CCI rejects market abuse charges against BPCL

Fair trade regulator CCI has dismissed complaints of Bharat Petroleum Corp Ltd (BPCL) abusing its market dominance in transportation of LPG cylinders from bottling plants to distributors across the country.

Competition Commission of India (CCI) has said "there does not exist a prima facie case" for directing its investigation arm, Director General, to probe the matter against BPCL.

Certain LPG cylinder transporters in Kerala and Tamil Nadu had alleged BPCL of introducing a system of reservation of routes to the LPG distributors, among other things.

It was alleged BPCL abused its dominant market position by imposing unfair and discriminatory conditions for services and indulged in practices resulting in denial of market access to the complainants.

Further, it had been alleged that BPCL reserved 50% of the routes for the distributors and entered into exclusive distribution agreement with them.

However, CCI in its order dated April 10 has said BPCL did not "appear to be a dominant procurer of the services of trucks for transportation of goods" as there were enough players for hiring such services in the country.

Regarding allegations that BPCL introduced changes in the existing practice of delivery of LPG cylinders, CCI said: "Based on hiring transport services selected through a tender, to a new model which is partly based on open tender and partly based on agreement with its distributors, (this) cannot be inferred to be anti-competitive or denial of market access".

The fair trade regulator said "prima facie it does not appear to be a case of tie-in arrangement, exclusive supply agreement or exclusive distribution agreement, between BPCL and its distributors".

"So far as conditions of tender are concerned, BPCL has business liberty for any changes in the tender for its own interests and can procure services from service providers other than the informant," CCI said.

"Besides, the presence of other buyers of the services of the informant indicates that there is no appreciable adverse effect on competition as such," it added.