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Competition Commission of India (CCI) vs Cement Cartel

Published in: Law
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  1. 1. • Objective: • to eliminate practices having adverse affect on competition, • promote and sustain competition, protect the interest of consumers, ensure freedom of trade in markets of India. • Ensure fair and healthy competition in economic activities • Composition: 1 Chairperson and 6 members
  2. 2. An association of manufacturers or suppliers with the purpose of maintaining prices at a high level and restricting competition.
  3. 3. • India is the second largest producer of cement in the world, only after China. • The cement industry is a vital part of the Indian economy, employing millions of people directly or indirectly. •The Competition Commission of India (“CCI”) has recently passed orders adjudicating allegations of anti-competitive agreements and abuse of dominance amongst the cement manufacturers under the Competition Act, 2002 (the “Act”) and imposed a penalty of more than INR 60 billion (USD 1.1 billion).
  4. 4. •Monopolies and Restrictive Trade Practices Commission (MRTPC) •Builders Association of India(BAI)
  5. 5. • 1. Shree Cement Limited • 2. Cement Manufacturers' Association • 3. J. K. Cement Ltd. • 4. BinaniCement Limited • 5. Lafarge India Private Limited • 6. JaiprakashAssociates Ltd. • 7. UltraTech Cement Ltd. • 8.The India Cements Ltd. • 9. Ambuja Cements Limited (formerly, Gujarat Ambuja Cement Limited) • 10. ACC Limited (formerly, Associated Cement Companies Limited ) • 11. CenturyTextiles and Industries Limited • 12.The Ramco Cements Limited (formerly, Madras Cement Ltd.)
  6. 6. 1) Price Increased without corresponding increase in the limestone price royalty excise duty sales tax railway freight. 2)Under utilization of installed capacity 3) Choking up of supply in the market, thereby raising the sale prices. 4) Creation of artificial scarcity of supply
  7. 7. The CCI found the case fit for imposition of penalty to the tune of Rs6,700 crore on 11 cement firms and the Cement Manufacturers Association (CMA) on the following proven fact/Evidences:- Indulging in cartelization by acting in concert, fixing cement prices, and limiting and controlling the production and supply in the market.
  8. 8. • Shree Cement Ltd, ACC Ltd , Jaiprakash Associates , CMA • Have made an appeal to Competition AppellateTribunal (COMPAT) on the grounds of :- I. violation of principles of natural justice. II. unfair hearing, III. pre-determined mindset. COMPAT has stayed the order of CCI
  9. 9. •Import-Export •Aviation Industry •Oil Companies •Transport •Telecom Industries