Russia`s Federal Antimonopoly Service 2016

27.07.2016 Star Ratings GCR Global Competition Review
http://globalcompetitionreview.com/surveys/article/41400/starratings 1/3
RATING ENFORCEMENT 2016
STAR RATINGS
Wednesday, 6 July 2016 (2 weeks ago)
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Every year, Global Competition Review evaluates the performance of the world’s leading competition
authorities. Pallavi Guniganti, Ron Knox, Tom Webb, Tom MadgeWyld, Mark Briggs, Sonya Lalli, Alex Wilts
and Charles McConnell present the agencies’ results from 2015.
Agency Star Rating
ELITE
France’s Competition Authority
Germany’s Federal Cartel Office
Korea's Fair Trade Commission
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VERY GOOD
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Australia’s Competition and Consumer Commission
Brazil’s Administrative Council for Economic Defence
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GOOD
Canada’s Competition Bureau
Greece’s Hellenic Competition Commission
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The Netherlands’ Authority for Consumers and Markets
Norway’s Competition Authority
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Austria’s Federal Competition Authority
Chile’s National Economic Prosecutor
Colombia's Superintendence of Industry and Commerce
Finland’s Competition and Consumer Authority
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Lithuania’s Competition Council
Mexico’s Federal Economic Competition Commission
New Zealand’s Commerce Commission
Pakistan's Competition Commission
Poland’s Office of Competition and Consumer Protection
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Russia’s Federal Antimonopoly Service
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FAIR
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27.07.2016 Russia's Federal Antimonopoly Service GCR Global Competition Review
http://globalcompetitionreview.com/surveys/article/41481/russiasfederalantimonopolyservice 1/19
RATING ENFORCEMENT 2016
RUSSIA'S FEDERAL ANTIMONOPOLY
SERVICE
Tuesday, 12 July 2016 (2 weeks ago)
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Russia’s Federal Antimonopoly Service (FAS) remained extremely active in 2015. The authority handed down
300 cartel decisions, all accompanied with fines, and launched 3,059 abuse of dominance investigations.
These numbers don’t significantly vary from those featured in previous editions of Rating Enforcement, except
that now the FAS has more money to match its large volume of cases.
STAR RATING:
PERFORMANCE:
HEAD OF AGENCY: Igor Artemiev
In 2015, the FAS’s budget was €67.4 million, almost double the
budget in 2014. “This change reflects the government’s efforts to
further strengthen the competition enforcement in Russia,” a lawyer
says.
The increase in the authority’s financial resources also led to a boost
in the number of new hires at the agency: more than 700 non
administrative staff joined in 2015 to focus on competition
enforcement, compared to a gain of about 500 people the year
before. According to a source, the growth could partially be explained
by the transfer of about half of the staff from the Federal Tariff

Service, which was abolished last year, to the authority. The FAS
took over several of the former tariff service’s responsibilities, which
include creating and maintaining a registry of natural monopolies, as
well as tariff regulation.
Observers say the upturns in budget and staff demonstrate growth in
the FAS’s functionality, which has frequently been criticised by
practitioners in the past. The authority has a history of being
understaffed compared to other Russian governmental bodies and
many of its foreign peers. One lawyer also says the authority’s
budget in previous years was too low to ensure quality enforcement,
while another notes that the agency’s level of professionalism and
the sophistication of its case handlers could be improved. Out of the
2,133 nonadministrative staffers who focus on competition
enforcement, 423 – or about 20 per cent – have worked at least five
years in the private sector. From 2014 to 2015, the agency’s attrition
rate was about 20 per cent, which is much higher than the rates of
other European competition authorities.
Although the FAS’s caseload continues to expand, one observer
commented that the budget was not enlarged to increase the
agency’s number of enforcement actions. “FAS already has too
many, and its head continues to promise to reduce their number,” a
lawyer says. Currently, the FAS’s high volume of activity bogs staff
down with less meaningful cases, observers say.
But it’s important to keep in mind that many smaller cases are
generated by the authority’s 85 regional offices, while the central
office takes on the bigger matters. Observers also comment on the
growing sophistication of the agency’s anticartel unit. The FAS
continues to investigate major oil companies that are believed to
have inflated petrol prices through irregular, highfrequency trading.

Additionally, in February 2015 the authority became the first
competition agency to open a formal investigation into Google’s
Android operating system. In September, the FAS announced that
the tech behemoth was found to have abused its power over pre
installed applications on Android smartphones and tablets.
Despite these successes, observers have commented that the office
could enhance the quality of its economic analysis and become more
willing to use independent economics experts on certain matters.
One lawyer says that some cases that the FAS brings seem to be
inspired more by political motives rather than strong economic
analysis, which could be a result of the authority being under the
purview of the executive branch. He says the agency has stated over
and over again that it will improve its economic analysis, but so far
there has been no visible evidence that it is doing so.
However, observers praise the agency for its transparency compared
to other government offices in Russia. One lawyer says: “In my
experience, it is one of the best Russian government authorities in
terms of transparency, openness, access to officers, friendliness,
compliance with statutory deadlines and absence of corruption.”
The FAS has recently begun to follow the lead of the European
Commission and other competition agencies by publishing decisions
in antitrust cases, as well as issuing guidelines explaining the
authority’s processes in investigating cases. A new amendment also
mandates that the FAS provide a statement of objections to the party
it is charging with anticompetitive behaviour.
Those who deal with the authority frequently view Igor Artemiev, who
has an unlimited term as head of the FAS, positively. But observers
still say the agency has room for improvement. One lawyer says
Artemiev seems to be saying all the right things but is struggling to

actually implement change: “Promises need to materialise.”
General Information
Head of agency Igor Artemiev
Previous employment
Member of the State Duma (Russia’s lower legislative house)
Mandate expires No fixed term
Salary of head of agency €123,993
Appointment of head of agency Government decree
Agency head reports to Russian government
Budget €67.43 million
Amount spent on salary €47.13 million
Percentage of budget spent on salary 70%
Total staff3,260 (865 in the central office)
Staff working on competition
enforcement
2,553
Percentage focused on competition 78%
Nonadministrative staff 2,133

Percentage who are lawyers 52%
Percentage who are economists 31%
Percentage who are others 17%
Other areas of focus
Unfair competition; advertising; state aid; public procurement;
anticompetitive conduct by state authorities; competition compliance
during foreign trade; foreign investment review; energy regulation;
trade regulation; advocacy.
Average age of staff 36 years
Male/Female 38%/62%
Average tenure 4 years 6 months
No. of staff who left in 2015 514
No. of staff who retired 44
No. of staff who remained in civil service 29
No. of staff who joined in 2015 705
No. of staff who joined from the civil
service
284

No. of staff who have spent at least 5
years in private practice
423
Percentage of staff who left 29%
Percentage who retired 9%
Percentage who remained in civil service 6%
Percentage who joined from civil service 40%
Percentage who joined in 2015 33%
Standalone bureau of economics Yes
No. with PhDs in economics 29
Name of chief economist Alexey Sushkevich
Priorities

No. of staff working on mergers Not available*
No. of staff working on anticartel Not available*
No. of staff working on dominance
related issues Not available*

No. of staff working on other areas Not available*
Percentage of staff working on mergers Not available*
Percentage of staff working on anti
cartel
Not available*
Percentage of staff working on
dominancerelated issues
Not available*
Percentage of staff working on other
areas
Not available*
Sectoral priorities in 2015
Commodity markets; cartels; oil; telecoms; mail services; railways;
airport services; automobile aftersale services; medicine; housing;
defence.
Sectoral priorities for 2016
Pharmaceutical and commodities markets; informational
technologies; rail transportation; gas industry; tariff regulation;
intellectual
property
Performance assessment
Yes. Annual review by the Accounts Chamber of the Russian
Federation. Reviews conducted by the OECD and Russian
government.

* Staff are tasked by sector rather than by the type of matter.
Mergers
No. of mergers filed 1,958
No. of mergers that led to indepth
review
185
No. of filed mergers challenged 119
No. of challenged mergers blocked 53
No. of challenged mergers resolved with
remedies
66
No. of challenged mergers abandoned
by parties
Not available
Percentage of filed mergers that led to
indepth review
9%
Percentage of filed mergers challenged 6.1%
Percentage of challenged mergers
blocked
44.5%
resolved with remedies
56%
Not available

abandoned by parties
Average length of an indepth merger
review
Did not respond
Anti-cartel
No. of leniency applications
Firstin 35
Total 46
No. of dawn raids 12
No. of cartel decisions 300
No. of cartel decisions concluded with
fines
300
Total cartel fines in 2015 €21.1 million
Average fine per cartel €1.7 million
Average length of cartel investigation 1 year
Fines collected by The FAS
Fines go to Federal budget

Abuse of dominance

Highest no. of abuse of dominance
cases under way in 2015
Not available
No. of abuse of dominance
investigations launched in 2015
3,059
No. rolled over 2,798
No. of files closed in 2015 2,542
Average length of investigation Did not respond
Sum total of abuse of dominance fines
€52.8 million before court decisions; €26.5 million after court
decisions
No. of abuse cases settled with
behavioural conditions
1,913
Longestrunning investigation None
Explanation for its duration None
Total fines
Total fines

€98.4 million before court decisions; €69.1 million after court
decisions
Imposed for
Cartels 30%
Abuse of dominance 38%
Other 32%
Criminal enforcement

Criminal enforcement track Yes
Offences punishable by imprisonment
Anticompetitive agreements; repeated abuse of dominance; fixing
monopolistically low or high prices; refusing to contract; restricting
market entry
Individual sentences imposed Yes
Longest prison sentence 3 years 8 months
2015 prison time 3 years 8 months
Organisational change
Structural change

The Federal Antimonopoly Service established a collegial body of 12
members, whose membership was approved by the federal
government.
Leadership change
Sergey Puzyrevsky, Vitaly Korolev and Alexander Redko were all
appointed as deputy heads of the FAS.
New powers or responsibilities
Tariff decisions about natural monopolies and other regulated
entities are now made by majority vote of the collegial body,
following the abolishment of the Federal Tariff Service.
Budget change
The authority’s budget increased 49% from 2014.
Advocacy
Percentage of budget dedicated to
advocacy
None
Standalone advocacy office
Yes. The Public Relations and
Department for Economic Cooperation.
Appearances before congress/parliament10
• 20 February 2015 – meeting in the State Duma of the Russian

Federation.
• 26 February 2015 – report on the meeting with the Russian
government (topic of report – promotion of competition in the
telecommunications sector).
• 2 September 2015 – report on the meeting with the Russian
government (topic of the report – state of competition in the Russian
Federation).
• 29 October – meeting with the Russian government (topic of the
meeting – competition in the health sector).
• 23 January 2015 – working meeting with the prime minister, Dmitry
Medvedev (topic of the meeting – price situation).
• 13 March 2015 – joint meeting with FAS Russia and the non
commercial partnership “Contribution to Development of
Competition” (topic of the meeting – antitrust compliance, the
procedure of pretrial review of decisions of territorial authorities in
antitrust cases, the development of codes of good practice of the
pharmaceutical market, the application of antitrust laws in the field of
defence procurement, etc).
• 19 March 2015 – congress of the Russian Union of Industrialists
and Entrepreneurs as part of Russian Business Week (report on
policy of liberalisation measures implemented by the FAS Russia in
relation to the business and plans for the near future).
• 3 April 2015 – scientific practical conference of the FAS Russia and
the Kutafin Moscow State Law University (topic – development of
the antimonopoly legislation in the light of the adoption of the fourth
antimonopoly package; report on changes in Russian antimonopoly
legislation).

• 28 May 2015 – roundtable “Competition enforcement in today’s
economy” in the framework of the V International Legal Forum in St
Petersburg.
• 8 June 2015 – working meeting with Russian President Vladimir
Putin (topic of the meeting – activities of the FAS).
• 22 September 2015 – the 43rd session of the Interstate Council for
Antimonopoly Policy (participants – representatives of the
competition authorities of Armenia, Belarus, Kazakhstan,
Kyrgyzstan, Moldova, Russia, Tajikistan, as well as the Eurasian
Economic Commission and the noncommercial partnership
“Competition Support in the CIS countries).
• 16 October 2015 – annual conference “Antimonopoly Regulation in
Russia” (topics – reform of antimonopoly regulation, fifth
antimonopoly package, reducing the cost of state companies, the
participation of small and mediumsized businesses in procurement).
• 13 November 2015 – meeting with Frederic Jenny, the chairman of
the OECD Competition Committee (topic – the new powers of the
FAS Russia and the fourth antimonopoly package).
• 16 November 2015 – Igor Artemiev and Alexander Ivanov, the
acting head of the Russian Federal Space Agency, signed an
agreement in Moscow on information exchange.
• 30 November 2015 – forum “Open power against corruption” was
held at the House of the Government of the Moscow Region.
• 1 December 2015 – the first meeting of the Scientific Council of the
Russian Academy of Sciences on the protection of competition
issues (topic – the powers and tasks of the Russian competition
authority).

Legal changes proposed/enacted
On 5 October 2015, Russian president Vladimir Putin signed a
package of amendments to the Russian antimonopoly legislation,
aimed at cutting administrative barriers for business and decreasing
the government’s presence in the economy. The document takes
into account the recommendations of experts from the OECD.
The fourth antimonopoly package introduces a number of important
provisions related to the prohibition of abuse of dominant positions,
the prohibition of unfair competition, as well as expanding the use of
admonitions and warnings and improving the antimonopoly
proceedings.
For example, the law clarifies the criteria for the admissibility of
“vertical” agreements, providing that such agreements are
acceptable if the share of neither the seller nor the buyer does not
exceed 20 per cent of the commodity market.
Currently, work is under way to grant small businesses immunity
from antitrust investigations, as well as prevent the creation of state
unitary enterprises and municipal unitary enterprises in competitive
markets.
Other results
There were 69,703 media publications about the FAS’s activity in
2015.
Priority setting

Setting goals and priorities
Priorities and objectives of the FAS are elaborated according to key
programme documents in the field of Russia’s economic
development as a whole, as well as other system documents in the
sphere of competition policy.
In 2012 a number of the strategic documents defining the activity of
the FAS were developed and adopted. One of these documents is
the road map “Development of the Competition and Improvement of
the Antimonopoly Policy”.
Shortterm tasks and their prioritisation are formed during weekly
meetings of the agency’s Presidium. The members of the board are
made up of the head of the FAS Russia, his deputies and some of
the agency’s department heads.
FAS objectives are elaborated by taking into account best practices
from around the globe.
Allocation of resources
Resources are distributed between management of the central office
and the regional offices of the FAS Russia according to the priorities
determined by state policy.
Long-term strategy and training
Evaluation methods
There is a uniform system of assessment of achievement of the main
indicators of the FAS’s performance carried out annually by the
analytical department of the FAS and by the presidium of the FAS.
On receiving the results of an assessment, if the planned values

have not been achieved or there is a negative dynamic, an analysis
is carried out of the reasons for such deviations for the purpose of
adopting administrative decisions.
The FAS presents an annual report on the authority’s achievements
to the government. Moreover, performance evaluation is carried out
by the FAS board.
Meanwhile, a system of public assessment has been set up. The
FAS and its regional offices have expert and public advisory boards
that unite both representatives of public organisations and ordinary
citizens. An independent organisation carries out an poll with citizens
each year, including telephone interviews, regarding their satisfaction
with the FAS’s performance (eg, professionalism of the antimonopoly
authority’s staff, efficiency and provision of information by the FAS).
Since 2011, the FAS’s performance has been assessed by the
Association of Corporate Lawyers (ACL), where members of the ACL
estimate the transparency of the FAS’s performance and allow for a
constructive open dialogue with the business community and
professional legal community.
Ensuring stability
To ensure stability and institutional memory among junior personnel,
the FAS undertakes several measures, including:
• workshops for employees accepted to the civil service for the first
time – the purpose of this training is to familiarise employees with the
structure of the antimonopoly authority, the legal status of civil
servants in general, the antimonopoly law and its application;
• mentoring programme – in the first two months of the probation
period, a mentor is appointed to a new employee to share experience

and knowledge necessary for work, and to help integrate him or her
into the team;
• rotation of federal civil servants – as part of the rotation scheme,
eight managing employees for the Regional Offices of the FAS were
appointed in 2014; and
• organisation of training events – each year, the FAS approves
regional workshops and training events with an emphasis on
educational events to increase skills and professional knowledge of
the FAS’s staff in the application of the legislation and interaction with
the judicial community.
Results
Key achievements
The establishment of new departments within the agency; adoption of
the fourth antimonopoly package that took into account OECD
recommendations; development of international cooperation in law
enforcement, particularly among the BRIC competition authorities;
hosting of the international event “Russian Competition Week” in
September 2015.
Appeals success
In 2015, the FAS Russia issued 7,446 decisions in cases of violation
of the Law on Protection of Competition. Of these, 1,577 decisions
were appealed in court and 40 were cancelled by the court.
How do you rate yourself?
During this extended meeting of the of the FAS Russia held in

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September 2015, the following positive trends were noted:
better implementation of orders issued by the authority;
an expanded use of administrative liability against
anticompetitive conduct;
improvement in the quality of work detecting signs of
competition law violations; and
significant reduction of the number of examined economic
concentration transactions.

Russia`s Federal Antimonopoly Service 2016

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