On 25 January, the Indian Coordination Committee of Farmers Movements (ICCFM), placed on record their objection with the proposed acquisition of Monsanto by the German firm Bayer.
Here is the full text of the letter.
Road No. 2, A – 87, Mahipalpur Extension, New Delhi – 110 037,
IndiaTel:+91-9899435968 ; Email: yudhvir55@yahoo.com
The
Secretary, 25.01.2018
Competition
Commission of India,
New
Delhi - 110001
Dear
Madam/Sir,
Subject:
Our objection to the Proposed Combination between Bayer AG and Monsanto and
request for extension of 15 days notice for public participation.
We
the farmers in India as Individual Farmers,
Farmers Groups, Women Farmers, Small farmers, Young Farmers, Farm
Workers, Landless Labourers have come together to place on record our
objections pertaining to the Notification issued by the Competition Commission
of India under Section 29(2) of the Competition Commission Act, 2002, inviting
objections/ comments/ suggest with regard to the combination of Two Corporate
Giants across the Globe viz, between Bayer
AG, Kaiser-Wilhelm-Allee, 51368, Leverkusen, Germany (hereinafter ‘Bayer’
or ‘Acquirer’) and Monsanto Company, 2711 Centerville Road, Suite 400,
Wilmington, Delaware 19808, County of New Castle (hereinafter ‘Monsanto’ or
‘Target’, and collectively with Bayer as ‘Parties’).
The signatories
hereunder are members of All India Coordination Committee for Farmers’
Movements (ICCFM) and South Indian Coordination Committee for Farmers’
Movements (SICCFM) and we represent 12 farmers’ organizations across India representing
millions of peasants, small and medium size farmers, landless people, rural
women and youth, indigenous people, migrants and agricultural workers. We defend peasant
agriculture for food sovereignty as a way to promote social justice and dignity
and strongly oppose corporate driven agriculture that destroys social relations
and nature.
We
consider that the acquisition of Monsanto by Bayer not only causes but also likely to cause an
appreciable adverse effect on competition within India. We request the Commission
to call for the records from these two companies regarding their market
concentration and study the overall reach of these two companies put together
in the market and assess the percentage of their shares objectively and
independent of the projections given by the Parties in Form IV, before arriving
at any conclusions. The Commission should carry out this investigation to
determine the questions whether the acquisition or the combination of these two
giant Corporates would cause adverse effect on competition within India.
It is
important to place on record the study conducted by the Friends of Earth,
Europe led by Ioannis Lianos, Professor of Global Competition Law and Public
Policy and Director of the Centre for Law, Economics and Society (CLES) at
University College London (UCL), concludes that even on a narrow reading of EU
competition law, the merger between US-based agro-chemical and biotech company
Monsanto and German ‘life science’ company Bayer should not be permitted. The
legal study sets out five main reasons why EU competition law requires that the
merger be blocked. The copy of the said
document is enclosed herewith.
In addition to the issues raised in the said study mentioned supra and the objections submitted by many other individual farmers, farmers organization and farmers collective, we also like to highlight the certain discrepancies in the combination of Bayer and Monsanto as published in the Notification dated 5th January 2018.
In
India, Bayer and Monsanto, as per the assertions given by the Parties in Form
IV, prior to the closing of the Proposed Combination operate in the 5 Segments
in terms of Products, viz, 1. Crop Production, 2. Agricultural Seeds, 3.
Vegetable Seeds, 4. Environmental Science and 5. Traits and Technology. The
Crop Productions again has 6 Sub Segments, Agricultural Seeds has 5 Sub Segments,
Vegetable Seeds has 22 Sub Segments , Environment Science has 5 Sub Segments
and Traits and Technology has 1 Sub Segment.
In
the Crop Production Segment, both the parties have one Sub Segment overlapping i.e.,
Non –selective herbicides.
In
Agricultural Seeds Segment, both the parties have one Sub Segment overlapping i.e.
Cotton Seeds.
In
Vegetable Seeds Segments, both the parties have 13 Sub segments overlapping, i.e.,
Cabbage, Cauliflower, Cucumber, Eggplant, Bitter Gourd, Bottle Gourd, Melon, Okra, Onion, Hot Pepper, Sweet
Pepper, Tomato and Watermelon.
BAYER AND BASF
Though
the Parties claim that the Bayer has executed an agreement with BASF on 13
October 2017 to divest its global glufosinate ammonium business and, therefore,
the insignificant overlap in the production and/or sale of non-selective
herbicides in India does not remain. The
Commission has to look into the veracity of the said claim and verify the
documents to substantiate the said claim.
The Commission shall also examine the share components of the BASF to
ascertain the true nature of the Agreement said to have been executed by Bayer
to BASF. Moreover it is only in the
stage of Agreement and pending finalization of the said Agreement between Bayer
and BASF, the combination of the Parties should not be APPROVED by the Hon’ble
Commission.
MONSANTO AND MAHYCO –
ABUSE OF DOMINANT POSITION
It
is an admitted fact that the Monsanto indirectly holds a shareholding of 26% in
Maharashtra Hybrids Seeds Company Limited (Mahyco). The fact that the Monsanto
is holding 26% shares in Mahyco, which again has its presence in the various
product segments in which the parties are now having market share need to be
taken into consideration by the Commission as the same would have direct impact
and give rise to appreciable adverse effect on competition (AAEC). From the products Segments listed by the
Parties, Mahyco has its markets share in the following Products;
Agricultural
Seeds: Cotton, Rice, Millet
Vegetable
Seeds: Cabbage, Cauliflower, Cucumber, Bitter Gourd, Bottle Gourd, Okra, Hot
Pepper, Sweet Pepper, Water Melon.
This
clearly establishes high concentration of market and a position of strength as
defined under ‘Explanation’ to Section 4 of the Competition Act, 2002,
hereinafter referred to as Act. The
dominant position in Agriculture Seeds and Vegetable Seeds Segment by the
parties to the combination along with MAHYCO
would result in Abuse of Dominant Position and not only likely cause but
certainly cause AAEC.
Cotton
The proposal of the Monsanto to sell its branded
cotton business to Tierra Agrotech Private Ltd is only with regard to
downstream market. The said sale is not
yet finalized and though it is stated that it was done for reasons unrelated to
the Proposed Combination, the same needs further enquiry. The overlap between the parties said to have
been eliminated in the downstream may be stage managed and needs proper enquiry
and appropriate investigation. Moreover
Monsanto has 100% concentration of the market in the upstream market and Bayer
has 0-5% market share in the downstream market.
All these would lead to ‘Dominant Position’ by the Parties to the
Combination. This would result in
limiting or restricting the production
of goods or provisions of services or market thereof and the technical or
scientific development relating to goods or services to the prejudice of
consumers prohibited under Section 4 (2) (b) of the Act. This would result in AAEC and therefore the agreement should
be declared as void.
Vegetable
Seeds
The monopoly of the combination of the Parties in
the vegetable seeds sector is highly detrimental to the market and brings down
the competition and choices for the consumers.
The total monopoly in Onion and almost near monopoly in Tomato,
watermelon, melon is not only detrimental to the farmers but also for the
nation as such. The Combination of the
Parties engaged in identical or similar trade of goods or provisions of
services, would result in determining the prices both directly and indirectly and
would also result in limiting or controlling the production, supply, markets,
technical development, investment or provisions of services. This is termed as Anti Competitive agreement
under Section 3 (3) of the Act. If this
combination is allowed the entire nation would have an appreciable adverse
effect on competition (AAEC). The
Commission shall therefore requested to not to allow this Combination as it
would have disastrous impact in the market, for the farmers as well as
consumers.
SEEDS TREATMENT SEGMENT
The seeds treatment segment also has a monopoly of
the Combination Parties both in Cotton and Corn and this would likely to cause
AAEC.
We the farmers of this country see the threat the
farmers community face due to the combination of the parties namely Monsanto
and Bayer as it would result in Abuse of Dominant Position. We request the Commission to conduct
appropriate enquiry and investigation into the agreement between Bayer and
Monsanto which will clearly establish the dominant position of this Combination
in the market and thereby will bring down competition in the products, prizes,
quality and participation. This would
lead to total dependency of the farmers of this county on this combination and trap
the farmers in untold misery. Given the
innumerable farmers suicide across the country due to the total monopoly of
Cotton market by Monsanto in the past, the Commission need to prevent this
Combination and protect the farmers of this country by not falling into the
trap set by this combination.
MONSANTO
AND TIERRA AGROTECH PRIVATE LTD
We also want the Commission to enquire that the so
called sale of Monsanto’s branded cotton business to
Tierra Agrotech Private Ltd and
Post
the notification of this Proposed Combination with the Hon’ble Commission,
Bayer has executed a definitive agreement with BASF dated 13 October 2017 to
divest the following businesses:
Bayer’s
worldwide glufosinate ammonium business;
Bayer’s
Liberty Link technology which confers trait plants with a resistance to the
non-selective herbicide glufosinate ammonium, including the related
intellectual property licensing business worldwide.
Virtually
the entire business of Bayer’s agricultural seeds and traits worldwide
(including all of its transgenic events and traits in cotton, corn, oilseed
rape, canola and soybean) is being sold to BASF. The very limited agricultural
seeds and traits activities that are not part of the agreement with BASF
include Bayer’s small Indian cotton seeds business. The Commission shall investigate the true
object behind these transactions, as it may be due to the legal impediments
faced by this combination and to circumvent the said impediments.
Best
regards,
Yudhvir
Singh
General
Secretary, ICCFM
Bhartiya
Kisan Union, Delhi
RakeshTikait,
Bhartiya Kisan Union U.P
KS Puttanaiah
Karnataka Rajya Raitha Sangha, Karnataka
ChamarasaPatil
Karnataka Rajya Raitha Sangha, Karnataka
Rajvir Singh
BKU, NCR
|
K. M. Rajegowda,
Karnataka Rajya Raitha Sangha, Karnataka
P Raveendranath,
Kerala Coconut Farmers Association , Kerala
S Kannaiyan
South Indian Coordination Committee of Farmers Movements
Ajmer Singh Lakhowal,
State President, BKU Punjab
K T Gangadhar
KarnatakaRajyaRaithaSangha,
Karnataka
|
ChukkiNanjundaswamy, Karnataka Rajya Raitha Sangha,
Karnataka
SellaMutthu,
President, Tamil Nadu Farmers Association, Tamil Nadu
Nallagounder,
Uzhavar Ulaippalar Katchi, Tamil Nadu Farmers Association
Ratan Singh Mann
BKU President , Haryana
Ms. Rajareega
President, Women Wing
Tamil Nadu Farmers Association
|
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