The Russian Federal Antimonopoly Service (FAS) has initiated a case against Russian steel producer Magnitogorsk Iron and Steel Works (MMK) regarding alleged violation of Clause 3 Part 1 Article 10 of the Federal Law "On Protection of Competition".
The case was initiated upon complaints by Chelyabinsk Tube-Rolling Plant (ChTPZ) and Russian pipe company TMK Group against MMK for imposing disadvantageous contract conditions.
MMK and Severstal are the only manufacturers of wide hot rolled plates in the Russian Federation. The main consumers of these products are manufacturers of large-size welded tubes, namely, TMK, ChTPZ, OMK and Izhora Pipe Plant.
According to FAS, in January this year MMK unilaterally increased prices for rolled plates due to considerable growth of prices for raw materials at the end of 2010/start of 2011. At the same time, under the agreement between MMK and ChTPZ the prices for rolled plates were approved for the period up to March 31, 2011.
In its turn, MMK reported that orders for these products for supply in February this year would only be accepted after ChTPZ and TMK confirmed acceptance of the new ex-works prices.