On May 20, 2015 at the site of the National Chamber of Entrepreneurs "Atameken" (hereinafter - NPP) was held a meeting on anti-monopoly regulation at cross-border markets of the Eurasian Economic Union. The participants of the meeting were: a collegium member (Minister) for competition and anti-monopoly regulation of the Eurasian Economic Commission (hereinafter - EEC) Nurlan Aldabergenov, Chairman of NCE RK Ablai Myrzakhmetov, as well as representatives of business associations of Kazakhstan, regional chambers of entrepreneurs, and government agencies.

From 1^st of January 2015, with the entry into force of the Treaty on the Eurasian Economic Union, there was created a supranational competition authority -EEC, with the authority to monitor compliance with the general rules of competition at cross-border markets, conduction of investigations and the use of other measures of antimonopoly response, including imposition of fines on violators. Also in the city of Minsk started its work the Court of EAEU, authorized to solve disputes arising from the implementation of the Treaty and the decisions of the EAEU.

There were adopted all the necessary regulatory framework for EEC to monitor compliance with the general rules of competition at cross-border markets, and on May 12, 2015 came into force an agreement on procedures to protect confidential information and responsibility for its disclosure in the implementation of its activities by EEC to monitor compliance with uniform rules on competition.

The meeting clarified issues of division of powers for suppression of infringements of the competition rules between the Commission and national competition authorities of the Member States of EAEU, as well as procedures for reviewing applications, conducting investigations and deal with cases of unfair competition, anti-competitive agreements (cartels) and abuse of a dominant position at the cross-border markets of EAEU.

The participants of the meeting discussed the current state of competition and the problematic issues at cross-border markets of EAEU.

About 20 million people live at the border regions of Kazakhstan and Russia, who often face with the problem of the high cost of cellular services in roaming. Kazakhstan subscriber pays at home 7 tenge per 1 minute of conversation on a cell phone, but after crossing the Russian border, he has to pay for this service 20 times more - 150 tenge. The same situation with the Belarusian and Russian customers.

According to the results of research carried out by EEC, the consumers of the three countries on tariff reduction in roaming tariffs and international calls can save up to 5.5 billion tenge, including Kazakhstani subscribers - to 2.2 bln. tenge. Expert estimates suggest that an increase in revenues of mobile operators due to increased traffic from lower roaming rates can be as high as 79 billion tenge, including Kazakhstani operators about 24 billion tenge.

The European Union reduced roaming rates 10 times in 2007, following this example EAEU should reduce and nullify roaming services to the level of international calls.

Cost of flight by competing airlines "Air Astana" and "Transaero" on the route Moscow-Astana is 50-60 thousand tenge, and on the comparable route Moscow-Karaganda, where "Transaero" competes with the airline "Aeroflot" flight is 22-25 thousand tenge. Users do not understand the reasons for this difference in rates.

 "EEC permanently analyzes air and railway tariffs, tariffs for mobile communications in roaming within the EAEU. If the Commission finds that carriers or mobile operators set monopolistically high prices at cross-border markets of EAEU, the supranational competition authority will start an investigation into violations of competition rules and adopt a binding decision on the cessation of the breach, the elimination of its consequences and imposition of a fine. In international practice, the European Commission regularly imposes multi-million fines for violations of antitrust laws on large multinational companies", - said Nurlan Aldabergenov.

For example, for the violation of the general rules of competition at cross-border markets EEC imposes on legal entities following penalties: up to 3.7 million tenge for unfair competition, for failure to submit or late submission of the requested data by EEC (information) or for giving deliberately false information; 15% of proceeds from the sale of goods on the market where the violation was committed by an agreement of economic entities (market players), restricting competition, abuse of dominant position of economic entities at the cross-border markets of Member States; 17.1 mln. tenge for the coordination of economic activities. In addition, for these violations will be imposed penalty on officials from 37 th. tenge to 555 thousand tenge.

At the market of detergents own production of Kazakhstan meets the needs of about 6% of population in detergents, and 70% comes from Russia, and the rest comes from other countries. In such circumstances, there is a possibility of cartel agreements on the establishment and maintenance of high prices, division of the market according to the territorial principle and other antitrust violations at the cross-border market of EAEU. For example, in the European Union in 2002-2005 there was a price collusion the largest manufacturers of detergents Procter & Gamble (P & G), Unilever and Henkel, which was revealed by the European Commission with imposition of a fine of more than 300 million euro.

Participants noted the difference in the prices of imported goods from authorized dealers and independent suppliers.

For example, the fuel filter for the popular car brand in Kazakhstan Toyota "Camry 40" in Almaty at the official dealer stands on 22 thousand tenge, while the independent supplier it is - 12 thousand tenge.

Engine C-27 10R7244 for special purpose vehicle "Caterpillar" in Russia stands at 55 thousand dollars cheaper than in Kazakhstan, but Kazakhstan's mining companies are not able to buy the engine directly from the Russian dealer with servicing in Kazakhstan. The situation is similar with the harvesters John Deer “W540”, in Kazakhstan they are 20 thousand euros more expensive than in Russia, and up to 35 thousand euros more expensive than in Germany.

2 or more times may vary prices for some drugs in Kazakhstan, compared with France, Canada, Great Britain, Spain and other countries. For example, a drug for the treatment of osteoporosis "Fosavans" in Kazakhstan is 65 US dollars, and in UK 32 US dollars.

Such a significant difference cannot be explained solely by transport and other necessary expenses.

According to representatives of EEC: "The policy of segmenting markets and restriction of competition between the distributors (dealers) by major foreign holders makes it profitable for Kazakhstan to return to the principle of international exhaustion of trademark rights, in fact, in effect until 2012. This will open the way to parallel imports, that is, we will be able to deliver the products of foreign manufacturers of certain registered brands, bypassing their distribution networks, having lower prices”.

Participants of the meeting noted the need for regular work to clarify the goals and objectives of the anti-monopoly regulation and competition policy in the EAEU, rules of EAEU Treaty, rules of competition and consequences of their violation, as well as the constant interaction of business in Kazakhstan with EEC on competition and anti-monopoly regulation.

In this regard, it agreed to sign the Memorandum between the collegium member (Minister) for competition and anti-monopoly regulation N.S. Aldabergenov and Chairman of the National Chamber of Entrepreneurs A.I.Myrzakhmetov on understanding and cooperation.

The created joint working group on the basis of the Memorandum between NCE and EEC will identify unfair competition, anti-competitive agreements, abuse of dominant position at the cross-border markets of EAEU against Kazakhstani businessmen and send materials to EEC for consideration, investigation and adoption of measures in accordance with the Treaty on the EAEU.

Thus, the Working Group and the interaction of NCE and EEC in the framework of the Memorandum will be aimed at ensuring equal conditions of competition, protection of the internal market, promotion of Kazakhstani goods at cross-border markets of EAEU, support of domestic business, budget savings and lower prices.

The facts of violation of general rules of competition at cross-border markets of EAEU against Kazakhstani businessmen can be communicated by phone and email to the responsible employees of the EEC:

Secretariat of the Collegium member (Minister) for competition and anti-monopoly regulation, tel. 8 (495) 669-24-00 ext. 5457;

Dosmukhambetov Balzhan Ibatovna - assistant to the collegium member (Minister) for competition and anti-monopoly regulation, tel. 8 (495) 669-24-00 ext. 5404; e-mail: balzhan@eecommission.org;

Fazil Almaty Usіnuly - Director of antitrust regulation, tel. 8 (495) 669-24-00 ext. 5444; e-mail: fazyl@eecommission.org;

Zhandarbek Dauren Zhandarbekuly - Deputy Director of Department of competition policy and public procurement, tel. 8 (495) 669-24-00 ext. 5451; e-mail: zhandarbek@eecommission.org.

The Department of Public Relations of NCE RK: +7 (7172) 91 93 67, pr@palata.kz

Official website: www.palata.kz