FAS Issues Warning to Oil Tycoons Over Price Rise Comments

On February 18, 2014, Russia’s competition authority, the Federal Antimonopoly Service (“FAS”), issued warnings to two business leaders in the oil industry after their comments about a possible increase in the price of petrol. Gennady Shmal, the president of the Oil and Gas Industrialists Union, and Konstantin Simonov, the CEO of the National Energy Security Fund, mentioned to the media that the price of petrol would increase above inflation because of an extraction tax.

The FAS noted that such a comment may violate antitrust law, because it may lead to increased demand for petrol and result in excessive increase in prices. This may result in economic benefits for the members of the associations headed by Shmal and Simonov.

The FAS has been actively using warnings to curb anticompetitive behavior. In 2012, the FAS issued 1423 such warnings in total; as a result, the FAS announced that the number of cases that it was considering in 2013 was much reduced.