Competition violators warned in Russia

Competition violators warned in Russia
Published: 13 March 2006

The chief of Russia’s anti-monopoly watchdog vowed Friday to step up competition protection and accused those who had violated Russia’s anti-monopoly legislation of fuelling spiraling levels of inflation. Such businessnes generate about 30 per cent of Russia’s inflation, Federal Anti-Monopoly Service chief Igor Artemyev said at a breakfast organized by the Russian Managers Association.  
 
Artemyev pledged to step up his fight against companies that engage in monopolistic practices, as well as to crackdown on bureaucrats who help businesses gain an unfair market advantage. The nature of Russian monopolies is unique in that there is "monopolisation and hindering of competition by government bureaucrats," said Artemyev.  
 
The anti-monopoly service has already locked horns with many giants, including leading cement maker Eurocement Group. It levied an unprecedented US$70m  fine on the company last October for what it said was an unfair use of its market position to raise cement prices. Eurocement’s appeal hearing is scheduled to be heard in the Moscow Arbitration Court on March 23, the company said Friday.  
 
 To accelerate the fight against antitrust violators, the service is pushing through a bill that would allow the anti-monopoly watchdog to be more aggressive in initiating court cases against government authorities.   The bill also clarifies the definition of monopolistic behavior by private companies and increases their penalties for such actions. The State Duma is set to pass the bill by this summer, Artemyev said. 

The construction sector is also concentrated in the hands of the few. "Companies close to municipal authorities dominate the construction industry," making the sector a quasi-monopoly, Belenkaya said.