Competition Commission penalises 4 maritime transport companies for cartelisation
IANS 25 January 2022
The Competition Commission of India (CCI) has passed a final order against four maritime transport companies for indulging in cartelisation in the provision of maritime motor vehicle transport services to automobile original equipment manufacturers (OEMs) for various trade routes.
The four companies are Nippon Yusen Kabushiki Kaisha (NYK Line), Kawasaki Kisen Kaisha Ltd (K-Line), Mitsui O.S.K. Lines Ltd (MOL) and Nissan Motor Car Carrier Company (NMCC).
Of these, since NYK Line, MOL and NMCC filed lesser penalty applications before the CCI, the Commission gave benefit of reduction in penalty by 100 per cent to NYK Line and its individuals, by 50 per cent to MOL and its individuals and by 30 per cent to NMCC and its individuals.
Accordingly, the Commission directed K-Line, MOL and NMCC to pay penalties to the tune of approximately Rs 24.23 crore, Rs 10.12 crore and Rs 28.69 crores, respectively, besides passing a cease-and-desist order.
Available evidence revealed that there was an agreement between NYK Line, K-Line, MOL and NMCC with the objective of enforcement of "Respect Rule", which implied avoiding competition with each other and protecting the business of the incumbent carrier with the respective OEMs.
To achieve the said objective, the maritime transport companies resorted to multi-lateral as well as bilateral contacts/ meetings/ e-mails with each other to share commercially sensitive information which, inter alia, included freight rates.
They also aimed to preserve their position in the market and maintain or increase prices, including by resisting requests for price reduction from certain OEMs.
Based on a cumulative assessment of the evidence, the Commission held all the four parties, NYK Line, K-Line, MOL and NMCC, guilty of contravention of the provisions of Section 3 of the Competition Act, 2002 (the Act), which prohibits anti-competitive agreements, including cartels, between 2009 and 2012.
Fourteen individuals from NYK Line, 10 from K-Line, 6 from MOL and 3 individuals from NMCC were also held liable for the anti-competitive conduct of their respective companies.
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