Act Applicable: Competition Act,2002
BRIEF OF FACTS
- The above two parties entered in a Sole Selling Agent agreement on 23.07.2007 where the Informant was appointed as the agent for selling its products in the State of Rajasthan.
- The Informant contended that the clauses of the agreement were one sided and heavily loaded in favour of the Defendant.
ALLEGATIONS
- The Defendant abused its 'dominant position' by imposing unfair and discriminatory conditions violating Section 4(2)(a).
- The Defendant had absolute discretion to fix prices of products, contravening Section 3(3)(a).
- The Defendant ceased supply of products after 21.05.2011 unreasonably, hampering business and spoiling reputation of the Informant.
- It appointed four more dealers without written permission of the Informant.
CONCLUSION
As per Section 4 'dominant position' means a position of strength, enjoyed by an enterprise, in the relevant market, in India, which enables it to (i) operate independently of competitive forces prevailing in the relevant market, or (ii) affect its competitors or consumers or the relevant market in its favour.
The relevant market was believed to be "the market of Truck and Trailer Components/ parts and accessories in the State of Rajasthan". The Competition Commission stated that the Defendant did not appear to be a dominant player in the relevant market as there were other players in the market and therefore it did not contravene the provisions of Section 4 regarding abuse of dominance. To constitute contravention of Section 3 which conforms to anti-competitive agreements, the agreement should cause AAEC (appreciable adverse effect on Competition). Considering AAEC as per Section 19(3), the Commission held that there was no appreciable adverse effect on competition in the relevant market.
DECISION
The case was closed as no violation of Section 3 and 4 was proved.
