OREANDA-NEWS. March 17, 2014. The Federal Arbitration Court of the Moscow District confirmed legitimacy of the decision and determination of the Federal Antimonopoly Service (FAS Russia) with regard to “Russian Railways” OJSC upon facts of frequent refusals to fulfill consignors’ applications for railway freight transportation in the carrier’s cars, that is paid in accordance with the tariffs set by the Federal Tariff Service.

The case was initiated upon elements of violating the antimonopoly law by a group of persons comprising: “Russian Railways” OJSC (a holder of natural monopoly – a freight carrier, the owner of railway transport infrastructure), “First Freight Company” OJSC and “Second Freight Company” OJSC (rolling stock owners).

Grounds for initiating the case: numerous petitions from consignors, executive bodies of the constituent territories of the Russian Federation on reducing availability of freight services with an uncontrolled growth of transportation costs. Petitioners also complained that “Russian Railways” OJSC unreasonably avoided to accept, agree upon and fulfill applications for transporting freight in the inventory rolling stock, possessed by the carrier under the right of ownership and (or) other legitimate right.

Under the antimonopoly law, in such situations refusals of the carrier to agree upon and fulfill applications of consignors constitute several violations of Article 10 of the Federal Law “On Protection of Competition”.

As a result of anticompetitive actions, availability of the services of “Russian Railways” OJSC reduced from 90% to 60 % for large consignors and from 75-80% to 30% for small and medium business. The costs of cars increased twofold, and transportation costs went up by 30%.

Under the Statutes of the Railway Transport in the Russian Federation and the Rules for Railway Transportation of Freight, consignors filed applications to “Russian Railways” OJSC for integrated services of transporting cargo in the carrier’s cars. The company refused to fulfill applications referring to absence of the required cars. Russian law does not provide for such grounds for refusals by the carrier to accept applications. Under the Civil Code of the Russian Federation (Articles 426, 791, 793, 794, 796), the Law on Railway Transport in the Russian Federation (Article 12), the carrier (“Russian Railways” OJSC) must possess rolling stock and supply it for loading.