OREANDA-NEWS. May 28, 2013. Moscow Arbitration Court supported the decision of the Federal Antimonopoly Service (FAS Russia) regarding the Ministry of the Nizhniy Novgorod for State Property and Land Resources in an auction for leasing land plots.

On 19th November 2012, FAS received a complaint from “Vektron” CJSC regarding actions of the Ministry of the Nizhniy Novgorod for State Property and Land Resources in an auction for leasing 14 land plots, that are in state property of the Nizhniy Novgorod region, for their integrated development – housing construction and construction of engineering infrastructure facilities. All 14 plots (the total square – 4,532,179 sq.m.) were included in a single lot.

Investigating the complaint, the FAS Commission found that the auction organizer had failed to disclose the requirements for integrated development of the land plots, which created a possibility for the auction winner to refuse to implement his proposals for planning, surveying and building development, and for the auction organizer – to refuse to approve the winner’s proposals.

Under the Land Code of the Russian Federation, auctions for leasing land plots for integrated development for the purposes of housing construction must be organized for each plot with a Land Registry title plan. The Ministry of the Nizhniy Novgorod for State Property and Land Resources combined all 14 land plots in the same lot, which increased the initial lease payment, “the auction step” (the bid increment by which the bid is raised), deposit, which could have reduced the number of economic entities wishing to take part in the auction.

On 27th November 2012, the FAS Commission found that the Ministry of the Nizhniy Novgorod for State Property and Land Resources violated Article 17 of the Federal Law “On Protection of Competition”. The Ministry was issued a determination to abolish the auction results.

The Ministry disagreed with the FAS decision and filed a lawsuit. Moscow Arbitration Court dismissed the claim and fully confirmed legitimacy of the decision made by the antimonopoly body.

“Actions of the regional Ministry restricted access of economic entities for taking part in the auction. Any competitive bidding, especially organized by the authorities must meet the current law, particularly the Federal Law “On Protection of Competition”, which the Court judgment confirms”, pointed out the Head of FAS Department for Control over Housing & Utilities, Construction and Natural Resources, Vadim Solovyov.