Cooperation between the Federal Antimonopoly Service of the Russian Federation and the European Union in the field of competition policy
The Federal Antimonopoly Service of the Russian Federation (the FAS Russia) actively cooperates with the European Union (EU) in order to establish equal competitive environment in the common economic space between Russia and the EU, to eliminate the barriers to free movement of goods and services, to prevent restriction of competition – from both business entities and governmental authorities.
The achieving of the above mentioned goal is possible by addressing the following objectives:
- Establishment of comparable standards and regulatory guidelines for governing competitive relations through further convergence of competition legislation of the Russian Federation and the European Union, and working out practical approaches of its enforcement;
- Ensuring the effective enforcement of competition policy and interaction between competition authorities of the Russian Federation and the European Union concerning the application of national competition legislation;
- Considering mutual interests when investigating the cases of restrictive practices of a cross-border nature.
In order to solve these issues, the FAS Russia is taking measures aimed at reinforcing international cooperation in the field of protecting competition with the European Union in the framework of the implementation of:
- Partnership and Co-operation Agreement, introducing partnership between the Russian Federation, on the one side, and European Communities and their member states, on the other hand (PCA);
- The Memorandum of Understanding in the field of cooperation signed between the FAS Russia and the Directorate General for Competition of the European Commission on March 9, 2011 (hereinafter - the Memorandum).
With the signing of the Memorandum cooperation between the FAS Russia and the Directorate General for Competition of the European Commission has reached a qualitatively new level.
The Memorandum defines the basic principles of interaction between the authorities, including the coordination of their activities when considering cases of violation of antimonopoly legislation in order to protect competition in the markets of the Russian Federation and the European Union.
Since 2015, for objective foreign policy reasons bilateral meetings with the participation of representatives of high-level regulatory authorities have been practically curtailed. Nevertheless, contacts at the working level of experts as a part of consideration of similar antitrust cases are still actively maintained.
In December 2019, European Union key institutions underwent a change in leadership. In the new composition of the European Commission Competition Commissioner Ms. M. Vestager has maintained her “antitrust” portfolio and took up a position of one of the executive vice-presidents of the European Commission for digital issues.
In this regard, the formation of a positive vector in the interaction between the FAS Russia and the European Commission seems possible.
In order to discuss promising areas of cooperation an interdepartmental meeting on the expansion of relations with the EU was held at the Ministry of Foreign Affairs with the participation of concerned federal executive authorities.
The most essential areas of cooperation
One of the goals of cooperation between the competition authorities of Russia and the EU is the intensification of the process of joint investigations between the FAS Russia and the Directorate-General for Competition of the European Commission, as well as consulting when considering global transactions of economic concentration. The pharmaceutical sector, the air transportation sector, and the financial sector were classified as prioritized ones.
In addition, in recent years, the issues of bilateral interaction have acquired particular relevance when addressing the problems of competition in the automobile markets.
In order to share the experience and information on this issue, the Directorate‑General for Competition of the European Commission provided the materials related to the considered and previously considered cases in automobile the parts market.
The experts of the European Commission provided the FAS Russia with the materials of the cases considered by the European Commission and the European Court concerning violations on the automobile market and related markets for a deeper study and possible use in joint work.
It is worth noting that best practices and information obtained by the FAS Russia in the process of cooperation with the European Union are actively distributed among the antimonopoly authorities of the Commonwealth of Independent States (CIS) member states, which, in turn, contributes to the introduction of international best practices in the field of competition in the CIS countries and the improvement of national legislation in this area.
Cooperation in cartel investigations
In 2015, the FAS Russia issued its decision in the case of liner shipping services, finding a number of foreign companies guilty for violating Russian antimonopoly legislation. This process was largely facilitated by carrying out consultations with the European Commission's Directorate-General for Competition, which also conducted investigations in this sector of the economy.
In 2016, FAS Russia held consultations with the Directorate-General for Competition of the European Commission on the investigations conducted by the FAS Russia and the issues of interest to the Service.
The experience and advice shared with the European Commission and provided by the FAS Russia with reference to the ongoing investigation into the cartel conspiracy of fish suppliers turned out to be very useful.
In 2017, the consultations on a study carried out by the European Commission on the market of exhaust gas treatment systems in diesel vehicles and on a possible collusion between car manufacturers were held with the European Commission's Directorate‑General for Competition.
In November 2017 within the V BRICS Competition Conference (Brasilia, Brazil), the negotiations with Mr. Van Ginderrachter, Head of the Anti-Cartel Department of the Directorate‑General for Competition of the European Commission, were held. During these negotiations, significant influence was given to investigations in the market of the production of automobile parts in the Russian Federation and the EU. In particular, there was discussed a case initiated by the European Commission and the German competition authority against Audi, BMW, Daimler, Volkswagen and Porsche on the fact of a possible cartel agreement, according to which the above-mentioned companies exchanged information about suppliers and price changes to the detriment of third-party car manufacturers. As the result of the negotiations, the parties agreed to continue exchanging views and information on cases in the automobile parts market.
The FAS Russia shared information with the European colleagues on the case initiated by the Service on the fact of the alleged cartel between car glass manufacturers. The FAS Russia case was dismissed due to the lack of sufficient evidence.
In November 2017, The European Commission fined five manufacturers of security systems on the grounds of participation in the cartel amounting to 34 million euros. The European Commission ruled that the cartel members replaced spare parts, namely, seat belts, airbags and steering wheels, for Japanese cars on the territory of the EU's single internal market.
Cooperation in considering global transactions of economic concentration
In 2009, the FAS Russia cooperated with the European Commission on the approval of the Sun/Oracle transaction. As part of the consideration of this transaction, waivers (disclaimers of confidentiality) were used for the first time.
In 2017, the FAS Russia sent a request to the European Commission with questions regarding the consideration of mega-mergers in the food market, namely, the consideration of the Dow/DuPont merger, which was notified on 22th June 2016, and the ChemChina/Syngenta merger, notified on the 23th September 2016. The European Commission, in its turn, provided all the information on the above-mentioned mergers needed to the FAS Russia.
In the period from 2017 to 2018, the FAS Russia actively cooperated with the European Commission on the consideration and approval of the Bayer/Monsanto merger. The consultations were carried out on the basis of waivers, which made it possible to fully exchange confidential information and comprehensively discuss this global merger.
Within such consultations, which were carried out in the form of both audio conferences and face-to-face meetings, we managed to discuss methodological approaches, as well as conditions that the FAS Russia and the European Commission are ready to impose on companies in order to develop competition in the agro-industrial market.
The decision and remedies that the FAS Russia passed following the consideration of the Bayer/Monsanto merger was largely based on the results of consultations with the European Commission.
In 2018-early 2019, the FAS Russia actively cooperated with the European Commission on the consideration of approaches to the analysis of the Siemens/Alstom merger, which was subsequently blocked by the European Commission in February 2019.
The proposed merger of the railway engineering branches was announced in September 2017. It was supposed that the joined company would be named Siemens-Alstom and it would retain its headquarters in the suburbs of Paris. Its annual revenue was supposed to be about 15.3 billion euros, with the staff - 62 thousand employees.
The merger was considered around the world, including Russia, the European Union, the USA, Canada, Australia, the BRICS countries, the Middle East and the CIS countries.
The consultations between the FAS Russia and the European Commission were held on the basis of the waivers received from the parties to the transaction. Within the consultations the key concerns that the merger could entail, as well as possible conditions that could be exposed to the companies were discussed. The European Commission representatives pointed out that the main concern of the European Commission was caused by the fact that the expected merger between two technology giants, owning enormous data sets, including unique ones, could significantly harm competitive environment and reduce innovation process in the railway engineering market, and lead to the withdrawal of smaller entities from the market and also promote higher prices and less choice for the buyers.
The European Commission banned the Siemens/Alstom deal on the 6 February 2019, arguing that significant technological potential that could be formed in the merged Siemens/Alstom company, as well as access of the combined company to huge amounts of data related to unique production technologies, could have critical impact for other market participants.
In 2019-2020, the FAS Russia actively cooperated with the European Commission on the negotiation of mergers Metso/Outotec (mining and metallurgy company), Alstom/Bombardier (production and assembly of rolling stock), IFF/DuPont (food and beverage, household and personal hygiene).
Cooperation in considering cases of abuse of dominance
During 2015-2016, the FAS Russia referred to the experience of the European Commission while investigating cases of abuse of a dominant position against Google, Apple and Microsoft. The decisions of the FAS Russia in these cases were mainly based on the decisions of the European Commission.
In June 2019, the FAS Russia held consultations with the European Commission to consider the Apple case. The case with similar evidence of violation of antimonopoly legislation was considered by the European Commission.
In 2019-2020, the FAS Russia was actively cooperating with the European Commission in the Booking case.
Partnership and Cooperation Agreement 1997
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Memorandum of Understanding on Cooperation
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