Supplier Protection in Russia: Antimonopoly Rules and Disputes with Retail Chains

 

September 16, 2025

BRACE Law Firm ©

 

The largest participants in any trade market dictate the rules of the game and significantly influence the market environment through their actions. The food market and other markets where retail chains operate are no exception.

In practice, suppliers complain that large retail chains impose unfavorable cooperation terms, including requirements for slotting fees, volume-based bonuses, additional discounts, payment deferrals, and several other violations.

To mitigate the risks of abuse in the trade of socially significant goods, including food products, Federal Law No. 381-FZ dated December 28, 2009, On the Fundamentals of State Regulation of Trading Activities in the Russian Federation (the "Trade Law" or "381-FZ") establishes antimonopoly rules, prohibitions, and restrictions for retail chains. Since its enactment, it has undergone significant amendments.

This article examines the antimonopoly prohibitions and restrictions established for retail chains selling food products and explores methods for protecting suppliers from abuses by large market players.

What is a Retail Chain?

Before examining the main topic, let us clarify how Russian legislation defines a retail chain.

According to Article 2 of the Trade Law, a retail chain is a set of two or more trade facilities that are legally owned by a single economic entity or several economic entities within the same group of persons as defined by the Federal Law On the Protection of Competition, or a set of two or more trade facilities used under a single commercial designation or other means of individualization.

Simply put, a retail chain consists of trade facilities that either belong to a single owner or use the same brand.

The Trade Law defines a trade facility as a building, structure, or part thereof equipped for displaying and demonstrating goods, serving customers, and conducting monetary settlements during sales.

Based on these definitions, if an entrepreneur owns two kiosks, they formally constitute a retail chain. However, this approach does not fully reflect the essence of a retail chain, as owning two small facilities does not necessarily create market power. Consequently, some authors [1] propose including dominance as a criterion in the definition of a retail chain. This, according to some experts, would distinguish small enterprises with several points of sale from large network retailers, for whom the antimonopoly restrictions were intended.

Nevertheless, one must consider that under Part 4.1 of Article 1 of the Trade Law, the provisions of Article 13 (Antimonopoly Rules for Economic Entities Engaged in Trading Activities and Economic Entities Supplying Food Products, excluding subparagraph "d" of paragraph 4 and paragraph 6 of Part 1) and Article 14 (Restriction on the Acquisition or Lease of Additional Area for Trade Facilities by Economic Entities Engaged in the Retail Sale of Food Products via a Retail Chain) of the Trade Law do not apply to economic entities (or their group of persons) whose revenue from the sale of goods in the last calendar year does not exceed 800 million rubles. This exemption also applies to economic entities operating a retail chain if their total revenue within that chain for the last calendar year does not exceed 800 million rubles.

According to the FAS Russia Clarifications No. RP/86973/18 dated October 29, 2018, the total revenue from both food and non-food products is considered when determining whether the Trade Law applies to a retail chain. Judicial authorities share this position. [2]

What Antimonopoly Prohibitions and Restrictions Apply to Retail Chains?

To limit the influence of large retail chains on the food market, the Trade Law establishes:

• Antimonopoly rules for trading activities (Article 13 of 381-FZ);
• Obligations for retail chains regarding the conclusion and performance of food supply contracts (Article 9 of 381-FZ);
• Restrictions on the acquisition and lease of additional space (Article 14 of 381-FZ).

These are discussed in detail below.

Antimonopoly Rules for Retail Chains

Article 13 of the Trade Law lists actions prohibited for retail chains. Specifically, it is prohibited to:

• Create discriminatory conditions, as defined by Federal Law No. 135-FZ dated July 26, 2006, On the Protection of Competition (the "Protection of Competition Law");

FAS Russia explains that creating discriminatory conditions involves placing one economic entity in an unequal position compared to others. [3] Such conditions may be explicitly stated in a contract or exist as factual terms of cooperation.

• Create barriers to market entry or exit for other economic entities;
• Violate the pricing procedures established by regulatory legal acts;
• Impose terms on a counterparty regarding:

• A prohibition on entering into supply contracts with other economic entities engaged in similar activities;
• Liability for failing to perform obligations on terms more favorable than those offered to other economic entities;
• Providing information about contracts concluded with other economic entities engaged in similar activities;
• Reducing food product prices to a level where, after adding a trade markup, the price would not exceed the minimum price of another supplier;
• The return of food products with a shelf life exceeding 30 days;
• Other terms unrelated to the subject of the contract or containing significant signs of discriminatory conditions or market entry barriers;

• Conclude and perform contracts where goods are transferred to a third party for sale without the transfer of ownership rights to that third party.

Notably, these prohibitions are largely similar to those established by the Protection of Competition Law for entities holding a dominant position. However, researchers point out that, unlike the Protection of Competition Law, the above prohibitions apply to retail chains regardless of their market power or position. [4] Furthermore, the Trade Law does not require the antimonopoly authority to conduct a market analysis to prove a violation.

Obligations of Retail Chains Related to Contract Conclusion and Performance

In addition to antimonopoly prohibitions, Article 9 of the Trade Law defines mutual obligations for retail chains and suppliers regarding the conclusion and performance of food supply contracts. Specifically:

• A retail chain must provide suppliers with access to information regarding counterparty selection criteria and the material terms of the supply contract by posting this information on its website;
• Parties may agree on remuneration for the retail chain for purchasing a specific volume of food products and fees for marketing, logistics, preparation, processing, or packaging services. However, such remuneration must not exceed 5% of the product price. Remuneration for the purchase of socially significant goods (the list of which is approved by the Russian Government [5]) or other types of bonuses is prohibited;
• Maximum payment terms for delivered food products are established based on shelf life:

• For goods with a shelf life of up to 5 days (provided that acceptance documents are signed electronically): no later than 4 business days from actual receipt;
• For goods with a shelf life of up to 9 days: no later than 8 business days;
• For goods with a shelf life of 10 to 30 days: no later than 25 calendar days;
• For goods with a shelf life exceeding 30 days: no later than 40 calendar days.

• The following are prohibited:

• Contractual restrictions on the assignment of claims;
• Compelling a counterparty to enter into service contracts for marketing, preparation, processing, packaging, or similar services;
• Holding suppliers liable for failing to deliver volumes exceeding those agreed upon in the contract;
• Charging or paying fees for the right to supply products to trade facilities or for changing the product assortment;
• Reimbursing expenses related to the loss or damage of products after ownership has transferred.

Thus, these rules deviate from the principle of freedom of contract to protect food suppliers. However, current practice shows that many other contractual terms remain burdensome for suppliers, indicating a need for further legislative refinement.

Restriction on the Acquisition and Lease of Trading Space

Under Article 14 of the Trade Law, retail chains engaged in the retail sale of food products may not acquire or lease additional trading space within a specific administrative-territorial entity if the chain's share exceeds 25% of the total volume of food products sold in monetary terms within the borders of that Russian Federation constituent entity during the preceding financial year.

Under Article 2, paragraph 7 of the Trade Law, trading space is defined as an area intended for displaying goods, serving customers, conducting monetary settlements, and providing customer passage.

Market share is calculated annually. Government Decree No. 305 dated May 4, 2010, approved the methodology for calculating the volume of food products sold. Rosstat publishes this information on its official website annually by May 1. FAS Russia clarifies that the prohibition applies from the date of Rosstat's official publication until the next annual publication. [6]

Transactions violating these requirements are void. Any interested party, including the antimonopoly authority, may petition a court to apply the consequences of an invalid transaction.

This is illustrated by Case No. A41-65274/2020. [7] During an annual monitoring of compliance with antimonopoly requirements, the UFAS discovered that a company had violated Article 14 of the Trade Law by leasing a new trade facility when its sales share already exceeded 25%.

The UFAS sued to declare the lease agreement invalid. The court of first instance granted the claim. However, subsequent courts overturned the decision, arguing that since trading activity had ceased at one of the previously leased locations, the company was merely replacing one facility with another. The antimonopoly authority appealed to the Supreme Court of the Russian Federation.

The Supreme Court ruled that the total volume of food products sold by the chain exceeded the threshold. The market share calculation by the antimonopoly authority followed the approved methodology. The Court held that if a group of companies intended to open a new facility in 2018, it should have taken measures to reduce its revenue share; without such measures, it had no right to acquire additional space. The lease agreement was declared invalid.

The Supreme Court essentially established the position that the profit generated by trade facilities, rather than the number of outlets, is the primary consideration. A retail chain must prove that a new acquisition did not increase its market share or that it took sufficient measures to keep its share below the statutory limit.

Filing with FAS Russia to Protect Supplier Rights

Filing a complaint with FAS Russia is an effective way to stop retail chains from imposing unfavorable terms or creating market entry barriers.

An interested party may file an application alleging signs of antimonopoly violations. The application must include:

• Information about the applicant (full name and address for individuals; name and location for legal entities);
• Information about the entity being reported;
• A description of the violation;
• The substance of the requirements.

Documents evidencing the signs of a violation must be attached. If signs of a violation are present, the antimonopoly authority initiates a case. If the violation is confirmed, a commission issues a decision and a mandatory injunction to remedy the violation.

This is illustrated by Case No. A65-37234/2019. [8] A retail chain repeatedly rejected a dairy plant's commercial proposals to include its products in the chain's assortment, citing high prices and unattractive packaging. Meanwhile, the chain accepted similar proposals from other suppliers. During the investigation, the antimonopoly authority found that the dairy plant's prices were actually lower than those of other suppliers. The chain's argument regarding packaging was deemed speculative and unsupported by research. The UFAS found that the chain had created barriers to market access and ordered it to conclude a contract with the dairy plant. When the chain failed to comply, it was fined 100,000 rubles under Article 19.5 of the CAO RF. The court upheld the antimonopoly authority's order.

Administrative Liability for Antimonopoly Violations by Retail Chains

If the UFAS identifies circumstances of an administrative offense during an antimonopoly investigation, it will initiate an administrative case.

Liability for violating antimonopoly rules in trading activities is provided by Article 14.40 of the CAO RF, which covers several offenses under Article 13 of the Trade Law, such as:

• Creating discriminatory conditions;
• Creating market access barriers;
• Violating pricing procedures;
• Imposing prohibited terms on a counterparty;
• Concluding or performing contracts where goods are transferred to a third party without a transfer of ownership.

Maximum fines reach 50,000 rubles for officials and 5,000,000 rubles for legal entities. Researchers note that the significantly higher fines for retail entities compared to other sectors create a situation where identical violations, such as creating discriminatory conditions, result in different levels of liability. [9]

For instance, in Case No. A74-12347/2018, [10] the antimonopoly authority qualified the unilateral imposition of unfavorable terms by a retail chain as a market access barrier. The supplier, being in a dependent position, accepted the terms under the threat of losing a major sales channel. The UFAS found this to be a violation of Article 13, Part 1, Clause 2 of the Trade Law and fined the company 2,000,000 rubles.

Failure to provide a counterparty with requested information regarding selection criteria and material contract terms is punishable under Article 14.41, Part 1 of the CAO RF. Fines range up to 40,000 rubles for officials and 500,000 rubles for legal entities.

However, the Supreme Court of the Russian Federation has clarified [11] that the failure to post such information on the Internet does not constitute an offense under this specific provision. The Court reasoned that, based on a literal interpretation, the offense only occurs when the chain fails to respond to a specific request from a counterparty.

Liability for violating statutory requirements for food supply contract terms is established by Article 14.42 of the CAO RF. This article includes various offenses, with maximum fines reaching 40,000 rubles for officials and 5,000,000 rubles for legal entities.

In Case No. A43-18433/2018,[12] the antimonopoly authority found that a retail chain imposed penalties on a supplier for product defects discovered during the sales process. The UFAS fined the chain 1,000,000 rubles under Article 14.42, Part 7 of the CAO RF. The chain appealed, but the court found that the penalties were applied after ownership had transferred and were not caused by the supplier's fault, which violated the Trade Law. The appeal was denied.

It should be noted, however, that in some cases, courts may view a retail chain's actions as insignificant, reduce the fine, or find that the antimonopoly authority failed to prove the violation. [13]

Civil Law Remedies for Antimonopoly Violations by Retail Chains

To recover funds that were unlawfully withheld or not paid by a retail chain, a supplier must use civil law remedies by filing a lawsuit. The most common claims involve recovering debt and contractual penalties for late payment or interest for the use of others' funds.

For example, in Case No. A40-22278/2024, [14] a supplier sued a retail chain to recover a debt of 3,388,440 rubles and interest of 276,874 rubles. The court found that the supply contract required payment weekly as the goods were sold to end consumers.

The plaintiff delivered goods worth over 4 million rubles. The supplier failed to pay over 3.4 million rubles, claiming the contract allowed for the return of goods if less than 70% was sold within 30 days. The court noted that Article 13 of the Trade Law prohibits imposing terms for the return of goods with a shelf life exceeding 30 days. Contract terms that contradict legislative regulations are void. The claim was granted in full, although this decision followed several reviews and a reversal by the Supreme Court.

Antimonopoly Prohibitions and Restrictions for Other Retail Chains

It is important to note that the specific antimonopoly prohibitions and restrictions discussed above apply only to retail chains selling food products.

Retail chains selling non-food products can only be held liable for violations of the prohibitions and restrictions established by the Protection of Competition Law, such as monopolistic activity or unfair competition.

Furthermore, a draft amendment to the Trade Law has been posted on the regulatory portal [15] that would establish requirements for the trade of non-food products. The project proposes a minimum share for national goods and specific shelf placement requirements for non-food retail chains. Whether this will be linked to antimonopoly requirements remains to be seen. The changes are expected to take effect on March 1, 2026. These innovations will not apply to retail chains with annual revenue below 2 billion rubles or those selling products under the trademark of a single right holder.

Conclusions

Antimonopoly prohibitions and restrictions established by the Trade Law apply to specific categories of participants: retail chains selling food products and economic entities supplying food products to these chains. The current legal framework allows these restrictions to be applied to all retail chains regardless of their actual market share or ability to influence competition, which may not be entirely correct.

Retail chains selling non-food products are held liable under the Protection of Competition Law. While some prohibitions under the Trade Law and the Protection of Competition Law are similar, there are differences in both the substance of the rules and the administrative liability for their violation.

Russian law provides mechanisms to protect suppliers from abuses by retail chains; however, these often require specialized legal counsel and significant time. Furthermore, suppliers are often reluctant to use these mechanisms due to the risk of losing their sales channels.

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References

1. Kharitonova Yu.S. Signs of a Retail Chain in the Legislation on Trade and Competition // Journal of Business and Corporate Law, 2018, No. 1.
2. Ruling of the Supreme Court of the Russian Federation dated March 23, 2020, No. 304-ES20-3196 in Case No. A46-2742/2019.
3. Clarifications of FAS Russia On Certain Issues of the Application of Federal Law No. 381-FZ dated December 28, 2009, On the Fundamentals of State Regulation of Trading Activities in the Russian Federation.
4. Fedorov Yu.V. Problems of the Application of Certain Antimonopoly Prohibitions in the Activities of Retail Chains // Russian Competition Law and Economics, 2021, No. 4.
5. Decree of the Government of Russia dated July 15, 2010, No. 530, On the Approval of the Rules for Establishing Maximum Permissible Retail Prices for Certain Types of Socially Significant Food Products of First Necessity, the List of Certain Types of Socially Significant Food Products of First Necessity for Which Maximum Permissible Retail Prices May Be Established, and the List of Certain Types of Socially Significant Food Products for Which No Remuneration May Be Paid to an Economic Entity Engaged in Trading Activities for Purchasing a Certain Quantity.
6. Letter of FAS Russia dated February 8, 2019, No. SP/8916-PR/19, On Clarifications Regarding the Application of the Provisions of Part 1 of Article 14 of the Trade Law When Retail Chains Acquire Additional Space Prior to the Date of Publication of Rosstat Statistical Information on Retail Trade Turnover.
7. Ruling of the Judicial Chamber for Economic Disputes of the Supreme Court of the Russian Federation dated August 16, 2022, No. 305-ES22-4753 in Case No. A41-65274/2020.
8. Resolution of the Arbitration Court of the Volga District dated November 24, 2021, No. F06-10320/2021 in Case No. A65-244/2021.
9. Coordination of Economic Activity in the Russian Legal Space: Monograph // Ed. by M.A. Egorova. M.: Yustitsinform, 2015.
10. Ruling of the Supreme Court of the Russian Federation dated July 5, 2019, No. 302-ES19-10259 in Case No. A74-12347/2018.
11. Review of Judicial Practice of the Supreme Court of the Russian Federation No. 1 2018, approved by the Presidium of the Supreme Court of the Russian Federation on March 28, 2018.
12. Resolution of the Arbitration Court of the Volga-Vyatka District dated March 13, 2019, No. F01-376/2019 in Case No. A43-18433/2018.
13. Resolution of the Arbitration Court of the North-Western District dated December 24, 2018, No. F07-15149/2018 in Case No. A13-1628/2018, Ruling of the Supreme Court of the Russian Federation dated April 8, 2019, No. 306-ES19-2682 in Case No. A65-3964/2018.
14. Ruling of the Supreme Court of the Russian Federation dated April 8, 2025, No. 305-ES25-1713 in Case No. A40-22278/2024.
15. ID 02/04/08-25/00159684.