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Russia is pursuing a policy of strengthening market competition, including competition in the financial services market. It is expected that a new antitrust law regulating competition will be submitted to the Russian government soon. The existing system prevents market domination - it is proposed that instead any abuse of such domination and concerted action of competitors to restrict competition be suppressed.

The proposed amendments should simplify the procedure of filing competition forms, as well as change the control over capital concentration criteria that is used by the Russian antitrust authorities. According to the amendments prepared by the Federal Antitrust Ministry (reorganized on March 9 2004 into the Federal Antitrust Service) the threshold above which a transaction requires preliminary approval by the antitrust authorities will be increased up to $1 billion, while all other mergers and acquisitions will require post factum notification. It remains unclear, however, whether the antitrust law will be amended or a new one introduced.

Antitrust officials announced that the proposed amendments would also change the information to be disclosed when obtaining approval of a transaction. The new antitrust law will require disclosure of information on the owners of offshore companies. In order to make their control effective, the antitrust authorities plan to toughen the penalties for competition law violations. The current maximum penalty for an antitrust law violation is about $16,000.

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