CCI Dismisses Complaints Alleging Abuse of Dominant Position by way of Non-Delivery of Goods to Cement Dealer

On February 28, 2018, CCI dismissed the information filed by Mr. Ramachandra V. (‘Ramachandran’) under Section 19(1)(a) of the Competition Act against JSW Cements Limited (‘JSWCL’) alleging contravention of Section 4 of the Competition Act.[1] There was an agreement between JSWCL and Ramachandran as per which all consignments of cement and construction products were to be dispatched and delivered by JSWCL to the dealer’s consignee location from any of JSWCL’s manufacturing units or warehouses. It was alleged by Ramachandran that JSWCL was making deliveries to other dealers in the region but not to his consignees and therefore, there was manifest collusion with other dealers which has caused him irreparable losses. In response, JSWCL contended that the required order procedure had not been followed by Ramachandran and that if he wanted supplies to be delivered to his consignees, he may direct them to place orders after registering their addresses with JSWCL as they only deliver cement at registered addresses.

Determining the relevant market to be the ‘market for manufacture and sale/supply of cement in Kerala’, CCI held that the cement market in South India has no clear leader, and even JSWCL enjoys only 22% market share thereof. Further, it specializes only in Portland Slag Cement, and is part of a multinational conglomerate. Its chances of being immune to competitive forces prevailing in the market are further diminished by the existence of other established players in the market, such as ACC, UltraTech, etc. CCI concluded that JSWCL was not in a dominant position, and therefore, the question of abuse did not arise.

[1] Case no. 76 of 2017.

Published In:Inter Alia Special Edition Competition Law June 2018 [ English
Date: June 8, 2018