The Competition Commission sent out show-cause notices to 17 carmakers, many of them foreign entities, regarding allegations of providing spare parts to customers at higher prices
New Delhi: The Competition Commission of India (CCI) has sent notices to 17 carmakers on an alleged anti-competitive practice of selling spare parts at higher prices to consumers and it is likely to schedule the hearings for next month to seek explanations, reports PTI.
The Commission has sent out show-cause notices to 17 carmakers, many of them foreign entities, regarding allegations of providing spare parts to customers at higher prices, which is against healthy competition, said a source close to the development.
The Director General of the Commission has submitted the investigation report on the matter, following which the notices have been served, the source said, adding that the hearings are likely to take place next month. However, names were not disclosed.
The CCI would take a final decision on the alleged anti-competitive practice after taking into account the explanations of the carmakers as well as the report of the Director General. The DG acts as investigating arms of the fair-trade regulator.
CCI is pursuing the case under Section 4 of the Competition Act that relates to abuse of dominant position by enterprises.
The probe was conducted after a complaint was filed with the CCI last year against certain carmakers for allegedly abusing their dominant market position by selling spare auto parts to customers at high prices.
Going by the complaint, the carmakers were making available spare parts only through their authorised dealers, who in turn sold them on high rates.
In August, the government had said the CCI is investigating allegations of anti-competitive practices by a section of carmakers in the country.
In a written reply to the Lok Sabha, Minister of State for Corporate Affairs RPN Singh had said CCI had received certain information against some carmakers.
"The CCI, which is a quasi-judicial body, is getting the matter investigated for appropriate action in the matter as per the provisions of the Competition Act, 2002," the Minister had said.
Generally, CCI refers complaints related to anti- competitive practices for further investigation by its DG, before taking any action.