Oil firms challenge CCI jurisdiction in petrol pricing probe

CCI probing suspected unfair practices by state-run oil marketing companies in setting petrol prices

Fair trade watchdog CCI will soon pass an order on a challenge by oil marketing firms over its authority to investigate alleged cartelisation in fixing petrol prices.

"The oil companies are challenging our jurisdiction that we have no authority and legal competence to look at it (fixing of petrol prices)...We will soon pass an order (with regard to jurisdiction) in the next few days," CCI Chairman Ashok Chawla told PTI in an interview.

The Competition Commission of India (CCI) is probing suspected unfair practices by state-run oil marketing companies in setting petrol prices, which has been deregulated by the government.

Without divulging details, Chawla said an appropriate order would be passed since the oil companies have said the CCI cannot even look at issues related to petrol prices.

The companies told the CCI they are regulated by the Petroleum and Natural Gas Regulatory Board, Chawla said.

The CCI, which keeps a tab on anti-competitive practices across sectors, had referred the petrol pricing issue to its Director General (DG) for investigation after gathering information from the Petroleum Ministry.

Cases are referred to the DG, the investigation arm, on finding prima facie evidence of anti-competitive practices.

The CCI observed that even after deregulation, petrol prices were revised almost equally by the state-run oil firms -- Indian Oil, Bharat Petroleum and Hindustan Petroleum.

Finding ambiguity in the petrol pricing mechanism, the CCI sought information from the Petroleum Ministry.

The ministry said it was not responsible for fixing petrol prices and that oil marketing companies set the rates directly using a formula.