OREANDA-NEWS. On December 03, 2007 the Federal Antimonopoly Service (FAS Russia) received information confirming validity of the decision and determinations issued by the Khakassia Regional Office of the Federal Antimonopoly Service (FAS Russia) on the case against the Savings Bank of Russia in the person of № 8573 Chernogorsky branch of the Savings Bank of Russia, reported the press-centre of FAS Russia.

On 31st October 2007, the Federal Arbitration Court of the East-Siberian District ruled to dismiss the appeal of the Savings Bank of Russia and upheld the decisions and rulings of the arbitration courts of the first and appeal instances which recognized validity of the decision and determinations issued by Khakassia OFAS Russia on № 6-А-Т-06 case against the branch of the Savings Bank of Russia.

On 29th March 2006, the Commission of the Khakassia Regional Office heard a case against the Savings Bank of Russia in the person of № 8573 Chernogorsky branch of the Savings Bank of Russia - breaching Article 6 of the Federal Law "On Protection of Competition on the Market of Financial Services" (agreements or concerted actions which restrict competition on the market of financial services) by entering into № 10 co-operation agreement with "Biryusa-Service-Plus" Ltd.

Under the above agreement, the Savings Bank of Russia undertook obligations to credit physical persons to buy household appliances in "Biryusa-Service-Plus" Ltd. At the same time, the agreements conditions obligated the borrower - buyer of household appliances to insure the appliances, as bank collateral, in one of the insurance companies recommended by the bank.

In its antimonopoly investigation, the Commission of the Khakassia Regional Office established that № 8573 Chernogorsky branch of the Savings Bank of Russia introduced a special clause to the agreements for crediting physical persons for over $25,000, under which the borrower was obligated to insure the risks with the companies specified by the bank. Such an arrestment included a list of 17 insurance companies that won the tender of the Savings Bank of Russia for the right to insure the collateral.

In its antimonopoly investigation, the Commission of the Khakassia Regional Office found that the Savings Bank of Russia breached Article 6 of the Federal Law "On Protection of Competition on the Market of Financial Services" by including into the agreement conditions that restrict competition on the market of financial services - requesting the buyer to choose an insurance company recommended by the bank, and issued a determination to eliminate the violations by removing the above condition from the text of the agreement.

The Savings Bank of Russia appealed against the decision and determination of the antimonopoly authority. On 4th August 2006 the Court of First Instance dismissed the appeal. On 26th October 2006 the Court of Appeal instance upheld the ruling.

Having considered the cassation appeal of the Savings Bank of Russia, the Federal Arbitration Court of the East Siberian District reversed the decision and determination in question and remanded the case for reconsideration to the same Court of First Instance. This time the case hearing involved a non-party intervener - "Biryusa-Service-Plus" Ltd.

At a new hearing on 7th May 2007, the Court of First Instance dismissed the claim of the Savings Bank of Russia. Appellate finding of 20th July 2007 also upheld the above decision.

In its Ruling of 31st October 2007, which dismisses the cassation appeal of the Savings Bank of Russia, the Federal Arbitration Court of the East Siberian District stated that actions undertaken by the bank and "Biryusa-Service-Plus" Ltd. lead to restricting competition on the market of insurance services as insurance companies that did not participate in the tender and have not been included in the list of insurance companies are effectively removed from insuring collaterals. Such actions give advantage to a limited number of participants of the insurance market, selected by the Savings Bank of Russia.

FAS Russia believes the Court ruling substantiates the position of the antimonopoly authorities that work on developing equal and fair competition conditions for insurance companies and ensuring possibility for the borrowers to independently choose any insurance organization which will insure the risks under the bank credit programmes.