New retail regulation rules will be similar in same in America and Europe
At today s conference “Retail in Russia: new stage of the market s development” officials made several important pronouncements while leaders of the retail market were successful in expressing their opinion.
Stanislav Naumov, deputy minister of industry and trade of the Russian Federation, announced that several provisions (imposing serious administrative burdens for entrepreneurship) had been excluded from the trade legislation project. It is not planned to increase spending on regulators at the moment – precisely, there won t be any new structures to regulate trade business in Russia.
Andrey Kashevarov, deputy chief of the Federal Antimonopoly Service (FAS), agreed that there should be only minimal government s intervention into trade. One should develop general and fair rules to eliminate possible discrepancies between suppliers and retail networks. He particularly noted that FAS had absolutely no intensions to ensure any party s priority. Instead of minimal thresholds set to define market dominance, it would be better to set regulation dependant on the amount of retail turnover. New trade grounds will be assigned by municipal authorities to retailers having no more than 35% under the project of municipal formation. All those proposals by Mr. Kashevarov will, in his opinion, “ensure more effective and transparent administration (i.e., detection) of the maximum retail turnover to get closer attention from the government s side”. The antimonopoly service presumes that it will be defined by the government of Russia. Abandoning the 35%-dominanace threshold is explained by the fact that some networks with lesser market share are still able to affect the situation. In general, the whole concept of the legislation is made close to American and European retail legislation. Today, the Federal Antimonopoly Service has an effective toolkit in its possession, allowing it to regulate the market without harming anybody.
Nikolai Arkhipov, deputy minister of agriculture, thinks that in extreme crisis conditions like that, it is vital to introduce the government s regulation of retail markup.
Position of retailers themselves was announced by Lev Khasis, chief of X5 Retail. He disagreed with Mr. Arkhipov s suggestion, saying that in crisis conditions (and after the fall of oil prices), retail became the State s most promising sector – both in terms of inflows to the budget and in terms of employment. Which it why it has to survive. Like never before, retailers and representatives of official authorities (i.e., FAS) are engaged into positive and constructional dialogues – and their positions are closing step-by-step. However, according to Mr. Khasis, those discussions with the government s administration cost 1/10 of EBITDA. But despite all that, he expects a 25%-growth for X5 Retail Group in 2009.
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