CCI closes case against Urban Development Ministry, DMRC

The Competition Commission has rejected charges of unfair trade practices against Ministry of Urban Development, Delhi Metro Rail Corp and Kochi Metro Rail. in a case related to development of Kochi metro rail project.
A complaint filed with the Competition Commission of India (CCI) had alleged that the entities were abusing their dominant position by incorporating unfair and discriminatory conditions in a qualification criteria for a tender related to design, manufacture, supply, testing, commissioning and training of standard gauge cars for the Kochi metro.
In an order released today, CCI said "no case of contravention of the provisions...Of the (Competition) Act is made out against the opposite parties and the information is ordered to be closed forthwith".

DMRC and Kochi Metro Rail had signed an agreement for execution of the first phase of the Kochi metro rail project.
As per the complaint, few bidders had purchased the tender documents being eligible under the qualification terms, but the alleged parties had later modified the terms which changed nature of the pre-qualification criteria as a result of which many bidders "across the world got excluded and disqualified".
According to the Commission, "there could be competition concerns in rare cases where a monopoly buyer exercises the option in an anti-competitive manner but the present case is not in that category".

"Here, the procurer, in fact, appears to have widened the conditions of procurement vide the impugned addendum.

"As such, instead of creating entry barriers, it appears that the barriers are diluted/relaxed for having a wider zone of consideration. In these circumstances, the very basis of the challenge made by the informant is completely negated," the Commission said.
Further, the Commission noted that Kochi Metro Rail Ltd is the project owner whereas DMRC is an executing agency.
"As such, the averments of dominance laid by the informant against DMRC are of no consequence as Kochi Metro Rail Ltd is admittedly the project owner," CCI said.

"There is nothing on record to suggest that Kochi Metro Rail Ltd is in a dominant position in the relevant market of procurement of standard gauge cars for metro rail services in India," the regulator added.