Competition Commission dismisses alleged unfair business practices complaint against Uber

Representative image

Representative image

The Competition Commission has dismissed a complaint of alleged abuse of dominant position made against cab aggregator Uber.

“The Commission is of the view that the facts and evidence on record do not establish the dominance of Uber, in the absence of which the question of abuse does not arise within the provisions of…the (Competition) Act,” the regulator said in an order dated July 14.

The market for radio taxi services in Delhi-NCR was considered the relevant market to assess the complaint.

Rejecting the complaint, the Competition Commission of India (CCI) said Uber is not found to be dominant in the relevant market.

The complaint was filed by Meru Travel Solutions Pvt Ltd against Uber India Systems Pvt Ltd, Uber B.V., Uber International Holding B.V. , Uber International B.V. and Uber Technologies Inc.

It was alleged that Uber resorted to many abusive practices with the sole intent of establishing its monopoly and eliminate otherwise equally efficient competitors from the market by way of discounts and incentives.

Meru’s complaint was initially dismissed by CCI in 2016, pursuant to which Meru had approached the appellate tribunal.

The appellate tribunal then directed the director general (DG) of CCI to investigate the allegations of predatory pricing.

Aggrieved by the tribunal’s order, Uber had approached the Supreme Court which dismissed the complaint and asked the DG to complete the probe into the allegations against Uber India Systems Pvt Ltd within six months.

The DG carried out a detailed investigation and concluded that “Uber is not in a position of strength so as to behave, to an appreciable extent, independently of its competitors and customers, in the relevant market.

Thus, Uber is not found to be dominant in the relevant market in the present case.”

As per the DG, the highly competitive market with fluctuating market shares of Uber and Ola, cannot be construed to be a sign of market power or dominance of Uber.

Uber cannot be considered to have an exclusive access to funding or investment, it noted.

The regulator said that Uber operates in a competitive market, having competitive constraints from an equally strong player Ola.

The competitive constraints posed by Ola and Uber on each other outweigh the anti-competitive effects alleged by Meru, it said adding that there exists no exclusive agreement between drivers and Uber.

In light of facts and evidence, there is no merit in Meru’s argument that the incentives and rating mechanism adopted by Uber for its driver partners has led to any appreciable adverse effect on competition in the market, CCI said.