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Rosseti Volga

August 18, 2016

Ulyanovsk branch of IDGC of Volga, PJSC, is collecting debts through legal proceedings

Since the beginning of 2016, Ulyanovsk Distribution Grids, a branch of IDGC of Volga, PJSC (a member of Rosseti Group of Companies), has filed 53 claims with the Arbitration Court for collection of debts for power transmission services to the total amount of RUB 1.4 billion. The overwhelming majority of rulings are issued in favor of IDGC of Volga, PJSC. Submission of enforcement orders to the bank and the Court Bailiffs Service may entail seizure of the debtors' bank accounts and property, which will cause significant difficulties for their business activities. Many debtors prefer not to bring the situation to submission of enforcement orders and repay debts in the course of litigation before the ruling comes into legal force. Thus, in 2016, the company received RUB 146 million directly under enforcement orders. The number of lawsuits from Ulyanovsk DG is constantly increasing due to the increasing number of defaulters. Thus, in 2014, the company filed 58 claims, while in 2015—already 87 claims. Legal proceedings become the only possible action against the majority of unfair contracting parties. Despite the legal right to limit the power supply to the debtors, it is rather difficult to put this measure into practice. As a rule, the main debtors are last resort suppliers and power retail companies. It is practically impossible to limit their power supply without limiting bona fide customers. However, litigations often take many months. Over this time, defaulters actually carry out business activities at the expense of the power grid company. Since January of this year, fines for payment delays have significantly increased subject to Federal Law No. 307-FZ dated November 03, 2015. Now penalties are virtually comparable to bank loan interest. Subject to the court ruling, apart from the debt amount and the state duty, the debtor has to pay a considerable amount of overdue debt penalties. Longer delays in debt payment create a debt pit for defaulters who will face more difficulties in climbing out of it.

 

 

 

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