OREANDA-NEWS. July 26, 2013. The Office of the Federal Antimonopoly Service (FAS Russia) in the Khabarovsk region (Khabarovsk OFAS Russia) found that “Monolit” Ltd., “Afrodita” Ltd. and “Master SMP” Ltd. concluded an agreement which resulted in maintaining prices at open auctions in the electronic form (in breach of Clause 2 Part 1 Article 11 the Federal Law “On Protection of Competition”).

Khabarovsk OFAS Russia received materials from the State Procurement Committee of the Government of the Khabarovsk region about actions of “Monolit” Ltd., “Afrodita” Ltd. and “Master SMP” Ltd. in the course of electronic open auctions. The Antimonopoly Service inspected the companies and found that the companies concluded an agreement that resulted in maintaining prices at the auctions.

The Commission of the antimonopoly body established that in the course of several electronic auctions “Monolit” Ltd., “Afrodita” Ltd. and “Master SMP” Ltd. applied an anticompetitive strategy of behavior. Two of the bid-riggers took turns to considerably reduce the lot prices, misleading their competitors. Then, at the last seconds of an auction the third member of the cartel offered a price slightly lower than the price bids of bona fide auction participants and became the auction winner, knowing in advance that the bids of other cartel participants would be rejected because their bids did not comply with the law on procurement and the auction documentation. If none of other auction bidders made price offers, the two bid-riggers also did not take part in an auction enabling the third cartel member to conclude the government contract at the price reduced by 0.5% from the original (maximum) price.

Such behavior of “Monolit” Ltd., “Afrodita” Ltd. and “Master SMP” Ltd. proves arrangements pursued to mislead bona fide auction bidders and remove them from competition by unlawful actions.

Khabarovsk OFAS Russia issued determinations to the companies to stop violating the antimonopoly law and will hold the companies administratively liable.

“Anticompetitive agreements in the form of cartels are the most dangerous violations of the antimonopoly law. Cartels in state procurement inflict significant damages to the budget and eliminate competition at auctions. The Office of the Federal Antimonopoly Service in the Khabarovsk region working together with Khabarovsk regional authorities and the law enforcement bodies will continue its efforts to expose and suppress such violations”, pointed out Deputy Head of Khabarovsk OFAS Russia, the Head of Antimonopoly Control Department, Nikolai Kostromeev.