimizing the route network of Yaroslavl passenger transport. The experience of Yaroslavl OFAS, presented in the decision and judicial cases, will be useful to resolve the issues of supporting competition both in the field of organizing passenger transportation and rendering budget-funded socially important services. A decision of Samara OFAS on a case against Tolyatti State Duma was supported by the Supreme Court of the Russian Federation. Samara OFAS established that Tolyatti State Duma had approved different coefficients to calculate the lease fee for land plots without delineated ownership.