OREANDA-NEWS. June 09, 2014. Moscow Arbitration Court dismissed the claim of “URALSIB” OJSC and “Volkswagen Bank RUS” Ltd. to invalidate FAS decision and determination on a case against the banks violating the antimonopoly law and orders on imposing fines upon the facts of violations.

On 23rd October 2013, the joint Commission of FAS and the Bank of Russia found that “URALSIB” OJSC and “Volkswagen Bank RUS” Ltd. violated Part 4 Article 11 of the Federal Law “On Protection of Competition” by concluding an Agreement on Cooperation.

The Agreement was concluded due to “Volkswagen Bank RUS” Ltd. not having a license for depositing funds of physical persons and provided for opening accounts by borrowers of “Volkswagen Bank RUS” Ltd. at “URALSIB” OJSC to deposit and service loans.

The Agreement introduced an obligation of “URALSIB” OJSC not to recommend and create conditions for acquiring services of “URALSIB” OJSC by its partner’s clients to repay the loans of “Volkswagen Bank RUS” Ltd., as well as for any other purposes, including purchasing vehicles.

In the course of an investigation it was established that concluding the Agreement the banks were potential competitors on the market of auto loans for physical persons, and became true competitors on the market throughout implementation of the Agreement.

In view of this circumstance, the Commission concluded that by entering into the Agreement under such conditions “URALSIB” OJSC effectively refused to conduct certain independent actions in the future on the market in question, and as a result – rejected competition with “Volkswagen Bank RUS” Ltd. for customers.

Taking into account that at the time of issuing the decision the violation was not eliminated, the Commission issued a determination to exclude anticompetitive provisions from the Agreement that was executed within the statutory period.

Due to the exposed violation, “URALSIB” OJSC and “Volkswagen Bank RUS” Ltd. Were held administratively liable under Part 1 Article 14.32 of the Code on Administrative Violations.

The credit organizations disagreed with the decision and determination of the Commission and the orders on imposing fines and challenged them at Moscow Arbitration Court, which, however, dismissed the claim.

Part 4 Article 11 of the Federal Law “On Protection of Competition” prohibits other agreements between economic entities if it is established that such agreements lead or can lead to restricted competition.

Clause 17 Article 4 of the Federal Law “On Protection of Competition” provides that refusals by economic entities that are not members of the same group of persons to conduct independent actions on the market constitute a sign of restricting competition.

Part 1 Article 14.32 of the Code on Administrative Violations specifies that concluding an agreement by an economic entity that is prohibited by the antimonopoly law of the Russian Federation, and participation in it is punishable by an administrative fine upon legal entities – from one hundredth to fifteen hundredths of the income of a violator from selling goods (works, services) on the market where the administrative violations was committed, but no less than 100,000 RUB.

Under Article 176 of the Code of the Russian Federation on Administrative Procedures, drawing up a judgment of Arbitration Court in full can be postponed for a period not exceeding five days, the date of drawing up the judgment in full is considered the date of issuing a judgment.

Under Article 180 of the Code on Administrative Procedures a judgment of an Arbitration Court of First comes into effect a month after the date of passing the judgment, if no appeal is lodged. If an appeal is lodged, the judgment, if it is not abolished and changed comes into force on the date when a ruling is passed by Arbitration Appeal Court.