CCI Penalizes India’s Jute Mills and Gunny Trade Bodies For Following Anti-competition Practices

Finding the Indian Jute Mills Association and (IJMA) and the Gunny Trade Association (GTA) guilty of violating the provisions of Section 3 of the Competition Act, 2002, the Competition Commission of India (CCI) has imposed a penalty of Rs 7.68 lakh and Rs 35.16 thousand on the associations.

As per one of the provisions of Section 3 of Competition Act, 2002, no association, enterprise or an individual can enter into any agreement or form cartels which will directly or indirectly determine purchase and sale prices of the goods in the market, thus adversely affecting fair play and competition the sector.

The commission passed the order following a complaint was filed by Indian Sugar Mills Association, National Federation of Co-operative Sugar Factories Ltd. and All India Flat Tape Manufacturers Association. “These associations had alleged that IJMA and GTA had entered anti-competitive agreement in fixation of sale price of jute packaging material by issuing of Daily Price Bulletin (DPB) by GTA for jute bags for the members of IJMA and the GTA to follow,” said a senior official of the commission on the condition of anonymity.

Apart from imposing a penalty on the associations, the commission issued a cease and desist order barring them from implementing the said agreement. The commission has levied penalties on the members of the executive committee of IJMA and the Executive Committee and the DPB Sub-Committee of GTA. The penalties have been compounded at 5% of the average income of the last three financial years.