Dominancia Colectiva En Rusia

Abuse of Collective Dominance under the Competition Law of the Russian Federation1 By Svetlana Avdasheva*, Nadezhda Goreyko**, and Russell Pittman***
Draft 9/22/11
ABSTRACT
In 2006, Russia amended its competition law and added the concepts of “collective dominance” and its abuse. This was seen as an attempt to address the common problem of “conscious parallelism” among firms in concentratedindustries. Critics feared that the enforcement of this provision would become tantamount to government regulation of prices. In this paper we examine the enforcement experience to date, looking especially closely at sanctions imposed on firms in the oil industry. Some difficulties and complications experienced in enforcement are analyzed, and some alternative strategies for addressinganticompetitive behavior in concentrated industries discussed.
I. INTRODUCTION
In 2006, Russia amended its competition law. Among many changes made, perhaps the most
important was the introduction of the concept of “collective dominance”, as a part of the associated and implicit concept of the abuse of collective dominance (Article 5). Along with the detailed elaboration of the concept of a“monopolistically high price” (Article 6) and the introduction of the concept of “concerted practices” (Article 8), the introduction of this new concept led businesses and analysts to fear that the new law would be used to control directly the prices charged by firms in concentrated markets.
1 The authors are grateful for helpful comments by Andrei Shastitko.
* Professor of Economics, Higher School of Economics,Moscow.
** Junior Researcher, Institute for Industrial and Market Studies, Higher School of Economics, Moscow.
*** Director of Economic Research, Antitrust Division, U.S. Department of Justice, and Visiting Professor, New Economic
School, Moscow. The views expressed are not purported to reflect the views of the U.S. Department of Justice.
Electronic copy available at:http://ssrn.com/abstract=1933942
Of course, this broad issue is not unique to Russia, nor new to the area of competition law and policy. In a concentrated market, a small number of firms may be able to easily observe each other’s actions and thus to behave in a manner that is better characterized as cooperative than competitive. Furthermore, if the number of firms is sufficiently small and important marketcharacteristics (like price) sufficiently transparent, the firms may behave in this cooperative manner without the necessity of resorting to explicit discussions or agreements. As we will discuss below, attempts by competition authorities in other jurisdictions – principally the US and the EU – to attack such cooperative behavior as illegal under the competition law have not met with much success. Tribunalsand judges have been loath to punish firms for simply behaving in their own long-term interest, and have asked how they are to order the firms to pretend that they cannot observe the behavior of the other firms in the market and predict the reactions of rivals to their behavior. The introduction of the concept of the abuse of a position of collective dominance – a seemingly straightforward extensionof the standard concept of the abuse of a position of individual firm dominance – was an attempt by the Federal Antimonopoly Service (FAS) of the Russian Federation to allow enforcers to attack tacit collusion directly, moving beyond existing limitations to attacking such behavior as a form of prohibited horizontal “agreement” – under Section 1 of the Sherman Act, for example, or under Article101 of the Treaty of Lisbon. However, there are reasons why this avenue of competition law enforcement has run into difficulties in other jurisdictions, and some of these have come to the fore in the short enforcement experience of FAS with this provision of the law.2
In what follows, we will describe the background and context in which these changes in the Russian competition law took place,...