Ivanyan & Partners has represented the interests of the Russian Union of Railway Transport Operators and oil products transporter Transoil in antitrust proceedings against railway wheel manufacturer Vyksa Steel Works.
According to Ivanyan & Partners, “the subject matter of the comprehensive investigation by the Federal Antimonopoly Service of Russia was the supplier’s activities in 2019, when, during unmet demand on the market, VSW sold solid-rolled wheels via competitive tendering. As a result, the price for wheels increased by over 40% for some customers by August 2019.”
“VSW’s actions caused a shock in the market,” explained Ivanyan & Partners Counsel Ekaterina Smirnova, who led the firm's team on the deal. “Firstly, none of the players knew the volume of goods to be put up for competitive tenders and could not project their economic activity. Secondly, it was proposed that all buyers purchase wheels namely via the bidding procedure and not on the basis of [executed] supply contracts, which provoked additional speculative demand. Thirdly, the starting price at the auction was monopolistically high. What is more, in the eight days between the closing of the first auction and the beginning of the second one, VSW raised the price by another 25%, which had no production or economic grounds.”
Following the proceedings, which concluded on July 8, 2020, the FAS found Vyksa Steel Works guilty of price gouging in the market for solid-rolled wheels.