ANDREY TSYGANOV: TRUSTEES THAT WILL BE INVOVLED IN CONTROL OVER ECONOMIC CONCENTRATION MUST BE INDEPENDENT AND HAVE A NECESSARY LEVEL OF COMPETENCES

Deputy Head of FAS Andrey Tsyganov explained how the new institution of trustees will function at a meeting of the Antimonopoly Club organized by the “Competition and Law” Journal. The first meeting concerning the “fifth antimonopoly package” took place on 14 November 2018.

According to Deputy Head of FAS, it is expected that trustees will be used only to monitor executing of the orders and injunctions issued by FAS upon the results of considering mergers and other economic concentration actions.

“At the same time, engaging trustees will be an exception rather than the rule. This institution is designed for complex cases”, emphasizedAndrey Tsyganov, dispelling the worries of the business-community that the institution would also be implemented to monitor orders and injunctions on antimonopoly cases.

Andrey Tsyganov assured that FAS has a clear understanding that trustees should meet the general requirements of:

― Independence

― Necessary level of competence and professionalism in a particular sphere

― No affiliation and competitive relations with the transactions participants.

In the opinion of Deputy Head of FAS, Russia can embark on a European course when trustees are chosen not by regulators but by transaction applicants in the process of discussing possible obligations with the regulator. The transaction parties also finances the engaged trustees:

“The money for trustee payment must be allocated by companies that are interested in the transaction, legal conduct of business and minimizing the risks, rather than by the state”.

As an example, Andrey Tsyganov gave antimonopoly compliance: companies themselves bear the costs of implementing an in-house risk prevention system and maintaining it in a working condition.

The parties will determine trustee remuneration independently, in accord with the conditions of a civil law contract. Contacts should also specify access to commercial information and liability.

The meeting moderator, Elena Sokolovskaya, a principal expert of the “Competition and Law” Journal, asked whether FAS is going to pass a by-law with a more detailed regulation of trustee liability after the fifth antimonopoly package comes into force.

“I do not see any reasons for additional regulation so far”, responded Andrey Tsyganov. “Trustees will be liable similarly to experts engaged in investigating antimonopoly cases under a civil law contract”.

In his opinion, it is much more important to remember about the reputational risks of unfair conduct.

Along with the trustee institutions, the embers of the Antimonopoly Club discussed new terms proposed in the fifth antimonopoly package – “digital platform” and “network effect” and how these concepts can apply in practice, and qualitative-and quantitative criteria for determining dominance in the digital” sphere.