Case Law Details
Federation of Corrugated Box Manufacturers of India Vs Gujarat Paper Mills Association (Competition Commission of India)
CCI issues cease and desist order against Kraft Paper Manufacturers and their four associations for indulging in anti-competitive practices
The Competition Commission of India (CCI) issued a final order today against four regional associations of Kraft Paper manufacturers, including their 115 members which were found to have contravened the provisions of Section 3(3) read with Section 3(1) of the Competition Act, 2002 (the ‘Act’), which proscribe anti-competitive agreements. The case was initiated on the basis of information filed by three federations/associations of corrugated box manufacturers.
It was alleged that the various associations of Kraft Paper Manufacturers, by way of periodic meetings and correspondences, direct their members (i.e., Kraft Paper Mills) to: (i) increase the price of the paper to be sold to the buyers, i.e., corrugated box manufacturers; and (ii) create a condition of shortage to enforce the unjust price increase and shut the operation of the paper mills in a region collectively.
Based on the evidence on record such as minutes of Meetings, e–mail communications, WhatsApp messages exchanged on WhatsApp groups as well as oral depositions of various representatives, the CCI found 119 parties including four regional associations of Kraft Paper Manufacturers in contravention of provisions of Section 3(3)(a) and Section 3(3)(b) read with Section 3(1) of the Act, except one Kraft Paper Mill, which was found guilty of contravention of provisions of Section 3(3)(a) read with Section 3(1) of the Act, only. Of the 119 opposite parties, 31 Kraft Paper Mills were lesser penalty applicants before the CCI. Under Section 46 of the Act, a cartel member may approach the CCI by way of filing an application seeking lesser penalty, in return for providing full, true and vital disclosures in respect of the alleged cartel to the Commission.
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