NORTH-WEST ARBITRATION COURT SUPPORTED CONCLUSIONS OF ST PETERSBURG OFAS AND FOUND THAT PROPERTY RELATIONS COMMITTEE VIOALTED THE LAW ON COMPETITION

The Property Relations Committee unlawfully assigned the Committee’s functions and rights on determining the lease fee for land plots to the City Department for Inventorying and Real Estate Appraisal

Earlier the antimonopoly body found that the Property Relations Committee (KIO) of St Petersburg restricted competition when concluded a contract with St Petersburg City Department for Inventorying and Real Estate Appraisal (GUION) without competitive bidding for giving information to calculate lease fee for land plots in St Petersburg public property and the land plots with no delineated public property. The Commission of St Petersburg OFAS established that KIO unlawfully assigned the Committee’s functions and rights on determining the lease fee for land plots in St Petersburg public property to GUION.

OFAS issued an order to the Property Relations Committee of St Petersburg to support competition on the market in question and stop assigning the powers of the authority to GUION. KIO, however, disagreed with the conclusions of the antimonopoly body and attempted to challenge the decision and the order at Court. Nevertheless, Courts of three instances recognized the rightness of St Petersburg OFAS.

Head of St Petersburg OFAS Vadim Vladimirov emphasized: “St Petersburg OFAS once again showed that unitary enterprises in Petersburg very often operate on absolutely competitive markets; in this case, the market of land plot inventorying services.  We hope that KIO will listen to Courts’ opinions fulfill our order and select an entity for inventorying on the competitive basis”.

Reference:

No. 135-FZ Federal Law "On Protection of Competition" of 26.07.2006

Article 15

Clause 1. Federal executive bodies, regional authorities, local self-government bodies, other bodies and organizations exercising the functions of the above bodies, organizations involved in rendering public or municipal services, as well as state extra-budgetary funds, the Central Bank of the Russian Federation cannot pass acts and (or) exercise actions (omissions) that lead or can lead to preventing, restricting, eliminating competition, except cases of adopting acts and (or) exercising such actions (omissions) specified in the federal laws.

Clause 3. Combining functions of federal executive bodies, regional executive bodies, other authorities, local self-government bodies and functions of economic entities, except cases, specified by the federal laws, Orders of the President of the Russian Federation, Decrees of the Government of the Russian Federation, as well as assigning the functions and rights of the above bodies to economic entities  are forbidden