I. Notable merger control/combinations
1. Press Release No. 18/2024-25 dated May 28, 2024: Approval of demerger of hotel business of ITC Limited ("ITC") to ITC Hotels Limited ("ITC Hotels")
The proposed combination relates to the demerger of all businesses, undertakings, activities and operations of ITC to ITC's wholly owned subsidiary ITC Hotels as per the terms of the Scheme of Arrangement approved by the respective boards of ITC and ITC Hotels on August 14, 2023.
The hotel and hospitality business of ITC includes inter alia owning, licensing, operating, managing, servicing, marketing and supervising the operations of hotels, and includes accommodation, dining and banquet services and existing investments in certain subsidiaries and associate companies of ITC in the hotels and hospitality sector. This marks a shift from the historical manner of operation for the ITC group, and it remains to be seen how the demerger of the hotel business will affect the operations of ITC Hotels.
2. Press Release No. 26/2024-25 dated June 18, 2024: Approval of combination involving realignment of interests, legal ownership and management of various entities within the Godrej group
Pursuant to an inter-se arrangement between the members of the Godrej family – Adi Godrej and family, Nadir Godrej and family, Jamshyd Godrej and family and Smita Crishna and family, the target enterprises (mentioned below) were to be realigned. Such realignment will take place in accordance with the family settlement agreement dated April 30, 2024, executed collectively by the Godrej family. Considering that the Godrej family is one of the historically pre-eminent business families in India, the realignment will have implications across their group companies in various sectors of business.
The target enterprises include: (a) GILAC Group Entities(Godrej Industries Limited, Godrej Consumer Products Limited, Godrej Properties Limited, Godrej Agrovet Limited, Godrej Seeds & Genetics Limited, Innovia Multiventures Private Limited, Astec Lifesciences Limited and Anamudi Real Estates LLP) and (b) G&B Group Entities (Godrej & Boyce Manufacturing Company Limited; Godrej Holdings Private Limited, Godrej Infotech Limited and RKN Enterprises).
II. Enforcement Matters
Case no. 30 of 2023: Order issued by the Commission dated April 5, 2024, in relation to causing appreciable adverse effect on the relevant market and alleged abuse of dominant position under Sections 3 and 4 of the Act
A. Buchi Ramarao Valury ("Informant")
B. Covai Property Centre (India) Private Limited ("Covai Centre")
C. Covai Senior Citizen Services Pvt. Ltd. ("Covai Services")
D. Ozone Urbana Infra Developers Private Ltd. ("Ozone") (collectively referred to as "Opposite Parties")
Covai Centre set up Ozone, and Covai Services is the authorised service provider for Ozone. The Informant had entered into an agreement with Ozone and Covai Centre by virtue of which, the Informant was forced to accept catering and housekeeping services provided by Covai Services.
The Informant alleged that the corresponding allotment of housing staff and increase in maintenance charges was a result of abuse of dominant position. The Informant sought the annulment of the alleged one-sided service agreement between the residents and Covai Centre/Ozone.
The Commission dismissed the case and stated the following key points:
- The relevant market was defined by the Commission as 'the market for provision of services for development and sale of apartment to cater to the needs of senior citizens in Bangalore Metropolitan Region'.
- The relevant market was open to many players and the Opposite Parties could not operate independently of market forces, and no dominance could be established in these circumstances.
- From a vertical restraint perspective, the Commission noted that this was an agreement between a service provider (Covai Centre and Ozone) and a final consumer (Informant) and it would not fall under Section 3(4) of the Act.
2. Case No. 01 of 2024: Order issued by the Commission dated April 25, 2024, in relation to contravention of Section 3(4) read with Section 3(1) of the Act.
A. Somnath Banerjee ("Informant")
B. Apex Lab & Others ("Opposite Parties" or "OPs")
The Informant, being a pharmacist, held the patent for an invention i.e. "An Oral Rehydration Powder Composition Comprising Papain" and the product is marketed under the brand name 'Protestin'. The Informant alleged a violation of Section 3(4) read with Section 3(1) of the Act as (i) 'Protestin' is not being marketed and promoted because of non-cooperation by private hospitals, Federation of Medical and Sales Representatives, online pharmacies, MNCs, distributors, doctors, exporters, Indian Drug Manufacturers' Association, medicines shops etc; (ii) while the product is reasonably priced, it is not being promoted due to various reasons such as inter alia consent to be provided by the Food Safety and Standards Authority of India, presence of other brands in the relevant market etc.; and (iii) marketing proposals have been sent by the Informant to different organizations/companies but most of them did not revert.
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