Battery cos colluded to fix prices, says CCI

The Competition Commission of India (CCI) on Thursday said that three leading dry cell manufacturers — Eveready Industries India, Indo National (maker of Nippo), Panasonic Energy India — and the Association of Indian Dry Cell Manufacturers (AIDCM) had colluded to fix prices of zinc-carbon dry cell batteries and asked two of the companies to pay over Rs 200 crore as penalty.

Eveready has been ordered to pay over Rs 171 crore, while Nippo has been asked to cough up Rs 42 crore. Panasonic managed to avoid a fine as CCI had taken up the case suo motu.

“From the evidence collected in the case, the CCI found that the three battery manufacturers, facilitated by AIDCM, had indulged in anti-competitive conduct of price coordination, limiting production/supply as well as market allocation in contravention of the provisions,” an official statement said.

Considering contravention of provisions of the Competition Act, the fairplay watchdog computed the penalty on Eveready at Rs 245 crore, while those on Nippo and Panasonic worked out to nearly Rs 53 crore and Rs 75 crore, respectively. Also, a penalty of Rs 1.9 lakh was levied on AIDCM, with officials and office bearers of the association and the companies are also facing penalty.

“While computing leviable penalty, the CCI took into consideration all relevant factors including duration of cartel, industry conditions, etc, and decided to levy penalty on the three battery manufacturers at the rate of 1.25 times of their profit for each year from 2009-10 to 2016-17,” the statement said.

But, after factoring in the lesser penalty applications filed by those under the scanner and co-operation extended in establishing the existence of cartel, the CCI granted Panasonic and its officials 100% reduction in the penalty. Similarly, Eveready and Nippo, along with their officials, were granted 30% and 20% reduction in penalty, respectively.

The case was based on search and seizure operations, commonly referred to as raids, conducted by director general (investigation) at the premises of Eveready, Nippo and Panasonic on August 23, 2016, where incriminating material and documents were found. During the investigation stage itself the companies had approached CCI as “lesser penalty applicants”.

Source- The Times of India