The Competition Commission of India (CCI) has imposed a penalty of Rs. 87 crore on Hyundai Motor India Limited (HMIL) for ‘anti-competitive conduct.’
The CCI found HMIL to be in contravention of the provisions of the Competition Act, 2002, for imposing arrangements upon its dealers which resulted into Resale Price Maintenance (RPM) in sale of passenger cars manufactured by it.
RPM in this context refers to the practice of imposition of a “Discount Control Mechanism” through which dealers are only permitted to provide a maximum permissible discount and the dealers are not authorised to give discount which is above the recommended range, as per the CCI order.
HMIL was found to have contravened the provisions of the Act for mandating its dealers to use recommended lubricants/oils and penalising them for use of non-recommended lubricants and oils. “The twin objectives behind imposition of penalties are: to reflect the seriousness of the infringement; and to ensure that the threat of penalties will deter the infringing undertakings,” the CCI order said.