FAS: SIBUR/TAIF DEAL WILL BE POSSIBLE IF A NUMBER OF MANDATORY CONDITIONS ARE MET

The conclusion of this transaction, subject to the fulfillment of all the conditions of the Authority's order, will strengthen Russia's position in the world market of petroleum products and petrochemicals, while fully meeting the interests of the domestic market

The Antimonopoly Service granted the application of PJSC SIBUR Holding on acquisition 100% of the voting shares of JSC TAIF, issuing an order to the company to fulfill a number of mandatory conditions.

In particular, SIBUR Holding will have to meet the needs of the domestic market with manufactured goods, including as raw materials.

Besides, the company will be able to recycle liquefied petroleum gas (LPG) only partially. Non-processed LPG is used as fuel, including for the needs of housing and communal services, for example, for heating. The restriction is necessary so that to meet the needs of the domestic market, there is a sufficient volume of LPG used as fuel before processing.

The company will also be obliged to purchase and sell manufactured goods on competitive terms using transparent exchange and / or over-the-counter price indicators that have developed in the zone of active consumption or production of the corresponding goods.

In addition, by December 31, 2021, the company is required to develop and submit to the FAS Russia for consideration a draft trade policy, which will describe the sale of each product produced by the company in the territory of the country, in the markets of which PJSC SIBUR Holding occupies a dominant position. The trade policy will also include a number of provisions that guarantee the protection of the rights of potential counterparties of PJSC SIBUR Holding.

Thus, the company is prohibited from infringing the rights of its counterparties when concluding contracts for the supply of manufactured goods. In particular, the company will not be able to establish discriminatory conditions for third-party economic entities in comparison with its affiliates, as well as impose unfavorable, economically or technologically unjustified and not directly stipulated by the NPA conditions on counterparties. This refers to the contracts concluded in the territory of the country.

At the same time, PJSC SIBUR Holding does not have the right to refuse to conclude supply contracts in the territory of the country without economic or technological reasons, if it is possible to produce or supply goods under such contracts. Also, PJSC SIBUR Holding should sell products under direct long-term contracts, taking into account the possibility of effective delivery of goods to the consumer.

It is assumed that the conclusion of this transaction, if all the conditions of the Antimonopoly Service's order are met, will strengthen Russia's position as a non-commodity exporter, while fully satisfying the interests of the domestic market.