Used car traders fined for bid rigging
29 Mar 2013|10,253 views
The Competition Commission of Singapore (CCS) has imposed penalties on 12 used car traders for engaging in bid rigging activities at public auctions.
They have been charged a total of $179,071 for contravening Section 34 of the Competition Act (Cap 50B), which prohibits agreements, decisions and practices which prevent, restrict or distort competition.
The traders are Pang's Motor Trading, Auto & Carriage Engineering, Gold Sun Motor Vehicle Charter & Rental, Hup Lee Second Hand Auto Parts, Kiat Lee Scrap Vehicles Centre Pte Ltd, Kiat Lee Machinery Pte Ltd, Minsheng Agencies, PKS Scrap Vehicle Centre, Seng Guan Auto Parts, Seng Hup Huat Second Hand Auto Parts, Tim Bock Enterprise and Yong Soon Heng Auto Parts.
Kang San Trading Company, previously accused along with the 12 other traders by the CCS in September 2012, escaped penalisation on grounds of insufficient evidence.
From January 2008 to March 2011, these traders banded together to get themselves a good deal at auctions of motor vehicles that the Government had seized or no longer needed.
They agreed not to enter into a bidding war. Instead, one of them would bid for the vehicles on offer and, later, they would share gains made from selling off the vehicles at a higher price.
The CCS, Singapore's competition watchdog, considers this bid suppression a serious infringement of the Competition Act. Such suppression likely underestimated the true market value of the vehicles won, unfairly decreasing financial returns for vehicle owners and auction houses.
This is the CCS's first infringement decision against motor trading companies, investigations having started in May 2010.
The biggest penalty was received by Pang's Motor Trading ($50,733), followed by Tim Bock Enterprise ($37,795), Kiat Lee Machinery ($17,566), and Yong Soon Heng Auto Parts ($8,977). The rest must each pay $8,000.
"For the government agencies involved, as well as other bodies who hold auctions or are involved in tender processes, it is a call for increased vigilance to ensure the effectiveness of their procurement and sales practices," said Ms Ameera Ashraf, head of the competition and regulatory practice at WongPartnership LLP.
The Competition Commission of Singapore (CCS) has imposed penalties on 12 used car traders for engaging in bid rigging activities at public auctions.
They have been charged a total of $179,071 for contravening Section 34 of the Competition Act (Cap 50B), which prohibits agreements, decisions and practices which prevent, restrict or distort competition.
The traders are Pang's Motor Trading, Auto & Carriage Engineering, Gold Sun Motor Vehicle Charter & Rental, Hup Lee Second Hand Auto Parts, Kiat Lee Scrap Vehicles Centre Pte Ltd, Kiat Lee Machinery Pte Ltd, Minsheng Agencies, PKS Scrap Vehicle Centre, Seng Guan Auto Parts, Seng Hup Huat Second Hand Auto Parts, Tim Bock Enterprise and Yong Soon Heng Auto Parts.
Kang San Trading Company, previously accused along with the 12 other traders by the CCS in September 2012, escaped penalisation on grounds of insufficient evidence.
From January 2008 to March 2011, these traders banded together to get themselves a good deal at auctions of motor vehicles that the Government had seized or no longer needed.
They agreed not to enter into a bidding war. Instead, one of them would bid for the vehicles on offer and, later, they would share gains made from selling off the vehicles at a higher price.
The CCS, Singapore's competition watchdog, considers this bid suppression a serious infringement of the Competition Act. Such suppression likely underestimated the true market value of the vehicles won, unfairly decreasing financial returns for vehicle owners and auction houses.
This is the CCS's first infringement decision against motor trading companies, investigations having started in May 2010.
The biggest penalty was received by Pang's Motor Trading ($50,733), followed by Tim Bock Enterprise ($37,795), Kiat Lee Machinery ($17,566), and Yong Soon Heng Auto Parts ($8,977). The rest must each pay $8,000.
"For the government agencies involved, as well as other bodies who hold auctions or are involved in tender processes, it is a call for increased vigilance to ensure the effectiveness of their procurement and sales practices," said Ms Ameera Ashraf, head of the competition and regulatory practice at WongPartnership LLP.
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