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On June 6, 2017, Krasnodar hosted a roundtable on Non-payments in Housing and Utilities: Judicial Practice and Current Issues in 2017, where regional authorities, energy market participants and invited experts evaluated the effectiveness and practice of applying the law tightening the payment discipline*, which regulates settlements between energy consumers and suppliers of gas, heat and electricity.

Ilya Shengeliya, project manager at VEGAS LEX Southern directorate, explained the reasons why debts owed to suppliers accumulate in the housing and utilities sector, pointing out possible ways of regulating payments for the resources supplied. The expert talked about the judicial practice of recovering debts in the housing and utilities sector and listed the recent initiatives in the sector’s regulation, including simplifying the procedure for signing direct contracts, increasing the responsibility of managing companies and their officials, establishing control over information transparency, introducing the requirement that managing companies ensure their liabilities by bank guarantees, etc.

The participants also discussed the state of payment discipline in the fuel and energy sector and in the housing and utilities services in the Krasnodar Territory; the problem of non-payments in the electric grid segment and the prospects for their resolution; the need to work out a set of measures needed to introduce a pre-established limit of subsidized electricity consumption in the Krasnodar Territory; judicial practice and ways to deal with problems with owners of non-residential premises in multi-apartment residential buildings paying for their heat supply; and effective legislative measures to enforce payment obligations and improve the payment discipline.

As a result of the event, a resolution is to be prepared and submitted to federal executive and legislative bodies.

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* Russia passed a law tightening the payment discipline* more than a year ago. The need for the new legislation was particularly evident in large industrial areas such as the Krasnodar Territory, where debts to water, gas, heat and electricity suppliers were growing at an alarming rate. Collecting debts through court action is not as effective as using measures provided by the law http://www.kommersant.ru/doc/3312250.

For more information on VEGAS LEX’s services to the energy sector, please go here.