Code of Conduct

AIBA is committed to conduct all its activities in keeping with the highest legal, moral and ethical standards. Compliance with this Code will protect its members, reduce regulatory burdens, enhance the industry’s reputation with government bodies and the public at large, and assist AIBA and its members from steering clear of any potential violations and liabilities.

AIBA Code of Business Conduct & Ethics — Preamble

About this code

Why AIBA has adopted this Code

All India Brewers' Association (“AIBA”) is committed to conduct all its activities in keeping with the highest legal, moral and ethical standards. In order to assist all its members in upholding this commitment, AIBA has formalized and adopted this 'Code of Business Conduct & Ethics' (“the Code”).

AIBA believes that compliance with this Code will not only protect its members, reduce regulatory burdens for the members, enhance industry's reputation with government bodies and the public at large but will also assist AIBA and its members from steering clear of any potential violations and liabilities.

The Code lays down compliance requirements by AIBA and its members under the Competition Act 2002 and various other laws including Anti-bribery laws as may be applicable.

Full

Legal and statutory compliance expected from all members

Zero

Tolerance for bribery, corruption or anti-competitive conduct

All

AIBA communications restricted to legitimate, pre-circulated agendas

No anti-competitive agreements or arrangements

No member of AIBA shall enter into any agreement or arrangement or engage in any practice or understanding, whether formal or informal, express or implied with its competitors or use AIBA as a platform for such arrangement to (a) fix prices or discuss pricing matters in any way, including brand/s, volumes, markets etc., (b) limit output, (c) allocate customers / territories, or (d) indulge in bid rigging — as they constitute hardcore anti-competitive conduct and may lead to enquiry, search and high penalty under the Competition Act 2002.

Illustrative don'ts

Members must not discuss the following amongst themselves or under the aegis of AIBA:

Price fixing

Past, current or future prices; possible increases / decreases; margins / profitability; pricing policies, strategies or methods; standardisation of credit or billing terms; individual company prices, discounts, commissions, rebates; individual production or distribution costs, cost accounting formulas, etc.

Limiting output

Control of production or quantity of goods offered or supplied in the market; information on future plans of individual companies concerning technology, production, marketing and sales.

Market sharing

Territorial restrictions, allocation of customers, restrictions on type of products or any kind of market division; individual company figures on market shares; matters relating to individual suppliers, distributors or customers or any business sensitive information.

Bid rigging

Collusive bidding for prices, quantity, rate or terms of tender; avoid all forms of communication, even for non-tender issues, with competitors prior to closing of the tender; avoid stay in the same hotel as other competitors or attending social gatherings where your competitors are likely to be present prior to submission of bids for a tender.

No exchange of commercially sensitive business data

No member shall directly or indirectly exchange or share any business data or commercially sensitive information with its competitors or with AIBA — via face-to-face meetings, phone, e-mails or other modes, or indirectly through a third party, customer, supplier, agent, or in social or business events. Failure to observe this may potentially be construed as evidence of cartelisation and anti-competitive conduct.

Business strategy, marketing plans, current and future prices, discounts, time frame for price changes

Production costs — raw/packaging material cost, distribution costs or remuneration

Production capacities and quality issues, vendor details

Investments, technologies / R&D programmes and their results

Procurement strategy and preferred or blacklisted suppliers

Customers' identity, sales terms and conditions, purchase amounts, prices applied

Collection of competitive or market intelligence from customers and retailers is permissible, but NEVER from competitors. Such information must always be collected in a legitimate and transparent manner.

AIBA meeting rules

During AIBA meetings, no member shall discuss any business or commercially sensitive matters other than pre-circulated agenda items, unless directed otherwise by the Chairperson.

Minutes of all AIBA meetings must accurately reflect the actual discussions and decisions, reviewed by all members and vetted by AIBA's legal advisors. Discrepancies must be reported and rectified at the next meeting before signature.

Members shall not use AIBA meetings or any side meetings in connection with AIBA events to discuss competitively sensitive matters such as prices, volumes, customers, territories, tenders or future commercial strategy.

Members are prohibited from sharing any commercially sensitive business information with AIBA, even for the purpose of making representations to government departments. Only aggregate, historical and anonymised data may be shared.

Members will not seek legislation or regulation under the aegis of AIBA that leads to the creation of barriers to entry or restricts the ability of competitors to compete in a given market.

Language caution

Members must remain very careful with the language used in communications with AIBA as well as government agencies. Poor language or inappropriate choice of words can make a perfectly legal activity look suspicious.

Members must ensure that their communication is reviewed by their respective legal counsels to ensure compliance with this Code, before the same is circulated to AIBA or any member of AIBA.

Avoid any suggestion that a common view has been reached between members on a prohibited issue such as price or volume levels.

Avoid vocabulary such as 'please destroy' or 'delete after reading'.

Avoid dominating vocabulary such as 'this will enable us to dominate the market', 'we have virtually eliminated the competition', or words suggesting combat such as 'destroy', 'block access', 'boycott' or 'conquer'.

Remember that during an investigation or legal proceedings, internal documents of AIBA and of its members, including those which you may think to be personal or confidential, such as diaries, personal note books or hand written annotations on a memorandum, are likely to come under scrutiny. Such documents are not limited to papers and include computer records, databases, electronic communication, such as e-mails, or instant messages, as well as voice-mails, telephone call records, which are very difficult to completely delete.

The aforesaid stipulations are only indicative, and not exhaustive. Members shall conduct themselves at all times in a fair, ethical and competitive manner.

Zero tolerance for bribery and corruption

All members must respect, comply and obey all applicable laws, rules and regulations including anti-corruption, anti-money laundering and lobbying-related regulations of India as well as applicable laws of other nations in which the members may have business dealings. Members shall neither themselves, nor through AIBA or its employees, bestow — either directly or indirectly — any 'undue advantage' / pecuniary gains, either in cash or kind, to any public servant.

AIBA zero-tolerance policy — AIBA or its officials shall not, under any circumstances:

1

Give any gifts, either in cash or kind, or arrange for entertainment or extend any hospitality — including financing travel and/or lodging expenses for attending conferences, events, seminars etc. — to any government official or public servant or to their agent.

2

Provide fees or commissions in excess of what is due or required to third parties for carrying out various assignments such as research on consumer behaviour, promotion of beer industry, advocacy, etc.

3

Make donations or contributions to any NGO, charitable institution, religious institution, educational institution, hospitals or political party. However, members may for CSR activities or other purposes, within limits as prescribed by any statute and/or subject to applicable approvals, make contributions or grant donations.

Failure to comply with any of the provisions of this Code may render the membership of such member in AIBA liable for termination by the Chairman, AIBA after following the due process as determined by AIBA at its meeting.

Ignorance of law is not an excuse. Disciplinary action may be taken even if one claims to be ignorant of applicable law or this Policy. Members are responsible for ensuring that their relevant employees are trained on this Code.