The ministry of petroleum and natural gas has issued new policy guidelines on transfer, change of location and inclusion of new partners for LPG distributors.
NEW DELHI: As part of its efforts to control the diversion of domestic LPG, the ministry of petroleum and natural gas has issued new policy guidelines on transfer, change of location and inclusion of new partners for LPG distributors.
Senior officials told DNA Money that the guidelines have been issued to lay down the principles on which distributorship can pass on from one person to his or her legal heir.
“Such reconstitution (or change of distributor’s name for an agency) of distributorship was earlier being done in an ad hoc manner,” said an official.
There are about 9,360 LPG distributors for government-owned oil marketing companies (OMCs), catering to about 980 lakh customers across the country.
According to the new guidelines, no reconstitution of distributorship would be allowed at the letter of intent (LoI) stage, except in cases where the LoI holder dies or is incapacitated before the commissioning of the distributorship.
The distributorship would pass on to the legal heir, though he would have to satisfy multiple dealership norms and other selection criteria, except those of age and education.
The exception would, however, be made only if the LoI holder, before his death or being incapacitated, had made substantial investment for commissioning the LPG distributorship.
No transfer of distributorship would be made in case it had been allotted under the corpus fund distributorship, where the entire investment is by OMCs.
In cases where substantial investment was not made or where the distributorship was under the corpus fund, the legal heir would be required to go through the selection process.
Change of the person holding distributorship would be allowed within the family in case of commissioned distributorship after meeting certain requirements.
Reconstitution would also be allowed outside the family in case of death of a partner and his legal heir not willing to join. Such reconstitution would take place in favour of the other partner.
Where a distributor has attained the age of more than 60 years, induction of a minority partner would be allowed.
Besides reconstitution, OMCs have also been asked to follow revised guidelines for revival of distributorship.
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