FAS determined the most frequent violations in the housing-and-utilities sector

24-09-2017 | 09:44

To prevent violations of the antimonopoly law, FAS recommends economic entities involved in heat supply, water supply and drainage to get acquainted with the relevant regulatory acts

FAS is executing the reform in control and supervision.

The new public control system will reduce administrative burden upon business, increase the quality of control-and-supervision functions and reduce the level of damages to competition caused by violations.

The Antimonopoly Service will publish information about the most frequent antimonopoly violations in advertising, tariff regulation as well as public procurement and public defence procurement.

On 25 August 2017, FAS published a press-release about the numbers and most frequent violations in public procurement in road construction.

Regarding complaints about the housing-and-utility sector, FAS exposes numerous violations when economic entities avoid or refuse to conclude contracts in heatsupply, water supply and drainage.

Deputy Head of FAS, Vitaly Korolev pointed out: “Such actions prevents development of business, restricts the rights of companies that are already in operation and threaten reliability and quality of heatsupply, water supply and drainage for consumers”.

“To prevent antimonopoly violations, economic entities should become acquainted with regulatory acts on the housing-and-utility sector. Especially with the provisions, where an organization cannot refuse to enter in a particular contract with an applicant”, added Deputy Head of FAS.

The next block of violations is exposed by FAS in the actions of the authorities. For instance, to get a tariff, a company submits document and materials to the regional tariff regulator in accord with the exhaustive list determined by the law.

If a company provides the full set of documents within the statutory period, the regulator cannot refuse to consider proposals on tariff-setting and return the documents and materials.

Vitaly Korolev stated: “An unlawful refusal by the regional regulator to set a tariff prevents company’s market operations, which is simultaneously a violation of the tariff law and a restriction of competition. Such actions of the regulator are in breach of Article 15 of the Federal Law “On Protection of Competition”.

To prevent such violations, tariff regulators must carefully observe the procedure and the rules established by the basic pricing principles.

Another type of violations is failure by local self-government bodies to organize tenders to select managing companies. The Government of the Russian Federation approved a decree on the rules for such tenders and cases when they should be conducted. Under the rules, if owners of the premises in apartment blocks have already chosen a managing company, a tender is not organized. Other reasons do not constitute the grounds not to organize tenders.

To avoid breaching the law, FAS recommends local self-government bodies to observe the rules and organize competitive selection of managing companies.

Vitaly Korolev concluded: “The reform of control-and-supervision activities will reduce the burden upon inspected entities, but it can be done if companies pursue bona fide conduct on the markets and do not breach the law of the Russian Federation”.