Case Law Details
In Re: Cartelisation by Shipping Lines in the matter of provision of Maritime Motor Vehicle Transport Services to the Original Equipment Manufacturers (Competition Commission of India)
The evaluation of available evidence indicates that there was an agreement between NYK Line, K-Line, MOL and NMCC with the objective of enforcement of “Respect Rule”, which implies avoiding competition with each other and protecting the business of incumbent PCC with the respective OEM. The PCCs would respect the business of the incumbent carrier by either providing a quote above the incumbent’s rates or refraining from quoting. To achieve the said objective, the OPs resorted to multi-lateral as well as bilateral contacts/ meetings/ e-mails with each other to share commercially sensitive information which, inter alia, includes freight rate. The OPs engaged in such practices with the aim of restricting competition and maintaining the status quo, i.e., ensuring that the car carriers would keep their respective businesses for certain customers and/or certain routes. They also aimed to preserve their position in the market and maintain or increase prices, including by resisting requests for price reduction from certain OEMs.
It is also noted that the contacts between the OPs were route or customer-specific and not all parties were involved in every exchange. Further, the conduct was an ongoing process and did not consist of isolated or intermittent occurrences.
The said conduct on the part of the OPs can be classified as an agreement which is presumed to have AAEC within India under the provisions of Section 3(3) of the Act. It is noted that NYK Line, MOL and NMCC have not objected to such AAEC and K-Line has not been able to rebut the same. Accordingly, based on a cumulative assessment of the evidence discussed above, the Commission holds all the four OPs, e., NYK Line, K-Line, MOL and NMCC, guilty of contravention of the provisions of Section 3(3)(a), 3(3)(c) and 3(3)(d) read with Section 3(1) of the Act from 2009 to 2012.
FULL TEXT OF THE ORDER OF COMPETITION COMMISSION OF INDIA
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