CCI Dismisses Allegations of Cartelization and Abuse of Dominance against Urbanclap Technologies India Pvt. Ltd.

On March 31, 2021, CCI dismissed allegations of cartelization and abuse of dominance against Urbanclap Technologies India Pvt. Ltd. (‘Urban Clap’). [1]

The Informant who was Urban Clap’s user, alleged that Urban Clap, an online platform providing beauty and housekeeping services, forces the professionals listed on its platform to purchase the products/material used by them, only from Urban Clap. Further, Urban Clap arbitrarily decides the products it provides from selected brands, and in case the professional fails to procure the desired quantity, Urban Clap deducts amount from the account of the professional and dispatches the product arbitrarily. As per the informant, Urban Clap’s conduct amounted to imposition of unfair conditions, denial of market access, exclusive supply agreement and refusal to deal.

CCI in its assessment observed that the professionals listed on Urban Clap’s platform are allowed to purchase their products from third parties. Noting that the salon services market is quality-driven where brand image and goodwill are paramount, CCI found merit in Urban Clap’s justification that the products it selectively provides for professionals to use are based on: (i) consumer demand; (ii) genuineness and assured quality; and (iii) feedback of the professionals.

Based on the above, CCI closed the case under Section 26(2) of the Act.

 

[1] Case No. 30 of 2020, Order dated March 24, 2021

Published In:Inter Alia Special Edition - Competition Law - May 2021 [ English
Date: May 31, 2021