CCI penalises beer companies for cartelisation, UBL slapped Rs 750 crore penalty

The Competition Commission of India has passed a final order against three beer companies United Breweries Ltd UBL SABMiller India Ltd now renamed Anheuser Busch InBev India Ltd and Carlsberg India Private Ltd CIPL for indulging in cartelisation in the sale and supply of beerThe competition regulator has imposed a penalty of Rs 750 crore on UBL and Rs 120 crore on CIPL based on the evidence presented on their act of cartelisationAllegations of cartelisation were levelled against these companies in various states and Union Territories including through the platform of All India Brewers Association AIBAAs AIBA was found to be actively involved in facilitating such cartelisation the CCI also held it to be in contravention of the provisions of Competition Act 2002The period of cartel was held to be from 2009 to at least October 10 2018 the date on which the Director General conducted search and seizure operations at the premises of the beer companies with the CIPL joining in from 2012 and AIBA serving as a platform for facilitating such cartelisation since 2013 All three beer companies were lesser penalty applicants before CCIBased on evidences of regular communications between the parties collected by the DG during search and seizure and on the basis of the disclosures made in the lesser penalty applications the CCI found that the three companies engaged in price coordination in contravention of the provisions of Section 33a of the Competition ActThe legal provisions were not followed in Andhra Pradesh Karnataka Maharashtra Odisha Rajasthan West Bengal the National Capital Territory of Delhi and the Union Territory of Puducherry in collectively restricting supply of beer in Maharashtra Odisha and West BengalThe companies were also found to be in contravention of legal provisions in sharing of market in Maharashtra as well as coordination with respect to supply of beer to premium institutions in Bengaluru in contravention of the provisions of Section 33c of the ActThe CCI also found coordination amongst UBL and AB InBev with respect to purchase of secondhand bottles Further four individuals of UBL four of AB InBev six of CIPL and the Director General of AIBA were held by the CCI to be liable for the anticompetitive conduct of their respective companiesassociation in terms of Section 48 of the ActGiving benefit of reduction in penalty under the provisions of Section 46 of the Act of 100 per cent to AB InBev and its individuals 40 per cent to UBL and its individuals and 20 per cent to CIPL and its individuals the CCI directed the UBL and the CIPL to pay penalties of approx Rs 750 crore and Rs 120 crore respectively besides passing a ceaseanddesist orderThe legal provisions were not followed in Andhra Pradesh Karnataka Maharashtra Odisha Rajasthan West Bengal the National Capital Territory of Delhi and the Union Territory of Puducherry in collectively restricting supply of beer in Maharashtra Odisha and West BengalThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliabilitsy and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever