CCI slaps Rs 671-cr penalty on 4 PSU insurance firms

By: | Published: July 17, 2015 12:10 AM

Fines of Rs 162.80 cr, Rs 251.07 cr, Rs 100.56 cr and Rs 156.62 cr were imposed upon National Insurance, New India Assurance, Oriental Insurance and United India Insurance

The Competition Commission of India (CCI) has imposed a penalty of R671 crore on four public sector insurance companies for manipulating the bidding process initiated by Kerala government for selecting insurance service provider for Rashtriya Swasthya Bima Yojna for 2010-11, 2011-12 and 2012-13.

“The final order was passed by CCI on July 10, 2015, in a matter which was taken up suo moto pursuant to an anonymous information received by the Commission under Section 19(1) of the Competition Act, 2002, against National Insurance, New India Assurance, Oriental Insurance and United India Insurance alleging contravention of the provisions of section 3 of the Act which deals with anti-competitive agreements including bid rigging.”

The commission noted the impugned conduct of these companies to have resulted in manipulation of the bidding process in contravention of the provisions of Section 3(1)read with Section 3(3)(d) of the Act.

According to the CCI, the case related to bid rigging in public procurement for social welfare schemes, the beneficiaries of which were BPL and poor families and “as such the same was taken as an aggravating factor”.

Accordingly, penalties of Rs 162.80 crore, Rs 251.07 crore, Rs 100.56 crore and Rs 156.62 crore were imposed upon National Insurance, New India Assurance, Oriental Insurance and United India Insurance, respectively…”

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