Russian court confirms NLMK settlement with regulator in 'steelmakers case'
MOSCOW. Aug 7 (Interfax) - The Arbitration Court of Moscow on Wednesday confirmed an amicable settlement between the Federal Antimonopoly Service and Novolipetsk Steel (NLMK) in the so-called "steelmakers case," an Interfax correspondent reported from the courthouse.
NLMK and the FAS signed the settlement agreement to resolve the dispute over the legality of the FAS decision on the existence of collective dominance in the case against steelmakers in July.
NLMK has challenged the decision to impose administrative liability separately at the Lipetsk Region Arbitration Court. According to court materials, the claim was also transferred to the Moscow Arbitration Court. On July 31, the court combined both petitions into one. A preliminary hearing on the case was scheduled for August 7.
In February 2022, the regulator found Severstal and fellow steelmakers NLMK and MMK to have violated antimonopoly legislation by setting and maintaining monopolistically high prices for hot-rolled flat steel products on the domestic market. Prices for hot-rolled steel rose faster than production costs.
In addition, it was established that sales to the domestic market did not increase, while profits tripled compared to 2019-2020. MMK was fined 8 billion rubles, NLMK 6.4 billion rubles and Severstal 8.7 billion rubles.
The court has approved similar agreements with Severstal and MMK.
Severstal, as part of the settlement with the FAS, must pay a fine of about 900 million rubles. In adjusting the size of the fine under the agreement between the company and the regulator a lower bar for percentage of revenue from hot-rolled steel sales in 2021 was used for its calculation. Severstal also partially fulfilled the regulator's earlier demands, developing and presenting to the FAS a trade policy for hot-rolled flat steel.
According to Interfax's sources, the terms of the settlement agreement with MMK are generally identical and envisage the payment of 10% of the initial fine.
FAS chief Maxim Shaskolsky told reporters in June that in the cases of three steel producers, there were "certain similar positions" but that the decision on the settlement with Severstal did not automatically mean the same decision would be reached for the others.