FAS asked to extend the term for preparing amendments to the law on a single digital advertising operator

The Federal Antimonopoly Service (FAS) asked the government apparatus not to speed up the preparation of amendments to the bill on a single digital advertising operator. It was submitted to the State Duma on July 8 by Deputy Artem Kiryanov (United Russia), and on July 15 it was adopted in the first reading at an extraordinary plenary session of the lower house of parliament. After that, a 30-day deadline was set for collecting amendments to the initiative. Maxim Shaskolsky, Director of the Federal Antimonopoly Service, in a letter to First Deputy Chief of Staff of the Government Valery Sidorenko (Vedomosti got acquainted with his copy) asks to postpone the deadline for submitting amendments from the White House to autumn.

In the letter, the head of the antimonopoly agency refers to the fact that the government apparatus of the FAS was instructed, together with the Ministry of Digital Development, the Ministry of Economics, the Ministry of Construction, the Ministry of Transport, the Ministry of Internal Affairs, the Ministry of Foreign Affairs and the Ministry of Justice, to prepare and submit draft amendments to the White House by August 4. But some departments (Ministry of Finance, Ministry of Economics, Ministry of Transport, Ministry of Internal Affairs and Ministry of Foreign Affairs) did not send their proposals by the end of July. Referring to the “lack of opportunity to develop a consolidated position” within the specified period, Shaskolsky asked to extend the deadline for submitting amendments until September 5.

The deputy’s bill suggests that a single digital advertising operator should appear in Russia. He will check the content for compliance with the law, determine the prices for placement, as well as protect the personal data of users. The operator will remain a market participant and will be able to enter into 30-year contracts without bidding to install its digital structures on state-owned land and broadcast advertising on the screens of state and municipal transport during the same period.

The status of a single operator can be obtained by a company that is not controlled by foreign owners, is a backbone company and has its own digital structures, including in federal cities. Only Russ Outdoor meets these criteria, Vedomosti wrote. On July 28, at a round table in the State Duma, Yana Sklyarova, Deputy Head of the Department for Controlling Advertising and Unfair Competition of the Federal Antimonopoly Service, Yana Sklyarova, said that combining the functions of an economic entity and a market regulator by a company is contrary to antitrust laws and could lead to abuses against other enterprises.

The decision to extend the term for the adoption of amendments in the State Duma Committee was not taken, says a Vedomosti source on Okhotny Ryad. Formally, the deputies are on vacation since August 1. Vedomosti sent inquiries to the government apparatus, the Federal Antimonopoly Service, the Ministry of Finance, the Ministry of Economics, the Ministry of Transport, the Ministry of Internal Affairs and the Ministry of Foreign Affairs. By the time the material was submitted for publication, their representatives had not responded to Vedomosti’s requests. It was not possible to contact Kiryanov. Russ Outdoor declined to comment.

Earlier, the Moscow mayor’s office criticized the bill, Vedomosti wrote: they fear that the initiative will hit the advertising market, the image of the city and the income of the capital. Following Moscow, the bill was criticized by the government of St. Petersburg. It opposes the adoption of the draft law in the current version and considers it “inappropriate” to attempt to finalize it for the second reading, follows from a letter sent to Deputy Mikhail Romanov by Vice Governor Anatoly Poveliy on August 2 (Vedomosti got acquainted with a copy of it).

The bill prevents the preservation of the architectural appearance of cities and creates prerequisites for reducing the volume of social advertising (a single operator will have the right to control digital structures without allocating space for social advertising), the document states. Like the Federal Antimonopoly Service, Poveliy points out that entrusting a single economic entity with a private form of ownership “the powers to ensure equal conditions for the distribution of digital advertising and prevent the dissemination of false information, including when securing the right of a single operator to own digital advertising structures, is contrary to the principles of state regulation and antimonopoly policy of the Russian Federation. This, as Poveliy notes, “actually leads to the liquidation of the outdoor advertising market.”

A single operator will receive exclusive preferences, which will lead to the virtual elimination of competition in the outdoor advertising market, says a representative of the outdoor advertising operator Gallery. In addition, the bill creates a precedent for the intervention of a commercial company in the powers of the authorities to shape the appearance of cities, since a single operator will independently develop a scheme for placing advertising structures and install them at its own discretion, he clarifies.

Moscow and St. Petersburg have the largest volume of inventory, a significant share of which is occupied by digital designs, says Sergey Gumel, director of outdoor advertising purchases at Media Direction Group. “The initiative proposed by the legislator under a far-fetched pretext will do more harm than good for both local authorities and the industry as a whole,” he sums up.