On March 14, 2013 the Federal Antimonopoly Service of Russia completed the proceedings against large-diameter pipe manufacturers that had lasted for more than a year. EPA&P’s Competition Law Practice represented ZAO TD TMK (Pipe Metallurgical Co) in the antitrust violation proceedings.
The proceedings against ZAO TD TMK (Pipe Metallurgical Co), OAO OMK-Stal, ZAO Gruppa ChTPZ (Chelyabinsk Pipe-Rolling Plant) and Izhora Pipe Mill CJSC were initiated in late 2011 suggesting violation of the Competition Law, Section 11, Part 1, p. 3, demonstrated by the conclusion of agreements that could have resulted in the territorial market sharing, the sales volume, the range of marketable goods and the sellers’ composition.
In view of all the details, the Commission initially declared that the signing of the schedules of pipe deliveries to Gazprom OJSC sites while taking no steps to increase the sales volumes suggested the large-diameter pipe manufacturers had failed to act on their own in regard to the commodity market concerned, which should be treated as per Section 11, Part 4 of the Competition Law. The Firm’s Competition Practice team further managed to provide evidence that a positive social and economic effect was achieved, and thus the Commission declared the markets players’ behavior acceptable as per the requirements of Section 13 of the Competition Law.
During the proceedings, the Client was represented by the Chairman of Egorov Puginsky Afanasiev & Partners Dmitry Afanasiev, Partner Ivan Smirnov and Senior Associate Evgeny Bolshakov assisted by Associates Grigory Shafeev and Oksana Akhmedova.
“In view of the case circumstances, the Federal Arbitration Service of Russia applied Section 13 of Federal Law “On Competition”, thus admitting a very positive social and economic effect of the piping companies’ actions, including the pipe mills’ implementation of the state import substitution programme, introduction of a brand new range of domestic large-diameter pipes certified for compliance with the best international standards, as well as creation of the new internationally competitive industry. Therefore an unbiased assessment was given to the piping companies’ numerous actions and billion-strong investment into the real economy sector over the recent years”, says Ivan Smirnov. I’d like to emphasise that application of this norm is exceptional for the Antimonopoly Service’s practice: since the very beginning of the Law operation in 2006, there were only a few cases of a positive effect being justified. Thus we may say that a new precedent has been constituted through a well-coordinated work of EPA&P’s Competition Law Practice team”.