OREANDA-NEWS. August 08, 2013. The 9th Arbitration Appeal Court supported the conclusions of the Federal Antimonopoly Service (FAS Russia) and Moscow Arbitration Court on a case on restricting competition by the Government of the Republic of Baskortostan in the course of offering land plots for the purposes of social residential housing construction.

In July 2011 the Government of the Republic of Baskortostan issued a Decree to [provide land plots for constructing purposes to socially-oriented non-commercial organizations, according to which the land was offered free-of-charge and without competitive bidding. These organizations were formed by state unitary enterprises of Baskortostan.

Another Decree of the Government of the Republic introduced the rules for determining the sum of subsidies and the conditions for granting them by a competitive selection of non-commercial organizations.

Thus, budgetary funds were spent without competitive procedures required under the Law on state procurement (No.94-FZ), and the Decree of the Government of the Republic of Baskortostan were contrary to the Land Code of the Russian Federation.

On 25th December 2012, the FAS Commission found that the Government of the Republic of Baskortostan violated Part 1 Article15 of the Federal Law “On Protection of Competition” (competition-restricting actions of the authorities) and issued a determination to eliminate the violations. However, the regional authority disagreed with FAS decision and determination and filed a lawsuit. Already the Appeal Court confirmed validity of FAS actions.

“Affordable social housing is a priority task for the state that must be achieved under competitive conditions, which is confirmed by the ruling of the Appeal Court”, pointed out the Head of FAS Department for Control over Housing & Utilities Sector, Construction and Natural Resources, Vadim Solovyov.