OREANDA-NEWS. May 06, 2013. The 9th Arbitration Appeal Court reversed the judgment of the Court of First Instance and pronounced legitimacy of the decision of the Federal Antimonopoly Service (FAS Russia) to refuse approving the transaction for “Gazprombank” OJSC buying over 50% shares of “Moscow Integrated Electric Grid Company” OJSC.

Having investigated a petition of “Gazprombank” OJSC to FAS for approving acquiring 50.9% voting shares of “Moscow Integrated Electric Grid Company” OJSC in trust management, the antimonopoly body refused to approve the transaction.

The following circumstances formed the grounds for making the decision.

Documents (materials) submitted to FAS showed that “Gazprom” OJSC owns 41.73 % voting shares of “Gazprombank” OJSC, which confirms that “Gazprombank” OJSC and “Gazprom” OJSC are affiliated under Article 4 of No.948-1 Law of RSFSR “On Competition and Restricting Monopolistic Activities on the Markets” of 22nd March 1991.

The list of affiliated persons of “Gazprom” OJSC also include legal entities -“Mosenergo” OJSC, “No.1 TGK” OJSC, “2nd Generating Company of the Wholesale Market” OJSC,“6th Generating Company of the Wholesale Market” OJSC, mainly involved in energy generation.

Article 6 of the Federal Law “On the Specifics of Functioning of the Electric Power Industry in the Period of Transition and on Introducing Amendments to Some Legislative Acts of the Russian Federation and on Invalidating Some Legislative Acts of the Russian Federation due to Adopting the Federal Law “On the Electric Power Industry” prohibits legal entities, individual entrepreneurs and affiliated persons within the same price zone of the wholesale market to combine activities for electric power transmission and (or) operational dispatch management in the electric power industry with activities for generating and (or) buying-and-selling electric power.

Thus, the transaction petitioned by “Gazprombank” OJSC will lead to combining power transmission activities with power generating activities within legal entities affiliated with “Gazprom” OJSC, which would violate Article 6 of the Federal Law “On the Specifics of Functioning of the Electric Power Industry in the Period of Transition and on Introducing Amendments to Some Legislative Acts of the Russian Federation and on Invalidating Some Legislative Acts of the Russian Federation due to Adopting the Federal Law “On the Electric Power Industry”.