Embllem of the Federal Antimonopoly Service

Antitrust Competition law is the field of law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. It is also known as antitrust l ...

issues in

Russia Russia, or the Russian Federation, is a country spanning Eastern Europe and North Asia. It is the list of countries and dependencies by area, largest country in the world, and extends across Time in Russia, eleven time zones, sharing Borders ...

are regulated by one law: Federal Law No. 135-FZ, “On the Protection of Competition", which entered into force on 26 October 2006. The “3rd antimonopoly package”, which entered into force in January 2012, is indicative of a general trend of

liberalization Liberalization or liberalisation (British English) is a broad term that refers to the practice of making laws, systems, or opinions less severe, usually in the sense of eliminating certain government regulations or restrictions. The term is used ...

of antimonopoly regulation. Indeed, its stated aim was to bring Russia more in line with European competition regulations.

History

Russian competition law was ratified by the

Supreme Soviet The Supreme Soviet () was the common name for the legislative bodies (parliaments) of the Soviet socialist republics (SSR) in the Union of Soviet Socialist Republics (USSR). These soviets were modeled after the Supreme Soviet of the USSR, establ ...

of the

USSR The Union of Soviet Socialist Republics. (USSR), commonly known as the Soviet Union, was a List of former transcontinental countries#Since 1700, transcontinental country that spanned much of Eurasia from 1922 until Dissolution of the Soviet ...

in March 1991. In the final stages of glasnost and the deteriorating tethering of the

, the various member soviet republics saw the need for regulation and stabilisation of trade. The representatives to the

of the

ratified the Law on Competition and Limitation of Monopolistic Activity in Goods Market in March 1991 which became anti-monopoly policies within Russia after secession from the USSR. The Law on the Protection of Competition of 2006 is legislation pursued to translate those policies back into law.

Federal Law No. 135-FZ

Federal Law No. 135-FZ, “On the Protection of Competition", was legislated on July 26, 2006, and entered into force on October 26, 2006.

Federal Antimonopoly Service

The law was "initiated and developed" by the Federal Antimonopoly Service of Russia (FAS) (), the federal-level executive governmental organ that controls the execution of antitrust and competition. Headed by Igor Artemyev, it had been established by the

Decree A decree is a law, legal proclamation, usually issued by a head of state, judge, monarch, royal figure, or other relevant Authority, authorities, according to certain procedures. These procedures are usually defined by the constitution, Legislativ ...

President of Russia The president of Russia, officially the president of the Russian Federation (), is the executive head of state of Russia. The president is the chair of the State Council (Russia), Federal State Council and the President of Russia#Commander-in-ch ...

№314 on March 9, 2004. The law also gives the FAS authority over approval of company mergers stipulating various combinations of thresholds of assets of merging companies, an excess of which would require prior approval from the FAS. The scope of regulation of the FAS is focused on the commodity market and financial services with mandates over operations and transactions not just within the Russian Federation but also those taking place outside the boundaries of Russia which would have anti-competitive effects on the Russian market place. As with the trend in the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

and the

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, the FAS has also taken

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to task for anti-competitive behaviour by bringing Microsoft to court on 4 June 2009. In 2021, the FAS fined search engine corporation

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for allegedly violating Russian advertising law.

Dominance

Beyond western European competition laws against dominance, the Competition Law in Russia expressly presumes the existence of dominance by defining thresholds. * A company is "presumed dominant" if it has more than 50% of

market share Market share is the percentage of the total revenue or sales in a Market (economics), market that a company's business makes up. For example, if there are 50,000 units sold per year in a given industry, a company whose sales were 5,000 of those ...

* Dominance must be established by FAS if a company has more than 35% of market share * A company with less than 35% of market share is generally not considered dominant unless FAS establishes a case for dominance based on factors like analyses of competition on the market and stability of market share * Collective dominance exists if the market share of each entity exceeds 8% ''and'' the aggregate market share: **Exceeds 50% for not more than 3 entities **Exceeds 75% for not more than 5 entities * A safe harbour

margin Margin may refer to: Physical or graphical edges *Margin (typography), the white space that surrounds the content of a page * Continental margin, the zone of the ocean floor that separates the thin oceanic crust from thick continental crust *Leaf ...

of up to 20% market share per company for agreements between companies of different segments of a

supply chain A supply chain is a complex logistics system that consists of facilities that convert raw materials into finished products and distribute them to end consumers or end customers, while supply chain management deals with the flow of goods in distri ...

Other provisions

The law also places restrictions on aids from, and

public procurement Government procurement or public procurement is the purchase of goods, works (construction) or services by the state, such as by a government agency or a state-owned enterprise. In 2019, public procurement accounted for approximately 12% of GDP ...

policies of, federal, provincial, or municipal governments that otherwise would encourage anti-competition. In addition to a distinct competition law, the Code of Administrative Offences has also been amended to increase liability of anti-competitive practices. Punitive measures against anti-competitive practices are meted out in terms of percentages of revenues of a company. Company directors can be criminally liable in cases of a repeated abuse—e.g., establishing high monopoly or low monopoly prices, unjustified evasion from the execution of contracts with individual customers, creation of obstacles for other entities entering the market—and can be sentenced to up to 7 years in prison.

References