OREANDA-NEWS. November 06, 2009. The Supreme Arbitration Court of Russia (SAC) dismissed the claim of the "First Bread-Baking Complex" on referring the case to the Presidium of the Supreme Arbitration Court of the Russian Federation to review the ruling of the Cassation Court, which pronounced that the bread-baking complex had violated the law on competition, reported the press-centre of FAS Russia.

Earlier the Chelyabinsk OFAS Russia found that the company fixed and maintained monopolistically high prices for bread. In two instances, on 24th July 2007 and 13th August 2008, the "First Bread-Baking Complex" OJSC increased ex-works wholesale prices for its products. From the beginning of 2007 the company increased prices for bread in several other instances. Furthermore, the price for bread in Chelyabinsk was significantly higher than the prices for bread in a comparable market of Yekaterinburg.

The antimonopoly body established that the "First Bread-Baking Complex" OJSC dominated the market for wholesale distribution of bread and bread products in Chelyabinsk. In 2006 its market share was 73.57%, which enabled the company to exercise decisive influence upon the general conditions of the goods circulation: the volume of sale and wholesale prices for bread and bread products.

The Chelyabinsk OFAS Russia found that the company violated the antimonopoly legislation by fixing monopolistically high bread prices and issued a determination, requesting to fix economically justified prices for bread.

The "First Bread-Baking Complex" OJSC disagreed with the decision and determination of the Chelyabinsk OFAS Russia and filed a law suit.

The Courts, however, had different opinions regarding the "culpability" of the Bread-Baking Complex. The Chelyabinsk Regional Arbitration Court supported the position of the antimonopoly body with regard to the company's actions. Later the Appeal Court found the decision and determination of the Chelyabinsk OFAS Russia contrary to the law and groundless, and revoked the judgment of the Court of the First Instance. Then the antimonopoly body proved to the Federal Arbitration Court of the Urals District that it had legitimately pronounced that the Bread-Baking Complex had violated the antimonopoly legislation in terms of fixing monopolistically high bread prices.

The "First Bread-Baking Complex" OJSC decided that the ruling of the Cassation Court was unlawful and, "searching after truth", approached the Supreme Arbitration Court of Russia. In its petition the Bread-Baking Complex referred to "wrong administration of the norms of substantive law by the Cassation Court and breaching procedural law; infringing the company's rights and legitimate interests in entrepreneurial and economic activity; and failure to examine the evidence".

The Supreme Arbitration Court of the Russian Federation also confirmed that the "First Bread-Baking Complex" OJSC violated the antimonopoly legislation and refused to further review the company's case.

According to Anna Kozlova, the Head of the Chelyabinsk OFAS Russia, initiating the case by OFAS Russia and the pronouncing administrative violation had considerable impact upon the pricing policy of the Bread-Baking Complex, and in course of the litigation, which lasted nearly two years, the bread prices set by the "First Bread-Baking Complex" OJSC remained at the level of 2007.

At the moment the "First Bread-Baking Complex" OJSC must pay a fine in the amount of 2.7million Rubles.

If the company fails to pay the fine within the statutory period, the case file will be forwarded to the Court Bailiff Service.