Abuse of Dominant Position

Abuse of Dominant Position is Prohibited [Section 4(1)]

No enterprise or group shall abuse its dominant position.

Dominance is not considered bad per se but its abyse is. Abuse is stated to occur when an enterprise or a group of enterprises uses its dominant position in the relevant market in an exclusionary or/ and an exploitative manner.


List of Practices th Constitutes Abuse of Dominant Position – [Section 4(2)]

There shall be an abuse of dominant position under sub-section (1), if an enterprise or a group, —

  1. Directly or indirectly, imposes unfair or discriminatory—
      • Condition in purchase or sale of goods or service; or
      • Price in purchase or sale (including predatory price) of goods or service
  2. Limits or restricts—
      • Production of goods/services; or
      • Technical or scientific development relating to goods or services; or
  3. Indulges in practice or practices resulting in denial of market access in any manner; or
  4. Makes conclusion of contracts subject to acceptance by other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts; or
  5. Uses its dominant position in one relevant market to enter into, or protect, other relevant market.

Case laws

  • DLF v. Belaire Owner’s Association
    DLF announced the launch of Group Housing Complexes, known as The Belaire, Park Place and Magnolia upon which the informants booked the apartments and entered into the Apartment Buyer’s Agreements (‘ABA’). Also, by that time informants had already paid substantial amount as they hardly had any option but to adhere to the dictates of DLF.
    Facts of this Case:
    DLF, without informing the consumers (informants), altered the scheme of housing complexes and arbitrarily increased the prices. In addition, there was abnormal delay in giving possession to the informants. This was questioned by the informants on the grounds of being violative of Section 4(2) of the CA.
    CCI Found –
      • Gurugram + High End Residential Appartments is the Relevant Market
      • Competition Commission of India found DLF is dominated in its relevant market and it violated Section 4 (2) of the act
      • DLF penalised 630 crores for imposing unfair conditions.
  • Coal India limited Case
    • Maha genco and Gujarat electricity filed information with Competition Commission of India that
    • Coal India limited is indulged in discriminatory practices
    • Fuel supplier agreement with government company, old power company and New private companies were different
    • Private company were being supplied substandard quality of coal and also no rebate is given.
    • CCI levied a penalty of rupees 1773 crore as found guilty under section 4(2)(a). Later on, by appellate authority the penalty reduced to only rupees 10 crore.

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