BERC is on the way to cancel the license of United LPG
United LPG Limited did not respond to the second show cause notice. Bangladesh Energy Regulatory Commission (BERC) issued a show-cause notice to the company for selling LP gas at a higher price than the stipulated price.
BERC Chairman Nurul Amin confirmed to Barta24.com that he did not receive any reply to the second show cause notice. In response to the question of what can happen now, the BERC chairman said, United LPG Limited is our licensee. There are certain conditions when the license is granted. It is said there that the licensee will be punished for irregularity. I can give a notice as to why the license will not be cancelled.
BERC issued a show cause notice to United LPG Limited and Total LP Gas on July 11 for selling LPG gas at a higher price than the fixed price. If there is no response to the first round of notices on July 31, the second round of notices are to be issued within 15 working days. But even after the notice, United LPG Limited did not give any reply. However, Total LPG has submitted an application to BERC seeking time. In that letter, Total Gas said, our managing director is out of the country, he wants to return to the country to answer.
United Group chief advisor (former chairman and managing director) Hasan Mahmud Raja told Barta24.com, I am not aware of this. You talk to the CEO of the gas company.
In July, 12 kg cylinders were sold at dealer level at Tk. 924, but United LPG sold at Tk. 1074, Total Gas at Tk. 1019, BERC found evidence. Total LPG has sold a 12kg cylinder to one of their distributors in Chandpur at a price of Tk.1019. That information was sent to BERC by an Upazila Nirbahi Officer of Chandpur. On the other hand, when the BERC Chairman went to market monitoring in Manikganj, he found the sales price of Tk. 1074 in the invoice issued by United LPG on July 5.
The show cause notice issued on July 11 signed by BERC Secretary Barrister Khalilur Rahman Khan was sent to the Managing Director of United LPG Limited. It states that the invoice was issued to Millennium Traders. Tk. 150 more than the rate fixed by the Commission. Instructions are requested to send your explanation in this regard to the Commission. As the two companies did not respond, BERC issued a second show cause notice on July 31.
After the first round of notices, AGM Raisa of United LPG Limited told Barta24.com that BERC fixed the rates on 3rd, subject to system updates. Do we stop selling until then?
The new rates are scheduled to come into effect from 6 pm on July 3 as directed by BERC. The invoice is dated 5th, for the sake of argument, if we assume the previous month's rate, it is also an average. In the previous month (June) it was supposed to be sold to the distributor for Tk. 1002. And the highest retail price was Tk. 1074. So does United LPG never pay distributor and retailer commission. AGM Raisa did not give any answer when such question was asked.
Accusations of overcharging LPG importers are old. Many are not selling at BERC fixed rates. Until now, BERC has only been keeping a watchful eye on retailers. After the new Chairman joined the Commission, this is the first time it has looked at the LPG company. All the surprising information is coming out of it. During the press conference, the BERC Chairman was asked that action has been taken against only two companies. According to the accused, BERC does not have the courage to take action against big companies. In response, the Chairman said, this allegation is not true. Action will be taken against those against whom evidence is found. Under no circumstances will overselling be tolerated.
The BERC Chairman said that under no circumstances can bids be taken higher than the fixed price. Invoices are to be issued deducting distributor's margin. On April 12, 2021, BERC announced the first LP gas price. Then a total commission of Tk. 359.40 per 12 kg cylinder was fixed for LPG importers, dealers and retailers. Loab (LPG Importers' Association) raised objections on the amount of commission on the same day of price announcement. Since then, Loab's conflict with BERC began. They also put pressure on BERC by boycotting monthly rate announcements. Loab president Azam J Chowdhury even threatened to stop the import of LPG. BERC was forced to increase the commission from Tk. 359 to Tk. 441 on October 10 after 7 months. Still, companies are charging higher prices. In July, the price of 12 kg LP gas was Tk. 999. Due to growth in the international market, it has increased by Tk. 141 to Tk. 1140.