2024 (11) TMI 1006 - CCI - Companies Law

Contravention of the provisions of Section 4(2)(c) of the Competition Act, 2002 - abuse of dominant position - HELD THAT - In the absence of dominant position of the OPs in the delineated relevant market, the allegations of abuse made against the OPs need not be examined by the Commission. Be that as it may, based on the information available on record, the Commission is of the view that the alleged conduct cannot be considered as an abuse of dominant position by the OPs. The Informant has not provided any evidence indicating that the OPs used the Informant s information to develop and launch their products. Additionally, there is no evidence suggesting that the OPs prevented the Informant from introducing a similar product into the market. Furthermore, there is no record of the Informant having a similar product in development that was close to being launched and accordingly the Informant lost the first-mover advantage due to OPs product launch. Moreover, it is not demonstrated that having a first-mover advantage is crucial in this market. There does not seem to be any abuse of dominant position by the OPs in the delineated relevant market - the Commission is of the considered opinion that no prima facie case of contravention of the provisions of Section 4 of the Act is made out against the OPs in the present matter. Hence, the matter is directed to be closed in terms of the provisions contained in Section 26(2) of the Act. All pending applications stand disposed of accordingly.

Issues Involved:

1. Alleged abuse of dominant position by the Opposite Parties (OPs) under Section 4(2)(c) of the Competition Act, 2002.
2. Alleged misuse of the Informant's patented technology and ideas by the OPs.
3. Determination of the relevant market and assessment of dominance by the OPs.
4. Examination of whether the OPs' conduct constitutes an abuse of dominance.

Issue-wise Detailed Analysis:

1. Alleged Abuse of Dominant Position:

The Informant alleged that the OPs, by launching "Whisper ultra clean" sanitary pads with herbal oil, engaged in practices that resulted in denial of market access, constituting an abuse of dominant position under Section 4(2)(c) of the Competition Act, 2002. The Informant claimed that the OPs used their dominant power to oust him from the market by commercializing his innovative technology without authorization.

The Commission evaluated these claims by adopting a three-pronged approach: defining the relevant market, assessing the OPs' dominance, and determining if the conduct was abusive. The relevant market was identified as the "market for disposable sanitary pads in India." However, the Commission found that the OPs did not hold a dominant position in this market, as they did not operate independently of competitive forces or affect competitors or consumers in their favor. Consequently, the allegations of abuse were not examined further.

2. Alleged Misuse of the Informant's Technology:

The Informant accused the OPs of misusing his patented technology and ideas submitted under the "P&G Connect + Develop" program. He claimed that the OPs launched a product with similar features without his consent, violating the terms of the program, which required express approval for using shared information.

The Commission noted that the Informant's submission was made on a non-confidential basis, and the OPs had declined the proposal under binding terms. The OPs argued that they did not use the Informant's patented process, and the sanitary napkins were treated differently from the Informant's process. The Commission found no evidence that the OPs used the Informant's information to develop their products or prevented the Informant from launching a similar product.

3. Determination of Relevant Market and Assessment of Dominance:

The Commission defined the relevant market as the "market for disposable sanitary pads in India," considering factors such as product characteristics, consumer preferences, and geographical scope. The Informant cited a study indicating the OPs' significant market share. However, the Commission found that the OPs did not have a dominant position, as other players like Johnson & Johnson were close competitors with comparable resources.

4. Examination of Abusive Conduct:

The Commission concluded that the alleged conduct did not constitute an abuse of dominant position. The Informant failed to provide evidence of the OPs using his information or preventing him from market entry. Additionally, there was no indication that the Informant had a product close to launch or that a first-mover advantage was crucial in this market.

Conclusion:

The Commission determined that no prima facie case of contravention of Section 4 of the Competition Act, 2002, was made out against the OPs. The matter was closed under Section 26(2) of the Act, and all pending applications were disposed of accordingly. The Secretary was directed to communicate the decision to the Informant and the OPs.

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