Competition | October – December 2024
Enforcement Matters
NCLAT dismisses the appeal filed by the Travel Agents Association of India
On 25 October 2024, the NCLAT upheld the CCI’s dismissal of the case instituted against Department of Expenditure, Government of India (“DOE“) and others by the Travel Agents Association of India (“TAAI“).
In is order the NCLAT took note of the exclusivity granted to certain travel agents by the DOE, for the booking of air tickets, and reviewed these exclusivity arrangements in the context of whether it amounted to a denial of market access. To this end, it was held that DOE is not an “enterprise” as per the provisions of the Competition Act, as its activities are predominantly non-commercial and focused on policies.
Further it was observed that internal administrative decisions would not constitute an “agreement” as understood under the Competition Act, since these decisions are taken with non-commercial objectives.
Separately, the NCLAT also noted that the cause of action had already been dealt with by multiple forums in the past and as such, should neither have been reagitated nor should the court’s time have been wasted and consequently imposed costs of INR 500,000 (USD 5,796) on the TAAI.
CCI imposes penalty on Meta for abusing its dominant position
On 18 November 2024, Meta was held liable for abusing its dominant position by imposing unfair terms and conditions, leveraging its market position and denying market access to its competitors and consequently the CCI imposed a penalty of INR 2.13 billion (~USD 25.15 million)on Meta.
In its order, the CCI inter alia noted that that the sharing of WhatsApp user data between Meta companies created an entry barrier for the rivals of Meta which resulted in denial of market access. The CCI also held that Meta was leveraging its dominant position in the market for over the top (“OTT“) messaging apps through smartphones to protect its position in the online display advertising market. Additionally, the CCI noted that the ‘take-it-or-leave-it’ approach adopted by Meta, in 2021, at the time of rolling out its updated its privacy policy, amounted to an imposition of unfair condition on WhatsApp users because the users were, as a condition to the continued use of WhatsApp, required to give Meta the power to collect and share their data with other meta companies, without the ability to ‘opt-out’.
Further, with respect to averments relating to the jurisdiction of the CCI to hear a matter relating to data protection and privacy law, the CCI observed that data-related practices can trigger concerns that require simultaneous intervention from multiple branches of law, for instance, data-driven conduct by a dominant firm may raise privacy concerns and also constitute an abuse of market dominance.
As such, the CCI imposed a penalty on Meta and also issued directions pursuant to which Meta was (i) precluded from sharing of user data with other Meta companies or products for advertising for a duration of five years; (ii) mandated to provide its users with a detailed explanation of the nature, type and purpose of data being collected and shared; (iii) required to remove any conditions that made the access to WhatsApp subject to allowing data collected on WhatsApp to be shared with other Meta companies or products; (iv) to provide its users, who previously accepted the 2021 privacy policy with the option to be able to opt-out; and (v) to provide its users with the ability to review and modify their choice qua sharing of data.
CCI passes a cease-and-desist order against the Suburban Table Tennis Association and others
On 12 December 2024, the CCI found the Suburban Table Tennis Association (“STTA”), Maharashtra State Table Tennis Association (“MSTTA”), Gujarat State Table Tennis Association (“GSTTA”) and Table Tennis Federation of India (“TTFI” and collectively with STTA, MSTTA and GSTTA the “OPs“), to be in contravention of various provisions of the Competition Act that dealt with anti-competitive agreements and abuse of dominance.
The CCI assessed the conduct of the OPs in the context of the relevant markets for the organization of table tennis leagues/events/ tournaments and the provision of services by the players for table tennis leagues/events/ tournaments, in India.
After concluding that the OPs held a position of dominance in the relevant markets, it was observed that, by issuing WhatsApp advisories, public notices, and incorporating certain anti-competitive clauses in the bye-laws of the OPs, the OPs had prevented players from being able to participate in the informant’s competing table tennis tournaments, which in turn resulted in a denial of market access, creation of barriers to entry, foreclosure to competition and restriction of opportunities available to table tennis players.
Notably, inspite of the CCI concluding that the conduct of the OPs was anti-competitive, it did not impose any penalty and only issued a cease-and-desist order. This is because the OPs had undertaken corrective measures to address concerns raised during the investigation, including withdrawal of anti-competitive communications, amending or removing restrictive clauses from their governing documents, and issuing advisories for promoting open competition.
CCI initiates investigation against Google based information provided by Winzo Games
On 28 November 2024, pursuant to a complaint filed by Winzo Games Private Limited, the CCI ordered a detailed investigation into the conduct of Google to determine whether it had abused its dominance.
At the time of coming to its conclusion, the CCI inter alia took note of the fact that Google did not allow the informant’s (skill based) real money gaming app(s) to be listed on the Play Store and also displayed malware warnings whenever users tried to download the informant’s app from its website, even though certain other apps that dealt with daily fantasy sports gaming, rummy card gaming and online casual gaming platforms such as Zupee and MPL were being made available on the Play Store. Based on these facts, the CCI observed that the conduct of Google prima facie appeared to be abusive since its conduct qua it’s Play Store policies appeared to be imposing unfair and discriminatory conditions and limiting / restricting market access to certain app developers, like the informant, which was adversely affecting their ability to compete.
CCI dismisses abuse of dominance allegations against IREL
On 8 October 2024, the CCIdismissed a complaint against Indian Rare Earths (India) Limited (“IREL“) alleging that IREL had abused its dominance by increasing the price of a sand-based mineral sillimanite; practicing discriminatory pricing against micro, small and medium enterprises and in the domestic market while favouring multinationals; arbitrarily fixing the supply quantities of beach sand sillimanite; and forcing customers to accept certain supply quantities.
Notably, at the time of coming to its findings the CCI at the outset analysed whether the conduct of IREL, being a public sector could be reviewed by the markets regulator. In this regard, it was reasoned that IREL’s commercial activities did fall within the purview of the Competition Act, because inter alia it was not a department of the government but rather an entity that was governed by an independent board of directors which undertook commercial activities.
At the time of passing its dismissal order, the CCI acknowledged the dominant market position held by IREL. That said, while dealing with allegations pertaining to price increases, it was observed that such decisions were influenced by many factors that affected market dynamics such as demand and supply elasticity and dynamics, availability of substitutes etc. Additionally with respect to the allegations of differential prices being offered to customers, the CCI noted that such decisions were made on the basis of factors such as volume offtake and the relationship with the customers. Further noting that similar volume-based discounts and schemes were being provided to all customers. Thus, concluding that the differences in supply conditions were based on commercial and historical reasons without existence of any evidence indicating that IREL abused its dominant position.
CCI dismisses abuse of dominance allegations against Coal India
On 30 December 2024, the CCI dismissed abuse of dominance allegations against Coal India Limited (“CIL”). Notably these allegations stemmed from the terms of a new 2022 scheme for e-auction of coal which replaced the earlier spot e-auction scheme of 2007.
While looking into the market position of CIL, the CCI noted CIL held a dominant position in the market. Further, at the time of analyzing whether the terms of the 2022 scheme were abusive, the CCI analysed various clauses that inter alia required bidders to clear all pending dues before bidding; required bidders to pay a fixed bid security which could be forfeited if the bid-transaction remained incomplete; gave CIL the right to cancel the sale of coal under e-auction at its sole discretion without assigning any reason etc. However, in this regard, it was observed that the impugned clauses were not abusive since they appeared to be a reasonable and standard requirement in any bid with no apparent ramifications on competition.
Merger Control
CCI approves transaction between Reliance Industries, Viacom18 Media, Star India, Disney subject to conditions
On 22 October 2024, the CCI published its order approving significant restructuring and asset transfers among Reliance Industries Limited (“RIL“), Viacom18 Media Private Limited (“Viacom18“), Star India Private Limited (“Star India“), and other Disney-associated entities, such that the digital and linear TV entertainment business of Viacom 18 and The Walt Disney Company (“TWDC“) in India would be housed in Star India (“Proposed Transaction“).
At the time of reviewing the Proposed Transaction, the CCI took note of various horizontal overlaps in markets relating to TV channels, audio-visual content licensing (e.g. film, sports and non-sport licensing), film production, and OTT streaming platforms. To allay the CCI’s concerns arising out from these overlaps the parties offered voluntary modifications, which included divesting certain TV channels and committing to not bundle sports broadcasting rights.
However, after receiving these commitments the CCI still noted that that within the highly concentrated sports broadcasting market the combined entity would hold a significant market share. As such in order to address these further concerns of the CCI, the parties provided additional commitments, such that they would not increase advertisement rates unreasonably and ensure fair access to sports content.
For more information contact:
Zenia Cassinath
Practice Head – Competition
zenia.cassinath@veritaslegal.in
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