It was previously reported that the Antimonopoly Committee of the Republic of Uzbekistan conducted an inspection of JSC “UZAUTOMOTORS” in accordance with the requirements of the legislation and initiated a case against the company on the grounds of violation of the Law of the Republic of Uzbekistan “On Competition”.
Today, on August 19, 2020, this case has been considered at the new meeting of the Special Commission of the Committee, and the following was identified.
– that a monopolistic high price was applied on the formation of the basic wholesale and retail prices of manufactured cars through unreasonable increase in costs, and as a result, the prices of passenger cars has increased by an average of 10.29%;
– commitment of actions that discriminate the rights of consumers and business entities in the sale of cars through dealers, including the implementation of conditions not related to the subject of the contract, other actions that may or may not restrict competition and other economic activities in the car market. UZAUTOMOTORS JSC’s actions have been identified as abusing its superior position by obstructing the access of busi.
¬ The Special Commission studied the above cases in detail and instructed UZAUTOMOTORS JSC to eliminate the violations.
According to the instructions addressed to the UZAUTOMOTORS JSC:
Firstly, the application of a monopolistic high price in the formation of the price of passenger cars produced by Uzautomotors by including raw materials, fuel and energy resources, unrealized labor costs and other costs or unfinished work in the price of goods with the following actions, including the Company’s 2020 year prices, as well as reimbursing the sums to consumers:
– “Spark” LS M/ T modification at retail price 3 002 010 UZS and 3 563 704 UZS from the retail price of LT A/T modification;
– “Nexia 3” LT M/T modification at the retail price of 3,112,039 UZS and LTZ A/T modification at the retail price of 3,792,325 UZS;
– “Cobalt” car LT M / T modification from the retail price of 4 404 493 UZS and LTZ A / T modification from the retail price of 10 526 707 UZS;
– “Gentra” car SX M / T modification from retail price 13 825 248 UZS, SX M / T CNG modification from retail price 13 718 618 UZS and CDX A / T Plus modification from the retail price of 19,806,932 UZS;
– “Damas” car DLX modification at retail price 15,458,984 UZS, 15,746,315 UZS from the retail price of VAN modification and 13,052,930 UZS from the retail price of Labo modification must be deducted and returned to consumers.
Secondly, new coming contracts for the sale of passenger cars (since the Commission’s decision was adopted) are based on prices formed by deducting the above-mentioned unreasonable costs, or based on the company’s marketing strategy, the average price of cars is not less than 10.29% and ensuring that this is done taking into account the reduction of unreasonable costs in the amount of 942 891 108 031 UZS.
Revised and new approved prices for passenger cars, taking into account the above-mentioned instructions must be submitted to the Antimonopoly Committee.
Thirdly, company is obliged to ensure that cars produced by the company are sold to consumers only in strict accordance with the sequence of contracts concluded through the “UzAvtoSavdo” program.
Fourthly, in case of return of export-oriented cars from destination markets Uzautomotors must ensure a distribution of cars through dealers to the domestic market.
Fifthly, Uzautomotors ensures that the same conditions are applied to existing dealers and all business entities wishing to operate as dealers, as well as to refrain from actions that may or may not limit competition.
Sixthly, excluding the condition of prepayment in the amount of 10 billion UZS from the dealership agreement with Azimavtomotive LLC.
Seventh, when dealers are offered to enter into a distribution agreement for the sale of cars on a special basis on a fixed payment, all participants are obliged to conclude a contract on equal terms.
It was also concluded that this decision can be appealed to the Board of the Antimonopoly Committee of the Republic of Uzbekistan or the relevant administrative court within a month.