ANDREY TSYGANOV: SOFT LAW METHODS PROVED TO BE MOST EFFECTIVE DURING THE PANDEMIC

Deputy Head of the FAS Russia Andrey Tsyganov discussed activities of the FAS Russia during the crisis  with experts and representatives of Russian companies

"The economic development of Russia this year was largely determined by the spread of the new COVID-19 coronavirus infection. The main task for the FAS Russia during this period was to protect people and support the continuous operation of business. In the first days of the introduction of restrictive measures, the Antimonopoly authority began monitoring prices for socially important goods and personal protective equipment," Andrey Tsyganov said at the beginning of a meeting organized jointly by the Association of Business Ethics and (Russian Business Ethics Network (RBEN) and the Wharton School of the University of Pennsylvania Business Ethics Center with the support of St Petersburg University.

According to the speaker, the rapid adaptation of the Authority to the challenges of the pandemic is evidenced by the expansion of antitrust control tools:

"The specify of the FAS Russia is long cases. Society demanded quick solutions to problems, so we began to widely use the methods of "soft" law - warnings and admonitions, which in most cases had a positive effect. As a result, we achieved either a reduction in prices or a refusal to increase them, and most importantly – "calmed" the panic-buying  socially important goods. I would like to emphasize that, according to our monitoring, the reasons for price increasing often lie not in a systemic problem, but in the unfair and unethical behavior of individual market participants."

Deputy Head of the FAS Russia also highlighted the activities of the Antimonopoly authority on the strategic directions, stressing that the pandemic has not affected the  plans of the FAS even in the face of distance work , the Agency did not stop the control over realization of national projects in the regions, over the implementation of the National Plan of Competition Development approved by the Decree of the President of Russia.

"Now we fully deal with cases on violation of Antimonopoly legislation and economic concentration transactions. A draft of the next National Plan for 2021-2025 has already been prepared: the new Competition Development Plan has been developed based on the changes that need to be made to the legislation and its enforcement, including on the basis of our experience of recent months," explained Andrey Tsyganov.

The Deputy Head of the FAS Russia also spoke about the preparation of a draft Law on self-regulation in the advertising industry. In particular, it was noted that elements of self-regulation and co-regulation in advertising have been present in Russian legislation for 25 years, and the draft law developed by the Antimonopoly authority is clarifying and concretizing, creating a comfortable legal field for both the business community and citizens, the state, and forming a system of checks and balances based on international experience.

The meeting participants were particularly interested in the issue of antitrust compliance, including in the framework of multinational companies. "The FAS Russia supports a risk-oriented approach in antitrust legislation. The presence of antitrust compliance allows the company to reduce the forecast risk. This tool has shown its effectiveness at the initial stage, so the Agency plans to generalize this new element of antitrust legislation¹, probably in the form of explanations from the Presidium of the FAS Russia", concluded Andrey Tsyganov.

During the discussion of business ethics, the representative of the Service noted that even in crisis conditions, when, according to many experts, the topic of "survival at any cost" comes to the fore, ethics and integrity of doing business are always important, and the assessment of reputational risks is necessary for effective management.

Phil Nichols (the Wharton School of The University of Pennsylvania), Vasilisa Strizh and Philip Korotin (Morgan Lewis), Igor Belikov (Expert Council on Corporate Governance of the Bank of Russia's Financial Markets Service), Denis Primakov (Expert on corporate law and compliance), Gemma Aiolfi (Basel Institute on Governance), Anton Subbot (Baker & McKenzie CIS, Limited), Konstantin Panurovsky (AstraZeneca), Ivan Antipov (Unilever), Andrey Germanchuk (V&G Procurement), Maxim Storchevoy (HSE, Saint Petersburg) also attended the meeting.

Note:

¹ Federal Law of 01.03.2020 N 33-FZ "On Amendments to the Federal Law" On Protection of Competition”