OREANDA-NEWS. On June 22, 2009 the Government of the Russian Federation approved amendments to No. 148357-5 draft Federal Law "On Introducing Amendments to the Federal Law "On Protection of Competition" and Some Other Legislative Acts of the Russian Federation" and No. 148369-5 draft Federal Law "On Introducing Amendments to the Code of the Russian Federation on Administrative Violations and Some Other Legislative Acts of the Russian Federation". Those amendments were reviewed by the Federal Antimonopoly Service (FAS Russia) for the second reading by the State Duma of the Russian Federation, reported the press-centre of FAS Russia.

"I expect that it will enable members of the parliament to promptly complete their work on the amendments and on the law on competition in general. This will arm the Federal Antimonopoly Service with better tools for supporting the honest and fair rules of competitive rivalry, and protecting consumers from unfair actions of monopolists", said Russian Prime-Minister Vladimir Putin at the Government meeting on 22nd June.

The amendments provide for:

- Reducing dominance threshold regardless of the market share of an economic person if this person can exercise a decisive effect upon the conditions of goods circulation on the market;

- Using both the "cost plus method" (estimate of the profit and expenses necessary for production) and the "method of comparable markets" (comparison with the price established on a comparable market under competitive conditions) to determine monopolistically high goods prices. It is also possible to use the "retrospective method", which analyses changing structure of production and distribution costs within a particular period;

- Harmonizing the procedures for organising inspections of compliance with the antimonopoly legislation, carried out by the antimonopoly bodies, with No. 294-FZ Federal Law "On Protecting the Rights of Legal Persons and Individual Entrepreneurs in the Exercise of State Control (Supervision) and Municipal Control";

- Organising unscheduled inspections without prior notification of the inspected persons in order to enhance efficiency of detecting competition - restricting agreements (cartels);

- Introducing a notification requirement for transactions within a group of persons, united under the "structural" principle (a person owns more than 50% of voting shares of the charter (pooled) capital of an economic company or partnership);

- Granting the antimonopoly bodies the right to issue determinations on selling certain volume of products through commodities exchange; on preliminary approval by antimonopoly bodies of the reserved price and procedures for its calculation when selling the goods through commodities exchange; as well as prohibiting the executives of the dominant entities, that sell part of their goods through exchange following a determination of an antimonopoly body, to be members of the management bodies of the exchange;

- Introducing the 5-year period of limitation for initiating and processing the cases on violations of the antimonopoly legislation.

"The period of limitation is coherent with the periods of limitation established for antimonopoly violations in the European Union and the United States", explained Igor Artemyev, the Head of FAS Russia.

The amendments also add new administrative violations in state and municipal procurement to Code of the Russian Federation on Administrative Violations with the purpose ot enhance efficiency of bidding and protection of entrepreneurs, participating in the tenders. In particular, administrative liability will be established for:

- Failure to procure goods and services from small business;

- Breaching the period of return of funds and infringing the rights of the participants of electronic tenders;

- Continuing procurement actions, if placing of the order was suspended in accord with the laws of the Russian Federation;

- Failure to present information on concluding a state or a municipal contract.

FAS Russia proposed and the Russian Government supported the idea of 1- to 3-year disqualification period for the executives of the economic entities that abused the dominant position on the goods market. "This measure can be used as an alternative to an administrative fine", believes Igor Artemyev.