The Firm

Show Timings:

Friday: 10.30 pm, Saturday: 11.30 am

Sunday: 9:30am & 11.00pm


CCI's Rs 2544 Cr Order Against 14 Auto Companies!

Published on Mon, Aug 25,2014 | 21:49, Updated at Tue, Aug 26 at 15:29Source : 

By: Payaswini Upadhyay

Yes, CCI’s much awaited order on the anti-competitive practices in the auto parts case is finally here and the 14 companies won’t like the outcome!

CCI began its investigation on a complaint that genuine spare parts of automobiles manufactured by these companies are not made freely available in the open market.The competition regulator has found the following 14 companies guilty of abusing their dominant position and indulging in anti-competitive agreements:

1. Honda Siel Cars India
2. Volkswagen India
3. Fiat India Automobiles
4. BMW India
5. Ford India
6. General Motors India
7. Hindustan Motors
8. Mahindra & Mahindra
9. Maruti Suzuki India
10. Mercedes-Benz India
11. Nissan Motor India
12. Skoda Auto India
13. Tata Motors Ltd.
14. Toyota Kirloskar

The 14 auto companies have been directed to:

i) Immediately cease and desist from indulging in conduct which has been found to be in contravention of the provisions of the Act.

ii) Put in place an effective system to make the spare parts and diagnostic tools easily available through an efficient network.

iii) Allow OESs to sell spare parts in the open market without any restriction, including on prices. OESs will be allowed to sell the spare parts under their own brand name, if they so wish. Where the OPs hold intellectual property rights on some parts, they may charge royalty/fees through contracts carefully drafted to ensure that they are not in violation of the Competition Act, 2002.

iv) Place no restrictions or impediments on the operation of independent repairers/garages.

v) May develop and operate appropriate systems for training of independent repairer/garages, and also facilitate easy availability of diagnostic tools. Appropriate arrangements may also be considered for providing technical support and training certificates on payment basis.

vi) May also work for standardization of an increasing number of parts in such a manner that they can be used across different brands, like tyres, batteries etc. at present, which would result in reduction of prices and also give more choice to consumers as well as repairers/service providers.

vii) Not impose a blanket condition that warranties would be cancelled if the consumer avails of services of any independent repairer. While necessary safeguards may be put in place from safety and liability point of view, OPs may cancel the warranty only to the extent that damage has been caused because of faulty repair work outside their authorized network and circumstances clearly justify such action.

viii) Make available in public domain, and also host on their websites, information regarding the spare parts, their MRPs, arrangements for availability over the counter, and details of matching quality alternatives, maintenance costs, provisions regarding warranty including those mentioned above, and any such other information which may be relevant for full exercise of consumer choice and facilitate fair competition in the market.

The regulator has imposed a penalty of 2% of total turnover of the 14 companies…Rs 2544 cr in the next 60 days!Read CCI’s order here and watch The Firm this week for a detailed analysis!


Copyright © Ltd. All rights reserved. Reproduction of news articles, photos, videos or any other content in whole or in part in any form or medium without express written permission of is prohibited.