Tata Motors Commercial faces probe from the Competition Commission of India (CCI)

CCI has alleged that the Indian brand has abused its market position for supplying products to some dealers.

The Competition Commission of India (CCI) on Wednesday has ordered an antitrust investigation against the Commercial Vehicles division of Tata Motors Limited. The order has been given after allegations were made on India’s largest commercial vehicles seller to abuse its market position while supplying commercial vehicles to some of its dealerships in India. The allegations are made by two former dealership partners of the company. The aggrieved parties have also filed complaints against Tata Capital Financial Services Ltd and Tata Motors Finance Ltd.

According to the complaint, Tata Motors had set up strict terms around the quantity and type of vehicles the dealerships should stock. Also, Tata Motors worked with affiliate firms while advancing the credit to the dealerships. One of the dealers alleged that every authorized dealership is obligated to raise finance/loans from banks and or NBFCs such as Tata Capital and Tata Motors Finance.

In response, a Tata spokesperson said “We have learnt that the Competition Commission of India (“CCI”) has passed an order directing the Director-General, CCI to initiate investigation against Tata Motors Limited’s (TML) commercial vehicles business in India. We understand that the CCI has passed a prima facie order and has not made any final or binding observations with regard to the allegations levelled against TML. TML is currently reviewing the copy of the order available in the public domain and will consult its legal counsels to take necessary steps.”

CCI gave a 45-page order dated May 4 to assess the complaints. The CCI said that a case of contravention of the provision of Section 3(4) and Section 4 of the Competition Act is made out against Tata Motors and that the matter requires to be investigated. It stated the unfair terms and conditions in the dealership agreement for commercial vehicle is an abuse of Tata Motor’s dominant position in the market.

The watchdog has now directed its Director-General, investigation arm, to probe the matter in detail which is likely to happen soon. The order also mentions that Tata Motors coercing its dealer partners to order the vehicles according to its whims and fancies is anti-competitive. 

The order mentions that Tata Motors has denied all allegations before CCI. The investigation team needs to submit the final report on the matter within 60 days. However, the probe can go on for months as such investigations take a long time. Ознакомиться с остальными способами более подробно вы сможете на Мостбет зеркало. mosbet В букмекерской конторе Mostbet предоставляется возможность делать ставки на киберспортивные дисциплины

The governing body rejected the examination of the conduct of Tata Capital and Tata Motors Finance or the agreements executed by them with the dealers for channel financing, stating those do not appear to command any significant market power in the verticals where they are operating.

CCI has also made it clear that nothing stated in this order shall be tantamount to a final expression of opinion on the merits of the case and the DG shall investigate without being swayed in any manner whatsoever by the observations made herein.

Tata Motors as the ace of the commercial vehicle business in India holds more than 40% of the market share in the segment. It offers a large range of trucks and buses in India from its facilities in Jamshedpur, Pantnagar and Lucknow and competes with the likes of Ashok Leyland and Mahindra & Mahindra.

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Himanshu Harsh

My love for automobiles is what fuels my writing. You can catch me twisting synth knobs when I'm not drooling over cars.

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