Authorized Persons of the Federal Antimonopoly Service must balance the interests of the regulator and the business

29 november 2018

"As part of the Fifth Antimonopoly Package, the Federal Antimonopoly Service of the Russian Federation has for the first time provided for appearance of authorized persons. The current version of the document contains basic requirements to an authorized person but does not assign its status as a person acting in the interests both of the regulator and business, the procedure of appointment of an authorized person, its powers and financing terms. Thus, the experts are worried with uncertainty of law enforcement practice", Elena Kovaleva, Head of the Department for Competition Policy of the Analytical Center, said while opening a round table "Engagement of authorized persons in monitoring fulfilment of instructions of the antimonopoly authority".

As the expert explained, availability of the authorized person may allow increasing control efficiency, remove part of burden from the antimonopoly authority, reduce risks for companies and possible expenses resulting from non-performance of instructions. The analysis of international experience also demonstrates efficiency of monitoring by the authorized persons when following the instructions issued during approval of economic concentration transactions.

But there are risks related to conscientious performance of powers by the authorized persons. So, to monitor the instructions of the Antimonopoly Service, the authorized person gets access to confidential information and may use it for his or her own purposes. The mechanism of the authorized person selection is not transparent and the company may actually not influence this process. To reduce risks, it is necessary to develop the mechanism for attracting the authorized persons that will consider the balance of interests of the regulator and controlled companies, the experts say.

"Guidelines and by-laws to the project are required; they will contain clear explanations of law enforcement norms. It is necessary to understand how to check that an authorized person has no conflict of interests. Information protection mechanisms, including the technical ones, are required. Also, it is necessary to formalize mandatory insurance of responsibilities of the authorized persons and provide a mechanism of their powers termination in case of unfair actions", a partner of antimonopoly practice Goltsblat BLP Vitaly Dianov noted.

The expert added that before the entry of the Fifth Antimonopoly Package in force, it is necessary to specify a mechanism that will allow commercial companies to object to the actions of the authorized person, recall an appointed expert and select a new one. The business community also proposes to provide commercial companies with a possibility to choose an authorized person independently. To form such a mechanism, it is supposed to develop a system for accreditation of experts and expert companies that will be included to the register of authorized persons of the Federal Antimonopoly Service. This measure will allow to make the new institute more open and will satisfy the interest of all the process participants.

According to the opinion of the round table participants, the institute of authorized persons may be an optional mechanism for approval of the concentration transaction. According to such scheme, the company that received an instruction from the antimonopoly authority will be able to voluntarily agree to the participation of the authorized person. In this case, all the expenses related to the monitoring will be borne by the business structure, but the period of the instruction will be reduced. 

Currently, the Fifth Antimonopoly Package undergoes interdepartmental approval, Deputy Head of the Legal Administration of the Federal Antimonopoly Service Igor Antonov noted. Final corrections will be introduced after all discussions.