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JK Tyre, Other Firms Face Fair Trade Regulator’s Probe In Bid-Rigging Case: Report

JK Tyre, Other Firms Face Fair Trade Regulator's Probe In Bid-Rigging Case: Report

JK Tyre has a market worth of $190 million

The Competition Commission of India (CCI) final yr ordered a probe after Haryana mentioned JK Tyre employed unfair commerce practices whereas bidding to produce tyres for public transport autos, a courtroom submitting confirmed.

The case particulars and CCI’s preliminary evaluation had been contained in a September 19 state courtroom submitting made by JK Tyre contesting among the honest commerce regulator’s calls for. The submitting, reviewed by information company Reuters, has not beforehand been reported and the CCI doesn’t disclose present probes into cartel circumstances.

According to paperwork within the submitting, Haryana state advised CCI that JK Tyre was the only bidder in a young and quoted excessive costs. The regulator in November ordered a probe saying “non-participation by other tyre manufacturers” was suggestive of a “concerted act to rig the bid”.

A JK Tyre spokesman declined to remark “as the matter is currently subjudice”.

In August this yr, CCI determined the function of different tyre corporations needs to 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 accustomed to the case mentioned.

It was not instantly clear whether or not CCI has approached these tyre corporations with inquiries.

The sources declined to be recognized as particulars of the probe had been confidential. CCI and the Haryana 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 may result in a possible advantageous of as much as 3 times the revenue in every year costs had been mounted by the businesses, or 10 per cent of annual income, whichever is larger.

JK Tyre, which has a market worth of $190 million, says it accounts for 30-36 per cent of the marketplace for several types of tyre variants that’s price some $9 billion yearly.

“Email Dumps”

Haryana has alleged JK Tyre was the only bidder within the tender in 2018 and its costs had been round 34 per cent larger than earlier buy charges, the paperwork present.

“There appears to be some arrangement or understanding amongst the tyre manufacturers… The matter warrants a thorough and detailed investigation to unearth the entire modus operandi resorted to,” CCI’s November 2019 order mentioned.

As a part of the probe, CCI this yr sought “email dumps” over 5 years belonging to some senior executives within the JK group, saying they had been important for the investigation.

JK Tyre has challenged that demand on the High Court 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 regulator’s probe group was “acting in a completely unreasonable, arbitrary and whimsical manner”, JK Tyre mentioned within the September 19 submitting.

The courtroom will subsequent hear the case on October 28.

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