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Before The National Company Law Appellate Tribunal, Bohemia: Ppellate Urisdiction U S Ohemian Ompetition CT
Before The National Company Law Appellate Tribunal, Bohemia: Ppellate Urisdiction U S Ohemian Ompetition CT
V.
V.
V.
TABLE OF CONTENTS............................................................................................................I
LIST OF ABBREVIATIONS...................................................................................................IV
INDEX OF AUTHORITIES..................................................................................................VII
STATEMENT OF JURISDICTION......................................................................................XIV
STATEMENT OF FACTS......................................................................................................XV
SUMMARY OF ARGUMENTS...........................................................................................XIX
WRITTEN SUBMISSIONS......................................................................................................1
TRANSACTIONS…...............................................................................................................1
MARKET PURCHASES...........................................................................................................3
i. The market purchases were neither ‘solely an investment’ nor ‘in the ordinary
course of business’.........................................................................................................3
C. THE MCA NOTIFICATION DATED 27 MARCH 2017 DID NOT EXEMPT LUTYEN FROM
i. The applicable law is the pre-notification law when the cause of action arises......5
[i]
ii. The notification amends the substantive application of relevant sections and
ISSUE II. LUTYEN HAS ABUSED ITS DOMINANCE IN UHD TV MARKET TO INCREASE
i. Relevant market.......................................................................................................8
ii. Dominance...........................................................................................................9
B. LUTYEN HAS ABUSED ITS DOMINANCE TO INCREASE ITS SALES IN THE CASTING
…. 11
ISSUE III. LUTYEN HAS VIOLATED THE CCB’S ORDER REGARDING CONDITIONAL
ISSUE IV. THE RESALE PRICE MAINTENANCE IMPOSED BY LUTYEN VIOLATES THE
[ii]
A. THE RPM AGREEMENT CAUSES AAEC..................................................................20
i. RPM shall drive out existing competitors, will lead to foreclosure of competition,
ii. RPM shall not lead to any accrual of benefits to the consumers.......................23
iii. RPM is dispensable to achieve the said efficiencies due to the presence of less
restrictive alternatives..................................................................................................26
ISSUE V. SANDY HOME STORE HAS NOT INDULGED IN A REFUSAL TO DEAL U/S 3(4)
(D)……… 27
ii. Sandy’s dominant distribution network is no ground for penalizing its refusal….
32
[iii]
PRAYER..............................................................................................................................XXII
L I S T O F A B B R E V I AT I O N S
Co Company
DG Director General
Edn Edition
HD High Definition
Inc Incorporated
Ltd Limited
[iv]
MCA Ministry of Corporate Affairs
No Number
OJ Official Journal
Ors Others
Pvt Private
Reg Regulation
Supp Supplement
TV Television
US United States
V Versus
[v]
INDEX OF AUTHORITIES
INDIAN CASES:
S U P R E M E C O U RT
C O M P E T I T I O N A P P E L L AT E T R I BU N A L
[vi]
COMPETITION COMMISSION OF INDIA
Fx Enterprise Solutions India v Hyundai Motor India Ltd Case No 36 & 82/2014....20, 22, 23
M/s ESYS Information Technologies Pvt Ltd v Intel Technologies Case No 48/2011........10, 21
MCX Stock Exchange Ltd v National Stock Exchange of India Ltd Case No 13/2009............11
Shri Ghanshyam Dass Vij v M/s Bajaj Corp Ltd Case No 68/2013.........................................20
2014/12/235...........................................................................................................................3
[vii]
Sun Pharma/Ranbaxy order u/s 31(7), Combination Registration No C-2014/05/170...........18
US CASES:
Aspen Skiing Co v Aspen Highlands Skiing Corp 472 US 585 (1985)........................14, 29, 31
Brooke Group Inc v Brown & Williamson Tobacco Corp 748 F Supp 344 (MDNC 1990).....32
Fortner Enterprises Inc v United States Steel Corp 394 US 495 (1969)...........................13, 15
Illinois Tool Works Inc v Independent Ink Inc 126 S Ct 1281 (2006)........................................9
In re Data General Corporation Antitrust Litigation 490 F Supp 1089 (ND Cal 1980).........17
Leegin Creative Leather Products Inc v PSKS Inc 551 US 877 (2007)...................................23
[viii]
Nobody in Particular Presents v Clear Channel Communications 311 F Supp 2d 1048 (D
Colo 2004)............................................................................................................................13
Ortho Diagnostic Systems Inc v Abbot Labs Inc 920 F Supp 455 (SDNY 1996)....................14
Verizon Communications Inc v Law Offices of Curtis Trinko LLP 540 US 398 (2004)..........32
Virgin Atlantic Airways Ltd v British Airways 257 F 3d 256 (2nd Cir 2000)..........................14
EU CASES:
BOOKS:
[ix]
Alison Jones & Brenda Sufrin, EU Competition Law: Text, Cases and Materials (4th edn,
MA Utton, Market Dominance and Antitrust Policy (2nd edn, Edward Elgar Publishing 2003)
..............................................................................................................................................25
Phillip Areeda & Herbert Hovenkamp, Antitrust Law: An Analysis of Antitrust Principles and
JOURNALS:
Benjamin Klein & Kevin Murphy, ‘Vertical Restraints as Contract Enforcement Mechanisms’
Howard Marvel, ‘The Resale Price Maintenance Controversy: Beyond the Conventional
Marina Lao, ‘Internet Retailing and Free Riding: A Post-Leegin Antitrust Analysis’ (2011) 14
Marina Lao, ‘Resale Price Maintenance: The Internet Phenomenon and 'Free Rider' Issues’
Mart Kneepkens, ‘Resale Price Maintenance: Economics Call for a More Balanced
Oren Bar-Gill, ‘Bundling and Consumer Misperception’ (2006) 71(1) The University of
[x]
Robert Steiner, ‘How Manufacturers deal with Price Cutting Retailers: When are Vertical
Robert Steiner, ‘Manufacturers’ Promotional Allowances, Free Riders and Vertical Restraints’
Thomas Krattenmaker & Steven Salop, ‘Anticompetitive Exclusion: Raising Rivals Costs to
ONLINE RESOURCES:
<www.cci.gov.in/sites/default/files/faq/ConsultationPrior250511.pdf>................................5
Eric Gippini-Fournier, ‘Resale Price Maintenance in the EU: in statu quo ante bellum?’ (21
abstract_id=1763386>..........................................................................................................17
Marina Lao, ‘Free Riding: An Overstated, and Unconvincing, Explanation for Resale Price
abstract_id=1024221>..........................................................................................................24
Vikram Sobti & Kanika Chaudhary, ‘Analysis of the Verdict of the Apex Court in CCI v Steel
<http://www.indialawjournal.org/archives/volume4/issue_2/article_by_vikram_kanika.htm
l>..........................................................................................................................................29
[xi]
S TAT U T ES , R E G U L ATI O N S & N O T I F I C AT I O N S :
R E P O RT S , R E C O M M E N D AT I O N S & G U I D E LI N E S :
European Commission, ‘White Paper: Towards more effective EU merger control’ 2014.......4
[xii]
S TAT E M E N T O F J U R I S D I C T I O N
In the present appeal under Section 53B of the Bohemian Competition Act, 2002 concerning
the matter of Lutyen TV Pvt. Ltd v. Competition Commission of Bohemia, the respondent
In the present appeal under Section 53B of the Bohemian Competition Act, 2002 concerning
the matter of Lutyen TV Pvt. Ltd v. Sandy Home Store & RK & Competition Commission of
Bohemia, the respondents humbly submit to the Jurisdiction of this Hon’ble Tribunal.
In the present appeal under Section 53B of the Bohemian Competition Act, 2002 concerning
the matter of Lutyen TV Pvt. Ltd v. Sandy Home Store & Competition Commission of
Bohemia, the respondents humbly submit to the Jurisdiction of this Hon’ble Tribunal.
[xiii]
S TAT E M E N T O F FA C T S
I. THE PARTIES
Bohemia, incorporated under the provisions of Bohemian Companies Act, 1956 and
the National Stock Exchange of Bohemia, was previously the most popular manufacturer
of CRT TVs but has witnessed declining profits during the past decade due to its failure to
keep up with technology. Tojo’s casting device, the Tojo Stick, which was initially
restricted to FHD TVs is now compatible with UHD TVs and is its most profitable
across the territory of Bohemia and is renowned for stocking all television brands and
casting devices and selling them as per consumer preferences. It also manufactures many
products including UHD televisions. Its business model and one of the reasons for its
[xiv]
5. Tojo declined Lutyen’s offer to purchase its casting technology division. However,
determined to acquire the Tojo Stick business, Lutyen acquired 4%, 5%, and 3%
Agreement with Lutyen’s CEO for the sale of Tojo’s casting technology division on 24
February 2017 in exchange for cash consideration payable to Tojo’s shareholders and the
notifiable under Section 5 of the Competition Act and directed Lutyen TV to file a belated
adverse effect on competition but approved the transaction on the condition that there
would be no exclusive arrangement between Lutyen’s TVs and the Tojo Stick, and the
latter would remain compatible with the TVs of all other brands.
11. On 3 August 2017, CCB levied a penalty upon Lutyen for its failure to notify the
acquisition of Tojo’s casting technology division and the earlier market purchases and
consummating the transaction without its prior approval. Aggrieved, Lutyen filed an
12. To capitalize on the festival holidays, Lutyen proceeded to sell its Ultra HD TV and Tojo
Stick as a package at the same price of the television and mandated the distributors to sell
it as a package as well.
[xv]
13. On request of certain distributors, Lutyen included a clause in its distributorship
agreement, which mandated that distributors only provide end customers with a discount
its products and filed a complaint before the CCB alleging a violation of the provisions of
Lutyen’s bundling of its UHD TV with the Tojo Stick. Aggrieved by what it viewed as
investigation under Section 26(1). The DG found Lutyen guilty of indulging in resale
price maintenance, tying in, and failure to comply with commitments based on which the
direction to abide by the commitments made during the merger review. Aggrieved,
products. However, the CCB disagreed with the DG’s findings and dismissed the
I S S U E S F O R C O N S I D E R AT I O N
[xvi]
I. Whether Lutyen has violated the gun-jumping provisions u/s 43A, Bohemian
acquisition?
IV. Whether Lutyen has violated Section 3(4)(e) of the Bohemian Competition Act, 2002 by
SU MMA RY OF A R GU ME N TS
The market purchases and the Asset Purchase Agreement (hereinafter APA) were inter-
connected transactions since the APA mentions the market purchases. Further, the execution
[xvii]
of the latter occurred only because of the market purchases, thus satisfying the mutual
interdependence test. Therefore, the appellant should have filed the two transactions as a
single composite combination. Further, the market purchases, even individually, were
the ordinary course of business’. The APA was a notifiable transaction and not exempted
under the MCA notification since the notification is not retrospectively applicable and the
defaulter becomes liable for a penalty as soon as he breaches the civil obligations.
II. LUTYEN HAS ABUSED ITS DOMINANCE IN UHD TV MARKET TO INCREASE ITS SALE IN
The appellant is dominant in the market for the manufacture and sale of UHD TVs in
Bohemia which is evident from its high market shares, consumer preferences and because the
market is characterized by high entry barriers. The appellant has used this dominance to
conclude contracts with distributors that give rise to supplementary obligations having no
connection with the nature of the contract or the commercial usage by mandating them to sell
its UHD TV and Tojo Stick as a package, even when they might be only TV distributors.
Further, the arrangement amounts to a tie-in since consumers are restricted of the choice to
buy the UHD TV alone, or with a casting device from any other manufacturer. Thus, the
appellant is trying to leverage its market position to enter the market for the sale of casting
devices in Bohemia. The practice causes AAEC through foreclosure of competition in the tied
market by the elimination of even hypothetical equally efficient competitors and choice
III. LUTYEN HAS VIOLATED THE CCB’S ORDER REGARDING CONDITIONAL APPROVAL BY
[xviii]
The appellant indulged in an exclusive arrangement between its TVs and the Tojo Stick
thereby, violating the CCB’s order for conditional approval under section 31(7) of the Act.
The arrangement does not allow the end-customers to buy the appellant’s UHD TV without
the Tojo Stick. Further, the part of the joint penalty imposed under section 42 on the appellant
in case no. 1 & 2 of 2018 for violating the order regarding conditional approval is not
appealable to NCLAT.
IV. THE RESALE PRICE MAINTENANCE IMPOSED BY LUTYEN VIOLATES THE PROVISION OF
The resale price maintenance (hereinafter RPM) arrangement imposed by Lutyen shall have
customers due to increased prices in lieu of undesired services. It will also prevent the more
efficient and low-cost distributors from passing on the benefits to the consumers. By
restricting intra-brand competition, it will also reduce dynamism and innovation at the
distributor level. It will drive out existing competitors, especially the online retailers out of
the market, as aggressive pricing is one of their major competitive strategies. Imposition of
RPM by a manufacturer like Lutyen, which has significant market power shall also lead to
foreclosure of smaller rivals as the higher margins will entice the dealers to promote this
brand over others. The imposition of RPM on the request of certain distributors, which makes
it even more harmful. The use of RPM is dispensable to achieve the alleged efficiencies, as
there are less restrictive, more efficient alternatives like promotional allowances, dealer
The order passed by the CCB will strictly fall under Section 26(8). The right to appeal is not
a natural or inherent right but a statutory right and has to be deciphered taking into account
[xix]
the whole act and not merely a clause itself. Section 53A does not provide orders passed
under the section 26(8) as an appealable order and therefore NCLAT does not have the
jurisdiction to hear the appeal. Antitrust authorities cannot impinge on the right of an
enterprise to choose its dealing partners. The respondent’s conduct will not have exclusionary
effects as the appellant have several sufficient distribution channels to distribute their
products. In view of the facts that price restraint covenants may itself have anti-competitive
effects and refusal on the part of the respondent will have pro-competitive effects.
[xx]
WRITTEN SUBMISSIONS
¶1. The respondent humbly submits that the earlier market purchases and the asset purchase
that invariably had the same intended effect. The benefit of exemption under Item 1
Schedule 11 was not available for market purchases as they were a part of the composite
combination. Further, the acquisition of Tojo’s casting technology division was notifiable
¶2. Where the acquisition takes place in a number of interconnected steps, the party shall file
a single notice covering all these steps3 and consummation of any such step without prior
approval of the commission would be a violation and invite a penalty under the Act. 4 The
use of the word ‘shall’ in regulation 9(4) 5 makes the notification of each step of the
composite combination mandatory and unavoidable at any stage. The mutual dependence
subject of the transaction, the time gap between the said transactions, and whether it
1
Combination Regulations 2011, Item 1 Schedule 1.
2
Moot Proposition, ¶ 8.
3
Combination Regulations 2011, reg 9(4).
4
Etihad order u/s 43A, Combination Registration No C-2013/05/122.
5
Combination Regulations 2011, reg 9(4).
[1]
would be practically reasonable to view the transactions separately, which require
of exemption to some steps of the combination; and this could facilitate the structuring of
transactions to evade compliance with the Act and therefore, should not be permissible. 7
In EMC8, the Commission held that the same intent and purpose behind the transactions
connected them, even though the first transaction did not mention the second one. In
transaction because the success or failure of market purchases would have had no bearing
on the notified transaction and the parties would have proceeded with the second
transaction irrespective.
¶4. In the present case, the subject matter of both the market purchases and the APA was
same, the transactions were such intricately related that the execution of APA happened
only because of Lutyen’s market purchases, and the return of Lutyen’s 12% shareholding
in Tojo was part of the consideration in the APA.10 Further, Lutyen had the intention to
acquire controlling rights over Tojo when it started acquiring Tojo’s shares from the open
6
Thomas Cook order u/s 43A, Combination Registration No C-2014/02/153; Vedanta order
[2]
B. ALTERNATIVELY, ITEM 1 SCHEDULE 1 DID NOT EXEMPT THE NOTIFICATION OF THE
MARKET PURCHASES.
¶5. An acquisition of shares, which does not entitle the acquirer to hold more than 25% of the
total shares and does not lead to the acquisition of control over the target enterprise, is
exempted from notification12, provided that it is ‘solely an investment’ or ‘in the ordinary
course of business’.13
I. THE MARKET PURCHASES WERE NEITHER ‘SOLELY AN INVESTMENT’ NOR ‘IN THE
¶6. The term ‘solely an investment’ involves an element of strategic intent. This intent can be
characterized through a number of factors, which include but are not limited to the
since the two parties were present in the same market. Acquisitions made in a competing
investment’ even if they meet the exemption thresholds.18 Even in EU, the minority
2014/12/235.
15
Piramal Enterprises order u/s 31(1), Combination Registration No C-2015/02/249.
16
Abbot/Mylan order u/s 31(1), Combination Registration No C-2014/08/202; Alibaba/Jasper
[3]
coordination between the competitors, thereby harming competition. 19 The market
purchases were not ‘solely an investment’ since Tojo is not only Lutyen’s competitor in
the market for sale and manufacture of TVs in Bohemia but also operates in the vertically
affairs and management of the target. 20 However, the present acquisition of shares does
not qualify for the exemption since the Lutyen’s board documents and presentations
suggest its intention to acquire controlling rights over Tojo’s business.21 The Commission
derives intent from circumstantial evidence, which includes a press release or statement
by parties labeling the acquisition as strategic22 or unilateral board resolutions that qualify
as ‘other documents’ under section 6(2)23 and require notification within 30 days of
or acquisition of shares of a target directly related to the business activity of the acquirer
cannot be termed ‘solely an investment’ or ‘in the ordinary course of business’.24 Further,
an investment in a company witnessing declining profits for almost a decade 25 would not
be a wise decision and as such, Lutyen’s intent was not to invest in Tojo but to acquire
controlling rights over the company and hence, the market purchases do not qualify for an
[4]
C. THE MCA NOTIFICATION DATED 27 MARCH 2017 DID NOT EXEMPT LUTYEN FROM
¶10. The respondent humbly submits that the turnover and assets used as thresholds for
exemption are the total assets and turnover of the target enterprise. The pre-amended
statute is unambiguous and clear in meaning, and a plain reading of the notification dated
4 March 2016 would suggest the use of entire turnover and assets of the target enterprise
for determining the exemption’s applicability.26 The Commission also provides a facility
for pre-filing consultation concerning combinations, which was also not availed by the
appellant.27 Further, the appellant consummated the transaction without the approval of
the Commission, which clearly indicates its intention to jump the gun.
ACTION ARISES.
¶11. The cause of action for proceedings under section 43A arises only when the acquiring
entity has failed to notify the Commission within 30 days of executing the agreement
related to the acquisition under section 6(2). In the present case, the appellant was
obligated to notify the execution of APA within 30 days from 24 February i.e. until 26
March. Therefore, the cause of action when the thirty-day period ends, as laid down by
the CCI.28
¶12. “The penalty is attracted as soon as contravention of the statutory obligations as
contemplated by the Act is established and, therefore, the intention of the parties
26
MCA Notification SO 674(E) (4 March 2016).
27
Competition Commission of India, ‘Consultation prior to filing of notice of the proposed
<www.cci.gov.in/sites/default/files/faq/ConsultationPrior250511.pdf>.
28
ITC order u/s 43A, Combination Registration No C-2017/02/485.
[5]
committing such violation becomes immaterial.”29 Firstly, the breach of the obligations
had already happened when the law changed and therefore, the levy of penalty is justified
under the pre-notification law and secondly, the failure to notify the acquisition cannot be
contravening the ex-ante nature of combination regulations 30, which seeks to check and
¶14. A substantive change in law can never have a retrospective operation because it seeks
to alter and remedy the existing stance of law. 31 It is a well-identified rule of interpretation
that unless a statute amends the matter of procedure, it should apply prospectively; and
that if the wording of the statute could lead to either of the two interpretations, the Courts
should construe it as prospective.32 The notification33 not only changes the manner in
which the value of assets and turnover for application of section 5 is to be determined but
also “the principle determining the applicability of De-Minimis Exception itself”.34 The
29
The Chairman SEBI v Shriram Mutual Fund (2006) 5 SCC 361.
30
SCM Soilfert Ltd v CCI Appeal No 59/2015 (COMPAT).
31
Union of India v IndusInd Bank Limited (2016) 9 SCC 720.
32
Shyam Sunder v Ram Kumar (2001) 8 SCC 24.
33
Moot Proposition, ¶ 8.
34
ITC order u/s 43A, Combination Registration No C-2017/02/485.
[6]
present notification is only applicable for a period of five years, which also strengthens
the claim that it is not a clarification of the existing law but an addition instead.35
¶15. The legislation changing the ensuing rights or obligations is prospective in nature
unless the legislative intent shows otherwise.36 The present notification nowhere contains
words that show the legislature’s intent to make the notification retrospective in nature.
Further, the press release labeling the notification does not have the force of law and
cannot alter the position established by the statute.37 Therefore, the MCA notification does
ISSUE II. LUTYEN HAS ABUSED ITS DOMINANCE IN UHD TV MARKET TO INCREASE
ARRANGEMENT.
¶16. The respondent humbly submits that the appellant is dominant in the market for the
manufacture and sale of Ultra High Definition Television (hereinafter UHD TVs), evident
from its market share, the size of competitors, and the market structure. Further, the
appellant has abused this dominance through its arrangement of selling the UHD TV and
Tojo Stick as a package, which amounts to a tie-in arrangement that has caused and is
¶17. In order to determine whether an enterprise is abusing its dominant position or not, it
is necessary to first determine the relevant market in which that particular enterprise was
35
MCA Notification SO 988(E) (27 March 2017).
36
CIT v Vatika Township Private Limited (2015) 1 SCC 1.
37
CIT Mumbai v Anjum MH Ghaswala (2002) 1 SCC 633.
[7]
alleged to be in a dominant position. 38 The second issue would be whether the enterprise
abused its dominant position in any manner in that relevant market in terms of Section 4
of the Act.39
I. RELEVANT MARKET.
¶18. The Commission should consider the factors laid down in section 19 while
determining the relevant market (both product market and geographical market). 40 It is
pertinent to consider the substitutes available for the product while defining the relevant
product market.41 In the present scenario, the closest substitute available in the upstream
market, compatible with the casting devices is an FHD TV. However, while the end use of
the products is same, the quality and price difference do not provide the required demand-
side substitutability42; and further, in a tying claim, the relevant market is the market of
tying product since that particular market is subject to abuse. 43 Therefore, the CCB has
correctly identified the upstream market as the ‘manufacture and sale of UHD TV’ and
38
Vikrant Bhagi v M/s Media Video Limited Case No 28/2013 (CCI); Brown Shoe Co v US
[8]
II. DOMINANCE.
¶19. In a tying claim, it is essential to prove that the enterprise enjoys a dominant position
in the market for the tying product.44 The Commission should consider the various factors
position.45
A. MARKET SHARE.
¶20. The existence of a dominant position may derive from several factors which, taken
separately, are not necessarily determinative but among these factors, the existence of
very large market shares is highly important.46 Very large shares are in themselves, and
the market for manufacture and sale of UHD TVs in Bohemia, Lutyen has a huge market
share of 45% with the rest of market diffused between several manufacturers in such a
¶21. Where barriers to entry by firms outside the market are high, the fact that one firm has
dominance, where the barriers to entry include both legal barriers and strategic barriers. 48
44
Illinois Tool Works Inc v Independent Ink Inc 126 S Ct 1281, 1293 (2006).
45
The Competition Act 2002, § 19(4).
46
Case 85/76 Hoffmann-La Roche v Commission (1979) ECR 461, ¶ 41; Case T-30/89 Hilti
of the Treaty to Exclusionary Abuses’ 2005, ¶ 34-40; M/s ESYS Information Technologies Pvt
[9]
In a UHD TV market, a new entrant would require a huge capital for technology, set-up of
C. CONSUMER PREFERENCE.
¶22. In the case of British Airways,49 the Court of First Instance held that the assessment of
the dependence relationship between the undertaking in question and its customers is
relevant for the finding of a dominant position in a classical sense. In the present case, the
consumers have a greater preference for Lutyen’s products since it is the leading market
player, even after Sandy (the second biggest player) offers greater discounts on its UHD
TVs.
B. LUTYEN HAS ABUSED ITS DOMINANCE TO INCREASE ITS SALES IN THE CASTING
¶23. The Competition Act, 2002 prohibits the abuse of dominant position 50 rather than the
dominance itself. Section 4(2)(e) recognizes the fact that an enterprise may use its
position of strength in one market to leverage its position and gain an unfair advantage in
the other market.51 Section 4(2)(d) is applicable where a dominant enterprise “makes
49
Virgin Atlantic v British Airways (2000) OJ L 30/1, ¶ 220.
50
The Competition Act 2002, § 4(1).
51
MCX Stock Exchange Ltd v National Stock Exchange of India Ltd Case No 13/2009 (CCI).
52
The Competition Act 2002, § 4(2)(d).
[10]
¶24. In the distributorship agreement, Lutyen added a clause that the distributors should
sell Lutyen TVs together with the Tojo Stick as a package. 53 This is a supplementary
obligation by commercial usage since the TV and the casting device are two separate
products that the distributor may not sell together. Even while selling the two together, the
consumers should get the choice to buy any TV or casting device together.
¶25. Not only does the clause restrict consumer choice but it also does not allow the
distributors to sell any other casting device with Lutyen TVs, thereby creating a situation
of exclusivity with the Tojo Stick. This is against the very nature of operation of
independent distributors who provide several choices with respect to the product they
offer. Further, Lutyen’s distributorship agreement is only with respect to the TVs and by
providing the casting device as an additional product, along with the clause to sell both as
¶26. The respondent submits that Lutyen has indulged in tying of UHD TV and casting
devices, which are two separate products and thus coerced the consumers such that they
can only buy the more preferred UHD TV if they take the Tojo Stick with it. This practice
has led to exclusionary effects in the market for manufacture and sales of casting devices.
¶27. In a tying claim, it is necessary to establish that two products are distinct. 54 This
distinctness does not necessarily mean that they have a separate market for sale but
depends on the demand for the product. Evidence that two products are distinct can be
direct i.e. whether or not customers would buy the two products separately if given choice
53
Moot Proposition, ¶ 12.
54
Case T-201/04 Microsoft v Commission (2007) ECR II-3601.
[11]
or indirect evidence i.e. the existence of independent specialized companies that only
manufacture the tied product without the tying product. 55 In the present case, a large
number of manufacturers only produce the casting devices without producing the UHD
TVs; and RK, a specialized casting device manufacturer, has the highest market share in
¶28. There is an assumption of tying if an enterprise with substantial market power over
the tying product does not allow the customers to purchase the tying product without the
tied product.57 The idea that ‘inducement’ or ‘coercion’ i.e. forcing the customers to buy
things they do not want, is a well-regarded exception to the economic principle that lower
by exclusion of rivals and exorbitant prices in the recoupment period like a conventional
predatory pricing claim.59 “It is enough that the tying arrangement has forced the
customer to make a less than optimal choice in the tied product market.”60 In the present
case, the customers cannot obtain the UHD TV without buying the Tojo Stick with it, and
55
European Commission, ‘DG Competition Discussion Paper on the Application of Article 82
[12]
therefore, it is coercive towards consumers who want to buy Lutyen’s UHD TV but
¶30. For a tying claim to be successful, the arrangement should cause or be likely to cause
AAEC. Section 19(3) lays down the factors to determine whether a practice would cause
AAEC or not.
¶31. An enterprise with a dominant position in one market may extend it to a related
market, foreclosing the sales opportunities of its rivals in the tied market, which leads to
rely on the premise that packaged discounts can exclude an equally efficient competitor
who does not manufacture “equally diverse group of products”.61 The efficiency
arguments about a pro-consumer practice with above-cost discounts are immaterial when
dominant player does not have the freedom to take certain actions that a company in a
competitive market may take because the market conditions are entirely different.63
¶32. To determine whether a practice would exclude equally efficient rivals in the
competitive tied market, the Courts use the discount-attribution test wherein they attribute
61
LePage's Inc v 3M 324 F 3d 141, 155 (3rd Cir 2003).
62
Virgin Atlantic Airways Ltd v British Airways 257 F 3d 256 (2nd Cir 2000); Advo Inc v
Philadelphia Newspapers Inc 51 F 3d 1191 (3rd Cir 1995); Ortho Diagnostic Systems Inc v
[13]
the total discount on the package to the tied product.64 If the total discount is more than
the production cost of the tied product, then the practice is deemed to have exclusionary
effects.
¶33. In the present case, Lutyen offers the package at the price of the UHD TV alone and
therefore, the total discount is equal to the price of the Tojo Stick. Therefore, the other
manufacturers cannot compete in the casting device market since they would have to offer
an impossible discount equal to the price of Tojo Stick. Thus, Lutyen’s practice leads to
efficient competitors evident from RK’s loss of profits65, who might even be offering a
superior product.
¶34. Exclusion of an equally efficient rival harms consumers because competition results
in higher quality, lower-priced, and more innovative products. The practice of offering a
product at high discount or zero price for an introductory period is common and works on
miscalculation of choice that they will buy the product and terminate their association
after the introductory period, which rarely happens.67 In the present case, Lutyen is
offering the Tojo Stick for virtually zero price during the introductory period and hence
[14]
¶35. In a tying claim, the plaintiff is only required to prove that the defendant has restricted
consumer choice through coercion to take the tied product, irrespective of its quality,
merits or presence of superior substitutes. 68 In the present case, when consumers are
purchasing Lutyen’s Ultra HD, the package deprives them of their choice to purchase a
casting device other than Tojo Stick and hence, the arrangement is coercive towards
consumers who want to use any other casting device with the Lutyen’s UHD TVs that
MARKET.
¶36. Where an arrangement provides apparent short-term efficiencies but leads to the
creation of structural entry barriers and exclusion of competitors, the Commission should
theory’ states that an enterprise dominant in the tying market may use it to assume market
power in the competitive market for the tied product through the construction of strategic
entry barriers hindering entry into the tying market, besides the obvious exclusion of
incumbent rivals.
¶37. The creation of entry barriers happens when the enterprise provides sufficient
discounts on the tied product by transferring greater part of the potential losses (or
reduced profits) to the dominant tying product. 70 Further, if the tying market has entry
barriers, like the UHD TV market in the present case, then the new entrant in the tied
product market would not be able to overcome the short-term losses because it does not
United States Steel Corp 394 US 495, 512 (1969) (White dissenting).
69
Shamsher Kataria v Honda Siel Cars India Ltd Case No 3/2011 (CCI).
70
Antitrust Modernization Commission, ‘Report and Recommendations’ 2007, 95-96.
[15]
D. QUALITY CONTROL IS NOT A VALID DEFENSE WHEN LUTYEN COULD HAVE
¶38. The Courts have repeatedly rejected the quality control defenses where the tying
arrangement was not necessary and there were alternatives to protect quality. 71 In IBM72,
the Court even went on to state that quality control could never be a valid defense to any
reasonably buy the second product with best rate-quality match. 73 Even when the second
product’s quality directly affects the performance of the first product, the appellant could
have easily withdrawn from the quality protection exercise through a disclaimer of
specifications for the second product to work perfectly well with the first product, without
coercing the customer to buy the second product from him. 74 If a rival in the tied market
can supply the tied product of the same quality, there exists no rationale for tying. 75 In the
present case, the Lutyen’s UHD TV is compatible with other casting devices in the
market. In fact, RK’s casting device is the most preferred casting device by consumers
71
International Salt Company v US 332 US 392 (1947); IBM Corporation v US 298 US 131
(1936).
72
IBM Corporation v US 298 US 131 (1936).
73
Herbert Hovenkamp, ‘Tying Arrangements and Lawful Alternatives: Transaction Cost
abstract_id=1763386>.
74
Jefferson Parish Hospital v Hyde 466 US 2, 26 (1984); In re Data General Corporation
Antitrust Litigation 490 F Supp 1089 (ND Cal 1980); International Salt Company v US 332
US 392 (1947).
75
Carpa v Ward Foods 536 F 2d 39, 47 (5th Cir 1976).
[16]
and a mere statement of the specifications of casting devices best compatible with
Lutyen’s UHD TV would have sufficed, without restricting the competition in the market
ISSUE III. LUTYEN HAS VIOLATED THE CCB’S ORDER REGARDING CONDITIONAL
¶40. The respondent humbly submits that Lutyen has violated the CCB’s order for
conditional approval. The CCB had granted approval to the combination under section
31(7) of the Act, made contingent upon conditions that the appellant would not indulge in
an exclusive arrangement between its televisions and Tojo Stick and that the Tojo Stick
had approved the combination under section 31(7) of the Act, by indulging in an
the CCB is free to allow the combination after forbidding any practice that will lead to
under Act.77 Even the fundamental right to trade lays down certain exceptions, which
includes an existing law restricting the absolute exercise of the freedom. 78 The practice is
exclusionary since the customer’s choice to obtain the UHD TV with a casting device
other than Tojo Stick is restricted and it has caused AAEC as proved in [II. C. iii].
76
Moot Proposition, ¶ 10.
77
Sun Pharma/Ranbaxy order u/s 31(7), Combination Registration No C-2014/05/170.
78
The Constitution of India 1950, art 19(6).
[17]
A. THE PART OF JOINT PENALTY CORRESPONDING TO THE VIOLATION OF CCB’S ORDER
¶42. The CCB imposed a joint penalty in Case No. 1 and Case No. 2 of 2017. 79 The CCB
had found the appellant in violation of its order under section 31 of the Act regarding
conditional approval, which would invite a penalty under section 42 since the use of the
word ‘shall’80 mandates that the defaulter should be penalized. Therefore, a part of the
joint penalty was under section 42 of the Act for violating CCB’s order for conditional
right.81 When the legislature had specifically mentioned appealable orders and directions,
it intended to exclude all the other orders from the appeal and that any other construction
with respect to the Act would make the application and wording of Section 53B futile. 82
Therefore, this part of the penalty imposed under section 42 is not appealable to NCLAT
and the decision of the CCB is final and binding on the appellant.
ISSUE IV. THE RESALE PRICE MAINTENANCE IMPOSED BY LUTYEN VIOLATES THE
¶44. The respondents humbly submit that Lutyen TV by indulging in Resale Price
“any agreement to sell goods on condition that the prices to be charged on the resale by
79
Moot Proposition, ¶ 17.
80
The Competition Act 2002, § 42.
81
Super Cassettes Industries Limited v State of UP (2009) 10 SCC 531.
82
CCI v SAIL (2010) 10 SCC 744.
83
The Competition Act 2002, § 3(4)(e).
[18]
the purchaser shall be the prices stipulated by the seller unless it is clearly stated that
manufacturer can effectively fix the minimum resale price. An agreement that has the
direct or indirect object of establishing a fixed or minimum resale price level may restrict
competition. This would include fixing the distribution margin or the maximum level of
discount.84
¶47. The respondents humbly submit that the appellant is indulging in RPM by mandating
the maximum permissible discounts on its products, which is causing AAEC in Bohemia.
¶48. In Bajaj85, it was established that in order to determine if the agreements entered
between a manufacturer and its distributors are in the nature of ‘resale price
maintenance’, the factors listed in 19(3) need to be satisfied in order to prove AAEC is
caused in the market. It is pertinent to note that clauses (a)- (c) of section 19(3) deal with
factors which restrict the competitive process in the markets where the agreements
operate (negative factors) while clauses (d)-(f) deal with factors which enhance the
factors).
¶49. The criteria set out to gauge the possible anti-competitive effects include the presence
of significant unilateral upstream market power.86 Where barriers to entry by firms outside
the market are high, the fact that one firm has a very high market share is indicative of
84
Fx Enterprise Solutions India v Hyundai Motor India Ltd Case No 36 & 82/2014 (CCI).
85
Shri Ghanshyam Dass Vij v M/s Bajaj Corp Ltd Case No 68/2013 (CCI).
86
OECD, ‘Policy Roundtables Resale Price Maintenance’ 2008, 274.
87
M/s ESYS Information Technologies Pvt Ltd v Intel Technologies Case No 48/2011 (CCI).
[19]
¶50. In addition to possession of 45% market shares by Lutyen 88, the barriers to entry are
high. In a UHD TV market, a new entrant would require a huge capital for technology,
outweigh any pro-competitive effects, which may arise because of this practice.
¶52. The respondents humbly submit that this RPM agreement shall have a detrimental
effect on existing competitors resulting in their exit from the market. It is widely
acknowledged that Internet retailers’ overall lower prices, made possible by their
substantially lower operating costs, are a source of competitive advantage for the sector.
In banning discounts, RPM would eliminate this inherent advantage 89 and because the
nature of the services that the manufacturer may want to ensure is such that Internet
retailers are physically incapable of providing them, RPM will not succeed in inducing
these services from them and will ultimately drive them out of the competition.
¶53. Consumers are deceived when multi-brand dealers recommend a brand solely because
market power may implement RPM to foreclose competition from smaller rivals. The
increased margin that RPM may offer distributors, may entice the latter to favor the
particular brand over rival brands when advising customers, even where such advice is
88
Moot Proposition, ¶ 10.
89
Marina Lao, ‘Resale Price Maintenance: The Internet Phenomenon and 'Free Rider' Issues’
[20]
not in the interest of these customers, or not to sell these rival brands at all. The
respondents humbly submit that imposition of RPM by Lutyen, which has significant
market power shall have exclusionary effects on smaller rivals as the distributors in
Bohemia will be tilted towards promoting Lutyen’s brand due to the increased margins.
¶54. The RPM imposed by Lutyen shall also lead to reduced dynamism and innovation at
the incentives of more efficient retailers from entering the market and acquiring sufficient
market power through low prices.91 Permitting price competition for popular brands as
Lutyen would encourage new or existing multi-brand dealers to develop innovative and
cost-efficient ways to provide different services92 but restricting price competition shall
wiser manufacturer would have adopted on its own. However, such restraints must be
problematic since it helps maintain the collective interest of the downstream players, i.e.
the distributors, to maintain higher resale prices, causing consumer harm. 94 In that
instance, the manufacturer does not establish the practice to stimulate services or to
promote its brand but to give inefficient retailers higher profits. It would prevent the
retailers with better distribution systems and lower cost structures from charging lower
prices by the agreement. It prevents dealers with lower cost structures from passing on
91
European Commission, ‘Guidelines on Vertical Restraints’ 2010, ¶ 224.
92
Robert Steiner, ‘How Manufacturers deal with Price Cutting Retailers: When are Vertical
[21]
their superior efficiency to the consumer.95 In the present case, efficient online & offline
(Sandy) distributors are being denied the opportunity to pass on their efficiency benefits
restraint, there is a greater likelihood that the restraint supports an inefficient retailer. 96
The use of RPM to sustain this collusion, resulting in price increases, causes consumer
harm.97 Lutyen imposed RPM on the request of certain distributors. 98 As a result, even the
distributors operating efficiently and on low-cost have to charge higher prices to the
consumers.
II. RPM SHALL NOT LEAD TO ANY ACCRUAL OF BENEFITS TO THE CONSUMERS.
¶58. RPM decreases the pricing pressure on competing manufacturers when a dominant
player imposes minimum selling price restrictions in the form of maximum discount that
the dealers can offer. Preventing price competition on a popular brand would result in
higher prices of competing brands as well. Thus, minimum retail price RPM has the effect
competition.99 The RPM arrangements will lead to higher prices of competing brands as
Lutyen is the largest television manufacturer in Bohemia and has gained significant
market power in the market of sale of UHD Televisions across Bohemia in the last few
years.100
95
Eric Gippini-Fournier, ‘Resale Price Maintenance in the EU: in statu quo ante bellum?’ (21
[22]
¶59. Price is the ‘central nervous system’ of the economy 101 and the consistently and
substantially higher prices that result from restrictions on price competition are suggestive
of anti-competitive effects.102 The direct effect of RPM is a price increase. 103 It is difficult
to see what ‘enhanced value’ consumers would receive in return for increased prices.
RPM does not guarantee a high quality of services on the distributor’s end. He may
choose to provide no services at all and sell the product at a higher resale margin 104, which
would definitely be against consumer interest. In the present case, Sandy Home Store has
a large portfolio enjoying economies of scale105 and possesses a ‘retailer brand image’.
The discounts provided are a part of its business strategy and in no way suggests lack of
manufacturers, such services need not be worth their price to the consumers who
receive.106 The respondents humbly submit that the price rise would not be worth the
services that it would generate and the increased prices would not accrue any benefits to
the consumer.
¶60. The welfare effects of restraints encouraging dealer services are ambiguous when
consumers differ in their desire for service as it deprives them of the choice to obtain the
101
United States v Socony Vaccum Oil Co 310 US 150 (1940).
102
Marina Lao, ‘Free Riding: An Overstated, and Unconvincing, Explanation for Resale Price
abstract_id=1024221>.
103
European Commission, ‘Guidelines on Vertical Restraints’ 2010, ¶ 224.
104
Mart Kneepkens, ‘Resale Price Maintenance: Economics Call for a More Balanced
[23]
product at a lower price without unwanted services. Product demonstration is superfluous
for customers who already know the product’s features. High price worsens the welfare of
these consumers by forcing them to pay for services they do not desire. Any benefit for
the new customer must be weighed against the adverse impact on the welfare of the ‘non-
marginal’ consumer. Finally, to the extent that RPM prevents more efficient dealers from
offering consumers desired services at lower prices, even those desiring the services
suffer.107 In the present case, the choice of consumers who are well aware of the
specifications and technicalities are restricted when they are forced to pay for these
services. Further, Lutyen is also preventing the efficient dealers like Sandy from offering
the services at a lower price, which again harms even those consumers who desire these
services.
¶61. The ‘free-rider’ problem is one reason manufacturers might want to introduce resale
price maintenance.108 However, a familiar product like a TV does not need complex, free-
diminish the need for in-store demonstrations or knowledgeable sales assistance and,
thus, the frequency of free riding.109 RPM will anyway fail to control free riding as even if
the manufacturer does not permit the would-be free rider to lower its price, he can evade
price restriction by offering the price-restricted good together with a related product at a
price below the combined prices of the separate items.110 Further, even if the free-rider
effect is assumed prevalent, it can be more effectively avoided through less restrictive
107
Phillip Areeda & Herbert Hovenkamp, Antitrust Law: An Analysis of Antitrust Principles
2003) 245.
109
Marina Lao, ‘Resale Price Maintenance: The Internet Phenomenon and 'Free Rider' Issues’
[24]
means that may include dealer reimbursements including the mandatory services, which
III. RPM IS DISPENSABLE TO ACHIEVE THE SAID EFFICIENCIES DUE TO THE PRESENCE
¶62. The respondents humbly submit that even if Lutyen’s objective to impose RPM is to
ensure better services, there are least restrictive alternatives available to achieve it. If the
indispensable.111 In the present case, RPM is dispensable because a more efficient and less
not restrain their freedom to price the manufacturer’s products as they see fit. 112 In
addition to being less restrictive, promotional allowances are probably more efficient and
effective than RPM agreements. Internet and brick-and-mortar retailers provide very
110
Benjamin Klein & Kevin Murphy, ‘Vertical Restraints as Contract Enforcement
[25]
ISSUE V. SANDY HOME STORE HAS NOT INDULGED IN A REFUSAL TO DEAL U/S 3(4)
(D).
¶64. The respondents humbly submit that the NCLAT has no jurisdiction to hear an appeal
against an order not mentioned in section 53A. Sandy’s refusal to deal is justified since it
was in response to unfair restriction in the distribution of the appellant’s product. The
conduct does not amount to a refusal to deal when it is the outcome of non-adherence to
¶65. The purpose of the Act is to protect the interests of the consumers and to ensure
freedom of trade carried on by other participants in markets, to achieve this objective the
Act makes CCB a quasi-judicial body.115 The Act vests CCB with powers of adjudication
and passing orders. Therefore, it will be right to interpret that CCI has the power to take
any decision as it may deem fit after the DG’s report. In addition, since CCB is a quasi-
judicial body it should adhere to the principles of natural justice. 116 CCB’s orders should
not be under the compulsion of the DG’s report since DG is the mere investigative arm
¶66. Section 26(8) is the only possible section wherein CCB can pass such orders. Only
another possible section that envisages such an order is section 27, though it becomes
impossible to interpret this order under that section because the language of 27 is very
114
SM Dugar, Guide to Competition Law (6th edn, Lexis Nexis 2016).
115
CCI v SAIL (2010) 10 SCC 744.
116
Rama Varma Bharathan Thampuram v State of Kerala (1979) 4 SCC 782.
117
CCI v SAIL (2010) 10 SCC 744.
[26]
clear as to what it provides for in the main text of the section. The CCB cannot use the
marginal note in an Indian Statute for construing the statute 118 and it cannot certainly
control the meaning of the body of the section if the language employed therein is very
clear.119 The language of section 27 is very clear in the aspect that the section deals only
with situations where the commission after the DG’s investigation finds that there is a
¶67. Further, the right to appeal is not a natural or an inherent right. It is a statutory right,
strictly controlled by the provisions of the relevant Act and the procedure provided
therein.120 Therefore, even under the Competition Act, Section 53A provides the right to
appeal to NCLAT. This section of the Act provides the right to appeal only against certain
purpose of the Act and the legislative intent, it is clear that the said order passed by the
CCB was under Section 26(8). Section 53A does not provide for an order passed under
the section 26(8) as an appealable order. Therefore, the appeal is not maintainable, as the
118
Guntaih v Hambamma (2005) 6 SCC 228.
119
Nandani Satpathy v PC Dani AIR 1978 SC 1025.
120
CCI v SAIL (2010) 10 SCC 744; Vikram Sobti & Kanika Chaudhary, ‘Analysis of the
Verdict of the Apex Court in CCI v Steel Authority of India Limited’ (23 May 2011)
<http://www.indialawjournal.org/archives/volume4/issue_2/article_by_vikram_kanika.html>.
[27]
B. SANDY’S CONDUCT DOES NOT AMOUNT TO A REFUSAL TO DEAL.
¶69. Competition law does not impinge on companies’ choices to deal, or not to deal, with
other companies.121 One of the most unsettled areas of antitrust law has to do with the
duty of a firm to deal with its competitors. In general, a firm has no duty to deal with its
odds with other antitrust rules that discourage agreements among competitors that may
as contractual freedom.124
¶70. If the dominant firm refuses to deal in a competitor’s products or stops providing
services that it makes available to others, or if the dominant firm has done business with
the competitor and then stops, the firm needs a legitimate business reason for its
would mean that no damage resulted. The appellant may not use coercion on its retail
121
Alison Jones & Brenda Sufrin, EU Competition Law: Text, Cases and Materials (4th edn,
[28]
outlets to achieve RPM127. The coercive device may exist in any form128, which includes a
clause in the distributorship agreement. It is further submitted that the present contract
purporting to bind the dealer does confine its future freedom of action, which would not
be limited were it merely to adopt a suggested price at its pleasure and only for as long as
desired.
¶71. Further, the respondent did stock the appellant’s product in its showrooms 129 until the
distributors not to give discounts exceeding 10%. This was against the business model of
the respondent through which it had made its reputation in the market for distribution of
home electronics and any action against this model would adversely affect its reputation
in the end. Unrestricted pricing offers consumers with more options and therefore, leads
to better competition and any interference would adversely affect consumer welfare.130
¶72. A short-run profit sacrifice is not necessary for conduct to be exclusionary by the “no
economic sense” test because the anti-competitive gains from exclusionary conduct
firm refusing to deal earlier profitably dealt with its competitor earlier and later stopped,
127
Simpson v Union Oil Co 377 US 13, 17 (1964).
128
Simpson v Union Oil Co 377 US 13, 17 (1964).
129
Moot Proposition, ¶ 13.
130
Marina Lao, ‘Internet Retailing and Free Riding: A Post-Leegin Antitrust Analysis’ (2011)
to Achieve Power over Price’ (1986) 96 Yale Law Journal 209, 224; Brooke Group Inc v
Brown & Williamson Tobacco Corp 748 F Supp 344, 354 (MDNC 1990).
[29]
the Courts should look to find out whether it deliberately sacrificed its profits to exclude
its competitors.132 In the present case, though the respondent profitably dealt in appellant’s
product earlier, continued dealing after the discount restrictions would be against its
business model and harmful for its reputation in the end and therefore, the conduct makes
¶74. A refusal to deal cannot be anti-competitive unless it has exclusionary effects leading
to the elimination of competition from the market, and thereby reducing the number of
alternatives and restricting consumer choice in the market. It cannot exclude rivals unless
the facilities provided by the defendant are essential to carry out that particular trade in
the specific area.133 The refused product must constitute an objectively indispensable
input for such competitors, and not merely a particularly suitable or convenient one. 134 In
the present case, there are various other distribution channels available for the effective
dispensable to carry out the business of sale and manufacture of UHD TVs in Bohemia.
REFUSAL.
¶75. Firms may acquire dominant position by establishing an infrastructure that renders
them uniquely suited to serve their customers. Compelling such firms to share the source
of their advantage is in some tension with the purpose of the antitrust laws, since it may
132
Aspen Skiing Co v Aspen Highlands Skiing Corp 472 US 585 (1985).
133
Aspen Skiing Co v Aspen Highlands Skiing Corp 472 US 585 (1985).
134
OECD, ‘Policy Roundtables on Refusal to Deal’ 2007, ¶ 15; Case 7/97 Oscar Bronner v
[30]
lessen the incentive for the dominant firm, the rival, or both to invest in these
economically beneficial facilities.135 Enforced sharing also requires antitrust courts to act
as central planners, identifying the proper price, quantity, and other terms of dealing, a
role for which they are ill-suited. Moreover, compelling negotiation between competitors
may facilitate the supreme evil of antitrust: collusion. 136 Thus, the mere fact that by
retaining a facility for its own use a dominant undertaking retains an advantage over a
a discount restriction clause to the distributorship agreement and this may amount to
collusion between the manufacturer and distributors. 138 Such collusion may harm the
respondent because by harming its business model as per which it has the potential to
provide higher discounts.139 Such restraints will effectively increase the cost of UHD TVs
135
Verizon Communications Inc v Law Offices of Curtis Trinko LLP 540 US 398 (2004).
136
Verizon Communications Inc v Law Offices of Curtis Trinko LLP 540 US 398 (2004).
137
Case 7/97 Oscar Bronner v Mediaprint Zeitungs (1998) ECR I-7791.
138
Moot Proposition, ¶ 12.
139
Moot Proposition, ¶ 13.
[31]
P R AY E R
Wherefore, in light of the facts of the case, issues raised, arguments advanced and authorities
cited, this Hon’ble Court may be pleased to adjudge and declare that:
In Lutyen v CCB:
Item 1 Schedule 1 of the Combination Regulations did not exempt the market
The MCA notification did not exempt the APA from notification.
Lutyen is dominant in the market for sale and manufacture of UHD TV in Bohemia.
Lutyen has abused its dominance in the UHD TV market to increase its sale in the
Lutyen’s conduct amounts to Resale Price Maintenance since it would cause AAEC.
[xxii]
Lutyen has indulged in an exclusive arrangement and therefore, violated the
[xxiii]