Appeal Court confirmed legitimacy of FAS warning to the Government of the Ivanovo region
On 24 August 2017, the 9th Arbitration Appeal Court in Moscow confirmed legitimacy of the warning issued to the Government of the Ivanovo region.
In June 2016, the Government of the Ivanovo region adopted amendments to the procedure for granting subsidies for compensating some costs of agricultural producers per 1 kg of milk sold and (or) shipped for own processing.
Under the amendments, the annual subsidies allocated for this type of support from both the federal and the regional budget are granted to agricultural producers to the full in Q1 of the current year. Earlier subsidies were granted to agricultural producers quaterly during a year.
In FAS opinion, this novelty could have led to discriminating those raw milk producers, whose territory was recognized a contamination zone for cattle leucosis in Q1 of the current year. Further on throughout the same year, however, those agricultural producers could meet the requirement set by the Subsidy Procedure in full.
FAS issued a warning to the Government of the Ivanovo region to terminate the above actions by making the relevant amendments to the Subsidy Procedure.
Although the Order approving the procedure cased to be in force, the regional authorities appealed FAS warning. The Court of First Instance and the Appeal Court confirmed legitimacy of the warning.
Deputy Head of FAS Department for Control over Chemical Industry and Agro-Industrial Complex, Andrey Yerin pointed out: “The warning was designed to ensure non-discriminatory access to the subsidies granted to raw milk producers in the Ivanovo region”.