The Competition Commission has suspended the proceedings in the matters of alleged collusion by the United Investments Ltd (UIL) in respect of the supply of fertilisers.
UIL made a motion for a permanent stay of the proceedings to the Commission, on ground of abuse of process as the Executive Director’s decision to grant access to the investigation file (disclosure) came too late.
Being dissatisfied with the decision of the Commission and having regard to the dissenting opinion, the Executive Director has appealed the decision to the Supreme Court.
The Executive Director had investigated Mauritius Chemical & Fertilizers Industry Ltd (MCFI) (now Ingenia) and UIL for cartel conduct and recommended fines totalling Rs.71 million on UIL and Rs.5 million on MCFI.
Background
The Competition Commission had launched investigations in the supply of chemical fertilisers in Mauritius. The competition concern was whether the two suppliers, namely MCFI and UIL through its subsidiaries [Island Fertilisers Ltd (IFL) and Island Renewable Fertilisers Ltd (IRFL)], had illegally agreed to fix price and share the market for the supply of chemical fertilisers to customers in Mauritius.
Price fixing and market sharing agreements referred to as a cartel, are prohibited in Mauritius under section 41 of the Competition Act 2007 (the Act) and such conducts are penalised with fines.
Based on information submitted by MCFI, the Executive Director assessed whether MCFI and UIL had participated in bid rigging by agreeing amongst themselves on the price, and terms and conditions to be submitted in response to the invitation for tenders issued by sugar estates.
Bid rigging occurs when suppliers, instead of submitting their offers independently and competitively, agree amongst themselves on the price or conditions they would offer, or they agree on who would submit a bid, so as to eliminate competition between tenderers.
Bid rigging is prohibited under section 42 of the Act and penalised by fines as per section 59 of the Act.
After completion of the investigations in June 2018, the Executive Director found that UIL has participated in collusive agreement prohibited under section 41 of the Act and it has also participated in bid rigging in breach of section 42 of the Act.
The Executive Director consequently recommended the imposition of financial penalties totalling Rs 71 million on the UIL for the breaches as per section 59 of the Act.
Source: Competition Commission of Mauritius
