Steel Cartel Probe SAIL Moves Court as Industry Faces Heavy Penalties
New Delhi: On the matter of significant apprehension against jeopardization against the ongoing alleged cartelization of steel probe, the state-owned Steel Authority of India Ltd (SAIL) has disclosed that it has moved to the court after receiving a notice from the Competition Commission of India (CCI) over suspected cartelization of steel. The steel major PSU, is currently under a cartelization probe by the Competition Commission of India (CCI) over the allegation of price fixing and supply curbs in the steel industry.
The company sought details from the CCI with respect to the notice issued, asking for more information to respond effectively and accordingly. The CCI investigation began in 2021 where it found evidence of collusion among major steel makers, that includes major industries like Tata Steel, JSW Steel, and SAIL involving WhatsApp messages and coordinated production cuts.
The probe has implicated around 28 companies and 56 senior executives which includes top leaders from these firms. The involving companies would face potential penalties of around two to three times of their profit or 10% of turnover for each year of faced implications.
Probable Impact and Stance of Companies in the Case:
The steel makers like SAIL, Tata Steel, and JSW Steel have denied the allegations, and the CCI will expected to issue a final order after reviewing the final findings. In the Competition Act, the cartelization is defined as agreements between competing enterprises to fix prices, limit supply, or control markets is assumed to have an appreciable, adverse effects on competition and such agreements are illegal and void under Section 3 of the Act.
The possible potential impact of the probe on the steel industry would be significant with companies facing severe penalties related to the finances and core structure of the revenue generation of the companies between 2015 and 2023.
The implicated companies would submit audited financial statements for the eight financial years up to 2023. The companies would face severe penalties with strict restrictions and future warnings.