The competition act 2002

The Competition Commission of India (CCI) on Thursday imposed a whopping Rs.6,307-crore penalty on 11 leading cement firms for forming a cartel and colluding to charge higher prices from consumers.

The maximum fine was imposed on Jaiprakash Associates at Rs.1,323.6 crore followed by Aditya Birla Group's Ultratech Cements (Rs.1,175.49 crore), Ambuja Cements (Rs.1163.91 crore) and ACC (Rs.1,147.59 crore).

Other companies found guilty are Grasim Cements (now merged with Ultratech), Lafarge India, JK Cement, India Cements, Madras Cements, Century Textiles and Binani Cements.

The fine was fixed at 50 per cent of their profit during 2009-10 and 2010-11. The industry body Cement Manufacturers Association (CMA) has also been fined Rs.73 lakh. They have been directed to deposit the penalty within 90 days.

CCI found cement makers had violated the provisions of the Competition Act, 2002, which deals with anti-competitive contracts, including cartels.

"The act and conduct of the cement companies establish that they are a cartel. The Commission holds the cement firms acting together have limited, controlled and also attempted to control the production and price in the market in India," CCI said in its 258-page order.

The order was passed following a probe by director general (investigation) on a complaint filed by the Builders Association, which has hailed the order saying it was long-pending and the penalty could have been higher.

Reacting to the order, CMA and some of the affected cement manufacturers said they would decide on the future course of action after reading the order.

A law firm representing ACC and Ambuja Cements said they would appeal before a tribunal. CCI, which is the equivalent of the European Commission, is headed by Ashok Chawla

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Anti-competition watchdog CCI has imposed a penalty of over Rs. 8 crore on three entities of cable TV service operator Fast Way Group for abusing its dominant position in Punjab and Chandigarh.
"The Competition Commission of India (CCI) has found Fast Way Group abusing its dominance in the cable TV service in the territory of Punjab and Chandigarh in violation of the provisions of the Competition Act, 2002," CCI said in a statement on Tuesday.

CCI has imposed penalty on the Group's entities - Fast Way Transmission, Hathway Sukhamrit Cable and Datacom, Creative Cable Network -- at the rate of 6% of their average turnover for the last three financial years, it added.

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OBJECTIVE

Competition Act, 2002 is passed keeping in view of the economic development of the country with following objective:

(1) To prevent practices having adverse effect on competition,

(2) To promote and sustain competition in markets,

(3) To protect the interests of consumers and to ensure freedom of trade carried    on by other participants in markets,

GUIDING PRINCIPLES

The Competition Commission of India is being guided by the following principles in its approach to its work:

1. To be in sync with markets; have good understanding of market forces.

2. To minimize cost of compliance by enterprises, and cost of enforcement by Commission.

3. To maintain confidentiality of business information; to maintain transparency in Commission's own operations.

4. To be a professional body, equipped with requisite skills.

5. To maintain a consultative approach.

FUNCTIONS

1. CCI shall prohibit anti-competitive agreements and abuse of dominance, and regulate combinations (merger or amalgamation or acquisition) through a process of enquiry.

2. It shall give opinion on competition issues on a reference received from an authority established under any law (statutory authority)/Central Government.

3. CCI is also mandated to undertake competition advocacy, create public awareness and impart training on competition issues.

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