De Lima tests oil cartel waters


JUSTICE Secretary Leila de Lima on Tuesday stressed that the criminal charges filed against oil giant Chevron will be a test case against price manipulation that are likely perpetrated by an oil cartel.

De Lima assured the public that it will hasten its resolution in connection with the criminal raps filed by a local oil distributor against executives of oil giant Chevron Philippines Inc., producers of Caltex petroleum products, for alleged price manipulation through its service stations in Metro Manila.

“Since it’s a petition for review, the same will be handled and resolved by the office of the secretary,” de Lima said.

The Department of Justice (DOJ) boss pointed out that the complaint Chevron would strengthen the review powers of the DOJ and go after oil cartel practices.

“But of course, we will request for inputs and applicable studies from the Office for Competition which has expertise on the matter,” de Lima pointed out.

Last week, a petition for review lodged by the Petroleum Distributors and Services Corp. (PDSC) requested the department to file criminal charges against the officers and directors of Chevron

Chevron was accused of organizing themselves and thereafter successfully engaging in the retail business by creating and operating its own company-owned Caltex service stations called COCO’s throughout Metro Manila.

PDSC fears that it would manipulate and control pump prices of fuel products that tended to aggravate the domestic oil price crisis.

This company has been engaged in the business of retailing fuel products for almost fifty years, and was a Caltex dealer for more than 20 years. The case was filed by PDSC Vice President Robert Conrad Limcaco who accused the big oil company of malpractice.

PDSC argued that Chevron’s officers and directors committed a violation of Article 186 of the Revised Penal Code, which prohibits monopolies and combinations in restraint of trade.

Included in the charges were former directors and officers of Chevron and Chevron Services, Timothy Leveille, Rebecca Alivio, Ramon Ortiz, Frumencio Deguito, Aner Anda, Randall Johnson, Steven Mulvaney, Armando Diaz, Carlito Lopez, Leo Vasco Da-gamac, Glenn Lynch, Husain Shibly Latiff, Carol Bautista and several John Does.

The petitioner avers that with Chevron acting as supplier, Chevron Services acting as operator of gasoline stations and retailer of Caltex fuel and lubricants, Chevron can manipulate the market.

Under the law, it was enough to prove that there was an apparent arrangement, and that steps were taken to further the purpose.

It argued that the conspiracy between the two companies, by the same directors and officers, sufficiently proved the conspiracy to combine and control the distribution and pricing of fuel products, in competition with local Caltex dealers who are fully dependent on the pricing decisions of Chevron, and eventually to affect the fuel market trade, were acts punishable under Article 186, paragraph 1 of the Revised Penal Code.

The case reached the DOJ which seeks to reverse the resolution of the city prosecutor of Makati for committing error with its ruling.


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