Free Services by Reliance Jio is not Anti-Competitive: CCI

Commission notes that providing free services cannot by itself raise competition concerns unless the same is offered by a dominant enterprise and shown to be tainted with an anti-competitive objective of excluding competition/ competitors, which does not seem to be the case in the instant matter as the relevant market is characterised by the presence of entrenched players with sustained business presence and financial strength. In a competitive market scenario, where there are already big players operating in the market, it would not be anti­competitive for an entrant to incentivise customers towards its own services by giving attractive offers and schemes. Such short-term business strategy of an entrant to penetrate the market and establish its identity cannot be considered to be anti-competitive in nature and as such cannot be a subject matter of investigation under the Act.

Full Text of Order under Section 26(2) of the Act

1. The information in the present case has been filed by Bharti Airtel Limited (hereinafter referred to as the ‘Informant’) under Section 19(1) (a) of the Competition Act, 2002 (hereinafter referred to as the “Act”) against Reliance Industries Limited (hereinafter referred to as ‘OP-1TRIL’) and Reliance Jio Infocomm Limited (hereinafter referred to as ‘OP-2TRJIL’) alleging contravention of the provisions of Sections 3 and 4 of the Act.

2. The Informant is a global telecommunications company with operations in 18 countries across Asia and Africa. It provides 4G services in 21 telecommunication circles across India. The Informant is stated to be amongst the top three mobile service providers globally in terms of the number of subscribers. It offers 2nd Generation (2G), 3rd Generation (3G) and 4th Generation (4G) wireless telecommunication services, amongst other services. The Informant is also the first operator to roll out 4G Long Term Evolution (LTE) wireless telecommunication services in India.

4. OP-1 is stated to be one of the biggest private companies in India in terms of its size, revenue, assets and value, leading it to be one of the financially strongest companies in the country. OP-1 is engaged in several businesses such as exploration and production of oil and gas; petroleum refining and marketing; manufacture and sale of petrochemicals comprising polymers, polymer and fibre intermediates, textiles, retail; etc. It has been claimed that OP-1 has the largest market share in polyester fibre and yarn industry and petroleum products industry not only in India but also globally. OP-1 is also stated to be India’s first private sector company to feature in the Fortune Global 500 list of World’s Largest Corporations’.

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