TASMAC ’abusing dominant position’ in beer sales: CCI orders probe into TN marketing corp’s anti-competitive practices

Amid allegations of anti-competitive practices in beer sales, the Competition Commission of India (CCI) has ordered a probe against the Tamil Nadu State Marketing Corporation Limited (TASMAC), following a complaint of favouring select breweries, reported Bar and Bench.

The CCI passed its order on March 25 under Section 26(1) of the Competition Act, 2002 on the complaint filed by Chakra R Prabakaran, accusing the state-run liquor distribution corporation of favouring select breweries and restricting consumer choice.

"In consideration of the facts and circumstances of the present case, the Commission is of the prima facie view that TASMAC appears to be abusing its dominant position by limiting market access to certain brands of beer in the state of Tamil Nadu in contravention of Section 4(2)(c) of the Act. On the basis of the material available on record, there appears to be substance in the allegations levelled by the Informant and the same merits investigation by the Director General (‘DG’)," the order said.

Some brands neglected

Prabakaran alleged that TASMAC disproportionately stocks brands like SNJ 10000 and British Empire from SNJ Breweries and Kals Breweries, while neglecting other brands.

TASMAC holds a monopoly over liquor retail in the state through its more than 5,000 outlets.

60-day probe by Director General

The CCI has directed its Director General to conduct a 60-day probe to determine whether the company abused its dominant position.

The DG will scrutinise procurement policies, brand-wise sales data and manufacturer agreements, the Bar and Bench report said.

Madras HC directs ED not to proceed further

Last week, the Madras High Court directed the Enforcement Directorate (ED) not to proceed further pursuant to its recent searches at the state-run liquor retailer's headquarters in Chennai.

The HC also directed the ED to produce copies of FIR and Enforcement Case Information Report (ECIR) along with any other materials which it relied upon against the TASMAC.

The ED had earlier said it has found "multiple irregularities" in the operations of TASMAC, including "manipulation" in the tender processes and "unaccounted" cash transactions worth ₹1,000 crore through distillery companies.