CCI slams chemist bodies for unfair trade practices

Dec 12 2013, 14:44 IST
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The Competition Commission of India (CCI) has directed the All India Organisation of Chemists and Druggists The Competition Commission of India (CCI) has directed the All India Organisation of Chemists and Druggists
SummaryThe Competition Commission of India (CCI) has directed the All India Organisation of Chemists and Druggists

The Competition Commission of India (CCI) has directed the All India Organisation of Chemists and Druggists (AIOCD) and its affiliates to “cease and desist” from unfair trade practices that restrict supply of medicines in the market.

CCI has also slapped a penalty of R5.61 lakh on the Assam Drug Dealers Association (ADDA), an affiliate of AIOCD. Since CCI had already imposed a fine of R47.40 lakh on AIOCD in a similar matter earlier in the year, it said it did not consider it appropriate to impose any further monetary penalty” on this association again.

The orders came on the complaints that these associations were abusing their dominant position by limiting and restricting supply of pharmaceutical drugs. On probe conducted by the director deneral of investigations, the investigative arm of CCI, it was revealed that AIOCD and its affiliated associations resorted to the practice of boycott of pharmaceutical companies and their products in order to enforce certain requirements related to 'no-objection certificate (NOC)', 'product information service (PIS)' and fixed trade margins, among others.

In its order, CCI has also said that as the financial statements of two of the AIOCD affiliates — the All Kerala Chemists and Druggists Association and the Barpeta Drugs Dealers Association — were not available immediately, the quantum of fine on the drug associations of Kerala and Barpeta would be decided later at an appropriate time. CCI also asked all these associations to "cease and desist from indulging in and following the practices which have been found anti-competitive in violation...of the (Competition) Act”.

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