On July 25, 2018, National Company Law Appellate Tribunal (‘NCLAT’) pronounced its judgment in upholding the order of the Competition Commission of India (‘CCI’) dated August 31, 2016 finding 10 cement companies[1] and their trade association, Cement Manufacturers Association (‘CMA’), guilty of fixing prices and limiting supply in contravention of Section 3(3) of the Competition Act (‘Act’).As evidence of an ‘agreement’ between the cement companies, NCLAT found that the companies used the CMA as a platform for exchanging ‘pricing and sensitive information relating to production, capacity, dispatch etc.’ Reviewing the minutes of CMA’s Managing Committee between 2007 and 2009 and three High Powered Committee meetings in 2011, NCLAT found CMA to have provided a platform to collect prices in minimum and maximum ranges for different regions in India. NCLAT also considered (i) ACC and Ambuja’s withdrawal from CMA activities; and (ii) CMA’s amendments to its regulations post initiation of the CCI investigation, as further proof that CMA provided a platform to coordinate amongst its members. Per NCLAT, CMA’s collection of business sensitive information further to directions of the Department of Industrial Policy and Promotion (‘DIPP’) was not adequate justification for such conduct. While DIPP requested information relating to retail and wholesale prices from different centers, NCLAT held CMA’s process of providing DIPP this information by collecting this information through its members, such that cement companies were able to access each others sensitive price and non-price information, may not be said to have been sanctioned by the government. Finding that “information exchange can constitute concerted practice if it reduces strategic uncertainty in the market thereby facilitating collusion,” NCLAT concluded that there was a meeting of minds between cement companies to fix the sale price of cement and regulating production and supply.To determine whether the ‘agreement’ resulted in fixing prices or reduction in production or supply, NCLAT reviewed the data on record. On the basis of price charts, NCLAT found there existed price parallelism on the basis of absolute changes in cement prices in each state. This, NCLAT held, indicated that cement companies hiked prices without justification in departure from “normal trends over the previous years”.NCLAT also found dispatch and production coordination amongst cement companies on the basis of reduced production and dispatch of cement despite increased demand over corresponding months (November – December 2010) and a subsequent increase in prices (January – February 2011). Relying on statements made by third party cement distributors, NCLAT concluded that this coordination amongst cement companies resulted in reduction in supplies. NCLAT also noted that while installed capacity increased in 2009-10 and 2010-11, production growth and capacity utilization decreased in 2010-11, along with corresponding price increases across all regions- south, central, north and eastern, while this was not the case in 2009-10.Notably, NCLAT clarified the standard of evidence for cartel cases as being one of ‘balance of probabilities’ as distinguished from ‘beyond reasonable doubt’, unlike criminal law.The NCLAT also referred to the Supreme Court (‘SC’) decision in Competition Commission of India v. Coordination Committee of Artistes and Technicians of West Bengal Film Television & Ors.[2] (‘WBFT Case’) which held that it was necessary to delineate the relevant market in which competition may be said to be affected, and “in particular for determining if undertakings are competitors or potential competitors and when assessing the anti-competitive effect of conduct in a market”. Relying on the SC decision in the WBFT Case, NCLAT held that as market power analysis was key, it was necessary to delineate a relevant market in this case as well. Reviewing the price and non-price data collected and relied on by CCI, NCLAT clarified that CCI identified the relevant market as ‘all regional markets for cement.’[3]Finally, observing that CCI had imposed “mere minimum penalty,” NCLAT held there was no need to interfere with CCI’s penalty computation. On this basis, NCLAT dismissed the appeals filed by the cement manufacturers.[1] ACC Ltd. (ACC),  Ambuja Cement Ltd. (Ambuja), Binani Cement Ltd. (Binani) , Century Textiles & Industries Ltd. (Century Cement),  India Cement Ltd. (India Cement), JK Cement Ltd. (JK Cement) , Nuvoco Vistas Corporation Limited (Lafarge), Ramco Cements Ltd, (Ramco), Ultra Tech Cement Ltd. (Ultra Tech) and Jaiprakash Associates Limited. [2] (2017) 5 SCC 17 [3] We request our readers to note that by way of an order dated 7 May 2018 pursuant to a review application filed by CCI in the WBFT Case, the Supreme Court clarified that the “determination of ‘relevant market’ is not a mandatory pre-condition for making assessment of the alleged violation under Section 3 of the Act.”