Displaying items by tag: Cartel

India: The Competition Commission of India (CCI) has found seven cement companies guilty of bid rigging and cartelisation and imposed a total fine of nearly US$30m on them. The accused companies are Shree Cement, UltraTech Cement, Jaiprakash Associates, JK Cement, Ambuja Cements, ACC and JK Lakshmi Cement, according to the Times of India. The fines are based on 0.3% of each company’s average turnover for three financial years. Each company has also been ordered to cease and desist such behaviour.

The ruling relates to a tender floated by a Haryana state procurement agency in 2012 that the CCI started investigating in 2014. Evidence cited in the CCI’s order includes text messages and phone calls made between officials of the companies.

UltraTech Cement and Shree Cement have issued statements saying that they will appeal against the fine.

India: The Competition Appellate Tribunal (COMPAT) has rejected an appeal by Binani Cement to waive paying a 10% deposit of a US$25m fine that was given to it by the Competition Commission of India (CCI) for cartel-like behaviour. COMPAT said that the cement producer had failed to add any further information to the situation or pointed out any errors in the procedure, according to the Press Trust of India. In August 2016 the CCI imposed fines of nearly US$1bn on cement producers including ACC, ACL, Binani, Century, India Cements, JK Cement, Lafarge, Ramco, UltraTech, Jaiprakash Associates and the Cement Manufacturers Association for alleged cartelisation activity.

In November 2016, the COMPAT delayed the CCI condition that the cement producers deposit 10% of the fine. However, Binani Cement requested to waive the deposit on grounds of severe financial hardship. Binani Cement now potentially faces interest charges on top of the deposit as its appeal was dismissed.

Spain: The National Commission for Markets and Competition (CNMC) has issued total fines of Euro29.2m to 23 cement companies for involvement in a cartel between 1999 and 2014. Among the companies are Cementos Portland Valderrivas, with a Euro10.2m fine, Cemex Spain with a Euro5.8m fine and Holcim Spain, with a Euro4.4m fine, according to the Cinco Días newspaper.

The CNMC’s investigations have shown that the companies coordinated the exchange of commercial information, market sharing and price fixing between 1999 and 2014 in three distinct geographical areas in the north, centre and south of the country. Notably, the southern region examined the companies used email and WhatsApp mobile phone application to share sensitive information.

India: The Competition Commission of India (CCI) has imposed a penalty of more than Rs67bn (US$1bn) on 11 cement companies for alleged cartelisation. The companies affected are UltraTech, Binani, Ramco, Jaiprakash Associates, JK Cement, Lafarge, India Cements, ACL, ACC, Century, and Shree Cement, besides the Indian Cement Manufacturers' Association (CMA). The order issued by the anti-trust regulator held the companies and the CMA responsible for 'acting in concert in fixing prices of cement.' The companies and the CMA allegedly shared details relating to prices, capacity utilisation, production and dispatch, which led to restricted production and supplies in the market hurting consumers and the Indian economy, the order said. Further, the CCI also found the cement companies to be acting in concert in fixing prices of cement. A final order has been passed by CCI, pursuant to the directions issued by the Competition Appellate Tribunal (CAT) remanding the matter back, while setting aside the original order of the fair trade regulator, which had had also imposed fine on cement companies.

Penalties of US$171m on ACC, US$173m on ACL, US$24.9m on Binani, US$40.9m on Century, US$27.9m on India Cements, US$19.1m on JK Cement, US$73.1m on Lafarge, US$38.5m on Ramco, US$175.3m on UltraTech and US$197.5m on Jaiprakash Associates were imposed by CCI. In addition, a penalty of US$109,000 was slapped on the CMA.Penalising the companies, the CCI said the actions of the companies and the CMA are not only detrimental to the interests of consumers but also to the whole economy, as cement is a critical input in construction and infrastructure industry, and vital to economic development. Through a separate order, the regulator has slapped US$59.2m fine on Shree Cement for unfair businesses practices.

The CAT had, in late 2015, revoked CCI's order, imposing a combined penalty of US$943m on cement companies for allegedly forming a price cartel. The tribunal quashed the commission's order after observing that Ashok Chawla, then CCI chairperson, was party to the order, despite not being present during hearings. The tribunal also allowed the cement companies to withdraw the US$94m deposited by them in compliance of its interim order. The interim order, in May 2013, had stayed the penalty but asked the companies to deposit 10 per cent of its pending disposal of their appeal. In June 2012, the commission had fined ACC, Ambuja Cement, UltraTech Cement and Jaiprakash Associates a little over US$149m each for forming a cartel. The other companies fined included Madras Cements, Century Cement, Binani Cement, Lafarge India, JK Cement, India Cements and Grasim Cements (now merged with UltraTech). The CMA was also a party in this case and it was fined a token amount.

Competition watchdog CCI said interactions between the trade body and the cement companies were not confined to promoting the interest of the industry. "Such interactions have been found to have transgressed the limits in sharing of information and extended to discussions on cost, prices, production and capacities...," the CCI order said. The case was filed by Builders Association of India against the cement companies and CMA alleging collusion to fix prices.

South Korea: South Korea's antitrust watchdog has fined six local cement makers a combined US$168m for fixing the prices of cement products and divvying up the market, according to Dow Jones.

According to the Fair Trade Commission (FTC), cement companies have allegedly colluded to rig the prices of cement products by controlling output and market share in 2011. The suspected companies are Ssangyong Cement Industry Co., Tongyang Cement & Energy Corp., Hanil Cement Co., Sungshin Cement Co., Hyundai Cement Co. and Asia Cement Co. Ssangyong was set to take 22.9% of the total market share, while Tongyang and Hanil were in charge of 15.1% and 14.9%, respectively.

"Managers of the six companies had regular monthly meetings to oversee whether or not the members had complied with the arranged shipments," said the FTC. The prices of cements surged by 43% year-on-year in April 2012.

Industry leader Ssangyong was slapped with US$73.6m of fines, followed by Hanil with US$34.5m and Sungshin with US$36.7m. Tongyang was exempted from the penalty, as the cement maker has been under court receivership since October 2013.

The FTC said that it will strictly crack down on price-rigging practices in backbone industries to build sound market order and fair competition.

India: The Competition Appellate Tribunal has set aside a US$945m penalty imposed on 11 cement firms by the Competition Commission of India (CCI) on accusations of cartel behaviour and asked the fair trade regulator to resubmit the case. The Tribunal also allowed the cement manufacturers to withdraw the 10% penalty amount already deposited with the CCI, according to the Press Trust of India.

The judgement follows appeals filed by the cement firms and their industry body, the Cement Manufacturers Association, against the two CCI orders passed in June - July 2012. The cement companies included ACC, Ambuja Cements, Binani Cements, Century Textiles Ltd, India Cements, JK Cements, Lafarge India, Madras Cements, Ultratech, JP Associates and Shree Cements.

The CCI had passed the orders after an investigation into complaints, including from Builders Association of India (BAI), against alleged price collaboration between cement firms.

The orders were later challenged at the Competition Appellate Tribunal, which ordered that 'the impugned order is set aside and the matter is remitted to the CCI for fresh adjudication of the issues relating to alleged violation" of the relevant sections of the Competition Act.'

South Africa: Lucky Cement has filed papers in the High Court in Pretoria contesting a 14.29% provisional antidumping duty imposed in May 2015 on its cement exports to the Southern African Customs Union (SACU). The Pakistan-based cement producer has accused the International Trade Administration Commission (ITAC) of failing to consider the losses suffered by producers due to a Competition Commission ruling on a cement cartel, according to Business Day. ITAC intends to oppose the motion.

ITAC imposed provisional anti-dumping duties of 14.3 – 77.2% on Portland Cement originating in or imported from Pakistan from 15 May 2015 for six months. The duty was imposed on bagged cement.

"The breaking up of anticompetitive behaviour must have resulted in more normal competition in the industry with resulting lower prices and tighter margins," said Lucky Cement chief financial officer Muhammad Faisal. "It was illogical and irrational for ITAC to attribute 100% of the injury to the SACU cement industry to Pakistani exports."

Faisal also objected to ITAC's decision to retrospectively limit its inquiry to only bagged cement. The dumping margin placed on Lucky Cement was based on all its cement sales whereas ITAC focused only on bagged cement in SACU.

The Competition Commission imposed a fine of US$9.3m on Afrisam and US$11.1m on Lafarge in 2011 and 2012 respectively, after concluding that a cement cartel did exist. It estimated its intervention would save consumers US$335 – 454m for the period 2010 to 2013.

South Korea: The Korea Fair Trade Commission (FTC) has continued its investigation into whether cement producers colluded to raise cement prices. The antitrust watchdog conducted an on-site probe into cement producers including Tongyang Cement & Energy and Hanil Cement in mid July according to industry sources cited by the Maeil Business Newspaper and the FTC. If a fine is levied a legal battle may follow regarding whether the Sampyo consortium, chosen as the preferred bidder to acquire Tongyang Cement & Energy, should pay the fine imposed by the FTC on Tongyang.

Upon the request from the ready-mixed concrete industry, the regulator started an investigation into alleged price-fixing in the South Korean cement industry in April 2013, but it has yet to reach a conclusion. The latest site visit is believed to have been organised to obtain further evidence on suspicions of price-fixing.

The combined sales of the seven cement makers that account for about 88% of South Korea's cement market are estimated at be up to US$855m/yr. Suspicions of cartel-like activity date back to 2011 and this may be reflected in potential fines if any price-fixing is proved.

Spain: Spanish competition regulator CNMC has expanded its probe into cement and concrete producers on alleged cartel agreements. The CNMC carried out inspections at the headquarters of cement and concrete makers on 27 and 28 May 2015 as part of the probe on 14 sector players, the CNMC said in a statement. The regulator said it has 18 months to decide whether it will impose a fine on the companies.

Spain: Spanish competition regulator CNMC has included Lafarge and Holcim in the proceedings for alleged cartel agreements brought up against a number of sector players at the end of 2014. Additionally, the CNMC has extended the proceedings to Materiales y Hormigones and Hormibusa. The move was based on information gathered during several inspections carried out in September 2014 for alleged exchange of information, price fixing and market division practices in the cement and concrete sector. The CNMC will complete the investigation and produce a resolution within 18 months.