JK Tyre, different corporations face antitrust scrutiny in bid-rigging case: Report

NEW DELHI: India’s antitrust regulator is investigating JK Tyre & Industries Ltd after a state authorities accused the corporate of bid rigging, and the probe has been expanded to different corporations, in response to sources and authorized filings seen by Reuters.
The Competitors Fee of India (CCI) final yr ordered a probe after the northern state of Haryana mentioned JK Tyre employed unfair commerce practices whereas bidding to produce tyres for public transport automobiles, a courtroom submitting confirmed.
The case particulars and CCI’s preliminary evaluation have been contained in a Sept. 19 state courtroom submitting made by JK Tyre contesting a few of the watchdog’s calls for. The submitting, reviewed by Reuters, has not beforehand been reported and the CCI doesn’t disclose present probes into cartel instances.
In accordance with paperwork within the submitting, Haryana state advised the CCI that JK Tyre was the only bidder in a young and quoted excessive costs. The watchdog in November ordered a probe saying “non-participation by different tyre producers” was suggestive of a “concerted act to rig the bid”.
A JK Tyre spokesman declined to remark “because the matter is at the moment subjudice.”
In August this yr, the CCI determined the function of different tyre corporations must be examined and expanded its scrutiny to incorporate Apollo Tyres, CEAT, MRF, and the Indian items of France’s Michelin and Germany’s Continental AG, two sources acquainted with the case mentioned.
It was not instantly clear whether or not the CCI has approached these tyre corporations with inquiries.
The sources declined to be recognized as particulars of the probe have been confidential. The CCI and the Haryana state authorities didn’t reply to requests for feedback. MRF, Michelin and Continental additionally didn’t reply to requests for feedback, whereas CEAT and Apollo declined to remark.
A discovering of bid-rigging might result in a possible tremendous of as much as 3 times the revenue in every year costs have been mounted by the businesses, or 10% of annual income, whichever is larger.
JK Tyre, which has a market worth of $190 million, says it accounts for 30-36% of the marketplace for various kinds of tyre variants that’s price some $9 billion yearly.
“E-mail dumps”
Haryana state has alleged JK Tyre was the only bidder within the tender in 2018 and its costs have been round 34% larger than earlier buy charges, the paperwork present.
“There seems to be some association or understanding amongst the tyre producers … The matter warrants an intensive and detailed investigation to unearth all the modus operandi resorted to,” the CCI’s November 2019 order mentioned.
As a part of the probe, the CCI this yr sought “electronic mail dumps” over 5 years belonging to some senior executives within the JK group, saying they have been important for the investigation.
JK Tyre has challenged that demand on the excessive courtroom of Punjab and Haryana, saying it was cooperating with the investigation and the emails of these executives had restricted or no relation to the case.
The watchdog’s probe group was “appearing in a totally unreasonable, arbitrary and kooky method”, JK Tyre mentioned within the September 19 submitting.
The courtroom will subsequent hear the case on October 28.

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