Medical Device Procurement Disputes: FAS Enforcement and Litigation Trends in Russia

 

July 27, 2026

BRACE Law Firm©

 

Public procurement of medical devices constitutes one of the most legally contentious areas of state contracting in Russia. This sector frequently witnesses clashes between the interests of the Customer, who seeks to allocate funds efficiently while obtaining a medical device that optimally meets their needs, and the interests of suppliers, manufacturers, and distributors, who defend their technological solutions and compete for supply contracts.

This divergence of interests leads to a significant portion of disputes transitioning into the legal arena for review by the antimonopoly authorities, Arbitration Courts, and, in certain cases, law enforcement agencies.

This survey analyzes the primary categories of disputes, current trends in enforcement practice, and available mechanisms for protecting the violated rights of market participants and Customers.

Legal Framework Governing Public Procurement of Medical Devices

The legal framework governing the public procurement of medical devices is comprehensive and primarily relies on:

• Civil Code of the Russian Federation (Civil Code) (§ 3 "Supply of Goods" and § 4 "Supply of Goods for State or Municipal Needs" of Chapter 30 "Purchase and Sale", among others);
• Federal Law No. 44-FZ dated April 5, 2013, On the Contract System in the Sphere of Procurement of Goods, Works, and Services for Ensuring State and Municipal Needs (the "Contract System Law");
• Federal Law No. 135-FZ dated July 26, 2006, On Protection of Competition (the "Protection of Competition Law");
• Regulations governing the circulation of medical devices, including Federal Law No. 323-FZ dated November 21, 2011, On the Fundamentals of Health Protection of Citizens in the Russian Federation (the "Law on Health Protection"), Rules for State Registration of Medical Devices approved by Decree of the Government of the Russian Federation No. 1684 dated November 30, 2024 (the "Rules for State Registration of Medical Devices"), Rules for the Registration and Expertise of the Safety, Quality, and Efficacy of Medical Devices approved by Decision of the Council of the Eurasian Economic Commission No. 46 dated February 12, 2016, Order of the Ministry of Health of Russia No. 4n dated June 6, 2012, On Approval of the Nomenclature Classification of Medical Devices (the "Order No. 4n"), and others;
• Regulations establishing national treatment requirements for public procurement, including Decree of the Government of the Russian Federation No. 1875 dated December 23, 2024, On Measures for Providing National Treatment in the Procurement of Goods, Works, and Services for Ensuring State and Municipal Needs, and the Procurement of Goods, Works, and Services by Certain Types of Legal Entities (the Decree No. 1875).

This survey examines the primary categories of disputes that arise during the medical device public procurement procedure and the execution of contracts.

Antitrust Disputes in Medical Device Procurement Procedures

Article 17 of the Protection of Competition Law establishes the following antitrust requirements for bidding, request for quotations, and request for proposals:

1. Actions that result or may result in the prevention, restriction, or elimination of competition are prohibited, including:

• Coordinating the activities of bidders by procurement organizers or Customers, as well as concluding agreements between procurement organizers and (or) Customers with the bidders, if such agreements aim to or may result in restricting competition and (or) granting preferential conditions for certain bidders;
• Granting a bidder preferential conditions for participation, including through access to information, unless otherwise provided by federal law;
• Violating the procedure for determining the winning bidder;
• Permitting procurement organizers or Customers and (or) their employees to participate in the bidding.

2. Restricting access to participation in bidding not provided for by regulatory legal acts is prohibited.

3. Restricting competition among bidders by including technologically and functionally unrelated goods, works, or services in a single lot is prohibited.

Below are examples of typical dispute scenarios.

Restricting Competition Through Procurement Specifications: Judicial Practice

Article 33 of the Contract System Law establishes rules for describing the object of procurement. Specifically, the description must be objective, and the Customer may not include product requirements if such inclusion restricts the number of bidders.

However, a frequently encountered violation involves tailoring the procurement description to a specific manufacturer's product. Customers achieve this by specifying excessive characteristics without a legitimate need, defining overly narrow parameter ranges, combining characteristics unique to a single product, or setting non-standard values for parameters.

The Overview of Judicial Practice on the Application of the Legislation of the Russian Federation on the Contract System in the Sphere of Procurement of Goods, Works, and Services for Ensuring State and Municipal Needs, approved by the Presidium of the Supreme Court of the Russian Federation on June 28, 2017, formulates the following position on this matter.

Generally, the Customer's specification of unique product characteristics in the auction documentation, which meet their needs and are necessary given the specific use of such product, does not constitute a restriction on the pool of potential bidders. Conversely, including requirements in the procurement documentation that point to a specific manufacturer without relying on the specific use of such product violates Article 33 of the Contract System Law.

Consequently, the Customer must be prepared to justify such requirements. If the Customer does not utilize indicators and requirements provided by standardization legislation, and sets characteristics beyond those specified in the Catalog of Goods, Works, and Services (KTRU) position, the Customer must include this justification directly in the procurement description. The Customer describes the procurement object using the KTRU in accordance with Article 23 of the Contract System Law and the Rules for Using the KTRU, approved by Decree of the Government of the Russian Federation No. 145 dated February 8, 2017. If the catalog contains a position corresponding to the procurement object, the Customer applies its characteristics; the Customer may only include characteristics not provided by the KTRU position if they justify the necessity of their use. Determining the correct KTRU position and the scope of additional characteristics constitutes a separate and prevalent subject of disputes.

For example, in case No. A13-11016/2024,[1] a bidder filed a complaint with the regional office of FAS Russia (OFAS) regarding the provisions of the procurement notice for an ultrasonic surgical system handle. The bidder argued that the technical characteristics requirements (the placement of the medical instrument's activation buttons) effectively matched only one manufacturer's equipment. Before the antimonopoly authority and subsequently in court, the Clinic explained that the requirements for the placement of the MIN and MAX activation buttons stemmed from the surgeons' prolonged daily use of the instrument, as this specific design accelerates the surgeons' workflow and reduces tremor.

The court concluded that the Customer, when establishing requirements for the technical and functional properties of the procured goods, based its decision on its operational needs and the objective of providing effective medical care to patients. Because the bidder pool could include entities other than manufacturers, the court ruled that this requirement did not create unjustified advantages for procurement participation.

Notably, FAS Russia has adopted a stricter stance on this issue in recent years. In letter No. 28/26176/25 dated March 21, 2025, FAS Russia emphasized that "specifying requirements for the procured goods that point to a specific manufacturer, in the absence of specific features of such goods or their use, creates unjustified barriers for bidders and reduces their number, which constitutes a sign of restricted competition. Therefore, the Customer must formulate the procurement object in a manner ensuring that the combination of product characteristics corresponds to multiple manufacturers".

While letters from regulatory bodies lack normative force and do not bind the courts, Customers frequently bear the burden of proving in court the necessity of purchasing a product with characteristics matching only a specific manufacturer. Conversely, suppliers should proactively challenge tailored documentation before the antimonopoly authorities prior to the bid submission deadline.

Improper Consolidation of Disparate Goods into a Single Lot: Judicial Review

Another method of restricting competition is the artificial enlargement of a lot, where the Customer combines technologically and functionally unrelated items into a single procurement object. Consequently, this practice narrows the pool of potential suppliers to only those capable of delivering the entire bundle.

FAS Russia and the courts evaluate the legality of such consolidation based on the technological and functional relationship of the goods. If such a relationship is absent, authorities deem the consolidation a violation. To prevent the artificial expansion of lots, the Government of the Russian Federation adopted Decree No. 620 dated April 19, 2021, On the Requirement for the Formation of Lots in the Procurement of Medical Devices Constituting the Object of Procurement for Ensuring State and Municipal Needs (the "Decree No. 620"). This act prohibits combining medical devices of different types into a single lot according to the nomenclature classification of medical devices by type (NCMI) if the Initial Maximum Contract Price (IMCP) exceeds:

• 600,000 rubles – for Customers whose allocated funds for purchasing medical devices in the preceding year totaled less than 50 million rubles;
• 1 million rubles – if the allocated funds for purchasing medical devices in the preceding year ranged from 50 to 100 million rubles;
• 5 million rubles – if the allocated funds for purchasing medical devices in the preceding year exceeded 100 million rubles.

The Customer may bypass these IMCP restrictions when procuring:

• Medical devices under lifecycle contracts;
• Medical devices consolidated into a single lot with consumables compatible with such medical devices;
• Medical devices procured under a contract with counter-investment obligations pursuant to Article 111.4 of the Contract System Law.

Collectively, these restrictions established a significant barrier against arbitrary lot formation by Customers; however, in practice, they have also generated a substantial number of disputes.

For instance, in case No. A40-233495/2024,[2] a Medical Center conducted an auction for the supply of reagents and consumables for the "A" biochemical analyzer. Following a bidder's complaint, the antimonopoly authority ruled that consolidating reagents and consumables for the analyzer with different NCMI codes into a single lot violated the "Decree No. 620". The Medical Center petitioned the court to invalidate the OFAS decision. The claimant argued that the consolidation was necessary due to the items' direct physical and technical relationship and shared purpose. The court concluded that classifying the procured medical devices under different NCMI codes does not preclude their procurement as a single lot within a unified procurement procedure, provided the transaction falls under the exceptions specified in the "Decree No. 620".

However, a review of enforcement practice reveals that antimonopoly authorities generally reject this perspective.

Unjustified Requirements for Compatibility of Consumables With Existing Equipment

A distinct issue arises regarding the procurement of consumables or components that must be compatible with the Customer's existing equipment. Certain medical equipment manufacturers design closed systems, for example:

• A laboratory analyzer functions exclusively with original reagents;
• An injector operates solely with specific syringes;
• Consumables feature electronic protection mechanisms (RFID tags, chips).

After acquiring expensive equipment, the Customer is often forced to purchase consumables from the same manufacturer.

The Contract System Law permits procurement by trademark without the words "or equivalent" in the following instances:

• When goods bearing other trademarks are incompatible, and there is a need to ensure the interaction of such goods with the goods utilized by the Customer;
• When procuring spare parts and consumables for machinery and equipment used by the Customer, in accordance with the technical documentation for such machinery and equipment (subparagraphs "b" and "c" of paragraph 1 of Part 1 of Article 33 of the Contract System Law). Furthermore, a special provision applies to medical devices–subparagraph "d" of paragraph 1 of Part 1 of Article 33 of the Contract System Law: the Customer may specify a trademark without the words "or equivalent" when procuring medical devices required for prescription to a patient based on medical indications (individual intolerance, life-saving indications) following a medical commission's decision.

According to the position of FAS Russia outlined in letter No. GR/48883/25 dated May 26, 2025, the Customer must document the necessity of ensuring compatibility with existing equipment within the technical and/or operational documentation for that equipment. Furthermore, the Customer must explicitly state the trademark of the procured consumable in the procurement object description.

Typical conflict scenarios include:

• Substantiating compatibility requirements solely with letters from the manufacturer or its authorized representative, lacking corresponding data in the equipment documentation;
• Specifying article numbers or brands in the absence of a registered trademark;
• Imposing warranty restrictions when the Customer utilizes non-original consumables;
• The presence of registered and functionally compatible consumables on the market.

This final scenario has triggered particularly fierce disputes in recent years. For an extended period, antimonopoly authorities followed Roszdravnadzor's position, set forth in letter No. 09-S-571-14144 dated February 5, 2016, which stated that the manufacturer of the medical equipment determines the feasibility of operating medical equipment from one manufacturer with accessories from another manufacturer.

However, the regulatory authority altered its stance in 2025. In letter No. 04-22671/25 dated April 16, 2025, Roszdravnadzor stated that, absent specific compatibility guidelines in the manufacturer's technical and operational documentation, the state registration process for medical devices determines the compatibility of non-original accessories and consumables through an expert review of quality, efficacy, and safety. Thus, if the manufacturer of non-original consumables confirms such compatibility during state registration, the joint use of the medical device with those consumables is permissible. This conclusion relied, inter alia, on the provisions of subparagraph "b" of paragraph 61 of the Rules for State Registration of Medical Devices, which allows applicants to confirm the feasibility of jointly using a registered medical device with another medical device from a different manufacturer during the state registration process.

FAS Russia actively supported this position in letter No. GR/48883/25 dated May 26, 2025. This generated a wave of disputes, and judicial practice on this issue remains inconsistent.

For example, in case No. A19-18385/2024,[3] a medical center procured laboratory consumables for automated nucleic acid dosing and extraction complexes "R". The Customer included a requirement in the procurement notice mandating the compatibility of the consumables with its leased equipment. An individual entrepreneur filed a complaint with the OFAS regarding the restriction of competition, citing the availability of third-party consumables compatible with the Customer's equipment. However, the antimonopoly authority dismissed the complaint as unfounded. Contesting the antimonopoly authority's decision, the individual entrepreneur appealed to the court.

The court concluded that the compatibility requirements for the consumables with the equipment were justified by the lease agreement and the necessity to ensure the safety and quality of diagnostics. Furthermore, the court agreed with the respondent's argument that the compatibility of the consumables lacked documentary confirmation via an expert review of the quality, efficacy, and safety of the medical device. The court denied the claim to invalidate the OFAS decision.

In another case, No. A75-21095/2025,[4] the court reached the opposite conclusion, stating that during the operation of medical devices, the Customer may use components or accessories not specified in the manufacturer's technical and (or) operational documentation, provided technical trials, toxicological studies, and clinical trials conducted during the registration of the consumables confirm the feasibility of joint use.

Thus, courts generally proceed from the premise that patient safety takes priority; therefore, actual incompatibility constitutes a legitimate ground for restriction. However, the Customer must prove this incompatibility in relation to the specific procurement, rather than relying on abstract claims.

To minimize disputes, we advise Customers to:

• Assess the "cost of ownership", including the price of consumables over the entire operational lifespan, when procuring equipment whenever feasible;
• Proactively analyze the technical and operational documentation for the medical device to confirm the necessity of ensuring compatibility;
• Avoid phrasing that grants an advantage to a single manufacturer without objective necessity.

For suppliers of non-original consumables, we advise to:

• Ensure compatibility confirmation during the state registration of the medical device, incorporating this information into the technical and operational documentation for their products;
• Promptly challenge tailored documentation before FAS Russia upon detecting anti-competitive specifications favoring a competitor.

Misapplication of National Treatment Measures in Public Procurement

A separate category of disputes relates to the implementation of bans and restrictions on the admission of foreign medical devices. Customers and bidders often manipulate these rules to establish barriers against specific devices or, conversely, to secure advantages for promoting their own products.

The Decree No. 1875 regulates the rules for granting national treatment.

The Decree No. 1875 provides three categories of national treatment measures applicable to various lists of goods: (1) a ban on the admission of goods originating from foreign states; (2) a restriction on admission, under which the Customer rejects a bid containing foreign goods if there is a specified number of compliant bids offering goods from Eurasian Economic Union (EAEU) member states (the "Second One Out" rule); (3) the provision of an advantage (price preference) regarding the contract price in favor of EAEU goods. The legal consequences for a bidder vary significantly depending on which measure applies to a specific medical device, a factor that generates a substantial portion of these disputes. The current version of the Decree No. 1875 outlines the specific conditions and parameters for applying these measures.

Typical conflict scenarios involve:

• Selecting the incorrect applicable national treatment measure (ban on foreign goods, restriction on foreign goods, preference for Russian goods);
• Challenging the confirmed country of origin of a product from the Russian Federation or the EAEU;
• Unlawfully rejecting or admitting bids due to the misapplication of national treatment rules.

In case No. A40-85698/2025,[5] which reached the Supreme Court of the Russian Federation, a medical center conducted an electronic auction for the supply of syringe-manometers. Based on a complaint from a bidder, the antimonopoly authority determined that the Customer violated the procurement notice requirements by selecting the incorrect national treatment measure. According to the OFAS, the Customer should have established a restriction on the admission of foreign goods instead of granting a preference to Russian goods. Disagreeing with the antimonopoly authority's decision, the medical center appealed to the court. The claimant argued that the procured syringe-manometer differed in design and purpose from standard syringes, which are subject to admission restrictions.

Courts across all instances concluded that the syringe-manometer did not correspond to the description of position 385, "Surgical needles: piercing instruments; syringes", which mandates an admission restriction. Consequently, the courts invalidated the decision and order of the antimonopoly authority.

To mitigate disputes, we advise both parties to apply the Decree No. 1875 accurately and meticulously verify all documentation regarding the origin of medical devices.

Procedural and Miscellaneous Disputes in Public Procurement of Medical Devices

Medical device procurement also features other types of disputes, including those concerning:

• The validity of requiring the proposed medical device to comply with a specific NCMI code;
• The correct selection and application of a KTRU position (e.g., failing to use the KTRU when a position meets the Customer's needs, specifying additional product characteristics absent from the KTRU position without proper justification in the notice, or adding characteristics when regulatory acts prohibit doing so);
• The accuracy of the information provided by bidders in their bids compared to the data in the registration dossier and the actual parameters of the medical device;
• The supply terms (delivery schedules, equipment manufacturing dates), among others.

Review of Complaints by FAS Russia

Most antitrust disputes arise during the preparation and execution of the procurement and are predominantly reviewed by antimonopoly authorities pursuant to Chapter 6 of the Contract System Law, "Appealing Actions (Inactions) of the Subjects of Control".

The antimonopoly authority reviews complaints during the supplier determination period. A party may file a complaint no later than 5 days following the date the Customer publishes the protocol summarizing the supplier determination results in the Unified Information System (EIS), subject to the following nuances:

• A party may file a complaint against the provisions of the procurement notice or procurement documentation up until the bid submission deadline;
• A party may file a complaint against actions (inactions) committed during the contract execution phase up until the contract is signed.

The antimonopoly authority must review the complaint within 5 working days. During this period, the regulatory body possesses the authority to issue requests for information and documents necessary to evaluate the complaint, including demanding such information and documents from the subjects of control.

Following the review, the antimonopoly authority holds the power to:

• Declare the complaint justified and issue an order to rectify the violations;
• Hold the Customer's officials administratively liable;
• Initiate an antitrust case upon identifying evidence of collusion.

Procedure for Challenging FAS Decisions and Orders in Commercial Courts

Interested parties may challenge the decisions and orders of the antimonopoly authority in an Arbitration Court pursuant to Chapter 24 of the APC RF, "Consideration of Cases on Challenging Non-Normative Legal Acts, Decisions, and Actions (Inactions) of State Bodies". The statutory limitation period for filing an application to invalidate a non-normative legal act or to declare decisions and actions (inactions) unlawful is 3 months from the date the party became aware of the violation of its rights.

Furthermore, by direct operation of Part 4 of Article 17 of the Protection of Competition Law, a violation of antitrust prohibitions constitutes grounds for a court to invalidate the relevant bidding process and any transactions concluded based on its results, including upon a claim filed by the antimonopoly authority.

Cartels and Collusive Agreements Among Medical Device Suppliers

Cartel agreements represent the most dangerous form of antitrust violation in public procurement, as they restrict competition and cause the unjustified expenditure of budget funds.

Pursuant to Part 1 of Article 11 of the Protection of Competition Law, agreements between competing economic entities (i.e., entities selling or purchasing goods in the same commodity market) are recognized as a cartel and prohibited if such agreements result in or may result in:

• Fixing or maintaining prices (tariffs), discounts, markups (surcharges), and (or) margins;
• Increasing, decreasing, or maintaining prices at bidding;
• Dividing the commodity market by territory, volume of sales or purchases, assortment of goods sold, or composition of sellers or buyers;
• Curtailing or ceasing the production of goods; or refusing to conclude contracts with specific sellers or buyers.

The medical device market is particularly vulnerable to cartels due to the limited number of suppliers in niche product categories, the complexity of objectively evaluating product characteristics, and the entrenched relationships between a single manufacturer's distributors. FAS Russia regularly initiates cartel cases in the markets for consumables, reagents, hemodialysis products, endoprostheses, and other high-margin goods.

Typical bid-rigging schemes include:

• Predatory price dropping (the Battering Ram strategy): two or three participants drastically lower the price to push out bona fide competitors, and are subsequently disqualified on formal grounds.
• Passive participation: several companies submit bids to create the illusion of competition without lowering the price, thereby securing a victory for a pre-selected participant with virtually no bidding.
• Market allocation: competitors coordinate which entity will win specific bids, alternating victories and maintaining inflated prices.
• Refraining from submitting price offers in favor of an affiliated participant.

Evidentiary Standards for Proving Collusion in Procurement

Direct evidence (written agreements) is rarely available; therefore, authorities rely on a combination of circumstantial evidence to prove a cartel, such as:

• Utilizing shared infrastructure (identical IP addresses or MAC addresses when submitting bids);
• Matching electronic file properties in the bids (document author, creation time);
• Executing minimal reductions of the initial price despite the presence of multiple bidders;
• Demonstrating synchronized and uniform behavior among bidders;
• Maintaining financial relationships between "competitors" (loans, shared accounts, cross-financing);
• Sharing identical representatives, powers of attorney, bank details, common founders, or executives.

For example, in case No. A08-11436/2023,[6] a Hospital conducted a series of procurement procedures for COVID-19 laboratory diagnostic tests in accordance with the Contract System Law. Consequently, the Hospital concluded 30 contracts over 2 years, totaling 1,346,203,281 rubles. The antimonopoly authority received a report alleging collusion among the bidders. Following an investigation, the OFAS concluded that the winning bidders–Companies P., F., and R.–had entered into an anti-competitive agreement designed to maintain bidding prices. Contesting this decision, Company R. appealed to the court. During the proceedings, the court verified the following facts:

• The Companies dispatched their price (commercial) proposals from a single email account;
• The bidders utilized identical IP addresses to submit their bids;
• During bid submission, the Companies either submitted identical price offers or abstained from participating in the procedure entirely.
• The court denied the claim to invalidate the antimonopoly authority's decision.

Vertical agreements constitute another category of prohibited agreements. A vertical agreement is an agreement between economic entities where one purchases a product and the other sells it (paragraph 19 of Article 4 of the Protection of Competition Law). In practice, vertical agreements occur between economic entities operating at different levels of the supply chain. Agreements between a manufacturer and a distributor of medical devices fall into this category.

Pursuant to Part 2 of Article 11 of the Protection of Competition Law, vertical agreements between economic entities are prohibited if:

• They result in or may result in establishing a resale price for the product, except when the seller sets a maximum resale price for the buyer;
• Such agreements mandate that the buyer shall not sell the product of an economic entity that competes with the seller.

Entering into or participating in an anti-competitive agreement incurs administrative liability under Article 14.32 of the CAO RF, which encompasses several distinct offenses, including:

• Under Part 1 of Article 14.32 of the CAO RF, entering into an agreement recognized as a cartel, or participating therein, carries a fine for officials ranging from 40,000 to 50,000 rubles or disqualification for 1 to 3 years; for legal entities, a fine ranging from 0.03 to 0.15 times the amount of the offender's revenue from the sale of the product in the market where the offense occurred, or the amount of expenses incurred purchasing the product in the market where the offense occurred, but not less than 100,000 rubles.
• Under Part 2 of Article 14.32 of the CAO RF, if such an agreement results in or may result in increasing, decreasing, or maintaining prices at bidding, or is concluded with procurement organizers or Customers with bidders and aims to or may result in restricting competition and (or) granting preferential conditions to certain bidders, or for participating in such an agreement, the penalties escalate. Officials face a fine from 20,000 to 50,000 rubles or disqualification for up to 3 years; legal entities face a fine ranging from 1/10 to 1/2 of the initial value of the bidding object, but not exceeding 1/25 of the total revenue from the sale of all goods, and not less than 100,000 rubles.

Parts 3 and 4 of this article impose liability for concluding other legally prohibited anti-competitive agreements (vertical agreements, etc.), while Part 5 penalizes the coordination of economic activity.

The law incorporates a leniency mechanism: a cartel participant who is the first to voluntarily report the collusion to the antimonopoly authority, provides sufficient information, and ceases participation may obtain exemption from administrative liability (Note to Article 14.32 of the CAO RF). This serves as a critical tool for detecting cartels, incentivizing internal defection.

For a cartel that causes major or particularly major damage, or generates income on a major or particularly major scale, the law imposes criminal liability under Article 178 of the Criminal Code of the Russian Federation, Restriction of Competition.

Major damage is defined as damage exceeding 16,000,000 rubles, while particularly major damage exceeds 47,500,000 rubles. Income on a major scale denotes income exceeding 80,000,000 rubles, and on a particularly major scale, 395,000,000 rubles.

This offense carries a penalty of a fine ranging from 300,000 to 500,000 rubles, or an amount equal to the offender's salary or other income for a period of 1 to 2 years, or forced labor for up to 3 years, or imprisonment for up to 3 years. The court may apply an additional penalty: disqualification from holding certain positions or engaging in specific activities for up to 1 year.

Parts 2–4 of Article 178 of the Criminal Code establish aggravating circumstances that trigger more severe sanctions.

An offender secures exemption from criminal liability if they are the first among the accomplices to voluntarily report the crime, actively assist in its detection and (or) investigation, compensate for the damage caused by the crime, return the illegally obtained income, or otherwise make amends for the harm caused, provided their actions do not constitute a separate criminal offense (Note 4 to Article 178 of the Criminal Code).

To mitigate the risks of facing liability, we advise medical device suppliers to avoid any communications with competitors regarding pricing and terms of participation in bidding.

Litigation Arising During the Execution of Supply Contracts

Disputes do not cease upon the execution of a medical device supply contract. A substantial portion of these cases emerges during the contract execution phase. In quality disputes, the critical evidence usually comprises the results of the expert examination that the Customer must conduct upon accepting the goods (Article 94 of the Contract System Law). The Customer performs this examination internally or engages independent experts or expert organizations.

Below are examples of typical conflict scenarios.

Supply of Counterfeit or Substandard Medical Devices

Pursuant to Part 17 of Article 38 of the Law on Health Protection, the sale of falsified, substandard, counterfeit, and unregistered medical devices is prohibited. Notably, the law defines a counterfeit medical device as one that is in circulation in violation of civil legislation (Part 14 of Article 38 of the Law on Health Protection).

Paragraph 3 of Article 1484 of the Civil Code stipulates that no party may use, without the right holder's consent, designations similar to a registered trademark for goods matching the registration, or for homogeneous goods, if such use creates a likelihood of confusion.

Pursuant to Article 1515 of the Civil Code, the right holder possesses the right to demand the removal from circulation and destruction, at the infringer's expense, of counterfeit goods, labels, and product packaging that unlawfully bear the trademark or a confusingly similar designation.

Relying on the aforementioned regulations, right holders petition the courts to declare the use of trademarks unlawful, designate the supplied goods as counterfeit, order their removal from circulation, and award compensation for trademark infringement. Furthermore, the right holder may demand, at their discretion, that the infringer either compensate for damages or pay statutory compensation:

1. Ranging from 10,000 to 5,000,000 rubles, determined at the court's discretion based on the nature of the infringement;
2. Equal to twice the value of the goods unlawfully bearing the trademark, or twice the value of the right to use the trademark, calculated based on the price normally charged for lawful use under comparable circumstances.

A review of enforcement practice reveals a growing number of disputes involving the supply of counterfeit goods under medical device public procurement contracts in recent years.

Case No. A21-2100/2024[7] provides an illustrative example. In this case, the authorized representative of Company R. filed a lawsuit in the Commercial Court against an Individual Entrepreneur, seeking an injunction to prohibit the introduction of reagents for an immunochemical analyzer bearing the "C" trademark into circulation in Russia, and a mandate to seize and destroy at the respondent's expense all goods supplied to the Clinical Center.

The case materials established that Company R. held the exclusive rights to the "C" trademark. The Individual Entrepreneur supplied medical devices bearing the disputed trademarks to the Clinical Center under a finalized contract. However, during the acceptance process, the Customer discovered that some medical devices lacked Russian-language labeling, while others bore a Russian sticker displaying insufficient information. These facts prompted the Customer to reject the supplied goods and the right holder's representative to initiate legal action.

The respondent argued that they had purchased the goods within Russia. Nonetheless, they refused to disclose the entire supply chain from the foreign manufacturer to the Russian Federation, justifying this stance by citing potential repercussions for suppliers due to imposed sanctions.

Considering the above, the court concluded that the disputed medical devices were unlawfully introduced into civil circulation and designated them as counterfeit. The court satisfied the claim in full.

In a similar case, No. A76-11990/2018,[8] the court also awarded the right holder 860,000 rubles as statutory compensation for trademark infringement.

Liability for the Supply of Substandard Medical Devices

As noted above, the Law on Health Protection prohibits the supply of substandard medical devices in addition to counterfeit ones.

According to Part 13 of Article 38 of the Law on Health Protection, a medical device is considered substandard if it fails to comply with safety and efficacy requirements, labeling standards, or normative, technical, and operational documentation, rendering it unsafe for its intended use as established by the manufacturer.

Pursuant to Part 2 of Article 475 of the Civil Code, in the event of a material breach of product quality requirements (discovery of fatal defects, defects that cannot be eliminated without disproportionate expenses or time, defects that appear repeatedly, or defects that reappear after elimination, among others), the buyer holds the right to terminate the purchase and sale contract and demand a refund of the amount paid for the goods.

For example, in case No. A72-15012/2020,[9] a Medical and Sanitary Unit filed a lawsuit against Company M., seeking to terminate the contract and recover over 7,000,000 rubles paid for the goods, along with interest for the use of other people's funds. Company M. filed a counterclaim demanding the Customer accept the goods.

The court established that the Medical and Sanitary Unit and the Company had concluded contracts for the supply of portable X-ray machines. During acceptance, the Customer identified the following defects: the goods lacked packaging, and the manufacturing location stated in the Marketing Authorization did not match the information on the X-ray machines' nameplates. The Customer refused acceptance and issued a demand for the refund of the funds paid. During the proceedings, the equipment's official distributor testified that a mistake occurred on the nameplates and that corrected nameplates had been transferred to the supplier. The Company argued that merely replacing the nameplates on the supplied equipment would resolve the dispute.

The court rejected the respondent's position. According to the Rules for State Registration of Medical Devices, the registry entry specifies the manufacturing location, and any change to this location necessitates amending the equipment's registration dossier. Consequently, the courts concluded that the supplier delivered a substandard medical device, rendering the intended use of the supplied medical equipment impossible. The court satisfied the Medical and Sanitary Unit's claims to terminate the contracts due to the respondent's material breach of the supply terms and to recover the payment for the goods. The court awarded interest for the use of other people's funds calculated from the date the supplier received the refund demand.

Supply of Medical Devices Non-Compliant With National Treatment Requirements

Pursuant to paragraph 1 of Article 456 of the Civil Code, the supplier must deliver goods that comply with the terms of the contract.

This obligation assumes critical importance if national treatment measures were activated during the procurement, granting the winning bidder advantages over competing offers. According to the position of the Ministry of Industry and Trade of Russia, outlined in letter No. 117563/12 dated November 1, 2023, the registry entries verifying the product's origin from the Russian Federation or the EAEU must remain valid both when the bidder submits their bid and when the contract is executed. Judicial practice corroborates this position.

For instance, in case No. A21-2093/2026,[10] Company M. filed a lawsuit in the Commercial Court against a District Hospital, seeking to invalidate the decision to unilaterally terminate a contract for the supply of an ultrasound system manufactured by Russian entity E.

During the trial, the court established that the Ministry of Industry and Trade of Russia revoked the registry entry for the ultrasound system while the contract was being executed. This revocation provided the grounds for rejecting the goods and subsequently issuing the decision to unilaterally terminate the contract.

The court noted that the Decree No. 1875 governs the rules for verifying the country of origin, specifying that the registry entry number from the register of Russian industrial products constitutes the information confirming Russian origin. Furthermore, the court agreed with the Customer's stance that the termination of the registry entry prior to acceptance constitutes valid grounds for refusing acceptance under national treatment rules. The court denied the claim.

Notably, this position is not isolated and continues to gain traction in judicial practice.[11]

The medical device sector also frequently encounters disputes involving supply failures caused by the cancellation of medical device registrations, manufacturers exiting the market, logistical disruptions, and sanctions restrictions, among other factors.

Additionally, an independent category comprises disputes regarding the application of liability measures for contract breaches. These include the recovery of penalties (fines and late payment fees) assessed pursuant to Parts 4–8 of Article 34 of the Contract System Law, and the legality of unilateral contract termination under Article 95 of the same Law. Judicial review routinely scrutinizes the validity of assessing penalties and executing unilateral terminations.

Disputes arising during contract execution generally undergo resolution in court pursuant to Section II of the APC RF, "Action Proceedings". The methods of protecting rights vary based on the specific facts of the case and may include claims for damages, recovery of penalties, specific performance, and invalidation of a unilateral termination.

Disputes Regarding Inclusion in the Register of Unscrupulous Suppliers

This represents a distinct category of disputes frequently encountered in medical device procurement. Pursuant to Part 2 of Article 104 of the Contract System Law, the Register of Unscrupulous Suppliers (RNP) incorporates information:

• Concerning bidders who evaded signing contracts;
• Regarding suppliers who failed to perform or improperly performed obligations stipulated in their contracts.

A bidder designated as the winner is deemed to have evaded signing the contract if, within the established timeframes, they:

• Fail to sign the contract or publish a protocol of disagreements in the EIS;
• Neglect to provide adequate contract performance security (when such a requirement exists);
• Violate anti-dumping requirements (if specified in the notice pursuant to Article 37 of the Contract System Law for instances where the contract price drops by 25% or more from the IMCP).

Information concerning a supplier's failure to perform or improper performance is submitted if the Customer unilaterally terminates the contract or if a court orders its termination.

Antimonopoly authorities issue the decision to include or decline inclusion in the RNP after reviewing the data submitted by the Customer. If information about a bidder (including members of a collegial executive body, the individual acting as the sole executive body, corporate participants, and other entities listed in Part 3 of Article 104 of the Contract System Law) enters the RNP, these entities become ineligible to participate in procurements that mandate the absence of RNP registration. The duration of inclusion in the RNP is 2 years (Part 9 of Article 104 of the Contract System Law).

It is important to emphasize that inclusion in the RNP serves as a liability measure, not an automatic consequence of unilateral contract termination. Following established judicial precedent,[12] antimonopoly authorities must evaluate the supplier's degree of fault, their good faith, and the potential existence of force majeure circumstances.

A judicial case study illustrates this point. In case No. A16-360/2023,[13] a Department of Health conducted an electronic auction for the supply of medical stadiometers. Following the procedure, the Customer concluded a contract with an Individual Entrepreneur. However, during acceptance, the Customer discovered that the stadiometers failed to meet the technical characteristics specified in the contract regarding the minimum measurement limit. The Department refused to execute the contract and petitioned the antimonopoly authority to include the Individual Entrepreneur in the RNP. The antimonopoly authority proceeded to enter this information into the RNP. Disputing the regulatory body's decision, the entrepreneur appealed to the Commercial Court.

During the trial, evidence revealed that the Customer's commission failed to reject the bid during the review phase, even though the bid contained data detailing the actual characteristics of the stadiometer. The court concluded that there was no proof of intentional bad faith on the entrepreneur's part; therefore, the antimonopoly authority's decision violated the principles of fairness, proportionality, and commensurability. The court invalidated the decision to include the entity in the RNP.

To minimize the risk of RNP inclusion, we advise maintaining strict oversight of contract deadlines, procedures, and terms. In the event of an inability to execute obligations timely, parties must document the impeding circumstances to establish a defense against RNP listing.

A party may challenge the antimonopoly authority's decision to include or refuse inclusion in the RNP before an Arbitration Court pursuant to Chapter 24 of the APC RF, Consideration of Cases on Challenging Non-Normative Legal Acts, Decisions, and Actions (Inactions) of State Bodies. The statutory limitation period for filing an application to invalidate a non-normative legal act or to declare decisions and actions (inactions) unlawful is 3 months from the date the party became aware of the violation of its rights.

Overall, the grounds for judicial disputes involving the circulation of medical devices, the range of involved parties, and the selected legal remedies are exceptionally diverse. Nevertheless, we can identify several prevailing trends, including:

• Enforcing stricter requirements for drafting procurement descriptions to prevent artificial restrictions of competition in medical device markets;
• Digitalizing enforcement: FAS Russia increasingly deploys automated systems to analyze bidder behavior, detecting cartels through digital footprints (IP addresses, metadata, and price-dropping patterns). This technological shift enhances the detection rate for collusion;
• Strengthening the national treatment regime. The import substitution policy continues to broaden, which will inevitably generate a higher volume of disputes regarding product origin and manufacturing localization;
• Intensifying the crackdown on counterfeit and substandard medical devices.

The trajectory of judicial practice seeks to strike a reasonable balance between maintaining free competition and safeguarding the public interest in protecting patient life and health. For all participants in the medical device market, navigating this landscape demands structuring operations based on the principles of transparency, sound justification, and strict adherence to the law.

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References

1. Translation of the footnote: Resolution of the Fourteenth Arbitration Appeal Court No. 14AP-10047/2024 dated February 17, 2025, in case No. A13-11016/2024.

2. Translation of the footnote: Resolution of the Arbitration Court of the Moscow District No. F05-8073/2025 dated June 23, 2025, in case No. A40-233495/2024.

3. Translation of the footnote: Ruling of the Supreme Court of the Russian Federation No. 302-ES25-7472 dated August 4, 2025, in case No. A19-18385/2024.

4. Translation of the footnote: Decision of the Arbitration Court of the Khanty-Mansi Autonomous Okrug - Yugra dated July 4, 2026, in case No. A75-21095/2025.

5. Translation of the footnote: Ruling of the Supreme Court of the Russian Federation No. 305-ES26-4925 dated July 2, 2026, in case No. A40-85698/2025.

6. Translation of the footnote: Ruling of the Supreme Court of the Russian Federation No. 310-ES26-1433 dated March 25, 2026, in case No. A08-11436/2023.

7. Translation of the footnote: Ruling of the Supreme Court of the Russian Federation No. 307-ES25-6840 dated August 4, 2025, in case No. A21-2100/2024.

8. Translation of the footnote: Ruling of the Supreme Court of the Russian Federation No. 309-ES20-8538 dated July 3, 2020, in case No. A76-11990/2018.

9. Translation of the footnote: Resolution of the Arbitration Court of the Volga District No. F06-14803/2022 dated February 22, 2022, in case No. A72-15012/2020.

10. Translation of the footnote: Decision of the Arbitration Court of the Kaliningrad Region dated June 15, 2026, in case No. A21-2093/2026.

11. Translation of the footnote: Resolution of the Arbitration Court of the North-Western District No. F07-4944/2024 dated June 5, 2024, in case No. A66-10603/2023; Resolution of the Arbitration Court of the West Siberian District No. F04-2203/2025 dated July 28, 2025, in case No. A27-11862/2024.

12. Translation of the footnote: Ruling of the Supreme Court of the Russian Federation No. 304-ES20-8161 dated May 28, 2020, in case No. A46-10914/2019.

13. Translation of the footnote: Resolution of the Arbitration Court of the Far Eastern District No. F03-1979/2024 dated June 5, 2024, in case No. A16-360/2023.