Competition LawRulings

CCI holds that Star India has indulged into “price discrimination” and tried to evade from scrutiny

Drafted by Anirudh Agrawal

CCI held that Star India Pvt. Ltd. (Star India), broadcaster of satellite-based T.V. Channels in India having multiple channels indulges into price discrimination between its various distributors in the State of Kerala, with particularly Thiruvananthapuram Entertainment Network (P) Ltd (Informant), distributor of TV channels in Kerala. CCI further opined that Star India had furnished incomplete information not due to non-availability of the information rather give a perfunctory response to the Commission in order to evade scrutiny.

CCI concluded, there was a price discrimination between different Multiple System Operators coupled with the Star India’s speedy resolution of the Informant’s grievance followed by an evasive reply to the Commission, prima facie indicates that Star India was acting in contravention of the provisions of the Act. “

In the present case, Informant had filed an application against Star India that it has enhanced its rate for supplying the bouquet of channels over the period while the rates were, more or less, uniform for the big players of the market. Thereafter, Informant communicated that it would like to withdraw its information as the dispute stood resolved. However, CCI stated that” under Competition Act, 2002 Star India was being assessed and inquired into by the Commission not only from the perspective of the Informant but also from the perspective of its abuse of dominance in the market in general.”

CCI observed that since the agreement is not entered into between parties engaged in identical or similar trade of goods or provision of services but rather between broadcaster and distributors, it would not fall within the scope of Section 3 (3) of the Act.

However, after observing that Star India Pvt. Ltd. is in a position of dominance in ‘market for the provision of broadcasting services in the State of Kerala’, the Commission concluded that the Star has indulged into price discrimination between its various distributors in the State of Kerala, particularly the Informant. CCI opined that incomplete information furnished by Star India does not appear to be due to non-availability of the information. Rather, there appeared to be an attempt on part of the Star India to give a perfunctory response to the Commission in order to evade scrutiny.

Finally, CCI directed Director General for an investigation into Star India in the matter to ascertain whether it had indulged in contravention of the provisions of Section 4 (2) (a) (ii) of the Competition Act 2002 in the market. Further, CCI asked Director-General to complete its investigation within a period of 60 days.

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