THE MOST IMPORTANT IN ANTIMONOPOLY COMPLIANCE: RELEVANCY AND THE PROSPECT OF IMPLEMENTATION

Opening the conference “Antimonopoly compliance in Russia: on the most important in the run-up to introducing a new institution”, Deputy Head of FAS Andrey Tsyganov explained the ideas, preconditions and spheres of implementing antimonopoly compliance in Russia:

“It is important because it enables us to achieve one of our main objectives: prevent violations of the antimonopoly law and decrease the number of violations by preventative measures”.

The conference “Antimonopoly compliance in Russia: on the most important in the run-up to introducing a new institution” was organized on 19 June 2018 by the Moscow branch of FAS Centre for Education and Methodics with official FAS support, and involvement of “Deloitte”, “Dentons” and “Baker McKenzie”.

Andrey Tsyganovhighlighted experience of some companies on Russian market that implemented antimonopoly compliance and FAS legislative initiatives. “Amendments to the antimonopoly law are already drafted. A definition of the “compliance” concept will be introduced as well as stimulating mechanisms such as use of the current compliance procedure as a mitigating circumstance for determining the size of a fine”.

Head of FAS Legal Department Artem Molchanov discussed the prospects of introducing compliance systems in the work of commercial entities and the authorities: “To a considerable extent FAS is a body of preventative control and soft regulation. We are convinced that implementing antimonopoly compliance reduces the risks of violations. Effectively, it is a tool for preventing violations of the Federal Law “On Protection of Competition”.

One of the objectives of the Order of the President of the Russian Federation on the state policy towards developing competition is to reduce the number of antimonopoly violations by the authorities twofold by 2020 in comparison with 2017.

Head of FAS Legal Department said that “to achieve this goal FAS is devising the guidelines on implementing antimonopoly compliance”.

Head of FAS Legal Department, Andrey Tenishev talked about one of the most serious violations of the antimonopoly law – cartels. He emphasized: “The risks associated with such violations are very bid: from heavy fines to criminal liability. FAS proposes to tighten liability for such serious economic crimes”.

“Factors restricting violations include moral deterrence, severity and inevitability of punishment. Effectively, compliance is a way to create one of such deterrence factors”, concluded Andrey Tenishev.

“It is essential to understand that a system of in-house antimonopoly compliance forms legal “literacy” of staff, personalizes violators and enable to estimate all risks in advance. The most important, it can mitigate liability for committing violations and reduce the fine if it is established that a company did everything possible to avoid the violation”, pointed out Head of Moscow OFAS Armen Khanyan.

According to Director of FAS Centre for Education and Methodics (Moscow), Stanislav Druzhinin, the Centre is actively involved in awareness campaign regarding antimonopoly novelties, particularly, antimonopoly compliance, and offers corporate educational programmes devised in view of the sectoral specifics and markets for particular entities.

Maria Babikova, Deputy Head of FAS Industry Control Department outlined the risks of violating the antimonopoly law, for example, when a company determines its market share: “Market analysis is very important, particularly, in light of compliance, since the competition law sets certain requirements to market players. Not only companies that are the only players on the market bear the risks. Violations in this field result in administrative fines and holding top-executives liable”.

She emphasized: “Prevention is a trend in the control-and-supervision reform and antimonopoly regulation. Antimonopoly risks can be prevented through antimonopoly compliance”.

Deputy Head of FAS Department for Control over Foreign Investments, Grigory Karakov, said that “the foundation is laid on” to form an investment compliance system – an in-house system of preventative procedures designed to prevent possible violations of the law on foreign investments as a results of mergers and acquisitions.

He pointed out that “investment compliance can be internal – with regard to company’s own operations, and external – for M&A. The later is already carried out for large investors, especially transnational corporations as Due Diligence”.