OREANDA-NEWS. July 23, 2012. Moscow Arbitration Court dismissed a claim of “Sverdlov Works” Federal State-Funded Enterprise and “Promsintez” OJSC to invalidate the decision the Federal Antimonopoly Service (FAS Russia), reported the press-centre of FAS Russia.

On 19th December 2011, FAS found that “Sverdlov Works” Federal State-Funded Enterprise and “Promsintez” OJSC had simultaneously fixed prices for some industrial explosives for “Lebedinsky Mining-and-Processing Integrated Works” OJSC in breach of Clause 1 Part 1 Article 11 of the Federal Law “On Protection of Competition”.

The FAS Commission concluded that simultaneous fixing prices for industrial explosives is a consequence of collusion between two competitors.

As a result of such actions, prices for “Lebedinsky Mining-and-Processing Integrated Works” OJSC and “Mikhailovsky Mining-and-Processing Integrated Works” OJSC increased considerably and exceeded the general level of prices set for other buyers. Due to specifics of government regulation of industrial explosives market, consumers are unable to promptly replace suppliers of purchased products.

“Currently FAS undertakes efforts to hold producers of explosives administratively liable. Under Article 14.32 of the Code of the Russian Federation on Administrative Violations, FAS will impose turnover fines upon the companies, calculated on the basis of the overall income of the violators on the market in question”, pointed out Deputy Head of FAS Department for Control over Industry and Defence Complex, Andrey Greshnyov.

Reference:

Under Clause 1 Part 1 Article 11 of the Federal Law “On Protection of Competition” agreement between competitors - economic entities that sell goods on the same market are classified as cartels and are prohibited, if such agreements lead or can lead to fixing and maintaining prices (tariffs), discounts, mark-ups (additional payments), surcharges.