KRK-Strakhovanie Will Pay over 7 mn Rubles as Fine
OREANDA-NEWS. December 15, 2011. Moscow Arbitration Court dismissed the claim of “KRK-Strakhovaniye” Ltd. to abolish the order of the Federal Antimonopoly Service (FAS Russia) to fine the insurance company 7,668,960 for taking part in a price cartel on the market of comprehensive and collusion car insurance, reported the press-centre of FAS Russia.
The insurance company violated the law by concluding and participating in competition-restricting agreements that led to fixing and maintaining prices (tariffs) for vehicle insurance for physical persons – the clients of “KRK” CJSC and “KRK” Commercial Bank” OJSC as well as for concluding and participating in agreements that led to imposing disadvantageous insurance contract conditions upon the clients of “KRK” CJSC and “KRK” Commercial Bank” OJSC, in the part of fixing insurance premium for the second and subsequent years of vehicle insurance at 9.99%.
Upon recognising the violation, FAS passed an order to fine the insurance company over 7 million Rubles. “KRK-Strakhovaniye” Ltd. disagreed with the order and filed a lawsuit to Moscow Arbitration Court. However, on 9th December 2011, the Court dismissed the claim.
In 2010 FAS exposed price collusion on the market of vehicle insurance between the KRK group of persons comprising “Retail Crediting Company” CJSC, “KRK-Strakhovaniye” Ltd. and “KRK” Commercial Bank” OJSC, and six insurance companies: “Alpha-Strakhovanie” OJSC, “MSK” Insurance Group” OJSC, “Rosgsstrakh” Ltd., “Admiral” Insurance Group” Ltd., “Renaissance” Insurance Group” Ltd., and “Russkaya” Insurance Company” OJSC.
Having investigated the case, FAS found that the cartel participants violated Part 1 Article 11 of the Federal Law “On Protection of Competition”.
Upon recognising the fact of violating the antimonopoly law, FAS opened administrative proceedings against the KRK group of persons and the insurance companies. As a result, FAS imposed turnover fines upon the violators for the total amount exceeding 115 million Rubles.
Reference:
1. Article 14.32. Concluding a competition-restricting agrement, exercising competition-restricting concerted actions, coordinating economic activities
1. Concluding an agreement, prohibited by the antimonopoly law of the Russian Federation, by an economic entity, as well as taking part in it, or exercising concerted actions, prohibited by the antimonopoly law of the Russian Federation, by an economic entity, are punishable by an administrative fine upon officials – from 20,000 to 50,000 Rubles, or disqualification for the period of up to three years; for legal entities – from one hundredths to fifteen hundredths of the income of the violator from selling goods (works, services) on the market where the administrative violation was committed, but no less than 100,000 Rubles, and if the income of the violator from selling goods (works, services) on the market where the administrative violation was committed exceeds 75% of the total income of the violator from selling all goods (works, services) – from three thousandths to three hundredths of the income of the violator from selling goods (works, services) on the market where the administrative violation was committed, but no less than 100,000 Rubles.
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