8/9/2019 Oil Regulator to Hear Predatory Pricing Charge Against OMCs

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Oil regulator to hear predatory pricing charge againstOMCs

By Siddhartha P Saikia Jun 23 2010 , New DelhiTags: BPCL, Essar Oil, HPCL, IOC, PNGRB, RIL, Section 16, Shell India, Petroleum

A three-member bench of downstream regulator Petroleum and Natural Gas Regulatory Board (PNGRB) willresume next month hearing on a complaint filed by private fuel retailers, Reliance

Industries (RIL), Essar Oil and Shell India against state-run oil marketing

companies (OMCs).

Private fuel stations owners have accused OMCs for predatory pricing of petroleum

products in 2008 that forced them to shut down their fuel selling pumps.

A bench headed by L K Singhvi (PNGRB member) will hear the complaint in

second or third week of July, said a government official. Other two members are

YPC Dangay, who retired as joint secretary in law ministry and another member

Sudha Mahalingam.

The three private fuel retailers in the country have accused government-run firms IOC, Bharat Petroleum and

Hindustan Petroleum of predatory pricing of transport fuel.

In 2008, international crude price shot up to $150 per barrel. But state-run fuel retailers continued selling petrol and

diesel at much lesser price owing to subsidy cushion from the government. Private retailers were forced to close

down their pumps as they had to sell at market driven prices and couldnt attract buyers.

As per the PNGRB Act 2006, the Board shall protect consumers interest by fostering fair trade and competition.

However, the Board can exercise its power in respect of notified petroleum, petroleum products and natural gas.

The state-run companies moved Appellate Tribunal for Electricity questioning the Boards jurisdiction to hear the

complaint. They say petroleum products are not notified. The OMCs said pricing of transport fuels are decided by the

government and they cannot alter them.

The Appellate Tribunal for Electricity upheld that the Board might continue to hear the complaint. Simultaneously, the

OMCs approached the Supreme Court, which admitted their petition and permitted the PNGRB to proceed with the

hearing. But asked it not to pass any final order.

Both the private and government retailers refused to comment. If PNGRB finds the charge true, it can issue directives

for a fair trade practice.

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