Indian tyre makers hit a roadblock as CCI expands JK Tyre investigation

By Rahul Vaimal, Associate Editor
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India’s leading automotive tyre manufacturers could reportedly be heading to a “comprehensive scrutiny” by the Competition Commission of India (CCI), the country’s antitrust regulator for their alleged involvement in a bid-rigging conducted by JK Tyre. 

The probe originally revolved around JK Tyre for its extravagant bidding price as a sole bidder for supplying tyres for public transport vehicles owned by the North Indian state of Haryana.

The Haryana government, in its document to CCI, alleged that the tyre manufacturer had employed unfair trade practices while bidding. As a response, the antitrust regulator ordered a probe into the matter saying “non-participation by other tyre manufacturers” was suggestive of a “concerted act to rig the bid”.

In its order in November 2019, the antitrust regulator stated that “There appears to be some arrangement or understanding amongst the tyre manufacturers … The matter warrants a thorough and detailed investigation to unearth the entire modus operandi resorted to.”

Earlier in August, CCI decided to expand its investigation to evaluate the involvement of other firms in the matter and reportedly added regional giants Apollo Tyres, CEAT, MRF and Indian subsidiaries of French tyre maker Michelin and Germany’s Continental AG.

The authority now has set its eyes on “email dumps” over five years belonging to senior executives in the JK group citing them as critical for the on-going investigation.

If found guilty, each perpetrator would be asked to pay a potential penalty of up to three times the profit in each year prices were fixed by them, or 10% of annual revenue, whichever is higher.