ARBITRATION COURT SUPPORTED FAS DECISION TO FINE “PENENZA” JSC

The Antimonopoly Service fined the company nearly 1 million RUB for violating the antimonopoly law

On 16 March 2020, Moscow Arbitration Court dismissed a claim of “Penenza” JSC to reverse an FAS order imposing an administrative fine [1].

Earlier Court also pronounced legitimacy of reasonableness of the fine imposed upon a top executive – General Director of “Penenza” JSC.

To remind, the antimonopoly body found that “Penenza” JSC violated the Federal Law “On Protection of Competition” [2]: as the administrator of the service for “Loan financing of auction bid sureties” of “Sberbank-AST” CJSC, the company concluded an oral agreement with the second service administrator to restrict access to the service of “SKIB” Bank” Ltd.

Head of FAS Department for Control over Financial Market, Olga Sergeeva, commented the Court position: “The ruling of Moscow Arbitration Court once again confirmed the legitimacy of the actions undertaken by the Federal Antimonopoly Service and must serve as a reminder to market participants  about liability for violating the antimonopoly law”.

Background:

Part 4 Article 11 of the Federal Law “On Protection of Competition” prohibits other agreements between economic entities if established that such agreements lead or can lead to competition restriction.

Administrative liability for such violations is specified in Clause 4 Article 14.32 of the Code on Administrative Violations – administrative fines:

Upon officials - 15000 to 30000 RUB;

Upon legal entities - from 1/100 to 5/100 of the violator’s proceeds from selling goods (works, services), on the market where an administrative violation was committed, or the costs of the violator for goods (works, services), on the market where an administrative violation was committed, but no less than 100000 RUB, and if the violator’s proceeds from selling goods (works, services), on the market where an administrative violation was committed, or the costs of the violator for goods (works, services), on the market where an administrative violation was committed exceeds 75% of the total proceeds from selling all goods (works, services) or an administrative violation was committed on the market of goods (works, services) that are sold under prices (tariffs) regulated in accord with the law of the Russian Federation - from 2/1000 to 2/100 of the violator’s proceeds from selling goods (works, services), on the market where an administrative violation was committed, but no less than 50000 RUB.

[1] № 07/04/14.32-12/2019 of 11.11.2019.

[2] Part 4 Article 11.