SMALL BUSINESS IS RAISED ON THE SHIELD. FAS OVERWRITE THE LAW «ON ADVERTISING»

22nd October 2013

Therefore FAS suggests to bidding in the first play position for small and medium business. The starting price of lots per year of validity of the contract, according to the idea of service shall not exceed RUR 1 million.

The Federal Antimonopoly service (FAS) intends to improve the order of trades on outdoor advertising. According to the plan offices not less than 20% offered for auctions and tenders places for advertising constructions should be fixed for small and medium business. With this initiative the service is performed only once in Moscow, the largest regional market, main trading is already gone.

FAS published prepared by it the amendments to the law "On advertising" directed on support of subjects of small and average business in sphere of distribution of the outdoor advertising. «Kommersant» already reported on 7 October that the service prepares such a bill. Now the law "On advertising" obliges municipalities (in Moscow and Saint Petersburg it is city administration) allocate the space for advertising media solely on the results of auctions or competitions. Since may of this year it is possible to make contracts with winners for five to ten years (the exact date now identifies each subject of the Russian Federation independently). But FAS draws attention that small and medium businesses involved in such trades on a par with major players and having no state support actually lose the ability to continue to engage in outdoor advertising.

Therefore FAS suggests to bidding in the first play position for small and medium business. The starting price of lots per year of validity of the contract, according to the idea of service shall not exceed RUR 1 million. A company falling within the definition of "small" or "medium enterprise" can only be participant of such tenders: the average number of the first for the previous calendar year shall not exceed 100 people, second – 250 employees, annual revenues excluding VAT – 400 mln and 1 bln, respectively. Fixed for small and medium business of the quota should be not less than 20% of all the places offered by the municipality at the auction.
In addition, FAS suggests making all bidders to disclose its beneficiaries and persons "exercising a significant influence on the decisions taken by the management bodies of the company". If the legal person does not do so or provides false information, it may be fined 100-500 thousand rubles – an appropriate amendment office plans to amend the Code of administrative offences.

The vesting of small companies with "a kind of formal priority" essentially means a ban on growth, says Director of the legal Department of the group Russ Outdoor Gary Napalkov. He not understands also the reason to disclosure of beneficiaries. These proposals have already been made in the state Duma in the form of amendments to sectoral law, but they still have not been heard by the deputies.

Meanwhile, across the country for more than a year there are trades as in 2012-2013 have expired earlier, five-year contracts. For example, in Moscow which in 2012, according to the research company "ESPAR-analytic", accounted for almost 48% of all spending on outdoor advertising, the main trading took place in August. Three auctions were drawn almost 7.3 thousand places under shields, banner stands and designs of small size (the so-called street furniture) and it is 60% of all places permitted in the capital of the outdoor advertising.

But in St. Petersburg, the second largest regional market, mass trades have not been, and they are unlikely to take place before the end of the year, although agreements on the operation of all installed in the city structures have expired in July. In 2012 their owners, according to «ESPAR-Analytic», earned more than 23.5 billion rubles (excluding small format), that is 12% of all spending on outdoor advertising. For bidding requires the concept of placing of outdoor advertising, which is still not ready.

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