Press Information Bureau

Government of India

Ministry of Corporate Affairs

10-April-2012 15:53 IST

CCI imposes a penalty of Rs.5.66 crores on Schott glass India Pvt. Ltd.

Competition Commission of India (CCI) has imposed a penalty of Rs.5.66 crores on Schott Glass India Private Limited (Schott India) for violating the provisions of the Competition Act. The Commission in its order has held that Schott India has abused its dominant position in the industry by imposing unfair and dissimilar discounts which has resulted in an adverse impact on the converters in the downstream market.

The order was passed by the Commission on a complaint filed by Kapoor Glass alleging that Schott Glass India drove out competitors by selling Borosilicate glass tubes at a very low prices. After investigations, CCI came to the conclusion that due to the abusive act and conduct of Schott Glass India, the small converters are not able to compete on equal footing. Accordingly, the Commission has decided to impose penalties for distorting competition in the market. The Commission has also issued following cease and desist order:

1. The Schott India should desist from applying dissimilar conditions while giving discounts to Schott Kaisha vis-à-vis other converters.

2. The terms of transactions for supply of tubes to Schott Kaisha, the JV should be similar and non-discriminatory vis-à-vis the other converters.

3. The discount on both Amber and Clear Tubes should not be contingent upon sale of each other.

The penalty of Rs.5.66 cores imposed by the Commission was based on a rate of 4% on the average of 3 years turnover of Schott Glass India.

“A copy of the detailed order of the Commission can be seen at www.cci.gov.in”

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RC/JR

Abuse of dominant position leads to penalty and orders requiring non discriminatory discounting and equal transaction terms. CCI found Schott Glass India abused its dominant position by granting dissimilar discounts and contingent rebates that disadvantaged independent converters, distorted competition and advantaged a joint venture customer. The Commission imposed a penalty based on a percentage of Schott India's average three year turnover and issued cease and desist directives requiring non discriminatory discounts, similar transaction terms for the joint venture vis a vis other converters, and prohibition of contingency discounts between tube types.