CCI imposes a penalty on seven entities for bid-rigging in the tender of the State Bank of India

The Competition Commission of India (‘CCI’) passed a final order against seven entities for indulging in an anti-competitive agreement for the supply of signages for branches/offices/ATMs of State Bank of India (SBI). Amongst these seven entities, one party was a lesser penalty applicant before CCI. 

This matter was initiated suo motu by CCI on the basis of the complaint received in 2018 alleging bid-rigging and cartelisation in the tender floated by SBI Infra Management Solutions Pvt. Ltd. The investigation inter alia found e-mails exchanged between the parties which formed the basis for manipulation of the bidding process.

Based on a cumulative assessment of the evidence collected, the Competition Commission of India found that there was an agreement amongst the parties which resulted in geographical market allocation as well as bid-rigging in the above-mentioned tender of SBI. Accordingly, all the parties were held to be guilty of contravention of the provisions of Section 3 of the Competition Act, 2002 (the Act), which prohibits anti-competitive agreements including cartels. Further, 9 (nine) individuals of these parties were also held liable for the anti-competitive conduct of their respective entities, in terms of the provisions of Section 48 of the Act.

Considering that one party has filed a lesser penalty application besides cooperating during the investigation as well as inquiry process and that most of the parties are MSMEs – some of which even acknowledged their conduct during the inquiry, CCI took a lenient view and decided to impose a penalty upon the parties @ 1% of their respective average turnover.

The individuals found guilty under Section 48 of the Act were also imposed a penalty @1% of their respective average incomes. Further, considering the stage at which the lesser penalty applicant approached the CCI and in light of the co-operation extended by it thereafter, the Competition Commission of India granted a reduction in penalty by 90% to it and its individuals. Apart from the above, CCI also directed the parties and their respective officials to cease and desist from indulging in anti-competitive conduct.

A copy of the order in Suo Motu Case No. 02 of 2020 is available on CCI’s website at the following link:

https://www.cci.gov.in/sites/default/files/SM-02-of-2020.pdf

Disclaimer : This is an official press release by PIB.