Competition Commission penalises 18 sugar mills for rigging bids

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SME Times News Bureau | 19 Sep, 2018
Fair trade regulator Competition Commission of India (CCI) has imposed a total penalty of Rs 38 crore on 18 sugar mills and two associations for unfairly fixing the bids of a joint tender floated by state-run oil marketing companies in 2013, the government said on Tuesday.

A Finance Ministry release said that the joint tender in question was floated by Indian Oil Corp (IOCL), Hindustan Petroleum Corp (HPCL) and Bharat Petroleum Corp (BPCL) in January 2013 for procurement of ethanol for blending with petrol.

"The CCI has imposed penalties upon 18 sugar mills and 2 associations -- Indian Sugar Mills Association (ISMA) and Ethanol Manufacturers Association of India (EMAI) -- for rigging the bids in respect of a joint tender floated by Oil Marketing Companies (HPCL/ BPCL/ IOCL) for procurement of ethanol for blending with petrol," it said.

The five complainant firms led by India Glycol Ltd accused ISMA and EMAI of persuading the oil marketers to float a joint tender for procurement of ethanol.

The firms alleged that the joint tendering was an agreement among horizontal players to procure ethanol from various suppliers in breach of the competition laws, the statement said.

The complainants also alleged that the sugar manufacturers, who had taken part in the tender, manipulated the bids by quoting similar rates, and in some cases identical rates, through an understanding and collective action, in violation of the domestic competition laws.

The CCI in its order said that the bidders acted in collusion to eliminate competition and also manipulated the bidding process, the statement added.