OREANDA-NEWS. February 28, 2008. The 9th Moscow Appeal Court that the decision of the Federal Antimonopoly Service (FAS Russia) on reorganizing "Samara City Electrical Networks" OJSC, reported the press-centre of FAS Russia. 

On 26th June 2007, FAS Russia made a decision, binding "Samara City Electrical Networks" OJSC to stop combining transmission of electric power with purchasing and selling of electric power by company reorganization.

The ban was set by the Federal Law "On Specifics of the Electric Power Industry in the Period of Transition, and on Introducing Amendments to Some Legislative Acts of the Russian Federation and Recognizing Some Legislative Acts of the Russian Federation Void due to Adopting the Federal Law "On Electric Power Industry" (passed on 26th March 2006 and came into power on April 1st 2006).

"Samara City Electrical Networks" OJSC disagreed with the decision of the antimonopoly authority and filed a suit to the Moscow Arbitration Court.

The economic agent explained its disagreement that under Clause 36 of the Regulations of retail electric power markets in the transitional period of reforming the electric power industry (approved by № 530 Resolution of the Government of the Russian Federation of 31.08.2006), "Samara City Electrical Networks" OJSC was granted the status of the provider of last resort.

Therefore, in view of the Petitioner, the law, which bans combining different types of activity in the electric power industry, does not cover "Samara City Electrical Networks" OJSC.

On 18th December 2007, the Moscow Arbitration Court ruled that the FAS Russia's decision on forced reorganization of "Samara City Electrical Networks" OJSC must be held invalid.

On 18th January 2008, FAS Russia appealed against the ruling of the Moscow Arbitration Court because only providers of last resort - regional network organizations, who have been assigned this status under Clause 51 of the Regulations of retail electric power markets in the transitional period of reforming the electric power industry, can combine different kind of activities in the electric power industry.

Under Clause 36 of the Regulations of retail electric power markets in the transitional period of reforming the electric power industry, the status of the provider of last resort is assigned to energy providers, rather than regional network organizations.

Therefore, taking into consideration different status of a regional network organization and an energy provider, as well as different procedures for assigning the status of the provider of last resort to the above agents, the ban for combining different kinds of activities in the electric power industry also extends to "Samara City Electrical Networks" OJSC.

The 9th Moscow Appeal Court recognized the FAS Russia' s decision on reorganizing "Samara City Electrical Networks" OJSC as valid.