The Federation Council unanimously passed the draft law on differentiating punishments for anticompetitive agreements

14-04-2017 | 13:31

The law changes Article 14.32 of the Code on Administrative Violations

On 12 April 2017, the Federation Council unanimously passed the draft law on differentiating punishments for anticompetitive agreements and concerted actions, based on the level of their public danger.

Article 14.32 of the Code of the Russian Federation on Administrative Violations introduces administrative liability for anticompetitive agreements which lead to restricting competition, unlawful concerted actions or coordinating economic activity.

Various types of anticompetitive agreements differ by the degree of their public danger; therefore, there is a need to differentiate fines for such types of violations.

FAS has drafted a law, which provides for reducing fines pro rata to reduction of the public danger of such agreements.

For instance, the highest level of administrative liability will be set for cartels:  for officials – fines from 40,000 RUB to 50,000 RUB or disqualification for a period from 1 to 3 years; for legal entities – fines from 0.03 to 0.15 of the income of the violators from selling goods on the market.

Administrative liability for “vertical agreements” will be diminished. Draft amendments to the Code on Administrative Violations establishes administrative liability for officials –  fines from 15,000 to 30,000 RUB, or disqualification for up to one year; and for legal entities – fines from 0.01 to 0.05 of the income of the violators from selling goods on the market.

Administrative liability for the authorities concluding such agreement will remain unchanged: fines for officials from 20,000 RUB to 50,000 RUB or disqualification for up to three years.

The State Duma passed the document in the 3rd reading on 7 April 2017.

“I’d like to draw your attention that combating cartels remains a priority for the Antimonopoly Service. Such anticompetitive agreements lead to an artificial growth of prices, absence of new and higher quality goods. No doubt, adopting the law will facilitate cartel countering”, said Deputy Head of FAS Sergey Puzyrevsky.