Rs 1650 Cr Penalty On Apollo Tyre, Ceat, MRF, JK Tyre and Birla Tyre For Manipulating Market

Competition Commission of India (CCI) has imposed a penalty of approximately Rs 1650 crores on five tyre companies, as per the  latest development.

How Did This Happen?

Here CCI is the chief national competition regulator in India. 

Basically, CCI is a statutory body within the Ministry of Corporate Affairs which is responsible for enforcing the Competition Act, 2002 in order to promote competition and prevent activities that have an appreciable adverse effect on competition in India. 

In simple words, CCI looks into cases and investigate it if the same has negative impact on competition

As mentioned earlier, the penalty has been imposed on five companies including Apollo Tyre, Ceat, MRF, JK Tyre and Birla Tyre.

In the case of Apollo Tyre, CCI has imposed a penalty of Rs 425 crore on this company. 

Followed by MRF, who has been slapped with a penalty of Rs 309 crore. 

The same amount of penalty, which is Rs 309 crore has been imposed on JK Tyre.

While, CEAT  has imposed a penalty of Rs 252 crore. On the other hand, Birla Tyre has been slapped by a penalty of Rs 178 crore.

Why Would This Happen?

The case has been investigated by CCI since 2018. However, the tyre companies with its association challenged the case in Chennai High Court. 

But, the Chennai High Court allowed CCI to pass its order last month when the latter submitted its report in a closed envelope.

With this order, CCI has imposed fines on these tyre companies of the country.

In response, the tyre companies’ only option is to challenge the order in the Supreme Court. 

Here, one can see that the CCI has been on this investigation for quite some time, so it seems that the order was passed only after the approval of Madras High Court. 

This way, it seems that the side of the tyre companies is not looking strong.

Earlier, the Ministry of Corporate Affairs had initiated the case against the tyre companies stating that five home tyre producers account for 90 per cent of the market share.

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