OREANDA-NEWS. September 10, 2014. The Head of FAS Department for Control over Housing & Utilities Sector, Construction and Natural Resources, Vadim Solovyov, discussed “System-wide problems of water and sewage utilities and ways to resolve them” at the VII Inter-regional Conference of Russian water-supply companies.

The Conference was organized by Russian Association of Water Supply and Drainage. Over 350 representatives of various organizations involved in water supply, water drainage, energy efficiency and production of equipment for water supply and drainage took part in the Conference. Attendees also included representatives of federal executive bodies, particularly, the Ministry of Construction, the Ministry of Economic Development and the Federal Tariff Service of the Russian Federation.

The program comprised Round Tables and plenary sessions that covered, in particular, the issues of developing water and sewage utilities under new sectoral legislation. Organizational, financial and legislative pre-conditions for enhancing efficiency of a concession model were not neglected.

The Head of the Department of the antimonopoly authority for Control over Housing & Utilities Sector, Construction and Natural Resources presented novelties in concession and antimonopoly laws. For instance, a federal law was announced, that has come into force this summer, aimed at developing the institution of attracting private investments to housing-and-utilities sector, developing the institution of concession model, protecting private investors and developing fair competition.

He said that “several positive changes were made to the concession law with regard to the markets of water and sewage utilities and fair competition”:

- Provided for investor’s possibilities to send an offer to a concession grantor on concluding a concession agreement upon considering which a concession agreement can be concluded without holding competitive tenders.

- Making changes to the Federal Law “On Protection of Competition” that granting state or municipal guarantees by a concession grantor to a concession holder in accordance with the budget legislation of the Russian Federation and the property right under a concession agreement does not constitute state or municipal preferences.

- The validity period of a concession agreement shall be determined in view of the period for obtaining the funds (revenue) by concession holder as specified by the agreement.

- A possibility of joint concession grantors is formalized.

The Head of the specialized FAS Department stated: “Recently the institution of concession in Russia has changed considerably for the better for business. Concluding concession agreements becomes transparent, and pre-conditions for fair competition are created. The authorities and local self-government bodies must follow changes in the law, observe the new rules for concluding concession agreements and enforce them. At the same time, although FAS sent explanations to the heads of the subjects of the Russian Federation, a great number of concession agreements in the housing-and-utilities sector are concluded with violations. FAS will continue monitoring concession agreements and lease contracts for water and sewage utilities facilities and provide the necessary explanations”.

Representatives of federal executive bodies arrived at a common view on changes to the concession law and the law on water supply and water sewage. They pointed out that the decisions on changes are adopted and came into effect, and it is necessary to move forward and develop this mechanism of attracting private investments and modernizing housing-and-utilities sector.

Participants discussed several problems in water and sewage utilities, including violations of the antimonopoly law in this field, and outlined the problems of tender procedure necessary for water-and-sewage utilities organizations to exercise their activities.

Vadim Solovyov emphasized that the issues are not with the statutory tender procedure but with unsatisfactory drafting of tender documentation by the ordering parties. They do not pay due attention to technical assignments in the documentation and instead complain about the law on the tender legislation.

In conclusion, he discussed FAS initiatives in the part of connecting to water and sewage utilities systems and exercising control over such procedures.