FAS measures to combat the spread of new coronavirus infection in Russia

Under current conditions, the Government of the Russian Federation is taking all necessary measures to combat the spread of new coronavirus infection in the Russian Federation, to ensure sustainable economic development and support for the citizens in a pandemic.

The FAS Russia, in accordance with the instructions of the President, the Government of the Russian Federation, is at the forefront of the fight against coronavirus and daily monitors the price situation in the markets for essential goods and in the markets affected by the pandemic, monitors the absence of a shortage of goods and takes measures with respect to, first of all, such important social goods and basic necessities as medicines, medical products, and foodstuff.

Price control in socially significant markets

The FAS Russia carries out continuous monitoring of retail prices in order to prevent possible violations, identify cases of shortages of food, pharmaceuticals and medical goods and prevent regional prohibitions on the movement of goods.

In its work, when controlling prices for essential goods and monitoring their availability in stores, the FAS Russia cooperates with federal executive bodies: at the federal level, primary information on prices and availability of goods in stores is collected jointly with the Ministry of Industry and Trade, the Ministry of Health and the Ministry of Agriculture, and at the regional level, the FAS Russia interacts with the regional authorities. In case of presence of violations, the prosecutor’s office, the Investigative Committee, the Ministry of Internal Affairs are involved to the law enforcement process.

In its structure, the FAS Russia established an operational headquarters to duly monitor the situation in the relevant product markets. Since March 23, for the constant monitoring of prices, the regional offices of the FAS Russia have switched to a daily operating mode.

Particular attention is paid to monitoring the prices of essential foodstuff: bakery products, cereals, meat, eggs, butter, as well as a number of vegetables and fruits.

Food

In order to get the most complete picture of the availability of goods in stores, the FAS Russia held a meeting with representatives of retail chains and associations, urging them to “not raise prices, ensure optimal supply and not panic”.

The FAS Russia also conducted several dawn raids in the market of suppliers of cereals, sugar and pasta.

As a result of the dawn raids, the FAS Russia revealed signs of a cartel among major suppliers of buckwheat (the cartel of the largest buckwheat producers), as well as signs of anticompetitive agreements in a number of regional retail markets for sugar and cereals.

Masks and coronavirus tests

In a pandemic, medical masks are becoming widespread, prompting violators to speculate on the prices for these goods in conditions of instability. In early February, when the situation with coronavirus began to gain momentum, prices for medical masks in several regions increased six times. This price increase has become the most serious in the territory of Russia.

In addition to unilateral price increases for this important socially significant product, mask manufacturers and sellers are not shy about concluding anti-competitive agreements, which increases the prices for masks significantly.

So far, after a series of dawn raids, the FAS Russia has filed three cases on the grounds of cartel in the market of medical masks in various regions of the Russian Federation.

As a rule, after vigorous intervention by the FAS Russia, previously unreasonably high prices for medical masks immediately declined.

Together with the Ministry of Health of Russia, the FAS Russia controls the issue of pricing in the medical equipment market, which is necessary for the entire cycle of treatment of patients with coronavirus infection, as well as tests for the presence of the virus.

Other measures

In connection with the transition of a huge number of workers to remote work, the FAS Russia checked the level of load on mobile networks, as well as the possible increase in prices for mobile communications. According to the regulator, despite the fact that the load on the communication network has grown by 20%, price increases are not expected even with the projected increase in the load.

The FAS Russia is also closely studying cases of increasing prices for air tickets caused by air travel restrictions as a result of COVID-19.

The FAS Russia also monitors the pricing of food delivery services in the where a regime of isolation of citizens has been introduced.

Wholesale and retail prices for fuel and energy resources are monitored on an ongoing basis.

In addition, due to the fact that the summer construction season is approaching, FAS Russia carefully monitors the prices of construction materials.

The FAS Russia also actively monitors any changes in antimonopoly regulation taking place in the world and uses it when adjusting its activities in the current conditions.

In order to support the business, which is currently being considered by the Government of the Russian Federation as one of the most important tasks, since its successful solution in the current situation is the key to effective recovery of the country's economy in the post-crisis period, the FAS Russia is working on the possibility of introducing some exemptions from antimonopoly legislation if the consumer benefits will exceed the likely damage to competition, as well as changes in M&A review.

Advocacy of competition

The FAS Russia regularly reports to the Government of the Russian Federation on changes in prices, on the availability/shortage of food and non-food essential goods, as well as on measures taken to prevent price increases and other violations of antimonopoly legislation.

On March 27, Igor Artemiev, head of the FAS Russia, held a briefing in the Government of the Russian Federation, during which he highlighted in detail the measures taken to monitor the situation in the food, medical and petroleum product markets.

In addition, a hotline of the central office and territorial bodies of the FAS Russia functions for all consumers, so resident of the Russian Federation can complain about prices and the absence of any goods in stores.

Comprehensive information on the activities of FAS Russia is available on its official website and in social networks.

Changes in the FAS Russia’s operational work

The FAS Russia, being a multi-regulator, continues to exercise its functions namely to monitor compliance with antimonopoly laws, tariff regulation procedures, public procurement, and foreign investment.

On March 20, the FAS Russia announced that it would suspend the appointments and inspections until April 10, 2020, with the exception of dawn raids initiated on the signs of violations of laws related to protecting the life and health of citizens, legislation on public procurement and legislation on state defense orders.

The FAS Russia also “temporarily postponed”, “taking into account all necessary deadlines”, the consideration of cases of violation of antimonopoly legislation and administrative offenses, or started their remote consideration by video link.

Moreover, more than half of the employees of the central office and regional offices of the FAS Russia switched to a remote format of work, interaction between them is carried out through video and audio communications.

Recognizing the COVID-19 pandemic as a force majeure event, the FAS Russia will take this situation into account when considering complaints about state and municipal procurements and procurements of state-owned companies, cases of administrative offenses.

The measures taken by the FAS Russia in order to stabilize current business processes include the appeal of the FAS Russia to the Central Bank with a request to ensure the operation of banks regarding the functioning of special accounts and the issuance of bank guarantees required to participate in procurement, as well as actions taken by the FAS Russia to maintain the regime work of electronic platforms for bidding.

A big step in ensuring the continuity of law enforcement processes is the ability announced by the FAS Russia to remotely (in the form of video conferencing) consider complaints at the central office of public tenders, concessions, privatization, bankruptcy and other industries from March 26 in all federal districts (excluding Moscow and the Moscow region).

Conclusions

The FAS Russia, as a federal executive body, continues to exercise its powers on a daily basis.

To date, cooperation between the FAS Russia and its regional offices, as well as with other federal executive authorities, has become especially important, which allows us to observe the complete picture on socially significant markets online in all regions of Russia, to conduct joint price control and prevent shortage of goods.

Due to the monitoring, the prices for medical masks for the week from March 17 to March 23 decreased in 15 Russian regions, for the week from March 23 to 30 - in another six regions (data were received from 1,535 business entities, 67 dawn raids were conducted and cases of violation of antitrust laws were initiated against 11 organizations).

In addition, despite the increased demand from citizens for food (from 50 to 70%), especially in the early days of the pandemic, the measures taken by the Government and the regions increased the speed of transportation of goods by several times. Various barriers were removed, and today the warehouses are replenished much more quickly.

To date, there is no shortage of cereals, sugar, and other food products in the country's stores. The rush demand for some groups of food and non-food products was able to repay within two days.

This suggests that the agriculture of the Russian Federation and the processing industry in recent years, including due to the import substitution programs adopted in advance, have significantly strengthened.

In general, it can be stated that the FAS Russia is ready to promptly and effectively address the new challenges that have arisen around the spread of the new coronavirus pandemic.

To see the Statement of Igor Artemien, Head of the FAS Russia, to the international competition community on COVID-19 please follow the link: https://en.fas.gov.ru/press-center/news/detail.html?id=54878