OREANDA-NEWS. October 23, 2014. The 9th Arbitration Appeal Court agreed with the arguments put forward by the Federal Antimonopoly Service and reversed the judgment of Moscow Arbitration Court on a cartel case at an auction for reconstructing children’s playgrounds in the North-Eastern Autonomous District in Moscow.

On 13th December 2013, FAS found that the Prefecture of the North-Eastern Administrative District in Moscow, “PUBLICITY-BUILDING No.2 Project” Ltd. and “Publicity” Regional Non-Governmental Charitable Foundation violated Article 16 of the Federal Law “On Protection of Competition”, and “PUBLICITY-BUILDING No.2 Project” Ltd. and “Delta Stroi” Ltd. violated Clause 2 Part 1 Article 11 of the Federal Law “On Protection of Competition” in an auction for capital repair of 48 sport playgrounds in the North-Eastern Administrative District in Moscow.

The FAS Commission established that the Prefecture of the North-Eastern Administrative District in Moscow jointly with “Publicity” Regional Non-Governmental Charitable Foundation prepared the auction documentation in such a way that potential bidders were unable to file competitive bids and all bidders except the two bidders determined earlier were not allowed to take part in the auction.

In its turn, “PUBLICITY-BUILDING No.2 Project” Ltd. formed a cartel with “Delta Stroi” Ltd. to maintain auction prices at the highest possible level.

As a result of the unlawful actions, “PUBLICITY-BUILDING No.2 Project” Ltd. won the auction with the lowest price reduction (1% of the contract value). The contract price was over 100 million RUB.

The Investigation Department in the North-Eastern Administrative District in Moscow has already initiated and investigated a criminal case upon abusing the office and fraud; and is considering opening criminal proceedings under Article 178 of the Criminal Code of the Russian Federation.

“The case is a classic example when as a result of an anticompetitive agreement between the ordering party and bidders, the budgetary means for solving socially important issues are spent inefficiently. Suppressing such activities is an important objective for the Antimonopoly Service and the law enforcement bodies”, pointed FAS Anti-Cartel Department, Andrey Tenischev.