ED summons AirAsia top brass for questioning on Jan 20
The Enforcement Directorate (ED) on Thursday said it has summoned AirAsia's top management including its Malayasia-based CEO Tony Fernandes for questioning on January 20.
 
A source in ED said that they have summoned the top brass for questioning under the sections of Prevention of Money Laundering Act.
 
The ED had registered the case of money laundering against AirAsia officials and others for allegedly trying to manipulate government policies through corrupt means to get international licenses for its Indian venture AirAsia India Limited in mid 2018.
 
The central financial probe agency filed the case to probe if alleged tainted funds were used to create illegal assets and it has taken cognisance of the CBI's FIR to lodge its own case.
 
The CBI had named Fernandes and others in the case of violating FDI norms in giving effective management to a foreign entity through FIPB clearance in 2013.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Competition Commission Orders Probe against Asian Paints’ Alleged Market Dominating Tactics
    The Competition Commission of India (CCI) has asked its director general to initiate an investigation against Asian Paints Ltd under the provisions of section 26(1) of the Competition Act, 2002, based on information received from JSW Paints Pvt Ltd.
     
    In its 14 January 2020 order, the CCI bench of Ashok Kumar Gupta (chairman), Sangeeta Verma and Bhagwant Singh Bishnoi, both members, noted that "...the alleged restrictions on dealers not to deal with JSW Paints or any other company manufacturing paints can create barriers for suppliers of paints, who compete with these suppliers besides not allowing the benefit of better prices to the consumers. A stipulation that appears to create barriers to entry and restricts choice of consumers is likely to result in appreciable adverse effect on competition resulting in higher prices for consumers."
     
    "Based on material available on record, the Commission is of the view that evidence provided by JSW Paints is prima-facie sufficient to indicate that Asian Paints has denied access to the distribution channels in the relevant market to JSW Paints by threatening and coercing such dealers through various means. In view of foregoing, Asian Paints, prima-facie, appears to be in contravention of provisions of Section 4(2)(c) of the Act," the order says.
     
    The Commission then directed its DG to investigate the matter and submit reports within 60 days. 
     
    In its complaint, JSW Paints has alleged that immediately after the launch of its decorative paints, Asian Paints began pressurising dealers who had agreed to stock and display decorative paints manufactured by the Jindal group company. 
     
    "Asian Paints targeted dealers, distributors and retailers partnering with JSW Paints directing them to stop dealing with JSW Paints, stopping supplies to these dealers, dropping service levels by delaying supplies and deliveries, asked dealers to remove display of JSW Paints products from their retail shelves and dealer signboards, threatened dealers by not allowing discretionary discounts, not inviting them for trips and loyalty schemes. Asian Paints did this through its sale personnel in the relevant regions. Such conduct has been alleged to have created fear amongst retailers and dealers, as a result of which a number of them stopped dealing with JSW Paints, despite having provided the initial cheque of Rs1 lakh," JSW Paints had said.
     
    The complaint filed by JSW Paints also cites allegedly similar tactics used by Asian Paints against Nippon Paint India Pvt Ltd. It says, "Asian Paints had taken punitive action against a dealer in the past on account of its decision to stock and sell paints manufactured by Nippon Paint. Asian paints is stated to have resumed its supplies only after the dealer agreed to cease business relations with Nippon. In the year 2015-16, Nippon had attempted to enter the decorative paints market in Chennai. However, Asian Paints took similar action against the dealers who entered into commercial relationship with Nippon."
     
    As per the information, decorative paints constitute 74% of the market sales. Industrial paints comprise general industrial, automotive, protective powder coatings, and coil coatings constitute 26% of the market sales.  
     
    In its order, the CCI observed sales of decorative paints require extensive dealer networks, especially in the rural and semi-urban markets; hence, a strong supply chain and pan-India distribution is essential for making products successful. Brand also plays an important role in the decorative paints segment. Within the decorative paints segment, consumers prefer branded products in the organised sector rather than unbranded products of the unorganised sector, it noted.
     
    The Commission noted that Asian Paints is the largest player in the relevant market. As per the information, Asian Paints has the highest market share based on all parameters including revenues, earnings before interest, taxes, depreciation, and amortisation (EBITDA) and installed capacity. Based on revenue, it has a market share of 55.92%, with the second player, Berger Paints being at 18.79 % for the FY17-18.
     
    It has also been stated that Asian Paints has 60,000 dealers and 135 depots across the length and breadth of the country. The next competitor is Berger Paints at second place with 25,000 dealers and 129 depots.
     
    There are four top operators in this industry, namely, Asian Paints, Berger Paints, Kansai Nerolac, Akzo Nobel, who have occupied around 80% of the relevant market, with Asian Paints maintaining its highest market share consistently over the years. Based on this, the Commission noted that Asian Paints prima-facie appears to enjoy a dominant position in the relevant market delineated above.
     
    In a regulatory filing, Asian Paints says "The company is currently examining the order and will take appropriate legal recourse and will extend full co-operation to CCI in the matter."
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    COMMENTS

    Ibrahim Sakarwala

    2 weeks ago

    Asian paints controls a huge chunk of the paints market. Why does it need to even bother about a company which is practically unknown. Many do this to get free publicity and thereby utilize such stunts as marketing gimmicks. Having said this.... Even if we consider something like this must've happened..... It will be impossible to prove it in a court of law

    Amazon aims to pacify small traders with $1bn SMB bet
    Amazon's $1 billion commitment to empower small and medium businesses (SMBs) in India is Jeff Bezos' attempt to change the e-commerce giant's perception among small businesses which are in a retaliatory mode, industry experts said on Wednesday.
     
    Bezos announced that the e-commerce major, through its global footprint, will help SMBs export products worth $10 billion by 2025.
     
    This move is seen as a measure to calm the growing unrest and protests going on under the aegis of the Confederation of All India Traders (CAIT).
     
    "Amazon wants to make sure that the current perception of the company among the small businesses go away, else this will further call for strict scrutiny from the regulators and protests from small traders," Satish Meena, Senior Forecast Analyst with Forrester, told IANS.
     
    Over the next five years, Amazon will invest $1 billion to digitise micro and small businesses in cities, towns and villages across India, helping them reach more customers than ever before, announced Bezos.
     
    According to Meena, this is in line with what Amazon is planning to do in India for the next few years.
     
    "They need partnerships with SMBs for products to cater not only to the Indian customers, but also to customers outside the country," he said.
     
    Amazon said it would establish 'Digital Haats' in 100 cities and villages to help businesses integrate into the digital economy.
     
    According to Prabhu Ram, Head, Industry Intelligence Group (IIG), CMR, SMBs in India account for 45 per cent of industrial output, creating employment for 60 million Indians and roughly 1.3 million jobs annually. 
     
    "The SMBs, however, are constrained by multiple challenges, including access to skills, talent, finance, and most importantly, digital outreach," Ram told IANS.
     
    "This is where SMB-centric initiatives, such as Amazon's commitment, are a welcome initiative to digitally support SMBs, enabling them to gain knowledge, reach their target audience, achieve scale, and while doing so, be able to measure their growth metrics," Ram said.
     
    In the end, added Meena, SMBs in India also need handholding in product development, capital investment and access to market.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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