CCI rejects antitrust complaint against Jindal Stainless over supply deals
The Competition Commission of India found no evidence that Jindal Stainless abused its dominant position or entered into anti-competitive supply arrangements
 "CCI rejects antitrust complaint against Jindal Stainless over supply deals")
The Competition Commission of India (CCI) on Tuesday dismissed allegations that Jindal Stainless Limited entered into anti-competitive exclusive supply agreements with Indonesian companies and nickel producers.
The matter was brought to CCI by an unnamed Indian stainless-steel manufacturer engaged in the downstream production and trade of stainless-steel products, whose identity the Commission kept confidential.
The informant alleged that Jindal Stainless had secured exclusive arrangements with the Indonesian suppliers for stainless-steel slabs and hot-rolled coil rich in nickel, thereby, depriving rival Indian manufacturers of a critical input. The informant highlighted that since India does not possess indigenous nickel reserves, the domestic stainless-steel industry is substantially reliant on imports, particularly since Indonesia banned exports of unprocessed nickel ore in 2020.
The complaint also alleged that Jindal Stainless’s dealership programme "Jindal Saathi," operated through memoranda of understanding (MoUs), locked distributors into sourcing predominantly from the company.
The antitrust watchdog in its order noted that no evidence was produced to show that any competing manufacturer suffered production constraints, reduced output, market exit or any other competitive disadvantage attributable to restricted access to such inputs. On the upstream market, the Commission held that Jindal Stainless does not appear to hold a dominant position, noting the presence of multiple domestic and international suppliers, including several Bureau of Indian Standards (BIS)-certified overseas manufacturers.
The Commission accepted that Jindal Stainless appears, prima facie, to occupy a dominant position in the downstream market for cold-rolled stainless steel (CRSS), citing its scale, economic strength and vertical integration, but found no evidence of abuse of such position.
“The Commission is of the prima facie view that the allegation that the impugned arrangements resulted in denial of market access to competing manufacturers in the downstream market for CRSS in India is not substantiated and, prima facie, there appears to be no violation of Section 4(2)(c) of the Act,” the CCI order said.
Clearing the company’s dealership programme, the CCI noted that participation in the “Jindal Saathi” programme and the associated MoUs is voluntary and is not a precondition for purchasing material from the company.
“The inspection, traceability and record-maintenance requirements appear to be directed towards the stated objective of preventing counterfeiting and ensuring product traceability, rather than restricting the commercial freedom of participants,” the CCI said.
Matter at hand
- It was alleged that Jindal Stainless had secured exclusive arrangements with Indonesian suppliers, depriving rival Indian firms from a critical input
- It was also claimed that the firm’s dealership programme locked distributors into sourcing predominantly from the company
- CCI noted there was no evidence of competitive disadvantage
- It cleared the dealership programme, noting that it was voluntary