19 July, 2015
On May 28, 2015, CCI dismissed a complaint filed by Rooster Info. Private Limited (‘RIPL’) against Maruti Suzuki India Limited (‘Maruti Suzuki’) alleging a contravention of the provi- sions of Sections 3 and 4 of the Competition Act.
RIPL is a manufacturer of Global Positioning Systems (‘GPS’), which track the location and other associated details of vehicles. As per the complaint, RIPL stated that it was it was complete- ly dependent on car manufacturers for its business, as a majority of its customers are car carrier trucks /transporters which are designed to transport cars manufactured by various original equipment manufacturer (‘OEMs’). RIPL further alleged that Maruti Suzuki, a dominant player in the market for automobiles, had abused its dominant position by coercing its transporters to install GPS devices made by only Trimble or Efcon GPS – even though there were no technical reasons for doing so. The complaint also averred that Maruti Suzuki refused to load its vehi- cles on car carrier trucks that were not installed with these GPS devices. RIPL claimed that this conduct was a contravention of Section 3(3)(b) of the Competition Act. It was also alleged that forcing the transporters to exclusively use the GPS devices made by two companies caused an appreciable adverse effect on competition (‘AAEC’) in the market due to the fact that Maruti Suzuki was a dominant player, and thus amounted to a contravention of Section 3(4) read with Section 3(4) of the Competition Act.
Further, RIPL claimed that the price for the GPS devices was fixed by Maruti Suzuki without consulting the transporters and compelled the transporters to enter into an agreement with Trimble or Efcon for the purchase of GPS devices for a higher price; a contravention of Section 3(a) of the Competition Act. Lastly, RIPL alleged that the aforementioned practice also amount- ed to an imposition of unfair conditions of trade by a dominant player which resulted in denial of market access to other manufacturers of GPS devices; a contravention of the provisions of Section 4(2) of the Competition Act.
CCI defined the relevant market as the market for procurement of services of GPS device- installed vehicles in India. Within this relevant market, CCI observed that the information pro- vided by RIPL was insufficient to suggest any prima facie case of contravention. Moreover, CCI noted that there were no publicly available information, which suggested the existence of an agreement between Maruti Suzuki and Trimble/Efcon. Having determined that the percent- age of GPS device installed vehicles used by Maruti Suzuki constituted only 1.52% of the total number of GPS device installed vehicles in India. Hence, CCI concluded that Maruti Suzuki was not a dominant purchaser, and that even if there were to be an arrangement between Maruti Suzuki and Trimble/ Efcon, the anti-competitive impact would be negligible. Accordingly CCI dismissed the complaint as it found no prima facie contravention by Maruti Suzuki.
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
Shuva Mandal, Partner, AZB & Partners
shuva.mandal@azbpartners.com
