CCI imposes Rs 1 crore fine on Thomas Cook, Sterling Holidays

The Competition Commission has imposed Rs 1 crore penalty on three entities, including Thomas Cook and Sterling Holiday Resorts, for carrying out certain market purchases related to their deal before seeking the fair trade watchdog’s approval. 

The imposition of penalty by CCI was disclosed by Thomas Cook (India) in a regulatory filing on Saturday.

Fine has also been imposed on Thomas Cook Insurance Services (India) Ltd, a party to the deal. The Rs 870 crore-deal involving merger of Sterling Holiday Resorts (India) with travel firm Thomas Cook (India) has already been cleared by Competition Commission of India. However, the fine relates to market purchases carried out as part of the deal between February 10 and 12 this year.

CCI had issued showcause notice to all three entities stating that “market purchases, being part of the composite combination (under the competition regulations), were consummated before giving notice to the Commission and as such invited penalty under the (Competition) Act”. Thomas Cook Insurance Services (India) Ltd acquired more than 90.26 lakh shares, representing 9.93 per cent stake of Sterling Holiday Resorts (India) Ltd.

The entities had filed notice seeking CCI nod for the deal on February 14, two days after the purchases. According to a regulatory filing by Thomas Cook (India), CCI felt that facts suggested that the conduct of the parties does not attract severe penalty.

“Considering the facts and circumstances of the case, the Commission...considered it appropriate to impose a relatively nominal penalty of Rs 1 crore on the parties,” Thomas Cook said in the filing to the BSE.