CCI closes anti-competitive case against Gujarat Gas

The Competition Commission of India had initiated a detailed probe in the case following a complaint by Saint Gobain Glass

The Competition Commission on Thursday disposed of a case alleging unfair business practices by Gujarat Gas Company with respect to supply of natural gas to industrial customers in certain districts of Gujarat.

The fair trade regulator's disposal came even after its investigation arm Director General (DG) in its report had concluded that there were violations of competition norms.

The Competition Commission of India (CCI) had initiated a detailed probe in the case following a complaint by Saint Gobain Glass.

The float glass maker had alleged that Gujarat Gas abused its dominant market position by imposing unfair conditions in its 'Gas Supply Agreement (GSA)' and charging differential pricing.

However, disposing of the matter CCI in an order said: "No case of contravention of the provisions of...the (Competition) Act is made out against the opposite party (Gujarat Gas) and the matter is ordered to be closed forthwith".

CCI observed that various companies were operating in the space of production, transmission and distribution of natural gas throughout the country.

Noting that there were presence of competitors in the market for natural gas and such as Gujarat Gas, it observed that it "cannot operate independently in the relevant market or affect the relevant market in its favour".

"As such the Commission, disagreeing with the DG's findings in this regard, holds that in the relevant market the opposite Party is not in a dominant position," CCI said.

It further said: "Since opposite party is not found to be in a dominant position in the relevant market, there is no need to examine the alleged abusive conduct of the opposite party."

The regulator also pointed out that most of the clauses in the GSA (gas supply agreement) are specific to the agreement between Saint Gobain and Gujarat Gas "and it is nobody's case that the opposite party is imposing these conditions on all of its industrial consumers".

"The Commission is also not oblivious of the fact that Saint Gobain had derived substantial benefits under the restructuring of GSA," the regulator said in its order.