India: United Breweries challenges Competition Commission of India’s penalty before appellate tribunal NCLAT

Beer maker United Breweries Ltd (UBL) has approached the appellate tribunal NCLAT against Rs 751.8 crore penalty imposed on the company by the fair trade regulator CCI, The Economic Times reported on December 8.

The Competition Commission of India on September 24, 2021, imposed a fine of Rs 751.8 crore for alleged cartelisation in the sale and supply of beer.

"The company has now filed an appeal before the National Company Law Appellate Tribunal (NCLAT) against the CCI order dated September 24, 2021," said UBL in a regulatory update.

The NCLAT is the appellate authority over the CCI. It hears appeals against any direction issued or decision made or order passed by CCI.

Earlier in October, UBL, which is now controlled by Dutch-based multinational Heineken, had said it was in process of preparing the grounds of the appeal, which was expected to be filed within two months from the date of order.

On the basis of the legal advise "the company believes that it has a strong case on merits for successful appeal on this matter", UBL had said on October 27, in post earning statement for July-September quarter.

Earlier this year, Heineken had acquired additional ordinary shares in UBL on June 23 taking its shareholding in the company from 46.5 per cent to 61.5 per cent.

The CCI had imposed penalties totalling over Rs 873 crore on UBL, Carlsberg India, All India Brewers' Association (AIBA) and 11 individuals for cartelisation in the sale and supply of beer.

The final order was passed against United Breweries Ltd (UBL), SABMiller India Ltd, now renamed as Anheuser Busch InBev India Ltd (AB InBev), and Carlsberg India Private Ltd (CIPL), among other entities.

In its 231-page order, which had come nearly four years after ordering a detailed probe, the CCI had also directed the companies, association and individuals to "cease and desist" from anti-competitive practices in the future.

The period of cartelisation was considered to be from 2009 to at least October 10, 2018, with Carlsberg India joining in from 2012 and AIBA serving as a platform for facilitating such cartelisation since 2013. All three beer companies were lesser penalty applicants before the regulator.

09 December, 2021