The Competition Commission of India (CCI) has imposed a Rs 38-crore penalty on 18 sugar mills and two trade associations for rigging bids in joint tenders floated by public sector oil marketing companies to procure ethanol for blending with petrol.
The regulator also directed the mills and the two associations — the Indian Sugar Mills Association and the Ethanol Manufacturers Association of India — to “cease and desist” from indulging in conduct that has been found to be in contravention of Section 3 of the Competition Act.
The Section 3 pertains to anti-competitive agreements. It states that no enterprise, person or association shall enter into any agreement in respect of production, supply, distribution, storage, acquisition or control of goods or provision of services, which causes or is likely to cause an appreciable adverse effect on competition within India.
The public sector oil retailers — IOC, HPCL, BPCL — had invited quotations from alcohol manufacturers for ethanol through a joint tender in 2013.
The CCI noted that the bidders through their “impugned conduct” have contravened the provisions of Section 3 of the Competition Act by acting in a “collusive and concerted manner which has eliminated and lessened the competition besides manipulating the bidding process in respect of the impugned tender floated by OMCs”.
“The bidders who participated in respect of the depots located in UP, Gujarat and Andhra Pradesh in response to the joint tender floated by OMCs, were found to have acted in a concerted and collusive manner in submitting their bids,” it added.
