ANNOUNCEMENT 23 Jul 2009In July 2009, the government of Russia announced a change in the access to public tenders.
NUMBER OF INTERVENTIONS
Official Newspaper of the Russian Federation "Rossiiskaya Gazeta" # 4958 from 23 July 2009. The Federal Law of the Russian Federation # 164 - from 17 July 2009 "On amendments to the Federal law "On Protection of Competition" and other legal documents of the Russian Federation"". Avaliable at < http://www.rg.ru/2009/07/23/izmeneniya-dok.html >. Federal Law 173- from 17 July 2009 "anemdments to Article 17 and Article 53 of the Federal Law "On the protection of competition"". Avaliable at < http://www.rg.ru/2009/07/23/zakon-dok.html >
Several amendments to the existing antimonopolylaw have been recently implemented. They are called 'the second antimonopoly package'. The first package was introduced in 2006 and made significant changes in the existing competitionlaw: the natural monopolies were considered as the ones having the dominant position at the market;a dominant position was defined as 50 percent market share (with some exceptions); government control over the business activities was significantly reduced.
The second antimonopoly package toughens rules against corruption and abuse of power by government officials in the implementation of competition law. The Russian Administrative Code have been amended accordingly.
The amendments to the Criminal Code introduce criminal sanctions (to 6 years of imprisonment)for individuals involved in cartels and abuses of a dominant position. The previous law contained only administrative responsibility (fines) as a punishment for these anticompetitive practices. This change in the competition law was caused by the fact that during the world oil price fall, the price of the gas at the gas stations in Russia remained unchanged. There was no legal instrument for the Russian antimonopoly services to influence the decisions of the management of the natural monopolies. Businessmen were said to constantly ignore the warnings of the government agencies and charged premium prices.
Among other amendments are the following:
·toughening the conditions of providing the state and municipal preferences to the firms;
·introduction of the antimonopoly monitoring procedure;
·increase of the threshold for the antimonopoly control of the economic concentration if the sum of the assets of the purchaser is more that 7 billion rubles or $ 225 million (up from 3 billion rubes or $ 96 million) or if the turnover of the purchaser is more than 10 billion rubles or $ 320 million(up from 6 billion rubles or $ 193 million ). Due to this innovation large share of the business in Russia will be realized from the excessive government control;
·detailed elaboration on the procedural rules on the litigation in competition law.
Moreover, the introduction of electronic tenders for the government procurement, where every firm is supposed to be represented by the anonymous code, significantly limits the potential for the bureaucrats' discretion and may improve general access to the government procurement (amendments to the Government Procurement Law).
Overall, improved conditions for competition in Russia can provide better investment climate for the foreigners. The control over the monopolies and introduction of the stricter responsibility for the anticompetitive practices can open some business opportunities for the foreign investors. The control of the corruption in the competition field provides more predictable business environment which could stimulate inflow of the foreign investments into Russia.
Some of those changes to the competition law are implemented from 23 July 2009 and others will come into force on 23 August 2009.