Russian Antitrust Regulator Initiates Proceedings Against Yandex, Google

Since 2019, a growing number of countries have set their sights on reining in the allegedly anticompetitive practices of Big Tech companies.  The United States has been conducting investigations and filing suit against multiple leading technology companies, the European Union and the United Kingdom announced proposed legislation to open such companies up to greater competition, and China sanctioned Chinese technology companies Alibaba, Tencent, ByteDance, Baidu, and Didi for anti-monopoly violations.

The latest country to enter the lists against Big Tech is Russia.  Within the past week, the Russian Federal Antimonopoly Service announced that it was taking action against two major technology companies for alleged competition law violations.

First, on April 13, the FAS announced that it had initiated a case against the Russian technology company Yandex for allegedly discriminatory conditions in the web search market.  The FAS stated that in February 2021, it had warned Yandex “to ensure equal conditions for the demonstration of the services on the pages of search engines, including market participants and competitors of the Yandex group,” and set a deadline of April 1.  Although Yandex reportedly requested additional time in April to respond to the accusations, the FAS chose not to grant that time.

The FAS said that as part of its consideration of the case, it would “investigate possible anticompetitive practices for promoting the services of the Yandex group in search results, as well as assess the consequences that such practices have led to (could lead to).”   it would investigate possible anti-competitive practices by Yandex and assess the consequences of those practices. It also noted that Yandex could be subject to a turnover-based fine if the FAS finds evidence that the company was restricting competition.

Second, on April 19, the FAS announced that it had initiated a case against Google for allegedly abusing of its dominant market position in YouTube video hosting services.  The FAS stated that the basis for its investigation was a complaint by the Regional Public Organization “Center for Internet Technologies” (ROCIT) about “Google’s actions of sudden blocking, deleting user accounts and content on the YouTube video hosting.”  It also said that it

has established that the rules related to the formation, suspension, blocking of accounts and the circulation of user content on YouTube are non-transparent, non-objective and unpredictable. This leads to sudden blocking and deletion of user accounts without warning and justification of actions. The FAS Russia believes that such behavior may lead to infringement of the interests of users, as well as to restriction of competition in related markets.

It also stated that as part of its consideration of the case, it “will assess the actions of Google LLC and consequences for users and content creators.”

Antitrust and competition compliance teams at technology companies doing business in Russia should regard the FAS actions with concern.  These proceedings should be viewed against the backdrop of last month’s actions by Russian authorities against Facebook, Google, Telegram, TikTok, and Twitter, for failing to delete posts urging children to take part in allegedly illegal protests of the imprisonment of Russian anti-corruption activist Alexei Navalny.

The fines against several of the companies in the March proceedings would be miniscule.  Nonetheless, there should be no doubt that the interests of Russian President Vladimir Putin and the Russian government extend well beyond promoting fair competition by technology companies.  A government committed to the speedy imprisonment of Navalny and mass arrests of protestors supporting Navalny can be counted on to exert systematic pressure on technology companies to bend to the government’s will, including suppression of free speech and criticism that those companies facilitate.

In a February 2021 meeting with U.S. Secretary of State Antony Blinken, Russian Foreign Affairs Minister Sergei Lavrov publicly insisted on “the need to respect (Russia’s) legislation and judicial system.”  Technology companies should expect that the Russian government will seek to compel that respect from them in matters extending well beyond competition law.

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