CCI Imposes Rs 87 Crore Penalty On Hyundai Motor For Anti-Competitive Conduct

The Competition Commission of India (CCI) has found Hyundai Motor India Limited (HMIL) to be in contravention of the provisions of Section 3(4)(e) read with Section 3(1) of the Competition Act, 2002 for imposing arrangements upon its dealers which resulted into Resale Price Maintenance in sale of passenger cars manufactured by  it. Such arrangements also included monitoring of the maximum permissible discount levels through a Discount Control Mechanism.

Further, Hyundai Motor was found to have contravened the provisions of Section 3(4)(a) read with Section 3(1) of the Act for mandating its dealers to use recommended lubricants/ oils and penalising them for use of non-recommended lubricants and oils.

The final order has been passed today on information filed by the dealers of Hyundai Motor viz. Fx Enterprise Solutions India Pvt. Ltd. and St. Antony’s Cars Pvt. Ltd.

Apart from issuing a cease and desist order against HMIL, CCI has imposed a penalty of Rs. 87 crore upon HMIL for the anti-competitive conduct. The penalty has been levied @ 0.3% of the average relevant turnover of HMIL of preceding three years. CCI noted in its order that for the purposes of determining the relevant turnover for the impugned infringement, revenue from the sale of motor vehicles alone have been taken into account.

A copy of the CCI’s order passed in Case Nos. 36 & 82 of 2014 has been uploaded on the website of CCI at www.cci.gov.in.

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S. Kapeed