OREANDA-NEWS. November 06, 2012. The VI Annual Conference “Antimonopoly Regulation in Russia” included a session on “Developing Competition in Car Sale and Servicing”. The session was moderated by Maksim Ovchinnikov, the Head of the Department for Control over Industry and Defence Complex of the Federal Antimonopoly Service (FAS Russia), reported the press-centre of FAS Russia.  

At the beginning, Mr. Ovchinnikov made a report on the main violations on the markets of car sale and servicing, the consequences of such violations, studies of the European experience, and proposals towards developing competition in this field.

The Head of the specialized FAS Department said that the main violations of the antimonopoly law on the market of car sale and servicing included creating discriminatory conditions for access to cars and spare parts for the dealers within the same dealer network; forcing dealer centres to work with certain suppliers of materials and equipment; prohibiting repair of the cars of competing brands; refusing to supply diagnostics and technical maintenance equipment to independent service centres; and some other violations.

Speaking about the problem of imposing certain suppliers upon dealers, Maksim Ovchinnikov pointed out that “when a supplier is determined, the prices simply become exorbitant, and it is obvious that the costs of furnishing dealer centres will be shifted to customers”.

The consequences of violating the antimonopoly law are infringing the interests of economic entities operating on the markets of car sale and servicing; restricting competition; and increased costs and decreased quality of dealer and after-sale services.

The Head of FAS Department pointed out that “the problems exposed in this market are not uniquely Russian; they are present across the globe. The European Commission competed a large-scale survey of the conduct and dealers and car concerns on the market and concluded that the costs of servicing and warranty maintenance of the authorized service centres are 30-120% higher than of independent centres”.

The requirements set by the European Commission for car sales and servicing include establishing transparent rules for selecting dealers and service centres by car manufacturers on non-discriminatory conditions, ensuring non-discriminatory access to car spare parts, technical documentation, diagnostics equipment and software for independent service-centres, etc.

To develop competition, FAS also proposes to ensure non-discriminatory access to spare parts, service documentation, diagnostics equipment and software for the authorized and independent service centres, eliminate unreasonable restrictions for sale and repair of the cars of competing brands, as well the restrictions of suppliers of the necessary equipment and materials by the authorized dealers and service centres.

Summing up the discussion, Maksim Ovchinnikov emphasized that today the market can “either follow the steps of the European Commission or become self-regulated”.

The session participants also actively discussed the recommendations for the car dealers issued by FAS in September 2012.