Posted by Arun Dagar On 03-Feb-2022 11:43 AM
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Apollo Tyres, CEAT Tyres, MRF Tyres, Birla Tyres and JK tyres were fined a total of Rs 1788 crores, in a landmark judgement by the anti-monopoly regulator CCI (Competition Commission of India) due to their alleged indulgence in cartelization.
In a press release the watchdog said that these tyre manufacturers in India had exchanged sensitive data regarding pricing through the ATMA (Automotive Tyre Manufacturers Association) platform and had increased prices by taking a collective decision. The regulator also imposed a penalty on ATMA due to its involvement in the price increase of cross-ply/bias tyres sold in the replacement tyre market by the afore-mentioned companies and also acted in concert to control and limit the production as well as supply in the aforementioned market.
CCI also observed that, since ATMA had collected company and segment-wise data on production, sales and exports of tyres for both monthly and cumulative sales. “Thus, the Commission noted that the sharing of such sensitive information made the coordination easier amongst the tyre manufacturers,” said the statement from CCI. Individually the fine amounts to Rs 622 crores on MRF Ltd, Rs 425 on Apollo Tyres Ltd, Rs 309 crores on JK Tyre & Industries Ltd, Rs 252 crores on CEAT Ltd and Rs 178 crores on Birla Tyres Ltd, with Rs 84 lakhs fine imposed on the tyre industry association, ATMA. The companies will however challenge this decision before NCLAT (National Company Law Appellate Tribunal). The commission has also directed ATMA to stop collecting retail and wholesale prices via any of the tyre companies which are its members or through any other means. This order was passed in 2018 by the regulator according to its statement but was kept sealed because of Madras High Court Order but after the matter went to Supreme Court, it was ordered to release this order. The accusations, are serious in terms of making the tyre market a level playing field and this will negatively affect these tyre manufacturing giants who have presence in cars, bikes, scooters trucks and replacement tyre markets in India as well as global outreach to overseas markets.
20-May-2022 11:33 AM