CCI Passes Order Against Container Trailer Owners’ Grouping

The Competition Commission of India (CCI) has directed a grouping of container trailer owners and related associations to "cease and desist" from unfair business practices after a detailed probe into a complaint by the Cochin Port Trust.

Container Trailer Owners Coordination Committee (CTOCC) and its four participating associations were found in violation of competition norms.

The four groupings are Cochin Container Carrier Owners Welfare Association (CCCOWA), Vallarpadam Trailer Owners Association (VTOA), Kerala Container Carrier Owners Association (KCCOA) and Island Container Carrier Owners Association (ICCOA).
Ten office bearers of these entities have also been asked to cease and desist from anti-competitive practices.

After a detailed investigation, the Competition Commission of India (CCI) found that CTOCC along with the four entities resorted to price fixing under the garb of 'Turn System'.

It was alleged that under 'Turn System', these entities indulged in unilateral fixation of prices. Users and container trailers were obliged to book services only through that centrally controlled system, an official release said on Wednesday.

Among others, it was alleged that CTOCC was restraining outside transporters from lifting the containers which was impeding the ability of the users to hire trailers of their choice.

Under the Competition Act provisions, the presumption arose against the said arrangement leading to appreciable adverse effect on competition, which was not satisfactorily rebutted by these associations despite being given ample opportunity, the release said.

"Through this order, the Commission has unequivocally clarified that though forming an association for furthering the legitimate trade activities does not fall foul of the Act, transgressing the legitimate boundaries and indulging in anti-competitive activities does," it noted.

According to the regulator, the purpose of imposing monetary penalties can be two-fold – for disciplining the erring party for its anti-competitive conduct and for creating deterrence to stall future contraventions.

"Considering that the contravention discontinued long- back and the parties are not indulging in such behaviour any more, the Commission does not find it appropriate to impose any monetary penalty in the present case," the order said.