Ceylon FT: Chevron Lubricants Lanka PLC (LLUB) is wary of new entrants to the market in the absence of proper regulation and a legal framework to ensure fair play and consumer protection.
"While all big global and regional lubricant players have a presence in the Sri Lankan market, with 13 players operating in a market that is relatively small with a potential of 55 million litres per annum, the Ministry of Petroleum Industries has initiated action to award further licenses to new entrants to the lubricants industry. While more competition may be good for the consumer it becomes imperative to bring about the right regulations and put in place a legal framework to ensure sanity in the market for fair play and to safeguard the consumers," Managing Director/CEO Kishu Gomes told shareholders in the company's annual report for 2013.
"In the absence of a proper regulator the Public Utilities Commission of Sri Lanka (PUCSL) which operates as the shadow regulator has not been empowered to deal with the issues the industry has been confronted with. These have been brought to the notice of all stakeholders by the industry players, but without success.
"Product adulteration in various forms continues, posing a serious risk to the consumer.
"While all big global and regional lubricant players have a presence in the Sri Lankan market, with 13 players operating in a market that is relatively small with a potential of 55 million litres per annum, the Ministry of Petroleum Industries has initiated action to award further licenses to new entrants to the lubricants industry. While more competition may be good for the consumer it becomes imperative to bring about the right regulations and put in place a legal framework to ensure sanity in the market for fair play and to safeguard the consumers," Managing Director/CEO Kishu Gomes told shareholders in the company's annual report for 2013.
"In the absence of a proper regulator the Public Utilities Commission of Sri Lanka (PUCSL) which operates as the shadow regulator has not been empowered to deal with the issues the industry has been confronted with. These have been brought to the notice of all stakeholders by the industry players, but without success.
"Product adulteration in various forms continues, posing a serious risk to the consumer.
The re-branding and distribution of products by non-licensed players also continues unabated while 'cross filling', the filling of products to containers proprietary to other players thereby misleading the customer and avoiding duties and taxes to the government coffers in some cases.
"With the increased number of players that may enter the market in 2014, these issues are likely to get aggravated. Therefore the necessity for an effective regulator is an urgent need of the hour from the perspective of all stakeholders. It is hoped that the government be judicious in issuing licenses to more players, as this could have an adverse effect on the industry as a whole. We have been lobbying for greater regulation of companies and products to protect consumers from the serious negative consequences including product adulteration," Gomes said.
Turnover fell 5% to Rs 11.2 billion in 2013 and net profit grew 12% 2.5 billion in a "high-pressure environment".
www.ceylontoday.lk
Turnover fell 5% to Rs 11.2 billion in 2013 and net profit grew 12% 2.5 billion in a "high-pressure environment".
www.ceylontoday.lk
No comments:
Post a Comment