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CCI disposes of cartelisation case against Tata Chem; 4 others

NEW DELHI: Fair trade regulator Competition Commission has dismissed charges of alleged cartelisation by five firms, including Tata ChemicalsBSE 1.46 % andNirma LtdBSE 0.06 %, in manufacturing and sale of soda ash. 

Besides Tata Chemicals and Nirma, the complaint of alleged cartelisation in the soda ash market was filed against DCW Ltd, Gujarat Heavy Chemicals and Saurashtra Chemical. 

Noting that no sufficient evidence has been brought on record to establish contravention of competition norms, the regulator said, "in such a scenario, the Commission deems it appropriate to order closure of the case". 

The order passed by the 
Competition Commission of India (CCI) on April 16 was made public today. 

According to 
CCI order, there is also no sufficient evidence to show that these soda ash makers indulged in bid rigging or collusive bidding or concerted practice to fix the sale price of soda ash, among others, that violated competition norms. 

It was alleged that firms under the aegis of 
Alkali Manufacturers Association of India had formed a cartel to manipulate prices and volume of production of soda ash in the country. 

Further, the complainant had alleged that when quotation for procurement of soda ash was invited, these firms quoted either same price or with little difference from each other. 

The Director General (DG) -- the investigation arm of the CCI -- did not find any cartelisation or anti-competitive conduct on the part of the soda ash manufacturers. 

Citing the DG findings, the order said there are product market characteristics that make the market of soda ash amenable to cartelisation. 

However, the order also said existence of such conducive scenario for cartelisation in itself is not enough to reach a finding of contravention against the parties. 

"... it appears that like in many oligopoly markets, soda manufacturers recognised their interdependence and simply mimicked their rivals conduct," CCI observed. 

According to the order, the non-competitive nature of a market, standing alone, does not imply an "agreement". 

Tata Chemicals had requested the Commission to maintain the confidentiality of the DG order till the final disposal of the proceedings at the appellate levels. 

However, CCI said that "the confidential treatment as granted by the DG to Tata Chemicals shall continue to operate for a further period of 60 days from the date of receipt of this order by Tata Chemicals".