CCI raids United Breweries, Carlsberg, AB InBev over price-fixing charges

The Competition Commission of India (CCI) has granted approval for the acquisition of a stake in Rebel Foods by Jongsong Investments, a wholly owned subsidiary of Temasek.

According to a statement from CCI, the proposal involves Jongsong subscribing to compulsorily convertible preference shares and acquiring equity shares in the cloud kitchen unicorn, Rebel Foods. The regulatory body stated, *“CCI approves the proposed acquisition of shares in Rebel Foods Private Limited by Jongsong Investments Pte. Ltd.”*  

Earlier reports indicated that Temasek was planning a significant stake acquisition in Rebel Foods through a combination of primary equity infusion and secondary share purchases. Rebel Foods is also reportedly considering a public listing within the next 12-18 months.  

As part of this development, early investors such as Coatue Management, Lightbox, and Peak XV Partners are expected to sell part of their combined 20-25 percent stake. This transaction, estimated at $180-200 million, will enable Jongsong Investments to become Rebel Foods' largest shareholder. Currently, the startup's founders hold a 12 percent stake, while Qatar Investment Authority owns approximately 10 percent.  

Founded in 2011 by Kallol Banerjee and Jaydeep Barman, Rebel Foods operates several quick-service restaurant (QSR) brands, including Behrouz Biryani, Ovenstory Pizza, The Good Bowl, SLAY Coffee, and Wendy’s. The company generates revenue through food sales via its cloud kitchens and third-party platforms, along with delivery fees and royalties from partnerships.  

Rebel Foods reported a 42 percent reduction in net losses in FY24, bringing it down to Rs 378.2 crore from Rs 656.5 crore in FY23. This improvement was attributed to an increase in operating revenue, which rose by 19 percent to Rs 1,420.2 crore in FY24 compared to Rs 1,195.2 crore in FY23.  

This transaction aligns with a broader trend in the Indian startup ecosystem, where late-stage companies are facilitating secondary share sales ahead of their IPOs. Startups like Urban Company, Acko, and Lenskart have also witnessed similar transactions, providing partial exits for early investors.

The National Company Law Appellate Tribunal on Friday upheld the Rs 873-crore penalty imposed by fair trade regulator CCI on UBL and other beer makers.

The appellants "had already conceded in the leniency application to their role in the cartelization," a two-member panel stated after reviewing the papers and taking the arguments into account.

The NCLAT stated in reference to the group of petitions submitted to the CCI by the beer manufacturers asking for a decrease in penalty: "A lesser penalty application is like an admission of guilt in a cartel."

The two-member bench, made up of Justices Rakesh Kumar and Ashok Kumar Mishra, stated that once they had acknowledged their involvement in an application filed under Section 46 read with Regulation 5, they were only permitted to contest the imposition of a penalty.

On September 24, 2021, the Competition Commission of India fined UBL, Carlsberg India, the All India Brewers' Association, and 11 people a combined sum of about Rs 873 crore for cartelization in the sale and supply of beer.

The aforementioned order was contested in front of the NCLAT, which has appellate jurisdiction over the CCI with regard to any directives issued, judgements rendered, or orders passed by the regulator. The NCLAT also rejected the beer manufacturers' arguments that a CCI order can be overturned without a judicial member present and simply needs to be noted for its rejection.

NCLAT, however, rejected it and noted "Nowhere does it state that CCI must include a member of the judiciary. The addition of a judicial member to decide the process is not contemplated by the Competition Act."

Gopal Subramaniam, a senior attorney representing the beer company, said that the order building a prima facie case and initiating an investigation on the basis of a leniency application was invalid. The CCI had rejected their requests for leniency.

Regarding the severity of the penalty, NCLAT stated that it is clear that, despite the CCI's discretion to impose a fine up to 10% of the average turnover for the previous three fiscal years, in the present case, in addition to granting the benefit of the doubt on the leniency application, the CCI has also adopted a lenient stance. The amount of the fine was calculated as follows: 0.5 times profit for each year the cartel persisted, or 2% of total revenue for each year the cartel persisted, whichever was higher.

With Carlsberg India joining in from 2012 and AIBA acting as a forum for supporting such cartelization from 2013, the era of cartelization was deemed to span from 2009 to at least October 10, 2018. Before the regulator, all three beer businesses submitted applications for reduced penalties.

The Competition Commission of India (CCI) has given approval to Tirumala Milk Products to buy Sunfresh Agro Industries, a subsidiary of Prabhat Dairy.

The fair trade regulator said, "CCI approves acquisition by Tirumala Milk Products Pvt. Ltd of (a) Prabhat Dairy Limited's subsidiary Sunfresh Agro Industries Private Limited; and (b) dairy business of Prabhat Dairy." 

In January, Prabhat Dairy said that Tirumala Milk Products, France-based Lactalis' Indian subsidiary, was buying its dairy business for Rs 1,700 crore, which is 1.09 times their sale in 2017-18 of Rs 1,554 crore. 

Apart from the dairy business, the transaction further involves the sale of 100% shareholding in Sunfresh Agro Industries through a share purchase agreement.

भारत के प्रतिस्पर्धा आयोग (सीसीआई) ने कैडबरी चॉकलेट निर्माता मोंडेलेज़ इंडिया के खिलाफ दायर शिकायत को खारिज कर दिया है। एक समझौते को समाप्त करने के संबंध में शिकायतकर्ता ने कन्फेक्शनरी विशाल मोंडेलेज़ इंडिया फूड्स द्वारा अनुचित व्यावसायिक प्रथाओं का आरोप लगाया।

निष्पक्ष व्यापार नियामक ने यह देखते हुए मामले को खारिज कर दिया है कि मोंडेलेज़ के खिलाफ (प्रतियोगिता) अधिनियम की धारा 3 या धारा 4 का कोई उल्लंघन नहीं किया गया है। धारा 3 विरोधी प्रतिस्पर्धी समझौतों से संबंधित है और धारा 4 प्रमुख बाजार स्थिति के दुरुपयोग के साथ सौदा करता है।

शिकायत महाराष्ट्र के पूर्ववर्ती स्टॉकिस्ट  और मोंडेज़ के उत्पादों के वितरक द्वारा दायर की गई थी। शिकायतकर्ता ने दलील दी कि कन्फेक्शनरी विशालकाय द्वारा प्रभुत्व और विरोधी प्रतिस्पर्धी प्रथाओं के दुरुपयोग के मुद्दों को उठाए जाने के बाद, मोंडेलेज़ ने दो इकाइयों के बीच निर्विवाद और झूठे आधार पर वितरण समझौते को समाप्त कर दिया।

नियामक ने कहा, "अन्य आरोपों के बारे में मोंडेलेज़ (विपरीत पार्टी) द्वारा पुनर्विक्रय मूल्य रखरखाव और वितरकों पर अपनी छूट योजनाओं के साथ आने के लिए प्रतिबंध, शिकायतकर्ता द्वारा उन्हें प्रमाणित करने के लिए कोई सहायक सबूत या संचार नहीं रहा है।"

"सीसीआई ने आगे कहा कि इसके अलावा, पुनर्विक्रय मूल्य रखरखाव अधिनियम के प्रावधानों का प्रति उल्लंघन नहीं है और सुझाव देने के लिए कुछ भी नहीं है कि आरोपी (विपरीत पार्टी) के आचरण के बाजार में प्रतिस्पर्धा पर एक  प्रतिकूल प्रभाव पड़ता है। इसलिए, कोई पहला पक्ष नहीं है अधिनियम की धारा 3 के प्रावधानों का उल्लंघन करने का मामला इस गिनती पर भी किया गया है ।"

Competition Commission of India (CCI) has rejected a complained filed against Cadbury Chocolates Maker Mondelez India. The complainant alleged unfair business practices by confectionery giant Mondelez India Foods with regard to termination of a distribution agreement.

The fair trade regulator has dismissed the case after observing that no contravention of either Section 3 or Section 4 of the (Competition) Act is made out against Mondelez. Section 3 pertains to anti-competitive agreements and Section 4 deals with abuse of dominant market position. 

The complaint was filed by a Maharashtra-based erstwhile stockist and distributor of products of Mondelez. The complainant contended that after it had raised the issues of abuse of dominance and anti-competitive practices by the confectionery giant, Mondelez terminated the distribution agreement between the two entities on frivolous and false grounds.

The regulator said, "Regarding the other allegations such as resale price maintenance by Mondelez (Opposite Party) and restriction on distributors to come up with their own discount schemes, there has been no supporting evidence or communication by the complainant to substantiate them."

"Further, resale price maintenance is not a per se violation of the provisions of the Act and there is nothing to suggest that the conduct of the OP (Opposite Party) has an appreciable adverse effect on competition in the market. Therefore, no prima facie case of violation of the provisions of Section 3 of the Act is made out on this count also," CCI further added.