Authored by Mr. Piyush Gupta, Partner, Kochhar & Co. (India - TAGLaw) On March 19, 2015, the competition regulator in India – the Competition Commission of India (“CCI”), passed an order rejecting charges that Suzuki Motorcycle India (“Suzuki”) had abused its dominant position in the market for manufacturing and sale of two-wheeler vehicles. The allegation against Suzuki was that it imposed unfair and discriminatory conditions in the sale of its two-wheeler ACCESS 125cc, by limiting the customers’ entitlement to avail of Suzuki’s free services in the event that the customers visit a local garage for paid services, thereby resulting in a denial of market access to local auto garage owners.

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BANGALORE  CHENNAI  NEW DELHI  GURGAON  HYDERABAD  MUMBAI 
ATLANTA  SINGAPORE  DUBAI  JEDDAH  RIYADH  TOKYO
THE CURIOUS CASE OF THE AUTO PARTS DECISION v THE SUZUKI
MOTORCYCLE DECISION:
WHY IS CCI MUDDYING THE WATERS?
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Tel: +91 124 4545222, Fax: +91 124 4375596 E-mail: gurgaon@kochhar.com

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On March 19, 2015, the competition regulator in India – the Competition Commission
of India (“CCI”), passed an order rejecting charges that Suzuki Motorcycle India
(“Suzuki”) had abused its dominant position in the market for manufacturing and
sale of two-wheeler vehicles.
The allegation against Suzuki was that it imposed unfair and discriminatory
conditions in the sale of its two-wheeler ACCESS 125cc, by limiting the customers’
entitlement to avail of Suzuki’s free services in the event that the customers visit a
local garage for paid services, thereby resulting in a denial of market access to local
auto garage owners.
In order to reach the conclusion as set forth above, the CCI determined the ‘relevant
market’ as being only the “market of the manufacturing and sale of two wheeler
vehicles in India”.
Curiously, however, in recent decision of automobile parts manufacturers1
(“Auto
Parts case”), the CCI, while adjudicating the issue of whether automobile
manufacturers had engaged in abusive conduct by imposing unfair and restrictive
conditions in the after-sales market, had delved into the matter in much greater
detail, and had opined that “there exist two separate relevant markets; one for
manufacture and sale of cars and the other for the sale of spare parts and repair
services in respect of the automobile market in the entire territory of India 2
”
[emphasis added].
1
Shamsher Kataria v Honda Siel Cars & Others, Case No. 03/2011, decided on 25.08.2014
2
Ibid, at pg 136

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The CCI, relying upon the “antitrust theory that each OEM was engaging in anti-
competitive practices to prevent independent service repairers from competing with
the authorized dealers of such OEMs in the aftermarket for maintenance and repair
services of such OEM manufactured automobiles3
”, concluded that the “automobile
primary market and the aftermarket for spare parts and repair services does not
consist of a unified systems market4
, that each OEM was a monopolistic player in
the aftermarket.
In the Suzuki case, if the allegation was of the nature of denial of market access to
local garage owners (i.e. independent repairers), which was one of the main issues
that the CCI had deliberated upon in great detail in the Auto Parts case, before
concluding that each OEM severely limited the access of independent repairers and
other multi-brand service providers to genuine spare parts and diagnostic tools
required to effectively compete with the authorized dealers of the OEMs in the
aftermarket; and that such practices amount to denial of market access by the OEMs
under section 4(2) of the Act5
.
If the CCI has taken a view that the sales and the aftersales markets are different in
the automobile industry, then surely the same standard needs to be adhered to for
evaluating the relevant market in the two wheeler market as well. There might have
been other factors that the CCI may have evaluated, which factors, unfortunately
have not been discussed in the order dated March 19, 2015, but the author
vehemently feels that the CCI has missed a trick by not evaluating the allegations
made in the Suzuki case in greater detail.
3
Ibid, at pg 143
4
Ibid, at pg 135
5
Ibid, at pg 156

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Since the defining lines have been marked by the CCI in one matter, there needs to
be consistency with that line of reasoning for the other matters as well, failing which,
the interpretation of the statute will remain muddy, and the same will be the fate of
the decisions coming out of the CCI in the coming days.
DISCLAIMER
The information contained in this article is correct to the best of our knowledge and
belief at the time of writing. The contents of the above article are intended to provide
a general guide to the subject-matter and should not be treated as a substitute for
specific professional advice for any particular course of action as the information
above may not necessarily suit your specific business and operational requirements.
It is to your advantage to seek legal advice for your specific situation.
ABOUT THE AUTHOR
The antitrust / competition advisory practice of Kochhar & Co. is headed by Piyush
Gupta. Piyush has more than a decade of trans-national experience in the
competition law regimes across India and Singapore. Piyush is well-versed with the
complexities of this relatively new entrant in the Indian legal arena and has drafted
the competition law compliance manuals and guidelines for companies across
various industries. Piyush has also conducted competition law compliance audits for
various corporates, in addition to providing training and holding workshops on
identification of issues pertaining to competition laws for the purposes of various
companies’ in-house legal counsels, as well as for various operational personnel,
such that competition law issues can be highlighted and dealt with on an immediate
basis. In this regard, you may contact Piyush Gupta at +91.124.454.5222 or email
him at piyush.gupta@kochhar.com.