The Competition Commission of India (Commission) has found the Cochin based
Container Trailer Owners Coordination Committee (CTOCC) and its four
participating associations, to be in
contravention of the provisions of the Competition Act, 2002 (the Act).
It was brought to the notice of the Commission that these associations,
under the garb of ‘Turn System’, have indulged in unilateral fixation of prices
through a reference filed by the Cochin Port Trust
It was alleged that, during the Turn System, the users and Container
trailers were obliged to book services only through this centrally-controlled
system and that CTOCC was restraining outside transporters from lifting the
containers, which was impeding the ability of the users to hire trailers of
Following a detailed investigation by the Director-General (DG), the
Commission has found that CTOCC, along with the participating associations have
resorted to price fixing under the garb of the Turn System.
The charge was not satisfactorily rebutted by these associations, despite
being given ample opportunity according to commission's official release.
Thus, the Commission held them to be in contravention of the provisions of
Section 3(3)(a) read with Section 3(1) of the Act. However, on the allegation
pertaining to limiting and restricting the provision of services under Section
3(3)(b) read with Section 3(1) of the Act, the Commission found the evidence to
be insufficient to hold CTOCC or any of its participating associations
Through this order, the Commission has unequivocally clarified that though
forming an association for furthering legitimate trade activities does not fall
foul of the Act, transgressing the legitimate boundaries and indulging in
anti-competitive activities does.
When trade associations are used as a platform to promote anti-competitive
ends, it becomes necessary for the Commission to intervene, for penalising the
Further, the Commission also mentioned in its order that though ‘Turn
System’ may have efficiency justification in a particular trade, no such
efficiency or redeeming virtue was shown by CTOCC or any of its
sub-associations in the present case.
The Commission has therefore held Container Trailer Operators Coordination
Committee and four of its affiliate organisations be in contravention of the
provisions of Section 3(3)(a) read with 3(1) of the Act.
Further, the Commission has also found 10 office-bearers of the
Cooridnation committee and the four affiliates responsible under Section 48 of
the Act, on account of the positions of responsibility held by them in these
associations during the period of contravention.
Accordingly, the office-bearers have been directed to desist from indulging
in the anti-competitive conduct found to be in contravention of the provisions
of the Act. But considering certain mitigating factors, the Commission decided
not to impose any monetary penalty on any of the parties, the release said.
Container trailer operators on Cochin port went on a wild cat strike last
month seriously hampering the handling of containers in the port.