Active Stocks
Tue Mar 19 2024 12:01:03
  1. Tata Consultancy Services share price
  2. 4,019.80 -3.01%
  1. Tata Steel share price
  2. 148.50 -0.74%
  1. Bharti Airtel share price
  2. 1,233.55 0.69%
  1. Power Grid Corporation Of India share price
  2. 260.20 -1.81%
  1. ITC share price
  2. 409.65 -1.86%
Business News/ Industry / Banking/  Compat fines four insurance companies for anti-competitive practices
BackBack

Compat fines four insurance companies for anti-competitive practices

National Insurance, New India Assurance, United India Insurance and Oriental Insurance were fined for manipulating bidding processes

Compat, in its order, said that the insurance companies entered into anti-competitive agreements leading to bid-rigging which had adverse effects on competition in the sector.Premium
Compat, in its order, said that the insurance companies entered into anti-competitive agreements leading to bid-rigging which had adverse effects on competition in the sector.

New Delhi: The Competition Appellate Tribunal (Compat) on Friday found four state-owned insurance companies guilty of anti-competitive practices.

Compat imposed penalties on National Insurance Co. Ltd (NICL), New India Assurance Co. Ltd (NIACL), United India Insurance Co. Ltd (UIICL) and Oriental Insurance Co. Ltd (OICL) for manipulating bidding processes initiated with regard to government insurance schemes.

The tribunal, in its order, said that the insurance companies entered into anti-competitive agreements leading to bid-rigging which had adverse effects on competition in the sector.

The order said that the arrangement arrived at by the companies leading to bid rigging was in the nature of cover bidding whereby NICL, NIACL and OICL submitted bids higher than that of UIICL, creating a false impression of genuine competition.

Compat issued the order against appeals filed by three of the state-owned companies against a decision of the Competition Commission of India (CCI) finding them guilty of anti-competitive practices.

CCI, in an order dated 10 July 2015, imposed a penalty on each company at the rate of 2% of its average turnover of over three years—2010-13. It asked the companies to cease and desist from indulging in the practices found anti-competitive.

Compat, recognizing that the burden of penalty will ultimately be transferred to the public, as the insurance companies are owned by the government, reduced the penalty to 1% of the turnover for the relevant period. It imposed penalties of Rs1.56 crore (on UIICL), Rs20 lakh (on NICL), Rs20 lakh (on NIACL), and Rs4 lakh (on OICL).

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 10 Dec 2016, 02:08 AM IST
Next Story footLogo
Recommended For You
Banking Stocks
â‚ą1,061.35-1.12%
â‚ą1,446.20.17%
â‚ą1,081.2-0.03%
â‚ą120.05-1.62%
â‚ą730.7-0.53%
Switch to the Mint app for fast and personalized news - Get App