On December 17, 2009 the Thirteenth Arbitration Appeal Court declared unlawful the Decision and Prescript of the Federal Antimonopoly Service’s Office for Kaliningrad Region regarding North-West Telecom’s violation of Law No. FZ-135 “On Protection of Competition” in the form of setting a monopolistically high price for space allocation in the cable ductwork.

The Federal Antimonopoly Service’s Office for Kaliningrad Region (Office) adopted the Decision of February 4, 2009 on antimonopoly case No. 42 with the conclusion that NWT had violated Article 10 of the Law “On Protection of Competition” by abusing its dominating position on the market of space allocation in the cable ductwork, namely, by setting a monopolistically high price, by setting economically, technically and otherwise unjustified tariffs for different contracting parties for the same services. In the opinion of the Office, NWT’s price of RUR 1,100 per 1 channel/km per month was disadvantageous for the applicants and involved a limitation of competition on the telephone services market in Kaliningrad Region. NWT was prescribed to cease abusing the dominating position by ensuring a base tariff for space allocation in the cable ductwork, taking account of the costs and profit necessary for providing this service. In addition, NWT was charged a fine of RUR 154,136.84.

Having disagreed with the position of the antimonopoly authority, NWT applied to the court for declaring unlawful the Decision and this Prescript of the Office.

The Thirteenth Arbitration Appeal Court found no grounds for holding North-West Telecom to be in breach of Article 10 of the Federal Law “On Competition”. The Decision of the Federal Antimonopoly Service’s Office for Kaliningrad Region and the Prescript issued on its basis were declared unlawful and issued with material breaches of applicable legislation.