Competition Comm rejects complaint against Hyundai Motor India

The Competition Commission today dismissed allegations of unfair business practices made against carmaker Hyundai Motor India Ltd (HMIL) with regard to misuse of an export promotion policy.
The informant, who did not wish to be identified, had also complained against the Director General of Foreign Trade (DGFT), which is an attached office of the commerce and industry ministry.
It was alleged that HMIL had misused the Export Promotion Capital Goods (EPCG) policy, framed by the DGFT, to reduce cost of production compared to its competitors.
Dismissing the complaint, the Competition Commission of India (CCI) said the allegations raise issues relating to the Foreign Trade (Development and Regulation) Act, 1992 and the Customs Act, 1962.

While noting that no competition issue arises out of the information presented or is otherwise made out, the CCI said the "reliefs sought by the informant (including seeking investigation into the impugned conduct through direction to DRI) do not fall within the ambit of the Commission as provided under the (Competition) Act".
DRI refers to the Directorate of Revenue Intelligence.

The regulator said no case of contravention of the provisions of either Section 3 or Section 4 of the Act is made out against HMIL and DGFT.
While Section 3 pertains to anti-competitive agreements, Section 4 relates to abuse of dominant market position.

As per the informant, HMIL was importing the capital goods for manufacture of different models of cars that were meant for exports but were selling them domestically.
Since the capital goods imported under the EPCG scheme are exempted from customs duty, capital goods were purchased by HMIL at cheaper rates thereby reducing its cost of production, it was alleged.