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. Last Updated: 07/27/2016

251 Firms Targeted in Antitrust Investigation

The Federal Anti-Monopoly Service said Thursday that it would open cases against 251 companies that sell refined oil products in Russia because of "intolerably high" prices for gasoline.

Igor Artemyev, the service's chief, also told reporters that the watchdog was considering canceling fees paid to Aeroflot by foreign companies flying over Russian territory, a move sought by a new domestic rival and demanded by the European Union as part of Russia's talks on joining the World Trade Organization.

"Our monitoring has uncovered 251 companies working in retail, all of which are violating anti-monopoly law," Artemyev said, Interfax reported.

The service has been stepping up its checks on oil refiners since last summer, when Prime Minister Vladimir Putin ordered the watchdog to find out why gasoline and jet fuel prices were not falling as quickly as crude oil.

Units of the country's five largest oil companies have since been fined for violations.

"All types of gasoline except 98 octane should cost less than 20 rubles [per liter]. In Siberia and the Far East, given the transportation costs, it could be a bit higher than 20 rubles, but not by much."

He said octane 95 gas, which currently retails for about 21 rubles in Moscow, should cost "19 rubles, or 19 and change."

He also said the anti-monopoly service would consider a proposal by Mayor Yury Luzhkov and Russian Technologies chief Sergei Chemezov, who are merging assets to create an airline called Rosavia, to scrap the overflight fees paid to Aeroflot.

"We're preparing a document for the government. It's possible that we won't try to get it approved [within the government] and request a decision directly from the prime minister," Artemyev said, adding that if Putin did not comment a decision would be made by Deputy Prime Minister Sergei Ivanov.

Artemyev characterized the practice as "madness," but he added that no one wanted to "make Aeroflot flop." The payments are supposed to be halted by 2013 as a condition for Russia's entry into the World Trade Organization.

The Transportation and Economic Development ministries have backed the royalty fees, Interfax said. Under recently introduced procedures, such proposals have to be approved by all relevant ministries and agencies or, in the case of a dispute, decided by one of Putin's eight deputies.

At a meeting of the body Wednesday evening, Putin ordered the anti-monopoly service, the Economic Development Ministry and the Industry and Trade Ministry to prepare changes to the law on foreign investment by April 1, Artemyev said.

Artemyev, who also sits on the commission, added that of 45 recent requests the committee had received, only some were from foreign investors. Others, he said, were Russian companies registered offshore or deals involving strategic assets being bought by domestic businesses.