CCI's inquiry began in October 2022 after the Federation of Indian Publishers complained that DHL, FedEx, UPS and Dubai's Aramex, along with some domestic firms, were deciding charges together, said a report.
Country's antitrust body, Competition Commission of India (CCI), is investigating domestic units of global delivery companies, such as Germany's DHL, US-based United Parcel Service and FedEx, for alleged collusion on discounts and tariffs, said a report on Friday.
It is the latest such scrutiny for the logistics industry, some dating back to 2015, when France levied fines amounting to $735 million on 20 companies, including FedEx and DHL, for secretly colluding to increase prices.
In recent weeks, CCI has begun reviewing hundreds of thousands of emails as it investigates the fees companies charged for airport services, reported Reuters citing government documents and quoting three sources.
CCI's inquiry began in October 2022 after the Federation of Indian Publishers complained that DHL, FedEx, UPS and Dubai's Aramex, along with some domestic firms, were deciding charges together and controlling customer discounts.
Such actions, if proved, violate Indian antitrust laws.
The publisher said company executives exchanged commercially sensitive information regarding volumes, charges and discounts on courier and storage services offered at airports, before deciding on rates, the documents stated.
FedEx denied the allegations but told Reuters it was cooperating with CCI and complying with all legal requirements. DHL and UPS also said they are cooperating with the antitrust agency.
A finding of cartelisation could bring a fine of up to three times the profit in each year the fee was fixed by the companies, or 10% of annual revenue for each year of violation, whichever is greater.
Many companies are bullish about prospects in a market for courier, express and parcel delivery services expected to grow 17% each year to reach $18.3 billion by 2029, as an e-commerce boom fuels demand, says research firm Mordor Intelligence.
The watchdog's 2022 review showed that charges for airport services by courier companies were decided at meetings, before being made "mandatory" for all participants in a pact, the documents showed.
The complainant group also alleged that some companies set a fuel surcharge of 17% to 22%, citing rising prices of fuel, but did not cut them subsequently when those prices eased, during the travels curbs surrounding the COVID-19 pandemic.
Source: Business Today
