OREANDA-NEWS. March 07, 2012. The Office of the Federal Antimonopoly Service in Moscow (Moscow OFAS Russia) initiated the cases upon signs of a cartel agreement exposed in the actions of the bidders of auction for the right to conclude contracts for placing non-stationary retail facilities, organized in the South Administrative District of Moscow, reported the press-centre of FAS Russia.

The auction bidders suspected in taking part in cartel initially increased the lot price to several millions and then took turns to refuse signing the contract. Under the initiated case, the beneficiary became an individual entrepreneur with whom the contracts on the lots were signed at reduced prices. Filing price bids without an intention to conclude the contract resulted in increasing lot prices at the auction and did not allow other interested persons to compete.

OFAS gave a preliminary qualification of the actions of the auction bidders under Part 1 Article 11 of the Federal Law “On Protection of Competition”.

“The outcome of some auctions show that unfair entrepreneurs quickly realized shortcomings of the procedures of the first auctions for placing non-stationary retail facilities and rushed to take advantage of them. The antimonopoly body analyzed the results of the auctions and started initiating cases, because it is unlawful to conduct business by restricting competition at auctions. The main tool for combating cartels is improving the auction procedure, in particular, introducing mandatory bid security, and transition to electronic bidding. At the same time no tools can completely eliminate possibility of collusion, therefore for the persons that tend to master their skills in developing cartels the Criminal Code has Article 178”, pointed out Deputy Head of OFAS Dmitry Tyotushkin.

Reference:

Under Part 1 Article 178 of the Criminal Code of the Russian Federation, preventing, restricting, eliminating competition by competitors – economic entities concluding a competition-restricting agreement (cartel), repeatedly abusing dominant position, by fixing and (or) maintaining monopolistically high or monopolistically low prices, unreasonably refusing to conclude a contract, restricting market entry, if such actions have caused heavy damages to citizens, organizations or the state, or resulting in gaining an income at a large-scale – are punishable by a fine form 300,000 to 500,000 Rubles or a salary or other income of a convicted person for the period from one year to two years, or либо compulsory labour for the period to up to three years depriving of the right to hold certain positions or to exercise certain activities for the period up to one year or without such, or imprisonment for up to three years depriving of the right to hold certain positions or to exercise certain activities for the period up to one year or without such.