Antitrust policy is a legal form antitrust regulation market relations at the state level. Legislation in this area acts as a set of normative acts, through the implementation of which reproduction and support of fair competition are carried out, as well as the prevention, suppression and restriction of monopolistic activity.
Fundamentals of Antitrust Policy in Russia
Market relations in Russia are still at the stage of their active formation. The government is constantly faced with a lot of difficulties, obstacles and contradictions that leave a negative imprint on the effectiveness of antitrust laws. The Ministry of Antimonopoly Policy is working on the territory of the Russian Federation - an antitrust regulation structure that is systematically modernized and improved. Due to the fact that monopolies constantly show an active desire for economic power, it is often necessary for the state to take preventive measures.
Over the past few years, antitrust policy in Russia has changed dramatically. If interventions in the activities of individual structures that carried a certain threat to the economy were previously practiced, one-time events have transformed into a stable function of the state.
Monopoly Impact Techniques
Despite the variety of options for influencing monopolies by the Russian government, the most effective levers can be identified. Effective antitrust policies are:
- High taxes, which can reduce the profitability of monopolies.
- In order to contain inflation, as well as to form artificial pressure on the price policy of highly concentrated industries, tighter price controls.
- Monopoly is established state property.
- Industry regulation held at the state level. This allows not only to clearly monitor the price level, but also to control the volume of production, entry and exit of companies from regulated industries.
- Antitrust policy includes an active antitrust policy.
Russia on the way to fight monopolies
The legislation of the Russian Federation regarding competition and monopolies is a new phenomenon in the economy of the state, in its legal life. The first decision to create legislation to regulate the activities of trusts and syndicates was made in the twentieth century. At that time, everything was limited to government legislative work. World War I hindered the development of the trend. After the formation of Soviet power, the idea of fighting monopolies completely lost all meaning. Due to the comprehensive liquidation of private entrepreneurship and the adoption of a command-and-control economic policy of a centralized type, the state has acquired unprecedented power and strength in history. By and large, it itself turned into a monopolist, which covered almost all areas of activity: economy, ideology and politics.
The first steps
After the economic reforms in Russia, accompanying the formation of market relations, as well as the refusal of the state to totalitarian methods of managing the economy, the monopolies began to show themselves again. There was a need to create a specialized section of Russian legislation.
Antitrust policy in Russia began with the adoption in 1990 of a series of acts that were aimed at controlling entrepreneurial activity.In 1995, the Law on Markets and the Restriction of Monopolistic Activities was approved, which, despite radical changes, even today remains the backbone of the entire domestic market system. Legislative norms not only prevent the emergence of private monopolies, they control associations that are formed through the manipulation of state power.
Monopoly Impact Options
Antitrust policy is not limited to the impact on monopoly structures only by legislation. Both in Russia and in other countries of the world, the government has a wide range of solutions to suppress the activities of such structures.
For states with market type of economy to which Russia belongs, the following areas are characteristic:
- Activation market structures who have a high level of competitive ability and who are able to provide global opposition to monopolies. A certain list of measures to liberalize markets is being implemented.
- Comprehensive and direct prevention of the activity of the monopoly, suppression of its work through legislation through the implementation of active actions.
- Tight control not only over pricing policy company, but also above the level of its profitability.
Antitrust policy - a guarantee of balance in the Russian economy
Despite the widespread and effective use of antitrust measures in many countries, they cannot serve as a pattern and role model. For each format of a market economy, you need to select an individual regulatory plan. The antimonopoly policy of the state, despite its cardinal nature, has never belonged to the category of systems of a negative character. It is not aimed at transforming the current system of the economy. The main goals of antitrust policy are to maintain a balance between competition and monopolies at an optimum level for the Russian Federation.
Why would the Russian government fight monopolies?
In Russia, monopolistic activity is accompanied by a rather large list of difficulties and negative consequences for the country's economy as a whole. These are not only insufficient production volumes, but also overpriced prices and low efficiency of enterprises. Clients of monopolistic companies are forced to accept the high cost of goods or services. Without alternatives, there remains agreement with poor product quality or with its obsolescence.
It should be noted the slowdown in technological progress, the lack of high service and other factors that indicate a neglect of the needs and interests of the consumer. Against the backdrop of a huge bunch of negative aspects, the most significant is the complete blocking by the monopolies of market self-regulation mechanisms. Monopolists are to some extent omnipotent. Other participants in the market cannot influence the current situation. Only a conscious antitrust policy of the Russian Federation and direct intervention in the situation of the government can set priorities.
Difficulties in the fight against monopolies
In the fight against monopolistic companies and in attempts to limit the abuse of leadership by the existing power, the Russian government faces certain difficulties. This is due to the large size of enterprises. The minimum values of average long-term costs can be achieved only with large volumes of production. Small production is not effective. For example, to create decent competition for a company such as AvtoVAZ, even by opening artificial small firms across the country is unlikely to succeed, as they will be uncompetitive, especially in the global market.
The antitrust policy of the state, based on the fragmentation of giants, is not only ineffective, but also impossible. High efficiency becomes a rather big obstacle.If the company has difficulties associated with sanctions by the government, then they are solved by raising prices for goods or services. For the state economy, this means not only an increase in costs in other sectors of activity, but also a sharp increase in the number of non-payments, complete closure of interregional relations.
What is a monopoly in Russia and which body controls it?
The antimonopoly policy of the state is supported by the main authority determined by law. This is the Ministry of Antitrust and Entrepreneurship Support. The rights and capabilities of the body are wide. The status is identical to that of similar bodies in other countries. Under the category of monopolies are companies that, through their activities, exercise control over 65% of the product market. An enterprise can be recognized as a monopoly if it controls from 35 to 65% of the market, and if the ministry succeeds in proving the dominant status of an economic entity after studying the market situation.
