Protection of rights in the civil court for the Protection and Development of Competition
Joint Stock Company "B" (hereinafter referred to as JSC) filed a lawsuit against AVTO to declare illegal the actions of the Republican State Institution "Department of the Committee for the Protection and Development of Competition of the Ministry of National Economy of the Republic of Kazakhstan for the East Kazakhstan Region" (hereinafter referred to as the Department) on the cancellation of orders dated September 9, 2019 No. 201-OD and No. 10-OD dated November 19, 2019, arguing that the Department violated their legitimate rights and interests by appealing the orders. By the decision of the specialized interdistrict Economic Court of the East Kazakhstan region dated February 4, 2020, which was left unchanged by the decision of the judicial board for civil cases of the Court of the East Kazakhstan Regional Court dated April 30, 2020, the application was satisfied. The actions of officials of the Department for the investigation of violations of the legislation of the Republic of Kazakhstan in the field of competition protection in relation to JSC AVTO were recognized as illegal. The Department's orders No. 201-OD dated September 9, 2019 and No. 10-OD dated November 19, 2019 were declared illegal and canceled. It was decided to reimburse the state duty in the amount of 37,875 tenge from the republican budget of JSC AVTO. The Judicial Board for Civil Cases of the Supreme Court overturned the judicial acts of local courts and issued a new decision in the case to dismiss the claim of JSC AVTO on the following grounds.
Protection of rights in the civil court for the Protection and Development of Competition
Within the meaning of the law, a decision is lawful when it is made in compliance with the norms of procedural law and in full compliance with the norms of substantive law applicable to this legal relationship. A reasoned decision is considered justified if it reflects the facts relevant to the case, confirmed by evidence examined by the court that meets the requirements of the law on their relevance, admissibility and reliability. Judicial acts of the courts of first instance and appeal do not meet these requirements. It follows from the case file that on June 10, 2019, the Department issued orders No. 101-OD and No. 102-OD to investigate violations of the legislation in the field of competition protection of the Republic of Kazakhstan in relation to LLP "G" and JSC "ASIA". The investigation dates are set from June 11, 2019 to September 4, 2019. By the rulings of July 18, 2019, the investigation of violations of legislation in the field of competition protection in relation to LLP "G" and JSC "ASIA" was suspended. On September 9, 2019, the Department issued an order to investigate violations of the legislation of the Republic of Kazakhstan in relation to AVTO JSC in the field of competition protection, provided for in subparagraphs 1), 2), 3) of paragraph 1 of Article 169 of the Entrepreneurial Code of the Republic of Kazakhstan (hereinafter referred to as the PC). The investigation period is set from September 11, 2019 to December 7, 2019. By the rulings of November 6, 2019, the investigation into violations of the legislation of the Republic of Kazakhstan in the field of competition protection in respect of LLP "G" and JSC "A" was resumed on November 6, 2019. By Order No. 10-OD dated November 19, 2019, the investigation of violations of the legislation in the field of competition protection of the Republic of Kazakhstan, provided for in subparagraphs 1), 2), 3) of paragraph 1 of Article 169 of the PC, on the grounds of LLP "G", JSC "A" and JSC "AUTO" is combined into one production.
The local courts, satisfying the applicant's claims, concluded that the appealed order dated September 9, 2019 did not comply with the requirements of Article 218 of the Criminal Code, in particular, it did not indicate whether the actions of the inspected facility showed signs of violation of the legislation of the Republic of Kazakhstan in the field of competition protection, as well as the subject of the investigation and the period under review. Meanwhile, the conclusions of the local courts do not correspond to the actual circumstances of the case and the norms of substantive law. Paragraph 3 of Article 218 of the PC stipulates that the order to conduct an investigation must contain: 1) the name of the object or objects of investigation; 2) the grounds for investigating violations of the legislation of the Republic of Kazakhstan in the field of competition protection; 3) signs of violation of the legislation of the Republic of Kazakhstan in the field of competition protection, which are seen in the actions (inaction) of the object of investigation; 4) the date of the beginning and end of the investigation; 4-1) the subject of the investigation; 4-2) the period under review; 5) the surname, first name and patronymic (if it is indicated in the identity document) of the official of the antimonopoly authority authorized to conduct the investigation; 6) the rights of persons involved in the investigation of violations of the legislation of the Republic of Kazakhstan in the field of protection of competition.
Protection of rights in the civil court for the Protection and Development of Competition
As follows from the content of the order dated September 9, 2019, the basis for conducting an investigation against AVTO JSC was the instruction of the Committee for the Protection and Development of Competition of the Ministry of National Economy of the Republic of Kazakhstan dated September 5, 2019. At the same time, it is indicated that the investigation was initiated in accordance with subparagraphs 1), 2), 3) of paragraph 1 of Article 169 of the PC on the grounds of violation of anti-competitive agreements, in terms of setting or maintaining prices (tariffs), discounts, surcharges (surcharges) and (or) margins, raising, lowering or maintaining prices at auction., distortion of the results of auctions, auctions and contests, including by dividing by lots, as well as dividing the commodity market by territorial principle, volume of sale or purchase of goods, the range of goods sold or the composition of sellers or indicators (customers) in relation to JSC "AVTO" with LLP "G" and JSC "AVTO". In this regard, the defendant's arguments that the Department did not violate the requirements of paragraph 3 of Article 218 of the Criminal Code during the issuance of the contested order are well-founded. Moreover, the Law of the Republic of Kazakhstan dated October 28, 2019 No. 268-VI SAM "On amendments and additions to certain legislative acts of the Republic of Kazakhstan on regulation of the agro-industrial complex" paragraph 3 of Article 218 of the PC supplemented with sub-paragraphs 4-1) and 4-2) as follows: "4-1) subject of investigation; 4-2) the period under review". Consequently, at the time of the issuance of the contested order dated September 9, 2019, there were no requirements for mandatory disclosure of information about the subject of the investigation and the period under review. According to the appealed order dated September 9, 2019, the investigation period is set from September 11, 2019 to December 7, 2019, that is, within the three-month period established by paragraph 4 of Article 218 of the Criminal Code. The Judicial Board also considers the conclusions of the local courts regarding the illegality of the Department's order dated November 19, 2019 on the following grounds to be unfounded. By this order, the investigation of violations of the legislation in the field of competition protection of the Republic of Kazakhstan in relation to LLP "G", JSC "A" and JSC "AUTO" has been combined into one production. The local courts, recognizing this order as illegal, reasoned that on July 18, 2019, the proceedings were suspended, and after the court's decision came into force on August 12, 2019, the investigation period was not suspended, it continued to take place, despite the fact that the decision to resume the investigation was issued on November 6, 2019. According to paragraph 5 of Article 218 of the Criminal Code, before starting an investigation, the antimonopoly authority registers with the authorized body for legal statistics and special accounts an act on the appointment of an investigation by submitting it to the authorized body for legal statistics and special accounts, including in electronic form.
Meanwhile, the antimonopoly authority has the right to suspend the investigation of violations of the legislation of the Republic of Kazakhstan in the field of competition protection in cases established by paragraph 1 of Article 222 of the PC. The investigation period for violations of the legislation of the Republic of Kazakhstan in the field of competition protection is interrupted upon suspension of the investigation and continues from the moment the investigation is resumed. During the investigation, the antimonopoly authority may decide to combine several investigations into one or to separate and conduct a separate investigation. The official of the antimonopoly authority issues a ruling on the suspension and resumption of the investigation, as well as the appointment of an expert examination. At the same time, the definition itself is not sent to the subjects of the investigation. The PC regulations do not contain a time limit for resuming an investigation. Moreover, the applicant does not dispute the fact that officials did not conduct an investigation during the suspension of the case. Therefore, the courts' conclusions about the antimonopoly authority's obligation to immediately reopen the investigation are not based on the requirements of current legislation. In such circumstances, several investigations were combined into one production within the time limit prescribed by law and there were no violations on the part of the Department.
Attention!
Law and Law Law Law draws your attention to the fact that this document is basic and does not always meet the requirements of a particular situation. Our lawyers are ready to assist you in legal advice, drawing up any legal document suitable for your situation.
For more information, please contact a Lawyer / Attorney by phone: +7 (708) 971-78-58; +7 (700) 978 5755, +7 (700) 978 5085.
Attorney at Law Almaty Lawyer Legal Services Legal Advice Civil Criminal Administrative Cases Disputes Protection Arbitration Law Firm Kazakhstan Law Office Court Cases
