OREANDA-NEWS. December 20, 2010. The Office of the Federal Antimonopoly Service in the Komi Re[public (Komi OFAS Russia) found that the Council of “Vorkuta” Municipal Town District violated Part 1 Article 15 of the Federal Law “On Protection of Competition” by introducing administrative regulation of bread prices in the municipality, reported the press-centre of FAS Russia.

As explained by Yaroslav Bordyug, the Head of Komi OFAS Russia: “The Antimonopoly Service watches out that dominant companies on the bread market do not abuse their position, particularly by fixing monopolistically high prices. At the same time bread prices in Russia are market-based and free, and only the national government can change the rules in this field.”

The Vorkuta Council adopted No.286 decision” On the Tariff-Setting Procedures”, which allows administrative “bread” regulation at the municipal level. The decision approved the provisions on assigning the function for regulating wholesale ex-works prices for rye-and-wheat bread to the authority of the transpolar town.

Investigating the case, the Commission of Komi OFAS Russia revealed that the town administration had not used this right.

Upon the fact of violation, the Commission of the antimonopoly body issued a determination to the Council of “Vorkuta” Municipal Town District to withdraw the provisions enabling regulation of bread prices from its decision on the tariff-setting procedures.

Reference:

Part 1 Article 15 of the Federal Law “On Protection of Competition” prohibits federal executive bodies, the authorities of the constituent territories of the Russian Federation, local self-government bodies, other bodies and organizations exercising the functions of the above bodies, as well as state extra-budgetary funds and the Central Bank of the Russian Federation to pass acts and (or) exercise actions (omissions) that lead or can lead to preventing, restricting or eliminating competition, except the cases of passing acts and (or) exercising such actions (omissions) provided for by the federal laws.