Supreme Court of Russia specified when the FAS cannot intervene in bankruptcy auctions

The Supreme Court of Russia considered a case in which one of the potential buyers of the debtor's property made a decision to complain to the Federal Antimonopoly Service.  The applicant was not satisfied with the fact that the bankruptcy trustee did not allow him to participate in bidding, referring to the failure to provide the necessary documentation.  The lower courts took opposite positions, but the Supreme Court of the Russian Federation put an end to the issue.

The question concerned the bankruptcy of an individual whose property was to be sold. One of the potential buyers was not allowed to take part in an auction by the bankruptcy trustee due to the failure to provide the consent of the spouse to the transaction. This fact did not suit the applicant, and he filed a complaint with the FAS.

The anti-monopolists detected a violation and ordered the trustee to eliminate it.

Federal Antimonopoly Service, the opinion of which was supported by the court of first instance, noted that the trustee had established an unlawful requirement.

The board of the court of appeal, on the contrary, found that the antimonopoly body did not have such powers. The district court, however, agreed with the first instance, after which the applicant filed a complaint with the Supreme Court of Russia.

The Economic Board noted that bankruptcy auctions do not pursue the goal of developing competition. Therefore, the participation of the FAS may become an obstacle to the timely satisfaction of the interests of the debtor's creditors. The legality of holding such auctions is controlled by the court, which, in the opinion of the Supreme Court of the Russian Federation, is a sufficient measure (decision № 309-ES21-27706 of April 26, 2022).