OREANDA-NEWS. The Federal Antimonopoly Service (FAS Russia) initiated a case against the "Zavolzhsky Engine Plant" and its dealers for breaching Parts 3 and 8 Article 11 of the Federal Law "On Competition Protection" (market sharing, market entry prevention), reported the press-centre of  FAS Russia. 


The "Zavolzhsky Engine Plant" is part of the "Severstal'-AVTO" group of persons - one of the biggest motor vehicle manufacturers in Russia. It appears that the "Zavolzhsky Engine Plant" breached that antimonopoly legislation by issuing №1 Addendum to the Dealer Agreement, which has a Clause stating that "in order to restrict competition" the dealers will lose their dealer discounts if they also sell competing products.

According to Alexei Ulyaniov, the Head of Department on Control and Supervision in Industry, Construction, Metallurgy and Ore Mining, "the case is unprecedented as it relates to a vertical agreement and the new law "On Competition" has changed their regulations. FAS Russia will determine what dealers are allowed or not allowed to do and to what extend dealer agreements can restrict competition".

On 3rd May 2007, the FAS Russia Commission discussed the possible breach of Parts 3 and 8 Article 11 of the Federal Law "On Competition Protection" by the "Zavolzhsky Engine Plant" and its dealers. However, the FAS Russia Commission established that "Magistral'-NN" OJSC and "Voskhod-K-Avto" OJSC did not submit information specified in the Decision on the case assignment, and did not attend the meeting. Under Part 1 Article 45 of the Federal Law "On Competition Protection", the Commission determined: to extend the period for case consideration. The next meeting to discuss the case of the "Zavolzhsky Engine Plant" and its dealers will take place in the beginning of June 2007.