Supplier's dominant position at the Russian wholesale electricity market: Key elements of regulation

The paper deals with a concept of dominant position of a supplier and with its implementation in the legal regulation of the Russian wholesale electricity market. The study involves describing the theoretical framework of the concept of dominant position and analyzing the legal rules that set the criteria to recognize market participant as the one having dominant position. These legal rules are evaluated from the viewpoint of the principle of legal certainty. The sanctions imposed against dominating and not dominating market participants are compared. An analysis of how a participant can abuse market dominance while bidding for sale of electricity and electric capacity and how the corresponding legal rules match the Russian electricity market architecture is provided. The authors come to a conclusion that the current criteria for dominant position in wholesale electricity market include not only characteristics of participant's position in the market but also participant's behavior, which comes into conflict with the theory and the rules set by the Federal law "On protection of competition". Posteriori market modelling applied to establish the dominant position of suppliers contradicts the principle of legal certainty. Sanction to the same action - price manipulation - can be stricter against not dominating participants, although it is the dominant position that is an aggravating factor that increases the societal harm of the action. Additionally, the term "abusing market dominance" needs to be clarified.