On 19 March, 2015, the competition regulator in India –
the Competition Commission of India
("CCI"), passed an order rejecting
charges that Suzuki Motorcycle India
("Suzuki") had abused its dominant
position in the market for manufacturing and sale of two-wheeler
The allegation against Suzuki was that it imposed unfair and
discriminatory conditions in the sale of its two-wheeler ACCESS
125cc, by limiting the customers' entitlement to avail
Suzuki's free services in the event customers visit a local
garage for paid services, thereby resulting in a denial of market
access to local auto garage owners.
In order to reach the conclusion as set forth above, the CCI
determined the 'relevant market' as being only the
"market of the manufacturing and sale of two wheeler vehicles
Curiously however, in the recent decision of automobile parts
manufacturers1 ("Auto Parts
case"), the CCI, while adjudicating the issue of
whether automobile manufacturers had engaged in abusive conduct by
imposing unfair and restrictive conditions in the after-sales
market, had delved into the matter in much greater detail, and had
opined that "there exist two separate relevant markets;
one for manufacture and sale of cars and the other for the sale of
spare parts and repair services in respect of the automobile market
in the entire territory of India2"
The CCI, relying upon the "antitrust theory that each OEM
was engaging in anti-competitive practices to prevent independent
service repairers from competing with authorised dealers of such
OEMs in the aftermarket for maintenance and repair services of such
OEM manufactured automobiles3", concluded that the
"automobile primary market and the aftermarket for spare parts
and repair services does not consist of a unified systems
market4, that each OEM was a monopolistic player in the
In the Suzuki case, if the allegation was of the nature of
denial of market access to local garage owners (i.e. independent
repairers), which was one of the main issues that the CCI had
deliberated upon in great detail in the Auto Parts case, before
concluding that each OEM severely limited the access of independent
repairers and other multi-brand service providers to genuine spare
parts and diagnostic tools required to effectively compete with
authorised dealers of OEMs in the aftermarket; and that such
practices amount to denial of market access by the OEMs under
section 4(2) of the Act5.
If the CCI has taken a view that the sales and the aftersales
markets are different in the automobile industry, then surely the
same standard needs to be adhered to for evaluating the two-wheeler
market as well. There might have been other factors that the CCI
may have evaluated, which factors, unfortunately have not been
discussed in the order dated March 19, 2015, but the author
vehemently feels that the CCI has missed a trick by not evaluating
the allegations made in the Suzuki case in greater detail.
Since the defining lines have been marked by the CCI in one
matter, there needs to be consistency with that line of reasoning
for other matters as well, failing which, the interpretation of the
statute will remain muddy, and the same will be the fate of
decisions coming out of the CCI in the coming days.
Originally published in Legal ERA – May-June 2015
1 Shamsher Kataria v Honda Siel Cars & Others, Case
No. 03/2011, decided on 25.08.2014;
2 Ibid, at pg 136;
3 Ibid, at pg 143;
4 Ibid, at pg 135;
5 Ibid, at pg 156
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