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CCI

CCI Fines MMT, Goibibo, OYO Rs 392 Cr For Unfair Biz Practices

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Make My Trip and Goibibo will pay a total fine of Rs 223.48 crore, whereas OYO will pay Rs 168.88 crore. MMT-Go and OYO had entered into confidential commercial agreements allowing MMT-Go to give preferential treatment to OYO on its platform, which lead to a denial of market access to other competitors in the market

The Competition Commission of India (CCI) imposed penalties more than of worth Rs 392 crore on the Online travel firms Make My Trip-Goibibo (MMT-Go) and hospitality services provider OYO, on 19 October.

The penalty order was 131-page long briefing the “unfair business practices”.  According to the order, Make My Trip and Goibibo will pay a total fine of Rs 223.48 crore, whereas OYO will pay Rs 168.88 crore. 

Briefing the allegations the order said, “MMT-Go has imposed price parity in its agreement/contract with hotel partners whereby the hotel partners are not allowed to sell their rooms at any other OTA or on its own online portal at a price below which it is being offered on MMT-Go’s platform.”

Further it also stated that MMT-Go and OYO had entered into confidential commercial agreements allowing MMT-Go to give preferential treatment to OYO on its platform, which lead to a denial of market access to other competitors in the market. This came out of a detailed investigation on the matter which was carried on since October 2019. 

Apart from the penalty, MMT-Go is also directed ” suitably modify its agreements with hotels/chain hotels, to remove/abandon the price and room availability parity obligations imposed by it on its hotel/chain hotel partners with respect to other OTAs (Online Travel Agencies).

The regulator has also ordered to make changes in its agreement with hotels/chain hotels, to remove/abandon the exclusivity conditions. “MMT-Go is directed to provide access to its platform on a fair, transparent and nondiscriminatory basis to the hotels/chain hotels, by formulating the platforms’ listing terms and conditions in an objective manner,” said the CCI order.

It may be noted that Ibibo Group business was acquired by MMT through MMT India under the brand name MakeMyTrip, whereas Ibibo India runs under the brand name Goibibo.

CCI

CCI Orders Probe Against State-Owned IREL For Unfair Biz Practices

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A complaint filed by Beach Mineral Producers Association (informant) based in Tamil Nadu resulted in passing the order. The company was practicing unfair pricing beach sand ilmenite, with various other issues. A detailed investigation would be conducted by the Director General (DG) being a probe arm of CCI for violating the provisions of Section 4(2)(a)(i) and 4(2)(a)(ii) of the Act

The Competition Commission of India (CCI) ordered a detailed probe against state-owned Indian Rare Earths Limited (IREL) on 18 October. Order is issued for allegedly abusing of dominant position in supplying and pricing of beach sand ilmenite in the nation. A complaint filed by Beach Mineral Producers Association (informant) based in Tamil Nadu resulted in passing the order. The association alleges that the company was practicing unfair pricing beach sand ilmenite, with various other issues. 

Assessing the matter, the CCI considered ‘mining and supply of beach sand ilmenite in India’ as the prominent market. IREL conducts mining and production activities of various minerals, rare earths and chemicals. 

In the order, CCI said that the opposite party’s (OP) conduct seems to have resulted in unfair/ discriminatory environment along with pricing for domestic consumers. This in prima facie is violation of the provisions of Section 4(2)(a)(i) and 4(2)(a)(ii) of the Act.

Also, the conduct appears in breach the of the provisions of Section 4(2)(c) of the Act due to denial of input to the informant’s members, CCI added.

The IREL (India) here is the OP and Section 4 of the Competition Act refers to abuse of dominant position. Considering the material available on record, the regulator said that the allegations levelled by the informant are substantial and violate Section 4.

As a consequence, following the order, a detailed investigation would be conducted by the Director General (DG) being a probe arm of CCI.

Ilmenite FeO-TiO2 is one of seven economically processed from beach sand. Along with it, the other popular six beach sand minerals include rutile, leucoxene, monazite, zircon, garnet and sillimanite. In order to derive products like titanium dioxide and titanium metal, ilmenite is processed.

nirmala sitharaman

FM Urges CCI To Fairly Address Cross-Border Merger Issues

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FM Nirmala Sitharaman while addressing at the virtual inauguration of the CCI office for the Western Region in Mumbai asked CCI to have proactive approach instead of waiting for people to reach them with complaints

Finance minister (FM) Nirmala Sitharaman urged the Competition Commission of India (CCI) to “fairly and squarely” address issues rising due to corporate mergers involving cross-border elements on 6 October.

Minister while addressing at the virtual inauguration of the CCI office for the Western Region in Mumbai also asked CCI to have proactive approach instead of waiting for people to reach them with complaints. 

“Aspiring be a digital economy, it is also very important for us to address the challenges that digitisation brings, we cannot ignore them,” said Sitharaman. 

“Considering the multi-national nature of activities, various companies are looking to have interlocking positions in global value chains. There are holding companies, new acquisitions taking place, there are mergers and such related events happening across the globe, ” she further added.

The finance minister’s delivers her thoughts at a time when a parliamentary panel is in the process of examining the new competition bill. The bill empowers CCI to regulate cross-border mergers and digital companies.  It was presented in the parliament during the Monsoon session.

law

Amazon-Future Deal Suspended, Rs. 200 Crore Fine Slapped By Competition Commission Of India

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CCI that had approved the investment in 2019 said Amazon “suppressed the actual scope” of the deal and had made “false and incorrect statements”.

India’s antitrust agency suspended Amazon.com’s 2019 deal with Future Group on Friday, potentially denting the US e-commerce giant’s attempts to block the sale of Future’s retail assets to an Indian market leader.

The regulator ruled that the US company had suppressed information while seeking regulatory approval on investment into Indian retailer Future Group two years ago.

The ruling by the Competition Commission of India (CCI) could have far-reaching consequences for Amazon’s legal battles with now-estranged partner Future.

Amazon has for months successfully used the terms of its toehold $200 million (roughly Rs. 1,500 crores) investment in Future in 2019 to block the Indian retailer’s attempt to sell retail assets to Reliance Industries for $3.4 billion (roughly Rs. 25,950 crores).

The regulator’s 57-page order said it considers “it necessary to examine the combination (deal) afresh,” adding its approval from 2019 “shall remain in abeyance” until then.

The CCI’s order said Amazon had “suppressed the actual scope” of the deal and had made “false and incorrect statements” while seeking approvals.

“The approval is suspended. This is absolutely unprecedented,” said Shweta Dubey, a partner at Indian law firm SD Partners, who was formerly a CCI official.

“The order seems to have found new power for CCI to keep the combination approval in abeyance,” she added.

With the 2019 Future deal’s antitrust approval now suspended, it could dent Amazon’s legal position and retail ambitions, while making it easier for Reliance – the country’s largest retailer – to acquire number two player Future, people familiar with the dispute said.

The CCI also imposed a penalty of around Rs. 200 crores ($27 million) on the US company, adding that Amazon will be given time to submit the information again to seek approvals, the CCI added.

Future Group, however, is unlikely to cooperate with Amazon if it tries to reapply for antitrust clearance after the CCI’s decision, a source with direct knowledge told Reuters.

The Indian company is also set to take CCI’s Friday decision before various legal forums to argue that Amazon has no legal basis to challenge its asset sale, the source added.

Future and Reliance did not respond to a request for comment. Amazon said it is reviewing the order “and will decide on its next steps in due course.”

Retail battle
The dispute over Future Retail, which has more than 1,500 supermarkets and other outlets, is the most hostile flashpoint between Jeff Bezos’ Amazon and Reliance, run by India’s richest man Mukesh Ambani, as they try to gain the upper hand in winning retail consumers.

Hit by the COVID-19 pandemic, Future last year decided to sell its retail assets to Reliance for $3.4 billion, but Amazon managed to block the sale successfully through legal challenges.

Amazon cited breach of contracts by Future, arguing that terms agreed in 2019 to pay $200 million for a 49 percent stake in Future’s gift voucher unit prevented its parent, Future Group, from selling its Future Retail business to certain rivals, including Reliance.

The CCI review of the deal started after Future, which denies any wrongdoing, complained, saying that Amazon was making contradictory statements before different legal forums about the intent of the 2019 transaction.

In June, the CCI told Amazon the US firm in 2019 explained its interest in investing in Future’s gift voucher unit as one that would address gaps in India’s payments industry. But later, the CCI said, Amazon disclosed in other legal forums the foundation of its investment in the Future unit was to obtain special rights over the retail arm, Future Retail.

In the Friday order, CCI said there was “a deliberate design on the part of Amazon to suppress the actual scope and purpose of the” deal.

Ahead of CCI’s decision, Amazon denied concealing any information and warned the watchdog that Future’s bid to unwind the 2019 deal to allow Reliance to consolidate its position “will further restrict competition in the Indian retail market”.

(Reuters)