OREANDA-NEWS. July 27, 2011. The Arbitration Court of St Petersburg and the Leningrad Region dismissed the claim of trade networks and upheld the decision and determination issued by the Office of the Federal Antimonopoly Service in St Petersburg (St Petersburg OFAS Russia) on a case on concerted actions of retailers, reported the press-centre of FAS Russia.

On 2nd December 2010, St Petersburg OFAS Russia found that “Agrotorg” Ltd. (“Pyaterochka”), “Perekryostok” Trading House” CJSC, “Real-Hypermarket” Ltd., “Lenta” Ltd., “Dixie - St Petersburg” CJSC and “OK” violated Clause 1 Part 1 Article 11 of the Federal Law “On Protection of Competition”. The trade networks were engaged in concerted actions that resulted in fixing and maintaining retail prices for buckwheat.

Executing FAS Russia instructions to tighten control over food product markets in the period of draught in order to prevent actions that lead or can lead to restricting competition, St Petersburg OFAS Russia monitored conduct of economic entities.

The antimonopoly body requested network retailers to provide information about purchase and retail price behaviour, volumes of sales and purchases, and stock size for buckwheat.

When respondents to the case received a notification from a supplier – “Angstrem” Ltd. about forthcoming increase of purchase prices, they increased retail prices for buckwheat supplied by this company from 10% to 70% and, as a result, increased their mark-ups.

In course of the antimonopoly investigation, the Commission of St Petersburg OFAS Russia discovered that trade networks simultaneously increased prices for buckwheat in a uniform manner (26th July – 20th September 2010), which restricted competition.

A similar situation was observed when respondents received notifications from their suppliers and increased retail prices for wheat, and as a consequence, their mark-ups went up.

On 9th December 2010, St Petersburg OFAS Russia found that these trade networks, except “OK”, as well as “Intertorg” Trading House” Ltd. and “Norma” Ltd.” violated Clause 1 Part 1 Article 11 of the Federal Law “On Protection of Competition”. Wheat flour mark-ups set by trade networks from 1st July to 15th October 2010 resulted in increasing priced for the products, which also restricted competition.

Having completed the investigations, in both cases the Commission of St Petersburg OFAS Russia issued determinations to the retailers to stop violating the antimonopoly law and applied administrative sanctions imposing fines.

For concerted actions between retail networks that resulted in fixing and maintaining retail prices for buckwheat, the companies are fined: “Dixie - St Petersburg” CJSC -797,000 Rubles; “Lenta” Ltd. - 2,396,000 Rubles; Perekryostok” Trading House” CJSC - 387,000 Rubles; “Agrotorg” Ltd. (“Pyaterochka”) – 1,709,000 Rubles; “Real-Hypermarket” Ltd. - 100,000 Rubles.

For concerted actions that resulted in fixing and maintaining retail prices for wheat flour trade networks are fined: “Dixie - St Petersburg” CJSC – 1,406,000 Rubles; “Lenta” Ltd. - 2,743,000 Rubles; Perekryostok” Trading House” CJSC - 1,196,000 Rubles; “Agrotorg” Ltd. - 6,211,000 Rubles; “Real-Hypermarket” Ltd." -100,000 Rubles; “Norma” Ltd.” - 126,000 Rubles; and “Intertorg” Trading House” Ltd. - 820,000 Rubles.

Reference:

Clause 1 Part 1 Article 11 of the Federal Law “On Protection of Competition” prohibits agreements between economic entities or concerted actions of economic entities if such agreements or concerted actions lead or can lead to fixing and maintaining prices (tariffs), mark-ups, discounts, surcharges.