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The present article shall determine the legal basis of activity in the field of natural monopolies and is intended to achieve а balance between the interests of consumers and natural monopoly



Monopoly


The present article shall determine the legal basis of activity in the field of natural monopolies and is intended to achieve а balance between the interests of consumers and natural monopoly entities which ensures that commodities sold by said natural monopoly entities will be accessible to consumers, and likewise that the said natural monopoly entities operate efficiently..
In order to make it clean, the following basic terms shall have the following meanings:
«natural monopoly» shall mean the state of the commodity market in which demand is more effectively satisfied when due to technological peculiarities of production there is no competition (due to substantial reduction of the production cost per unit of commodity as а result of increasing output), and in which commodities manufactured by natural monopoly entities cannot be substituted with other commodities in the market, thus causing the demand in the given commodity market to be less responsive to changes in price compared to the demand for other types of commodities.
«natural monopoly entity» shall mean commercial entity (legal entity) engaged in the production (sales) of commodities under the conditions of natural monopoly;
«consumer» shall mean individual or legal entity acquiring commodities produced (sold) by natural monopoly entities;
«manager of а natural monopoly entity (or commercial entity)» shall mean an individual authorized to act (without the power of attorney) on behalf of а natural monopoly entity (or other commercial entity).
For the regulation and control over the activities of natural monopoly entities, federal executive authorities for regulating natural monopolies (hereinafter referred to as the «natural monopoly regulatory agencies») are formed pursuant to the procedures established for federal executive authorities. In order to exercise their authorities the natural monopoly regulatory agencies may set up regional affiliates and authorize them respectively within the scope of their competence.
Agencies regulating natural monopolies may employ the following methods to regulate the activities of natural monopoly entities (hereinafter referred to as the «regulatory methods»):
price regulation implemented by means of determination (fixing) of prices (rates) or price ceilings;
identification of consumer groups that shall receive services under а mandatory service arrangement and (or) the fixing of а minimum level of services rendered in the event that full consumer demand for the commodities produced (sold) by the natural monopoly entity cannot be satisfied, while taking into the account the necessity of defending the rights and legal interests of citizens and ensuring state security, environmental safety and cultural values.
For purposes of implementing effective government policy in the fields of activity of natural monopoly entities, natural monopoly agencies shall exercise control over activities undertaken or involving natural monopoly entities and that may result in impairment of interests of consumers of products subject to the provisions of the law, or in restraining the economically justified transition of the relevant commodity market from the status of а natural monopoly market into the status of а competitive market.
Natural monopoly agencies shall exercise control over:
any transactions as а result of which а natural monopoly entity acquires the right of ownership for the fixed assets or the right of exploiting of the fixed assets not designated for use in the production (sales) of the commodities regulated subject to the provisions of the present legislation if the value of such fixed assets exceeds 10% of the natural monopoly entity' capital value under the most recently approved balance sheet;
capital investment made by а natural monopoly entity into the production (sale) of commodities, not regulated by legislation, when the investment exceeds l0% of the natural monopoly entity' assets value under the most recent approved balance sheet;
the sale, lease or other transaction through which а commercial entity acquires the natural monopoly entity' fixed assets portion. designated for production (sales) of commodities governed by the provisions of this Federal Law, if the book value of the said fixed assets exceeds l0% of the natural monopoly entity' assets value under the most recently approved balance sheet.
Natural monopoly regulatory entities may not refuse to enter into contracts to provide commodities to particu1ar consumers given avai1able capacity for producing (selling) such commodities.
Natural monopoly entities shall be obligated to submit to the appropriate natural mоnороlу regulatory agency:
Current activity reports within the procedure and terms set forth by the agency;
Draft capital investment p1ans.
Natural monopoly regulatory agencies are established in the fields of activity indicated according to current legislation. Overall management of the federal executive agency regulating natural monopolies is the responsibility of the agency director. The agency director of a natural monopoly regulatory agency shall be а member of the governing board of the given agency.
For determining the primary fields of activity of the federal executive agency regulating natural monopolies and for making decisions а governing board of the agency is formed with up to seven members, including the director, chosen from highly qualified specialists with experience in the relevant field.
The legal status of а government employee shall be applied to the staff of natural monopoly regulatory agencies.
А federal executive agency regulating natural monopolies shall be liquidated in the event that there appears а possibility of the development of competition in the relevant commodity market and (or) in case there occur changes in the character of demand for the commodities of the natural monopoly entities.
Natural monopoly regulatory agencies shall perform the following basic functions:
establish and maintain а register of natural monopoly entities undergoing State regulation and control;
determine regulatory methods as provided for by current legislation with respect to specific natural monopoly entity;.
exercise control within the scope of competence over compliance with current legislation;
make proposals, subject to the established procedure, on updating the current legislation on natural monopolies.





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