Antimonopoly Service recognizes tenders of the largest contractor of My Street Moscow program as cartel collusion

Antimonopoly Service recognizes tenders of the largest contractor of My Street Moscow program as cartel collusion
Evening Kremlin

Having concluded a cartel agreement, the companies achieved a minimum reduction from the initial contract price.

The Moscow Office of the Federal Antimonopoly Service (FAS) recognized the Agency for Advanced Technology Development (ARPT) and Orbita Service LLC as guilty of cartel collusion. The companies violated clause 2, part 1 of Art. 11 of the Law on Protection of Competition, and on contractual terms participated in bidding for the artistic illumination of buildings around the Kremlin and lighting traffic interchanges on Kashirskoye and Novorizhskoye Highways in Moscow.

The criminal case on the grounds of violation of the antimonopoly legislation was initiated in July 2017. According to the Moscow FAS Office, from July to December 2016 ARPT and Orbita Service took part in four auctions for a total of 625.9 million rubles ($10.6m). Having concluded the cartel agreement, the companies submitted one or several price offers during the auctions, refused to continue the competitive struggle. As a result, the price decrease in the auctions was from 1% to 5% of the initial price of the contract. Thus, the amount of contracts concluded by ARTP, according to the results of four auctions, was 615.5 million rubles ($10.4 m).

The regulator also found that during the auctions the companies exchanged information in the interests of each other and relied on a single information and technical infrastructure, and also conducted joint preparation for the auctions.

Thus, the capital's FAS established full identity of documents in the applications of both companies, the coincidence of names and file titles. In addition, they were saved one after another with a difference of a few seconds. The information on technical characteristics of the offered goods in the bids was also alike.

Punishment for violation of the antimonopoly legislation under the imputed article provides for a fine of up to 50% of the initial cost of bidding for legal entities and up to 50 thousand rubles ($852.6) for heads of organizations.

As Meduza notes, Orbita Service LLC was formerly called Prime Service. The only owner of the company is Alexander Pirogov. He also owns Technoconcept LLC, which in 2017 won tenders for Moya Ulitsa (My Street) program for almost 2.7 billion rubles ($46m) on the improvement of two sections of the Garden Ring - from Dolgorukovskaya Street to Tsvetnoy Boulevard and from Pokrovka Street to the Yauza Embankment. The rival of Technoconcept at these tenders was ARPT. The beneficiaries of the companies are the brothers Teymur and Murad Beniaminovs - longtime friends of the family of billionaire Aras Agalarov; the elder brother is married to the daughter of billionaire Gavriil Yushvaev.

In 2017, the Agency for Advanced Technology Development and Technoconcept became the largest contractors of My Street program, having won tenders worth almost 9.9 billion rubles ($168.8m).

The CrimeRussia has reported that ARTP under a similar scenario concluded contracts for landscape lighting of the Boulevard Ring, for which more than three billion rubles ($51.1m) will be allocated. A doubtful competitor in the bidding was another major contractor of the Moscow Mayor's office – Spetsstroy LLC (not affiliated with the federal agency Spetsstroy of Russia). The General Director and the owner of the company is some Anton Bazanov. RBC connects his name with the construction holding Capital Group, helmed by businessmen Vladislav Doronin, Eduard Berman and Pavel Tyo.

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