OREANDA-NEWS. On October 23, 2007 the Federal Antimonopoly Service (FAS Russia) reported to the Government of the Russian Federation on the result of the measures to control the situation on food products markets, undertaken from 15th to 19th October 2007, reported the press-centre of FAS Russia.

All regional antimonopoly offices undertook measures of control aimed to reveal and terminate abuse of dominant positions by economic entities at the relevant food products markets of (milk, sunflower oil, butter, assorted meat, hard chesses, eggs, and sugar), as well as possible collusion or concerted actions between producers and suppliers of food products to trade networks.

As a result of the above measures of control, essential element of violations of the antimonopoly legislation were revealed in a number of regions, in particular:

Upon checking "ALPI" OJSC, which is involved in food products retail, the Krasnoyarsk Office of FAS Russia initiated a case for breaching Clauses 1 and 3 Article 11 of the Federal Law "On Protection of Competition". The Company is one of the largest network organizations with a network of hypermarkets throughout the Krasnoyarsk regions and some other areas of West Siberia. The audit revealed that the Company concluded certain agreements that set advantageous terms and conditions for distributing the supplier's products over other suppliers of similar goods (priority product layout in priority locations, trade markup).

The Krasnoyarsk OFAS established that "UniMilk" Ltd., in the person of its branch "UniMilk - Krasnoyarsk" Ltd., made several distribution agreements on supplying milk products to distributors exclusively for their further reselling to the clients. The agreements in question contained some provisions that contravened the antimonopoly legislation.

The Krasnoyarsk antimonopoly office found that "UniMilk" Ltd., and distributors that had entered into the agreements: "Mol-Com Yenisei" Ltd., individual entrepreneur O.Protsneko, and Sole Trader A.Shurinov, breached Parts 1 and 2 Article 11 of the Federal Law "On Protection of Competition" and issued a determination to exclude the Clauses that contravene the antimonopoly legislation from the Distribution Agreement.

Based on the audit of bread and flour products producers, on 15th October 2007 the Penza Office of FAS Russia initiated a case against "№ 4 Penza Bread-Baking Plant" OJSC, "№ 2 Penza Bread-Baking Plant", "Penzakhleboproduct" Agricultural and Industrial Association CJSC, and "Penza Bread and Flour Products Plant Baking" OJSC for breaching Clause 1 Article 10 and Clause 1 Article 11 of the Federal Law "On Protection of Competition" by unjustified increase of prices on flour and bread-and-flour products.

Tomsk Office of FAS Russia is currently initiating a case against ЗАО "Tom-Mas" CJSC and a branch of "UniMilk" Ltd. - "UniMilk-Tomsk" Ltd. for breaching Article 11 of the Federal Law "On Protection of Competition" by entering into an agreement which determines the rate of milk products price increases.

The audit carried out by the Perm Office of FAS Russia reveled violations of Article 10 of the Federal Law "On Protection of Competition" by "PRODO Distribution Company" Ltd. (Moscow) that abused its dominant position on the wholesale market of meat and sausage products.

The Rostov Office of FAS Russia initiated a case against "Aksai Poultry Plant" CJSC and "Tagangor Poultry Plant" People's Enterprise" CJSC for breaching Clause 1 Part 1 Article 11 of the Federal Law "On Protection of Competition" by fixing and maintaining prices on eggs.

The Chelyabinsk Office of FAS Russia initiated two antimonopoly cases:

- against the "First Bread-Baking Complex" OJSC for breaching Part 1 Article 10 of the Federal Law "On Protection of Competition" by setting monopolistically high bread price;

- against the "First Bread-Baking Complex" OJSC and several trade networks: individual entrepreneur P.Strel'nikov (Lastochka store), the "Ural'Agro'Torg" Company Ltd. (the Pyatyorochka chain) and "Moll" Ltd. (the Molnia chain) for breaching Parts 2 and 3 Article 11 of the Federal Law "On Protection of Competition".

Based on the audit, the Ivanovo Office of FAS Russia initiated a case against "Shuia Oil-Extracting Plant" OJSC and "the Nizhny Novgorod Oil and Fat Complex" Trading House CJSC for breaching Clause 7 Part 1 Article 11 of the Federal Law "On Protection of Competition" by reducing (terminating) production of the goods in demand regardless possibility of their cost-effective production.

FAS Russia requested the biggest packaging manufacturer - "Tetrapack" OJSC to present relevant information. Enquiries were also sent to the biggest producers of milk products - ОАО the "UniMilk Company" OJSC, ОАО "Vimm-Bill-Dann" OJSC, the "Danone" Company, "Kampina" Ltd., "Ermann" Ltd. and "Parmalat MK" Ltd. (№ TsA/19527 Letter of 19.10.2007) to clarify the impact of packaging price increase on the ex-factory price of the producers.

In addition, the regional offices of FAS Russia were instructed to analyze the market of hen eggs to research the factors of sharp rise in prices on these products. FAS Russia also requested Rosptitsesoyz [Russian Poultry Association] to present information explaining current price increase on poultry products.

According to the regional offices of FAS Russia, against overall rising prices on food products the highest price increase is on sunflower oil and hard-pressed chesses (up to 70-80% in October in comparison with August 2007). Therefore, FAS Russia continues its antimonopoly investigation of the markets of refined bottled deodorized sunflower oil, and milk and whole milk products.