Competition Law in Russia

The Law on the Protection of Competition came into effect in the Russian Federation on 26 October 2006. The stated aim for establishing of the law was to bring the Russian Federation to be in line with the general trend of competition regulation in Europe. Beyond western European competition laws against dominance, the Competition Law in Russia expressly presumes existence of dominance by defining limits.

1. A company is in dominance if it dominates more than 50% of market share.
2. A company with less than 35% of market share, unless in exceptional case, is not considered dominant.
3. A collective dominance exists when up to three companies hold a combined market share exceeding 50%.
4. A collective dominance exists when up to five companies hold a combined market share exceeding 75%.
5. A safe harbor margin of up to 20% market share per company for agreements between companies of different segments of a supply chain.

The law also places restrictions on aids from, and public procurement policies of, federal, provincial or municipal governments that otherwise would encourage anti-competition.

The law is enforced by the Federal Anti-Monopoly Service (FAS). The law also gives the FAS authority over approval of company mergers stipulating various combinations of limits 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.

In addition to a separate 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 limited out in terms of percentages of revenues of a company.

http://en.wikipedia.org/wiki/Antitrust

Active Vocabulary

I.Find in the text English equivalents for the following Russian words and word combinations:

предотвращение, запрет (запрещение), свободная торговля, оскорбительное поведение, непомерно высокие цены, контролировать, приобретения, заключать сделку, политика в области закупок, снятие ограничений, государственные активы, доля рынка, ограничения, слияние компаний, вносить изменения\поправки, обязательство\ответственность, доход, карательные меры, сделка (транзакция).

II. Match two parts of word combinations and translate them:

anti-competitive	dominance
collective	between business
refusal	government
state	the law
to provide	practices
municipal	regulation
to enforce	public services
the scope of	to deal
competition	aids

III. Tick the right answer.

T	F
		1. The company is in dominance if it is the only one in the market.
		2. The main element of the Competition Law is control over abusive behavior by a firm dominating a market, or anti-competitive practices that tend to lead to such a dominant position.
		3.Competition law is a prerogative and isn’t connected with other laws.
		4.Each country has its ownCompetition law valid only on its territory.
		5.Punitive measures against anti-competitive practices are limited out in terms of percentages of revenues of a company.
		6. Competition law was developed in the 20th century in Europe.
		7. In Russia Competition law was worked out because many companies broke laws of honest business.
		8. FAS is Federation of American Scientists.

IV. Questions:

1)What do you think about Competition law? Is it necessary for our society?

2) Do you think it works properly?

3) What rules of doing business\competition would you include in it?

4) What companies do to outrun other firms?

5) How can you control competition in the market?

Group work

Follow all these rules and you’ll get a success.

Golden Rules for conducting a responsible business

When setting up your student company, take some time to consider how you could integrate those Golden Rules into your company wherever possible.