Updated: September 25, 2021 2:40:33 am
THE Competition Commission of India (CCI) has imposed penalties totalling over Rs 873 crore on United Breweries Ltd (UBL), Carlsberg India Pvt Ltd (CIPL), All India Brewers Association (AIBA) and 11 individuals for cartelisation in the sale and supply of beer in 10 states and Union Territories, including Andhra Pradesh, Karnataka, Delhi and Maharashtra. The regulator concluded United Breweries, Carlsberg India and Anheuser Busch InBev India colluded to fix beer prices from 2009 to at least October 2018.
A government release said the CCI had passed orders against UBL, AB InBev and CIPL “for indulging in cartelisation in the sale and supply of beer … including through the platform of AIBA.” The Commission decided to give a 100 per cent penalty reduction to AB Inbev as the company explained the nature of the cartel and submitted evidence of email communications between key managerial personnel at the companies being investigated.The final penalty of Rs 751.8 crore on UBL and Rs 120.6 crore CIPL also included reductions in penalties of 40 per cent and 20 per cent, respectively, for cooperation with the probe by the CCI.
The search and seizures conducted by the Director General of the CCI found regular communications between the three companies.
Key managerial personnel cited the need to seek approvals from state authorities for any price revisions as a key reason for the need for coordination. In one case, a UBL executive said due to the fact that price changes were only permitted on three specific dates in a year, competitors would exchange notes and price main products similarly to “ensure that we do not suffer huge losses as a result of this policy.”
Emails recovered during the investigation showed executives sharing proposed price changes and coordinating the timing for applying to state authorities for price changes. The CCI noted that such state policies “cannot be taken as an excuse for entering into price co-ordination by parties.” In case of Maharashtra, the CCI found price revisions by UBL and Ab Inbev since 2011 showed an “uncanny closeness” in timing, with Carlsberg India also joining the two companies in making revisions around the same time since April 2014.
UBL, AB InBev and CIPL did not respond to emailed requests for comments as of press time on Friday.
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