The Antimonopoly Committee of Ukraine (AMCU) has imposed a fine on Google LLC (99% owned by Google International LLC, the United States) in the amount of UAH 1 million for failure to provide information on time at the request of the state authorized representative of the AMCU.
As noted in the report on the website of the committee, such a decision was made by the provisional administrative board of the AMCU at a meeting on April 2.
“The size of the fine is determined by aggravating circumstances, namely by the fact that Google LLC has not provided the committee with the requested information for more than a year,” the report says.
This information was necessary for the AMCU to investigate the application of an individual entrepreneur regarding the blocking of his account in the Google My Business application.
The AMCU stressed that the failure of the respondent to provide information within a certain time frame makes it impossible for the committee to fulfill the tasks assigned to it, in particular, the timely, complete and comprehensive consideration of an application for violation of the legislation on protection of economic competition.
At the same time, it is noted that already within the framework of the consideration of the case initiated against the company for failure to provide information at the request of the committee, this information was provided by the defendant, which in turn was also taken into account by the AMCU when determining the amount of the fine.
“At the moment we are clarifying the details of this situation,” the press service of Google Ukraine commented to Interfax-Ukraine.
The Antimonopoly Committee of Ukraine has imposed a fine of UAH 4.7 billion on the operators of the filling station network, which are part of the Privat Group, for anticompetitive concerted actions in setting prices for petroleum products.
According to the committee’s statement on Tuesday evening, in particular, a fine was imposed on PTF Avias LLC, Trading House Avias LLC, Prom Garant Plus LLC, Alliance Evolution LLC, PJSC Ukrtatnafta and 169 filling station operators (including PJSC Ukrnafta).
The committee said that within the framework of the case opened in 2016, it was established that in the field of retail trade in light petroleum products in Ukraine, there is a system of cashless payments with scratch cards and Avias fuel cards. About 1,625 filling stations take part in this project, which operate under different brands in all regions of Ukraine, occupying a 25% share of all filling stations in the country.
“The committee determined that the Avias project is organized, coordinated and operates with the aim of harmonizing the price and trading behavior of the participants,” the committee said.
In particular, Keropur®ENERGY gasoline and diesel fuel were sold throughout the network, the same prices were set at a time regardless of the brand of the filling station and the region, and there was also a “center” that included several business entities located at the same address in the city of Dnipro, where detailed planning and coordination of network activities was performed.
In addition, the committee found a significant number of standard, basically identical contracts for the sale and purchase of petroleum products and property, lease of filling stations and financial assistance, and also established that individuals, who held the positions of director, founder, signatory, accountant, manager, etc, often changed each other and worked simultaneously in several companies participating in the project.
In addition, the composition of legal entities – participants in the project was constantly changing (without changing the personal composition). This happened through the same liquidators and at similar addresses of the latest registration in Kharkiv.
The committee found that filling station operators, including Ukrnafta, purchased light oil products from Ukrtatnafta at prices higher than similar imported fuel.
“Such coordinated behavior of the Avias project participants violates competition between operators of filling stations in the market. Therefore, prices for light oil products in the Avias network were set in anti-competitive conditions. Taking this into account, the committee approved to impose fines on the above-mentioned business entities in the total amount of UAH 4.7 billion for these violations,” the committee said.
“Today we are summarizing the result of a great deal of work and many years of legal confrontation between the Antimonopoly Committee and the participants in conspiracy on the Ukrainian fuel market. Despite complicated circumstances and enormous resistance from the defendants, we completed the investigation and made the decision,” Chair of the committee Olha Pischanska said after the meeting.
The findings of the Supreme Court, which allowed Tedis Ukraine to satisfy the cassation appeal against the Antimonopoly Committee of Ukraine (AMCU) and invalidate the fine of UAH 3.4 billion, will also significantly enhance the prospects of cigarette manufacturers to revoke the decision of the committee on fines, according to lawyers interviewed by Interfax-Ukraine.
“Speaking of other tobacco trials, it should be said that the Supreme Court’s findings on the inconsistency of the Antimonopoly Committee’s decision with the rules of prejudice and evidence can significantly enhance the prospects of cigarette manufacturers to overturn the Antimonopoly Committee’s decision,” Asters law firm partner Oleksiy Pustovit said.
He recalled that the Supreme Court had put an end to the Tedis Ukraine lawsuit against the Antimonopoly Committee, invalidating the committee’s decision incriminating anti-competitive concerted actions by Tedis and cigarette manufacturers Philip Morris International (PMI), JT International (JTI), Imperial Tobacco (IT) and British American Tobacco (BAT).
“The decision is important both in terms of influencing the law enforcement practice of the Antimonopoly Committee as a whole and in terms of changing the balance of power in ongoing similar litigation between cigarette manufacturers and the committee,” he said.
The lawyer called the Supreme Court’s decision “brief and capacious at the same time.” In particular, according to the lawyer, the most remarkable position is the illegality of the committee’s use of its decisions and recommendations in other cases as adjudicated. Many of the committee’s findings were not established or examined on the basis of evidence, as required by law, but were taken from other cases in which participants, markets and circumstances differed. In addition, the committee’s decision also contained elements of letters of recommendation as evidence in the case, which was closed without establishing any facts of violation of competition law.
“The Supreme Court concluded that the Antimonopoly Committee, citing other decisions, did not in fact investigate the market itself, which is decisive for any antitrust case, while other decisions dealt with other markets. The issue of the illegality of the committee’s use of its decisions in other cases as adjudicated was raised by the manufacturers and Tedis at the stage of consideration of the case by the committee. From a legal point of view, such an approach is tantamount to charges without some hard evidence,” he said.
The lawyer said that similar arguments were used in the claims of the tobacco manufacturers.
“Following the decision of the Supreme Court, courts will most likely follow the position of the illegality of the committee’s decisions and recommendations made in other cases as adjudicated, in other cases under manufacturer’s claims, which enhances the manufacturer’s chances of winning disputes with the committee,” Pustovit said.
In turn, partner of the Legal Alliance Andriy Gorbatenko reminded that the Antimonopoly Committee imposed a fine on tobacco companies due to the fact that with the entry of Tedis Ukraine (formerly Megapolis-Ukraine) in 2010, the number of cigarette distributors began to decline sharply and by 2013 Tedis Ukraine was the only distributor to which cigarette manufacturers supplied their products. Following the investigation, the committee concluded that this circumstance was the result of anti-competitive concerted actions that concerned the elimination of other distributors from the market or restriction of market access to them. In particular, the Antimonopoly Committee found that cigarette manufacturers had identified unfeasible selection conditions for distributors, which even Tedis Ukraine did not meet.
However, the lawyer said that “the unfortunate decision of the Antimonopoly Committee does not contain exhaustive evidence that would unequivocally answer this question,” and the Antimonopoly Committee did not provide evidence of consistency between the actions of cigarette manufacturers and Tedis Ukraine.
“Could this decision of the Supreme Court be the basis for reversing the decision of the Antimonopoly Committee and some cigarette manufacturers? Definitely, yes. Given the position set out in the decision of the Supreme Court, the accusation of the Antimonopoly Committee in this case is as follows: there seemed to be some agreement to establish barriers for other distributors to enter the primary cigarettes market, but it is not clear who agreed on this and with whom and it does not mean that the conditions established as a result of such an agreement (if any) could really create a barrier,” the lawyer said.
Gorbatenko also said that “the rest of the charges are based on evidence that cannot be used because it was collected in other investigations.”
“The probability that the Antimonopoly Committee’s decision regarding the accusations against the manufacturers will be backed by courts is akin to the probability of meeting an alien mind. Of course, there is a chance, but everyone will be very surprised if it really happens,” the lawyer said.
“We just have to hope that this decision of the Supreme Court will not only bring disappointment to the Antimonopoly Committee, but will also be an incentive for more thorough investigations and preparation of decisions, possibly in relation to Tedis Ukraine,” Gorbatenko said.
In turn, the American Chamber of Commerce in Ukraine reminded that “the rule of law and fair justice is one of the strategic priorities identified by the American Chamber of Commerce in 10 steps for Ukraine’s economic recovery and growth in 2021.”
The Chamber, in particular, notes the need for transparent and fair litigation, as companies have expressed concern that they have not been given full access to the evidence on which the Antimonopoly Committee’s allegations are based, and that insufficient attention was paid the companies’ arguments during the trial.
“Such high-profile disputes usually attract a lot of attention from the international community and can have an extremely negative impact on Ukraine’s image among foreign investors. A quick, transparent and fair solution will help maintain business relations between strategic investors and the state, not damage Ukraine’s reputation and investment climate and avoid losses for the budget,” President of the American Chamber of Commerce in Ukraine Andy Hunder said.
The Antimonopoly Committee of Ukraine (AMCU) fined the Ukrainian industrial company Interpipe UAH 69.3 million for violating antimonopoly legislation.
“Today, on October 29, 2020, the Ukrainian industrial company Interpipe has received a fine from the AMCU in the amount of UAH 69.3 million for violating antimonopoly legislation. According to the decision of the AMCU, the fine was imposed in connection with the abuse of a monopoly position in the wheel supply market,” the company’s press release reported on Thursday.
At the same time, Interpipe officially declares that it categorically disagrees with such decision of the AMCU and intends to contest this decision in court.
“As a national producer, we consider the AMCU’s decision to be unfair and unreasonable, taken not on the basis of facts, but on assumptions. The Ukrainian market is open to producers from other countries, and there are no protective duties on the market,” the press release emphasizes.
At the same time, it is noted that by submitting such complaints to the AMCU, unscrupulous competitors are trying to discredit the national manufacturer in order to ensure the supply of products of Russian manufacturers to Ukraine.
The statement also recalls that unlike the Ukrainian market, the Russian Federation protected its market from Ukrainian wheels with a 39% protective duty.
Tough sanctions for violation of the rules of importing cars with foreign registration came into force on August 22, State Fiscal Service of Ukraine said on its website.
“Let us remind that according to new rules a fine in an amount of UAH 85,000 was set if a term of delivery of the vehicles of personal and commercial use delayed by 20-30 days,” the service said.
The rules say that in terms of delay by 30 days, or if the vehicle is damaged or disassembled, the size of the fine will be UAH 170,000 or the car will be subject to confiscation.
The similar fines will be paid under violating of terms of temporarily import of the vehicles: UAH 85,000 fine for failure to meet 20-30 days of deadline, UAH 170,000 or confiscation of the vehicle in case of damage or disassembling of the vehicle.
As reported, President of Ukraine Volodymyr Zelensky is going to put to the parliament a bill that postpones fines for three months. During this period, the working group is to draw out a new bill that regulates rules of disassembling of new or already used vehicles, which are in Ukraine or will be imported to Ukraine.
The State Fiscal Service of Ukraine has imposed UAH 160.8 million of fine for over 600 facts of violation of declaration of transactions under control under transfer pricing by taxpayers, and 55% of the sum was paid to the national budget, the authority said on its website on Tuesday. “About 3,000 taxpayers report annually on the performance of controlled transactions, and 2,700 reports for 2016 for the amount of UAH 2.47 trillion were submitted,” the authority said.
According to its data, the main countries, with residents of which controlled transactions were held in 2013-2016, except for banking, were Cyprus (27%), Russia (18%), Switzerland (15%) and the United Arab Emirates (12%).
Most of the taxpayers who perform controlled transactions are registered in the Office of Large Taxpayers – 40%, while the amount of transactions performed by these companies is 92% of the total volume of transactions. Another 24% of taxpayers registered in Kyiv (the amount of transactions – 4%), and 4.6% of companies in Dnipropetrovsk region (the amount of transactions – 0.8%), according to the data of the fiscal service.
The largest subjects in terms of volumes of controlled transactions are banking – 57%, goods – 31% and financial services – 6%, the authority said.
As the fiscal service said, 34 out of 58 inspections started in 2014-2018 on taxpayers’ compliance with the arm’s length principle ended. According to their results, the supervising agencies added UAH 400 million of income tax, UAH 5.8 million of value-added tax (VAT) and reduced the amount of VAT refund by UAH 4.1 million. In addition, the supervising authorities also charged UAH 68 million penalty.
At the same time, 430 enterprises voluntarily increased their taxable income or reduced losses for operations in 2013-2016 by more than UAH 4.7 billion. “As a rule, this happened after receiving a request from the State Fiscal Service for the submission of documents on transfer pricing,” the authority said.
