MOSCOW, July 25 (RIA Novosti) - The Moscow District Federal Arbitration Court refused to approve a peace agreement between Russia's Federal Antimonopoly Service and Eurocement, the country's largest cement producer, a RIA Novosti correspondent reported from the courtroom.
The service and the company signed the agreement following a dispute over monopolization charges on July 3. Under the agreement, Eurocement was to inform the service of price rises of more than 5%, invest 10 billion rubles ($373 million) by 2010 in modernizing its infrastructure, and pay to the budget 267 million rubles ($9.9 million) of its revenues gained as a result of violating antimonopoly laws.
The service accused Eurocement in October of breaching competition law by raising prices by 70% from March 1, 2005, and ordered it to lower its prices "to a level of fair competitive pricing."
Eurocement appealed the decision, saying the antimonopoly service had failed to prove that the company dominated on the cement market, and had not taken into account dealer markups of 35%, which were also influencing the market.
The Moscow Arbitration Court rejected the company's appeal on January 10, and Eurocement filed an appeal with a higher court, which struck down the antimonopoly regulations on March 31. The antimonopoly service, in turn, appealed to the Moscow District Federal Arbitration Court.
Under the agreement with the antimonopoly service, Eurocement pledged to abide by antimonopoly legislation and not to abuse its leading position on the market.
The antimonopoly service said Tuesday it intended to appeal the Moscow District Federal Arbitration Court's refusal to approve the peace agreement.
"We fail to understand the ruling of the court of appeal, which today refused to approve the peace agreement today on the grounds the antimonopoly body was not entitled to conclude peace agreements," service head Igor Artemyev said.
He added that courts had approved peace agreements between the antimonopoly service and economic entities on several occasions previously, and that his service had the right to conclude such agreements.
