OREANDA-NEWS. October 15, 2014. The 9th Arbitration Appeal Court upheld the judgment of Moscow Arbitration Court that the decision and determination on the case on violating the antimonopoly law by Cheboksary Authority were legitimate.

Earlier, on 6th March 2014, the FAS Commission found that Cheboksary Authority violated Part 1 Article 15 of the Federal Law “On Protection of Competition”.

The Commission established that Cheboksary Authority passed No. 477 Decree “On Organizing the Work of “Cash Settlement Centre” OJSC” of 31.10.2012 with recommendations to the managing companies in Cheboksary to conclude the next day after adopting the Decree agreements with “Cash Settlement Centre” OJSC (“RKTs” OJSC) for settlements, accepting and transferring housing-and-utilities payments of the population to resource suppliers.

Although Cheboksary Authority had information that “RKTs” OJSC had a competitor (“ChGES” OJSC), it also gave instructions to district authorities, which were executed, aimed at supporting cooperation of the managing companies with “RKTs” OJSC.

Based on the case materials, the Commission concluded that Cheboksary Authority purposely created unreasonable advantages for “RKTs” OJSC could have resulted in monopolization by the relevant market and pushing the only competitor of “RKTs” OJSC out of the market.

It was also corroborated by statistical data on a considerable redistribution of customers of “ChGES” OJSC to the benefit of “RKTs” OJSC after Cheboksary Authority exercised controversial actions and by direct explanations from managing companies.

Since Cheboksary Authority did not eliminate the violation, FAS issued a determination to eliminate it and exercise actions aimed at competition support.

Cheboksary Authority disagreed with the FAS decision and determination and filed a lawsuit; however, on 15th July 2014 Moscow Arbitration Court отказал dismissed the claim.

On 8th October 2014, the 9th Arbitration Appeal Court also dismissed the claim of Cheboksary Authority to abolish the judgment of Moscow Arbitration Court.

Part 1 Article 15 of the Federal Law “On Protection of Competition” prohibits federal executive bodies, the authorities of the subjects of the Russian Federation, local authorities, other bodies and organizations exercising the functions of the above bodies, organizations involved in rendering state and municipal services, as well as state extra-budgetary funds, the Central Bank of the Russian Federation, to adopt acts and (or) exercise actions (omissions) that lead or can lead to preventing, restricting, eliminating competition, except cases of adopting acts and (or) exercising such actions (omissions) provided for by the federal laws.