CASSATION COURT CONFIRMED LEGITIMACY OF THE DECISION MADE BY ST PETERSBURG OFAS

“R.I.P.” leases premises in the crematorium mortuary free-of-charge to the “Forensic Medical Examination Bureau” state entity and in return gets the priority access to information about potential customers if its services in breach of the antimonopoly law

Arbitration Court of the Northwestern District pronounced legitimacy and reasonableness of the decision made by St Petersburg OFAS against “Forensic Medical Examination Bureau” St Petersburg State Budgetary healthcare Entity and “R.I.P.” Ltd.

Earlier, the antimonopoly body found that:

– By an order of the Property Relations Committee, the premises in the crematorium mortuary (Build. A., 12, Shafirovsky Ave., St Petersburg) are possessed by “Funeral Services” State Unitary Enterprise on the basis of economic management rights;

– The unitary enterprise leases these premises to “R.I.P.” Ltd.;

– “R.I.P.” provides some of these premises and equipment in them free-of-charge to the Forensic Medical Examination Bureau. The company and the Bureau have entered into a contract. The Forensic Medical Examination Bureau is founded by St Petersburg in the person of the Property Relations Committee. The Bureau’s activities are coordinated by the Healthcare Committee.

Thus, “R.I.P.” leases the premises as well as equipment – dissection tables, corpse storage racks, and refrigerator compartments – in the crematorium mortuary to the Forensic Medical Examination Bureau free-of-charge.

Such actions in fact constitute payment for the right to have access to information about potential service customers, which given an advantage to “R.I.P.” in their business operation in comparison with other participants of the funeral services market, which is contrary to Part 4 Article 16 of the Federal Law “On Protection of Competition” *.

The decision of the antimonopoly body was appealed.

The Court of First Instance supported St Petersburg OFAS but the Appeal Court took the side of the economic entity. The Cassation Court reversed the ruling of the Appeal Court and fully recognized legitimacy and reasonableness of the decision issued by the antimonopoly authority.

Reference:

* Part 4 Article 16 of the Federal Law “On Protection of Competition” prohibits competition-restricting agreements or concerted actions by the authorities and economic entities if such agreements result in restricting access to the market.