EVOLUTION OF CRIMINAL LIABILITY FOR CARTELS

Representatives of the antimonopoly authority, law enforcement bodies and the legal community met at the II Eurasian Cartel Forum to discuss development of the criminal law in the part of competition protection and enforcement practice

Head of FAS Anti-Cartel Department Andrey Tenishev explained the changes to Article 178 of the Criminal Code of the Russian Federation during its history: “First everything was put in Article 178: unfair competition, bid-rigging collusion, anticompetitive agreements. Then some of the norms were removed, including liability for collusion with government customers – tender organizers, which definitely is a more dangerous crime”.

In his opinion, not only Article 178 protects competition: practice shows that abuse of office, bribery, embezzlement and other formal elements of crime are used in sentencing.

“Any “white-collar” criminal weighs all pros and contras before committing an offence. If there no risk to be caught red-handed, there are no obstacles to violate the law. If he counts a fine for collusion and understands that there still is profit – it also does not deter from a criminal act. This kind of persons can be stopped by a threat of actual criminal liability for 7 years imprisonment. Otherwise, no fines can stop them”, emphasized Andrey Tenishev.

Head of FAS Anti-Cartel Department described a draft law that tighten liability for cartels, which is submitted to the parliament: “We are returning a special norm for collusion between ordering parties and bidders, separate the norms for cartels operating on the markets and bid-rigging cartels, remove the “competition restriction” element as cartels are violations per se – it a presumption which is not necessary to prove”.

There also will be a Register of cartel participants who are debarred from taking part in tenders and auctions; liability for recidivism; and declaration of awareness about liability for participating in cartels by bidders.

At the end of the session, talking about enforcement of the “criminal” Article 178 and FAS work with the law enforcement bodies, Andrey Tenishev emphasized: “What has happened is a breakthrough”.