Case Law Details
Muralya Dairy Products (P) Ltd. Vs. Kerala Co-operative Milk Marketing Federation Ltd. and Another (Competition Commission of India)
CCI observes that certain restrictions which are placed on exclusive outlets/dealers by the manufacturers may not always be termed as anti-competitive. An exclusive arrangement in a vertical chain is not an anathema under competition law, when supported by circumstances warranting such exclusivity when looked at objectively.
Contention of the Complainant
It has been alleged that the Opposite Parties, while supplying milk to retailers/agents, have unilaterally proposed certain conditions in the letter of agency whereby retailers/ agents are strictly prohibited from dealing with dairy products manufactured by companies in the same line of business. In the event, that the Opposite Parties come to know that retailers/agents are dealing with milk and milk products of other companies, their agency is liable to be withdrawn and they would be liable for punitive action including imposition of penalty by the Opposite Parties. It is submitted that the retailers/ agents and shopkeepers, apprehending the aforesaid punitive action proposed by the Opposite Parties, have now refused to accept and sell the products manufactured by the Informant. Resultantly, the Informant’s business has been seriously affected and the Informant is unable to expand its business in competition with the Opposite Parties.
It is submitted that the Informant’s daily sale volume of milk is about 41,000 litres, which forms not even 14% of the daily sale volume of the Opposite Parties in the same market. Also, other private dairies (around 11 brands) put together are selling another 18% of the daily sale volume of the Opposite Parties in the same market.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
